Health & Welfare Plans Newsletter

April 1, 2016

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[Official Guidance]

CMS Technical Guidance and Population Data for Exchanges, Qualified Health Plan Issuers, and Web-Brokers to Ensure Meaningful Access by Limited-English Proficient Speakers (PDF)
Unnumbered document dated Mar. 30, 2016. "[This] document provides guidance ... on how to comply with the amended language access requirements and on how these requirements interact with other language access requirements that may apply to the same entities. While the general standards under Section 155.205(c) with respect to oral interpretation, written translations, and taglines continue to apply to all entities subject to Section 155.205(c), this guidance will highlight specific requirements related to taglines and website translations for Exchanges, QHP issuers, and web-brokers. Additionally, this guidance provides language data and sample taglines in the top 15 languages spoken by the limited English proficient population in each state for use by Exchanges, QHP issuers, and web-brokers as necessary." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  


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[Official Guidance]

Qualified Health Plan Application Instructions, Templates and Materials for 2017
"The 2017 Qualified Health Plan (QHP) Application is available to issuers applying for certification to participate in the Federally-facilitated Marketplaces. [Links on this page provide] access detailed application instructions, templates, justifications and supporting documents, and tools for issuers." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])  

[Guidance Overview]

Finalized Market Mandate Guidance Requires Compliance by 2017 (PDF)
"Late in 2015, the departments issued regulations that finalize changes to the proposed and interim final regulations on market reforms ... The regulations leave a few open issues including the effect that a wellness program premium incentive, such as a surcharge, might have on grandfathered plan status.... The regulations allow HRA integration with Medicare for employers with fewer than 20 employees even if no group health plan coverage is offered to Medicare eligible individuals ... The departments maintain their position that the remedy for false or inaccurate reporting of tobacco use is to recoup any additional premiums that should have been paid, not to rescind the coverage." (Xerox HR Services)  

[Guidance Overview]

Is a Limited-Scope Dental Plan Required to Cover Dependent Children Until Age 26?
"[In the situation you have presented,] it is permissible for your company's limited-scope dental plan to cover dependent children only until age 19 [rather than 26] if it qualifies as an 'excepted benefit.' ... The dependent coverage mandate and employer shared responsibility do not apply to 'excepted benefits.' Thus, excepted benefits (including limited-scope dental plans that meet the applicable requirements ...) can use a narrower definition of dependent." (Thomson Reuters / EBIA)  

Workers' Desire Grows for Wage Increases Over Health Benefits
"In a recent survey, one in five people with employer-based coverage said they would opt for fewer health benefits if they could get a bump in their wages. That's double the percentage who said they would make that choice in 2012.... Overall, two-thirds of people with employer-sponsored coverage reported that they were satisfied with their health insurance benefits in 2015, the survey found, lower than the 74 percent satisfaction figure in 2012." (Kaiser Health News)  


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NBGH Annual Survey Shows Companies Expanding Wellness Programs to Focus on Improving Employees' Emotional and Financial Well-Being
"This year's survey results indicate employers recognize a 'healthy' employee may be affected by non-health factors and are including programs to address emotional and financial needs rather than focusing solely on physical health. In 2016, 87% of employers offer emotional or mental well-being programs and 76% provide financial health programs. When employers were asked about well-being programs in the future, 67% plan to expand their efforts and an additional 17% plan to maintain at the current level." (National Business Group on Health [NBGH])  

Beyond Workout Apps: The ROI of Well-Crafted Wellness Programs
"Both health insurers and employers have a stake in driving down healthcare costs for their member populations -- especially among patients with expensive-to-treat chronic conditions. Increasingly, businesses are turning to payers to design wellness programs to aid in the effort. But it's not as simple as handing out activity trackers or launching a member wellness portal. Every company is different, and there are many ways to measure success." (FierceHealthPayer)  

Insurers, Providers Could Save $8 Billion by Automating HIPAA Transactions
"Despite increasing use of electronic transactions for eligibility and benefit verifications and claim status inquiries, the industry continues to handle high volumes of these transactions manually. Healthcare providers alone could save more than $5 billion annually by using automated processes to check patients' eligibility and benefits ... On average, ... each manual transaction cost providers and plans $2 more than automated electronic transactions." (Healthcare Payer News)  

Phase 2 HIPAA Audits Are Under Way: Are You Prepared?
"OCR 'expects covered entities that are the subject of an audit to submit requested information via OCR's secure portal within 10 business days of the date on the information request.' In addition, all documents must be in digital form and must be submitted electronically to a secure online portal that OCR has specifically developed for Phase 2. After selected entities are notified of their participation, OCR will begin a round of desk audits for covered entities, followed by a round of desk audits for business associates. All desk audits will be completed by the end of December 2016." (Wilson Elser)  

