Health & Welfare Plans Newsletter

June 30, 2016

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Retirement Account Administrator
Alerus
in MI, NH

Regional Sales Consultant
The Retirement Advantage
in TX, Telecommute

Relationship Manager
John Hancock
in CA

Regional Sales Consultant
The Retirement Advantage
in IL, Telecommute

ERISA Compliance Services Director
Ameritas Life Insurance Corp.
in OH

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Webcasts and Conferences

Opportunity is Knocking: How Benefits Lay the Groundwork for a Thriving Workplace
July 12, 2016 WEBCAST
(PlanSource)

Changing National & Chicago Health Care Markets
July 20, 2016 WEBCAST
(Midwest Business Group on Health)

HRA/HSA Compliance and Administration Issues
July 28, 2016 WEBCAST
(Frenkel Benefits, LLC)

Creating a Domestic Partner Benefits Policy
August 30, 2016 WEBCAST
(Lorman Education Services)

Code Section 409A: Structuring Compliant Plans and Avoiding Pitfalls
August 31, 2016 WEBCAST
(Lorman Education Services)

Using New Payment Approaches to Obtain Quality Health Care
September 15, 2016 WEBCAST
(Midwest Business Group on Health)

Health & Welfare Benefit Plans National Institute
October 6, 2016 in DC
(ABA Joint Committee on Employee Benefits [JCEB])

Utilization Management Master Class for Health Plans
October 24, 2016 in IL
(Healthcare Education Associates)

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[Guidance Overview]

Agencies Propose ACA Regs on Expatriate Plans and Excepted Benefits
"If your plan includes a benefit intended to qualify as a fixed hospital or other fixed indemnity policy, review to ensure the reimbursements do not vary depending on type of service and are made on a per diem basis. If your company offers expatriate plans that are intended to constitute minimum essential coverage, check with your carrier that the plan meets minimum value and that the carrier is a qualified expatriate health insurance issuer. Confirm that substantially all of those covered under the expatriate plan are qualified expatriates." (Seyfarth Shaw LLP)  


[Advert.]

Register for NBCH's 21st Annual Conference, Sept. 26-28 in Orlando

Sponsored by National Business Coalition on Health [NBCH]

This must-attend event convenes employers, health plans, providers, business health coalitions and other key stakeholders focused on the future of health care and benefits. Free admission for employers that are members of an NBCH coalition. Join us.



[Guidance Overview]

Handling Intermittent, Unpredictable Leave Requests After FMLA Ends
"Because intermittent leave is irregular and unpredictable, however, an undue hardship defense will be easier to advance in these situations. Here, you are more likely to show that these continued intermittent absences adversely impact your operations and the ability to serve your customers/clients.... [It] is critical for the employer to continue to engage in the interactive process with the employee so that it can best determine whether any assistance can be provided to help them improve their attendance and return to work." (FMLA Insights)  

[Guidance Overview]

Managing Repeated Requests for Leave as an ADA Reasonable Accommodation
"EEOC appears to presume that any request for leave -- no matter the length -- is an effective accommodation. Before we even get to the undue hardship analysis, however, an employee should be required to establish that his request for additional leave is effective in helping him return to work in the near future.... [E]mployers typically conduct the undue hardship analysis only after the employee has exhausted FMLA leave and is requesting additional leave as an ADA accommodation. That's often too late." (FMLA Insights)  

Failure of FMLA Notice to Include Job Restoration Rights Might Be Interference If Employee Prejudiced
"The FMLA notice a federal reserve bank sent to an employee failed to inform him of his right to job restoration, the Fourth Circuit found. And because there was sufficient evidence to show he would have structured his leave differently had he known his job was protected, the court vacated the grant of summary judgment against his FMLA interference claim." [Vannoy v. The Federal Reserve Bank of Richmond, No. 14-2375 (4th Cir. June 28, 2016)] (Wolters Kluwer Law & Business)  

Sixth Circuit Nixes Provider ERISA Suit
"The more nuanced question became whether the provider had derivative standing under ERISA by virtue of the assignments of benefits. Blue Cross insisted that the assignment of benefit forms provided only for direct payment and therefore did not grant an assignment of rights sufficient to confer derivative standing.... [T]he Court found that the recoupment suit fell outside the scope of the assignments of benefit, and thus the provider was not entitled to any relief. This provider had a contract with Blue Cross and the Court found that its claims were more properly contractual, rather than arising from ERISA." [Brown v. BlueCross BlueShield of Tenn., No. 15-5739 (6th Cir. June 27, 2016)] (Squire Patton Boggs, via National Law Review)  


[Advert.]

Don't miss Private Exchange FORUM Baltimore Sept. 8-9

Sponsored by Institute for Healthcare Consumerism [IHC]

Learn the latest compliance and regulatory issues around the private exchange market at the IHC's Private Exchange FORUM Baltimore. PEX Baltimore will be held at the Renaissance Harborplace hotel in Baltimore, MD Sept. 8-9. Register here for free.



