Health & Welfare Plans Newsletter

May 27, 2016

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2016 Legislative & Regulatory Updates
July 12, 2016 WEBCAST
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HSA Proliferation in the New Health Care Market
July 17, 2016 WEBCAST
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[Guidance Overview]

New ACA Anti-Discrimination Rules: Language Assistance for Non-English Speakers
"Covered entities should immediately evaluate their policies and processes for interacting with individuals with limited English proficiency and, where necessary, modify them to comply with the new, heightened standards by July 18, 2016. Among other things, they will need to prepare the required notices and taglines by October 16, 2016, and arrange for appropriate and timely interpreter and, as appropriate, translator services." (Holland & Hart LLP)  


[Advert.]

Flexible Spending Accounts - June 2 webinar

Sponsored by Lorman and BenefitsLink

Overview of plan design considerations and legal requirements of flexible spending accounts. Avoid running afoul of rules that could jeopardize the tax-favored status of your plans. BenefitsLink discount.



[Guidance Overview]

HHS Issues Final Rule on ACA Nondiscrimination Provisions Under Section 1557 (PDF)
"Health insurance issuers should first determine whether they receive federal financial assistance from HHS (they most likely do, so any conclusion to the contrary should be carefully reviewed).... Issuers that are related to TPAs should consider whether the TPA is 'independent' and, if not, should take steps to ensure that benefits are administered in a nondiscriminatory manner.... Employers sponsoring group health plans should first determine whether the employer receives federal financial assistance from HHS for any purpose. Employers should also ensure that benefit design decisions made by the employer in its role as a plan settlor are adequately and appropriately documented." (Groom Law Group)  

[Guidance Overview]

It's Time to Review Your Wellness Program Under New ADA and GINA Final Rules (And HIPAA And...)
"A chart summarizing the applicable rules under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Genetic Information Nondiscrimination Act of 2008 (GINA), and the Americans with Disabilities Act of 1990 (ADA) appears at the end of this [article].... The EEOC urges employers to adopt best practices to protect confidentiality of medical information and genetic information. The EEOC suggests that such practices include adoption and communication of strong privacy policies, training for individuals who handle confidential medical information, encryption of electronic files, and policies that require prompt notification of employees whose information is compromised if data breaches occur." (Drinker Biddle)  

[Guidance Overview]

HHS, DOL and Treasury Release New Summary of Benefits and Coverage Templates and Accompanying Documents
"The SBCs provided to consumers must follow a uniform format and contain certain information. This information includes uniform standard definitions of medical and health coverage terms, a description of the coverage, cost-sharing requirements, and information regarding any exceptions, reductions or limitations under the coverage.... The changes to the requirements and templates and all relevant effective dates are described [in this article]." (Proskauer's ERISA Practice Center)  

[Guidance Overview]

IRS Letter Addresses Readily Available Test When Bus Company Does Not Accept Debit Cards
"If an employer cannot offer cash reimbursements for a particular transit provider, and more convenient vouchers like debit cards cannot be used, the employer may need to make a difficult decision: deal with the practical challenges of distributing the available vouchers for that provider, or refuse to pay benefits for that provider because the administrative burdens of dealing with the available vouchers outweigh the value of the transit benefit." (Thomson Reuters / EBIA)  


[Advert.]

The 2016 Government Health Care Congress - July 12-13, Washington, DC

Sponsored by World Congress

The top destination for execs from health plans, managed care plans, government entities, and private/public exchanges Promo Code BLINK2 takes $200 off your registration May not combine w any other offer. Invalid twd Govt Rate/Workshop Only/Webcast)



Be on the Lookout for Marketplace Notices
"[T]he Federally-Facilitated Marketplaces (FFM) will send an employer [a notice] when one of their employees accesses marketplace coverage and receives a tax credit. These notices will be sent out to employers throughout 2016 with plans for the first notices to be sent out in the coming weeks. Employers should be on the lookout for these notices since they will have 90 days to appeal a notice or face the risk of a fine." (Frenkel Benefits)  

Health Insurers Increase Borrowing Due to Impact of ACA
"U.S. health insurance carriers have increased the amount of borrowed money on their statutory balance sheets by nearly 100% over a four-year period, to approximately $6.4 billion at year-end 2015 from just under $3.3 billion in first-quarter 2011 ... [T]he financial leverage for the health industry has increased to more than 30% due to mergers & acquisitions and is expected to increase to well above 40% with the completion of two large mergers that are pending[.]" (A.M. Best Company)  

