Health & Welfare Plans Newsletter

February 26, 2016

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Lead Manager-Client Administration-Operations
T. Rowe Price
in MD

Benefits Attorney
New York City law firm
in NY

Defined Benefit Administrator
TPA firm in Phoenix, Arizona
in AZ

Enrolled Actuary for DB Plans
MB Actuarial Services
in CA

Administrative Assistant
Independent Retirement
in OR

Retirement Plan Consultant
Ascensus
in IN

Retirement Plan Consultant
Ascensus
in IN

Retirement Plan Coordinator
Ascensus
in NJ

Client Services Manager
Newport Group
in FL, NC, WI

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Webcasts and Conferences

Tax Implications of Affordable Care Act Changes for Businesses
March 1, 2016 WEBCAST
(Financial Executives International)

Seeking Better Outcomes: Expanding Coverage, Enhancing Portability, Improving Plan Design & Solving Retirement Income
March 10, 2016 in MN
(WISER [Women’s Institute for a Secure Retirement])

Are You Sure Your Company is 100% Bulletproof Against Costly ACA Compliance Penalties?
March 15, 2016 in PA
(HUB International)

Voluntary Fiduciary Correction Program
March 16, 2016 in IL
(Employee Benefits Security Administration [EBSA], U.S. Department of Labor)

Voluntary Fiduciary Correction Program
March 16, 2016 WEBCAST
(Employee Benefits Security Administration [EBSA], U.S. Department of Labor)

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[Official Guidance]

CMS Proposes 2017 Payment and Policy Updates for Medicare Health and Drug Plans
"[On February 25, 2016] CMS released proposed updates to the Medicare Advantage (MA) and Part D programs through the 2017 Advance Notice and Draft Call Letter.... Employer Group Waiver Plans (EGWPs) serve specific employer groups, and are either offered through negotiated arrangements between Medicare Advantage plans and employer groups or by the employer directly. Because of the nature of these unique agreements, EGWPs do not compete against other plans through the bidding process, and therefore have little incentive to submit lower bids. CMS has previously waived bidding requirements for Part D for EGWPs and set payment amounts for Part D plans based on the competitive bids submitted for non-EGWP Part D plans. CMS is proposing a similar waiver and payment policy for EGWP Part C plans for 2017." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  


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[Official Guidance]

Text of CMS Final Rule: Basic Health Program; Federal Funding Methodology for Program Years 2017 and 2018
53 pages. "This document provides the methodology and data sources necessary to determine Federal payment amounts made in program years 2017 and 2018 to states that elect to establish a Basic Health Program under the Affordable Care Act to offer health benefits coverage to low-income individuals otherwise eligible to purchase coverage through Affordable Insurance Exchanges[.]" (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  

[Guidance Overview]

Agencies Propose Revised Summary of Benefits and Coverage Template
"The proposed revised template adopts many of the NAIC stakeholder group recommendations and is a distinct improvement over the original NPRM template. It includes a new question -- 'Are there services covered before you meet your deductible?' ... The proposed revised SBC tracks the NAIC stakeholder recommended format for the coverage examples, which is somewhat less misleading and confusing than the NPRM version. It focuses on cost-sharing parameters that would apply to services received for these conditions and on what consumers would spend in cost sharing for these services. Significantly, the coverage examples are to be calculated by plans that have wellness programs assuming that enrollees are not participating in the wellness program[.]" (Health Affairs)  

[Guidance Overview]

CMS Wants to Set Payment Amounts for Medicare Advantage Employer, Union Plans
"[CMS] has proposed, in its new Medicare Advantage rate notice, to waive the bidding requirement for employers and union groups that offer retirement plans to their employees. CMS instead wants to establish set payment amounts, indicating the bid process lacks competition, and therefore, price incentives. Medicare Advantage plans that exclusively serve employer and union groups do not compete in the open market, but are offered through negotiated arrangements, CMS said." (Healthcare Payer News)  

[Guidance Overview]

CMS Notice Describes Modest Increases to Medicare Advantage and Part D Plan Payment Rates Accompanied by Significant Revisions to Risk Adjustment Methodologies and Employer/Union-Only Group Welfare Plan Bids
"While the Advance Notice may be initially welcomed, thanks to the modest proposed increase in plan payments and the lack of any proposal to limit in-home health assessments, CMS's proposed updates to the risk adjustment and quality bonus measure models will have varying positive or negative effects on MA and Part D plans, depending on the make-up of the plans' enrollees. Further, CMS is proposing to lower payments to employer/union-only group welfare plans (EGWPs) to be more in line with payments to non-EGWPs." (Epstein Becker Green)  