Strategies for Health System Innovation After Gobeille
"Given the impediments to comprehensive monitoring of health information that Gobeille creates, states should consider the following strategies. Data sharing agreements with self-insured plans ... Data reporting from health care professionals and facilities ... Federal regulatory action ... Congressional action." (JAMA)  

Anthem Said to Face U.S. Skepticism Cigna Deal Can Be Fixed
"The Justice Department has told Anthem Inc. that the health insurer's planned takeover of Cigna Corp. threatens competition and probably can't be fixed by selling parts of their businesses ... The Justice Department has indicated that it's open to hearing about proposals from the company to resolve the problems ... Still, its skepticism that the deal can be fixed raises the likelihood that the U.S. will sue to block it. The government is on track to make a decision on the combination by around mid-July[.]" (Bloomberg)  

[Opinion]

The Regulatory State Reaches the Wellness Industry
"Because employers cannot use underwriting for medical risk to charge different premiums to different employees, it is hard to avoid the conclusion that wellness programs are less designed to make or keep employees well, as to ensure healthy people are attracted to the employer and sick people are not. Evidence suggests this is the real consequence of workplace wellness programs." (National Center for Policy Analysis Health Policy Blog)  

[Opinion]

Seven Things Business Leaders Should Know (and Do) About Health Care
"[1] Our nation can and must broaden our definition of health and health care because our population is changing.... [2] We don't have a free market in health care -- and now is the time for the public and private sector to work together.... [3] The effect of retail health care on consumers.... [4] You are going to hear all about new care models for your employees that may or may not be better -- the devil is in the details.... [5] Consolidation is all the rage.... [6] Pharma will continue to reign as king -- you should be at the table.... [7] The Internet and data are changing how consumers access and use health care, with huge potential -- embrace it." (Altarum Institute)  

[Opinion]

After Continued Stonewalling, House Committee Issues Subpoena of HHS Records on Unlawful Reinsurance Program
"Despite Acting Administrator Slavitt's on-the-record commitments to produce the requested documents, on June 10, 2016, HHS sent a letter to the committee acknowledging that responsive documents exist, but it will not produce them. In refusing to produce the documents, the department cited the need to protect its 'confidentiality interests,' and claimed that providing documents to Congress about these final rules would 'have a chilling effect on future deliberations.' To date, HHS has not asserted any legal privileges -- let alone a valid one -- to justify withholding these final documents from Congress." (Energy & Commerce Committee, U.S. House of Representatives)  

Benefits in General

[Official Guidance]

Text of DOL Final Regs: Federal Civil Penalties Inflation Adjustment Act Catch-Up Adjustments
105 pages; includes provisions for all DOL agencies, including EBSA. "This section ... addresses the civil monetary penalties administered by EBSA to enforce title I of [ERISA]. Paragraph 2(a) explains how the Department determined the date each civil monetary penalty was last adjusted by law or regulation (other than the Prior Inflation Adjustment Act, as amended), and Paragraph 2(b) describes the calculation of the catch-up adjustment for each ERISA civil monetary penalty through the use of a table. Paragraph 2(c) addresses the restructuring of 29 CFR Part 2575 and other technical changes to the Department's regulations needed to reflect the amendments made to the Prior Inflation Adjustment Act by the Inflation Adjustment Act." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])  

What Does the Supreme Court's Spokeo Decision Mean in the ERISA Litigation Context?
"Spokeo holds that 'concrete' harm, which can arise from the violation of tangible or an 'intangible' right created by Congress, along with particularization, is all that is required by the standing analysis. However, Justice Alito also described some clear limitations on the definition of the term 'concrete.' ... Justice Alito's definition of the word concrete may offer some possible defenses to ERISA claims that are pled as no more than bare procedural violations or 'general grievances.' " [Spokeo v. Robins, No. 13-1339 (S. Ct. May 16, 2016)] (Jackson Lewis P.C.)  

Executive Compensation and Nonqualified Plans

[Guidance Overview]

Key Takeaways from the Newly Issued Proposed Section 409A Regs
"Exempt stock rights (stock options and stock appreciation rights) can be awarded to service providers who are expected to commence work for the service recipient within 12 months, if they actually do commence work within that period.... Liberal timing rules apply to payments triggered by the service provider's death.... 'Clawbacks' on exempt stock rights are permitted.... A payment can qualify as a 'short-term deferral' even if the payment is made after March 15 of the year following vesting, where the payment is prohibited by federal securities law restrictions." (Wilkins Finston Friedman Law Group LLP)  

[Guidance Overview]

Proposed Section 409A Regs Make Several Notable Changes
"Though the IRS emphasized that the proposed regulations make narrow, discrete clarifications and changes to the final and 2008 proposed regulations, ... changes to four areas ... are likely to have a greater impact on the design and operation of deferred compensation plans. [1] You can still 'fix' noncompliant arrangements the year before vesting.... [2] Changes to stock option/SAR Rules.... [3] Employee-Independent Contractor.... [4] Payment events triggered by beneficiaries." (Miller & Chevalier)  

[Guidance Overview]

Proposed Rules for Incentive-Based Compensation at Financial Institutions
"The theory behind the proposed rules is to deny compensation for short-term actions that produce longer-term bad consequences ... and to reward 'balanced' risk and rewards assessments by bankers.... [T]he proposed rule also rewards things that were perceived as not being rewarded in the industry prior to 2008, such as enhanced compliance and risk management practices. By bringing such mandatory compensation practices down to mid-size community banks with only $1 billion in assets, the Federal regulators (including the Federal Reserve) intend to achieve a sweeping impact on virtually the entire banking industry, not just Wall Street." (Quarles & Brady LLP)  

[Guidance Overview]

Section 409A Proposed Regs: IRS Changes Affect Nonqualified Deferred Comp and Stock Plans
"[T]hese proposals formalize previously informal guidance that the IRS has been providing, offer new flexibility in some areas, and set forth a few new requirements. The IRS is allowing reliance on this guidance now and will not assert any position that runs counter to it. The proposed regulations present a lengthy list of items." (myStockOptions.com)  

Press Releases

Keating Partners is Certified for Fiduciary Excellence
Centre for Fiduciary Excellence [CEFEX]

Advent Design Corporation is Certified for Fiduciary Excellence
Centre for Fiduciary Excellence [CEFEX]

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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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