Virginia Insurer's Decision to Drop Bronze Plans Prompts Concerns
"News that a CareFirst BlueCross BlueShield subsidiary will stop selling bronze level plans on the Virginia marketplace next year prompted some speculation that it could signal a developing movement by insurers to drop that level of coverage altogether. The reality may be more complicated and interesting, some experts said, based on an analysis of plan data." (Kaiser Health News)  

Ohio Makes a Baker's Dozen
"The state of Ohio announced [on May 26] that its CO-OP would shutter, forcing its more than 20,000 participants to find new coverage within the next 60 days. The announcement marks 13 out of the original 23 Obamacare CO-OPs that have closed its doors at a total cost to taxpayers of $1.36 billion." (Energy & Commerce Committee, U.S. House of Representatives)  

Blue Shield 'Lifts the Veil' on Executive Pay
"In its first detailed disclosure on executive pay, nonprofit Blue Shield of California said Chief Executive Paul Markovich made $3.5 million last year -- a 40 percent increase since he took the top job in 2013. The San Francisco-based health insurer has faced criticism for years from consumer advocates about its lack of transparency on executive compensation, and the issue attracted even more scrutiny after a state audit raised questions about the insurer's big pay increases." (Kaiser Health News)  

[Opinion]

How to Increase Competition Under the ACA
"[M]ost of the 'new' insurance plans on the exchanges are just different iterations on health plans already being offered by legacy insurance carriers. The ACA has been devoid of the kind of brisk new health plan company formation that was seen with the launch of Medicare's Part D drug benefit and its Medicare Advantage program. The question is, why? One of the big culprits, [the authors] believe, is the cap that the ACA places on the operating margins of insurance carriers." (BDO Center for Healthcare Excellence and Innovation)  

[Opinion]

Health Insurers Find Back Door to Limit Choice
"Insurance companies ... [have] cooked up a clever way to justify exclusions from formularies by founding and funding a group called the Institute for Clinical and Economic Review, or ICER.... ICER, which holds itself out as a kind of Consumer Reports for drugs, is basically an industry-backed comparative effectiveness calculator. That ICER is industry backed isn't the problem, it's that it uses comparative effectiveness to lend an air of legitimacy to the formulary shenanigans. Different people respond differently to medications. The blue pills don't always work the same as the red pills. Individuals, it turns out, are different." (USA TODAY)  

Benefits in General

DOL and Treasury Update 2015-2016 Regulatory Agendas for Employee Benefits
"The DOL's agenda and related materials include 13 pending projects related to employee benefits ... . The IRS Business Plan includes 28 pending items addressing retirement benefits and 14 pending items addressing executive compensation, health care and other benefits.... There are no new projects added to the agendas since they were last published." (Sutherland Asbill & Brennan LLP)  

ERISA Advisory Council to Discuss Cybersecurity, Other Benefit Plan Issues at June Meeting
"The council's discussion includes 'Cybersecurity Considerations for Benefit Plans' on June 7, and 'Participant Plan Transfers and Account Consolidation for the Advancement of Lifetime Plan Participation' on June 8. Both topics will be discussed on June 9; however, the meetings' schedule is subject to change." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])  

Executive Compensation and Nonqualified Plans

[Guidance Overview]

Your CEO Pay Ratio Will Be an Estimate Even If You Don't Use Statistical Sampling
"[S]ome companies that they're reluctant to employ statistical sampling in calculating their CEO pay ratios based on the notion that their calculation will not be as accurate as if they had used actual data for their entire workforce.... [The SEC] does not require companies to calculate Summary Compensation Table (SCT) total compensation for all employees to identify the median employee. As a result, every company will be using a less-than-100%-accurate methodology to arrive at an estimate of the median pay[.]" (Willis Towers Watson)  

[Guidance Overview]

Reproposed Regs Will Significantly Change the Structure of Incentive Compensation at Financial Institutions with $1 Billion or More in Assets (PDF)
12 pages. "While most commentary to date has focused on the rules applicable to entities with assets of $50 billion or more (Level 1 and Level 2 entities), the rules that affect Level 3 entities ($1 billion to $50 billion in assets) are also far reaching and will substantially affect the design and administration of their incentive compensation programs. In particular, it appears impermissible for any incentive compensation plan for any employee to provide payment based solely on quantitative criteria." (Frederic W. Cook & Co., Inc.)  

Press Releases

CalPERS Wins Government Finance Award For Sustainable Pension Policy
CalPERS [California Public Employees' Retirement System]

DOL's Actions Recover $7.1M for Workers in AIT Laboratories Employee Stock Ownership Plan
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

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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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