Limiting Employees' Hours to Dodge the ACA's Employer Mandate Could Violate ERISA
"This case should serve as a reminder to employers that ... they must engage in a careful analysis to determine which of the following options makes the most sense given their particular circumstances: [1] Follow the employer mandate, and accept the associated costs. [2] Reject the mandate, and accept the penalty fees. While the financial exposure attendant to this option may be significant, it is predictable and finite. [3] Adjust their employee welfare benefit plans in an attempt to eliminate any contention that employees are entitled to health insurance thereunder. While this option could throw up a road block against claims like the one presented in Marin, it carries its own set of uncertainties. [4] Adjust their staffing approach to reduce the number of FTE employees covered by the mandate. As Marin illustrates, though, this option carries potentially significant litigation risk." [Marin v. Dave & Buster's, Inc., No. 15-3608 (S.D.N.Y. Feb. 9, 2016)] (Cozen O'Connor)  

Employee's Mother Was Assessed by Social Worker, Not Health Care Provider; Court Finds No FMLA Entitlement
"[A] federal court in Washington granted summary judgment against the interference claim of an employee denied leave to take care of his mother who was suffering from dementia. Although she had been assessed by a social worker, the social worker was not a health care provider as defined under the FMLA, and thus the mother was not under the continual supervision of a health care provider at the time the employee requested leave in order to care for her[.]" [White v. AG Supply Co. of Wenatchee, No. 2:15-CV-0089 (E.D. Wash. Feb. 23, 2016)] (Wolters Kluwer Law & Business)  

More Pre-Tax Dollars -- Are You Offering Commuter Benefits Yet?
"Depending on the type of plan implemented, employees can access their accumulated funds via a debit card or can order their commuting pass and have it delivered directly to their home. Either way, it's another way to help employees increase their spendable income -- more money in their pockets instead of Uncle Sam's." (Frenkel Benefits)  

No Evidence That Insurance Market Consolidation Leads to Greater Innovation
"Identifying the most effective and efficient providers, negotiating favorable terms with these providers, and providing financial incentives to patients to utilize these providers ... are tried and tested tactics in insurers' toolkits.... [T]here is no evidence of greater product innovation in more concentrated insurance markets.... Given the history of slow innovation in health insurance, one could argue that a change in insurance markets is necessary to stimulate more. To date, there is no evidence that consolidation will be that catalyst." (Health Affairs)  

CMS Official: 'Too Early to Tell' Profitability of Remaining Insurance CO-OPs
"Eight of the 11 remaining co-ops are on corrective action plans this year that detail operational issues and ways to correct them, Mandy Cohen, CMS's chief operating officer and chief of staff, said at a House Oversight and Government Reform Health Subcommittee hearing. She also said she could not tell lawmakers at the hearing which of the remaining co-ops are meeting their enrollment projections." (Morning Consult)  

Fight for Health CO-OP Funds Looms
"A group representing existing co-ops, as well as leaders of some of the organizations, said there is little of the federal loan money remaining and some of what is left is needed to pay providers whose bills have yet to be paid. Obama administration officials have said they plan to use every available tool to recoup the federal loans, including legal action. Thousands of doctors, hospitals and other providers in some states still haven't been paid for health services they provided to members insured by the co-ops[.]" (The Wall Street Journal; subscription may be required)  

Task Force on Health Care Reform Releases Mission Statement
"To achieve the best outcomes and get results for the American people, this task force will follow key principles of patient-centered health care: Empower every American with the ability to gain access to coverage that is affordable and portable. Provide Americans with more choices, not mandates, so they have the freedom to pick plans and providers that best fit their unique health care needs. Protect the quality of care for all patients -- including those with pre-existing conditions. Promote innovation to improve competition, harness the power of new technologies, lower prices, and foster better cures and treatments for patients. Save Medicare and Medicaid to strengthen health care security for seniors and America's most vulnerable." (Committee on Education and the Workforce, U.S. House of Representatives)  

[Opinion]

Dubious Health Care Merger Justifications: The Sumo Wrestler and the 'Government Made Me Do It' Defenses
"Given formidable legal barriers to mergers of this magnitude, some may find it surprising that they have been attempted at all. However, because rapid consolidation has reduced the number of available partners and no legal penalties attach to unsuccessful mergers, parties seem increasingly willing to roll the dice. Consequently, lawyers representing them have had to scramble to find justifications that might appeal to courts and prosecutors. Two such defenses have surfaced that rely on the special circumstances involved in health care markets. Although both may have some intuitive appeal, neither can withstand close scrutiny under well-established legal standards." (Health Affairs)  

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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2016 BenefitsLink.com, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of BenefitsLink.com, Inc., or in the case of third party materials, the owner of that content. You may not alter or remove any trademark, copyright or other notice from copies of the content.

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