Supreme Court's Gobeille Decision Delivers a Win for Self-Funded Health Plan Sponsors
"The Court's opinion has undoubtedly left the door open for the [DOL] to create regulations mandating self-funded plans to report health information. However, this would be no easy task should the [DOL] decide to do so. Currently, the [DOL] does not have anything like an [all-payer claims database (APCD)], and it is questionable whether it has the resources and expertise to collect and manage big data of this nature. Should the [DOL] decide not to implement such regulations, states with APCDs are left with the following options: [1] allow self-funded plans to self-report health data to the state, or [2] attempt to gather this data directly from the providers, which would be less efficient and more expensive than gathering it from the plan itself or the plan's third-party administrator." [Gobeille v. Liberty Mutual Ins. Co., No. 14-181 (U.S. Mar. 1, 2016)] (Trucker Huss)  

Plan Design Strategies in the ACA Marketplace: A Review of Unified Rate Review Template Data (PDF)
"One way for insurers to provide a lower premium is to provide a plan with an actuarial value toward the bottom of the metallic level range....[This] research aimed to determine if this represented a widespread practice, as well as to see what other patterns in plan design offerings have been seen in the marketplace during the first three years after the implementation of the ACA. By looking at trends in plan offerings, even at a macro level, insurers may be able to gain insight from the emerging patterns in the market to help frame marketplace strategies in future years." (Milliman)  

Grant of Power to Decide Claims Did Not Give Discretionary Authority to Claims Administrator
"The relevant document (a subscriber certificate describing the plan's terms) stated that the claims administrator 'decides which health care services and supplies that you receive (or you are planning to receive) are medically necessary and appropriate for coverage.' The trial court held that the power to decide implies discretion. The First Circuit disagreed, explaining that while no precise words are required to confer discretionary authority, the language must unambiguously indicate that the decisionmaker has discretion to interpret the terms of the plan and determine whether benefits are due -- and the language in the certificate fell well short." [Stephanie C. v. Blue Cross Blue Shield of Mass. HMO Blue, Inc., No. 15-1531 (1st Cir. 2016)] (Thomson Reuters / EBIA)  

Insurers Cut Commissions to Restrict When and What Plans People Buy
"Insurers increasingly are dropping agents' commissions to discourage the sale of the [ACA] plans they're losing the most money on, especially when the consumers are more likely to be sick ... The moves by nearly every major insurer over the last few months are often focused on times of the year and plans that attract the sickest people and [are] starting to prompt action by state officials and legislators. Some, including the head of California's state insurance exchange, say federal regulators should help assure consumers get the help and plans they need, especially during special enrollment periods when they lose jobs, move or have babies." (USA TODAY)  

Traditional Medicare ... Disadvantaged?
"[C]onsumer protections, such as an annual open enrollment period without pre-existing condition exclusions, do not apply to the Medigap market as they do for Marketplace and Medicare Advantage plans.... [S]eniors who opt for a Medicare Advantage plan when they first go on Medicare can forever be locked out of the Medigap market. Seniors are permitted to switch back and forth between traditional Medicare and Medicare Advantage during the open enrollment period, but if they choose Medicare Advantage from the start, as more and more Boomers are doing, they may be making an irrevocable decision by giving up their right to purchase supplemental insurance later in life." (Henry J. Kaiser Family Foundation)  

Why a Small Health System Launched its Own Health Plan
"In one way, the announcement that Aspirus and WPS Healthcare were launching an insurance company was not surprising. The two-state health system and the Madison, WI-based health insurance company had offered a co-branded product in the local market that had grown 225% in the two years prior to January's announcement. But forming a health plan in which it has ownership is only one of several strategic initiatives the eight-hospital system ... is undertaking to preserve its independence." (HealthLeaders Media)  

Executive Compensation and Nonqualified Plans

[Guidance Overview]

2015 Executive Compensation Recap, Key Developments and Notable Trends (PDF)
30 pages. "In 2015, consistent with prior years, an overwhelming percentage of Russell 3000 companies obtained majority 'Say-on-Pay' support.... Institutional investors are demonstrating both a heightened level, and an increased expectation, of engagement on executive compensation matters.... Rigor of performance goals is becoming the key focus area for proxy advisory firms and institutional investors.... ISS implemented a 'scorecard approach' for evaluating equity plans.... Shareholder proposals relating to accelerated equity vesting upon a change in control increased in popularity.... Performance-based awards continue to be the most common long-term incentive vehicle.... The SEC finalized the CEO pay ratio rule.... The SEC proposed rules on the remaining executive compensation-related Dodd-Frank items." (Frederic W. Cook & Co., Inc.)  

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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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