Health & Welfare Plans Newsletter

August 30, 2016

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Employee Benefits Jobs

Retirement Plan Consultant
SuperiorUSA Benefits
in IA, MN

Sr Compliance Specialist / Manager -- ERISA Compliance
Simpkins & Associates
in TX

Pension Implementation Project Manager
Willis Towers Watson
in CA, CO, IL, MN, TX

Junior Defined Contribution (DC) Administrator
Planned Retirement Consultants & Administrators, LLC
in NJ

Director of Retirement Plan Compliance
Newport Group
in IL

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Webcasts and Conferences

Waiver of 60-Day Rollover Requirement
September 8, 2016 WEBCAST
Convergent Retirement Plan Solutions, LLC

Statewide Pension Fund Seminar Fall 2016
September 14, 2016 in NY
Bond, Schoeneck & King, PLLC

Collection Procedures Institute
September 19, 2016 in MA
International Foundation of Employee Benefit Plans [IFEBP]

QDROs: Breakiní Up Really Is Hard to Do [2016]
September 28, 2016 WEBCAST
FIS Relius Education

Defined Contribution Plan Boot Camp
November 3, 2016 in MA
New England Employee Benefits Council

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[Official Guidance]

Text of 2017 IRS Instructions for Forms 1099-SA and 5498-SA (PDF)
"File Form 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, to report distributions made from a health savings account (HSA), Archer medical savings account (Archer MSA), or Medicare Advantage MSA (MA MSA). The distribution may have been paid directly to a medical service provider or to the account holder. A separate return must be filed for each plan type.... File Form 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information, with the IRS on or before June 1, 2018, for each person for whom you maintained a [HSA, MSA, or MA MSA] during 2017. You are required to file if you are the trustee or custodian of an HSA, Archer MSA, or MA MSA. A separate form is required for each type of plan."
Internal Revenue Service [IRS]

[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.


[Official Guidance]

Text of 2016 IRS Instructions for Forms 1099-SA and 5498-SA (PDF)
"Due to the very low volume of paper Forms 1099-SA and 5498-SA received and processed by the IRS each year, these forms have been converted to an online fillable format.... File Form 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, to report distributions made from a health savings account (HSA), Archer medical savings account (Archer MSA), or Medicare Advantage MSA (MA MSA).... File Form 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information, with the IRS on or before June 1, 2017, for each person for whom you maintained a [HSA, Archer MSA, or MA MSA] during 2016."
Internal Revenue Service [IRS]

[Guidance Overview]

Text of CMS Fact Sheet on Proposed HHS Notice of Benefit and Payment Parameters for 2018 (PDF)
"This fact sheet highlights certain elements of the proposed rule.... [CMS also seeks] comment on other ideas to improve the risk pool, such as clarified coordination of benefits rules, grace period policy, specifying a certain amount or percent of user fee revenue for education and outreach, and whether and how to further support the transition of former Pre-Existing Condition Insurance Plan (PCIP) Program enrollees into the Marketplace to ensure that they do not experience a lapse in coverage."
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

[Guidance Overview]

Text of EEOC Informal Discussion Letter: Calculating Incentive Limits for Employer Wellness Programs under ADA and GINA
Unnumbered document; dated July 1, 2016. "You asked what incentive limit applies if an employer offers a group health plan with multiple benefit options (high, medium, and low medical options) and enrollment in any one of the options is required to participate in the wellness program.... [B]oth the ADA and GINA rules provide that where an employer offers more than one group health plan but enrollment in a particular plan is not required to participate in a wellness program, the maximum incentive is based on the total cost of the lowest cost self-only coverage under a major medical group health plan that the employer offers. Although the ADA and GINA rules use slightly different language in describing how to calculate permissible incentives, the differences are not legally consequential."
U.S. Equal Employment Opportunity Commission [EEOC]

[Guidance Overview]

Proposed Changes to Form 5500 Include Expanded Group Health Plan Reporting
"While at first glance it may appear that this is the government's way of performing an 'end run' around the Supreme Court's recent decision in Gobeille v. Liberty Mutual Insurance Co. (striking down a Vermont all-payer claims database law as applied to an ERISA-governed health plan), ... the information being sought through proposed Schedule J is more 'global' in nature and not claim-specific."
Reid and Riege, P.C.

[Advert.]

Be our guest at IHC FORUM West! Nov 9-10 in Las Vegas, NV

Sponsored by Institute for Healthcare Consumerism [IHC]

What compliance and regulatory issues are plaguing open enrollment this year? Will this year's presidential election alter the health & benefits landscape for the next four years? Find out at FORUM West. Claim your free registration now.


[Guidance Overview]

New Summary of Benefits and Coverage for 2017 (PDF)
"[1] Is an SBC required for every health plan? ... [2] Does the SBC replace other plan materials, such as the summary plan description (SPD) or the insurer's booklet or certificate? ... [3] What is included in the SBC? ... [4] Can we change the format of the SBC? ... [5] What is the Uniform Glossary? ... [6] Who produces the SBC? ... [7] Do SBCs have to be distributed separately to family members? ... [8] Are SBCs required for each enrollment option (e.g., coverage level, cost-sharing option)? ... [9] May we distribute the SBC electronically instead of hard copy?"
EPIC

District Court Finds Constructive Trust by Law Firm Supports Plan's Claim for Equitable Relief
"If an ERISA plan participant reimburses the plan, may the participant subsequently litigate issues concerning the reimbursement in state court? The court grapples with that issue in this case. The facts involve competing claims by the plan fiduciaries in federal court and the plan participant's law firm in state court. The comments in [this article] show a possible way around the complexities presented in this case." [UnitedHealth Group. Inc. v. MacElree Harvey, Ltd., No. 16-1026 (E.D. Pa. Aug. 23, 2016)]
Harmon on Health Plan Law

UNITE HERE Must Pay $5.5M to Hotel Employees Over ERISA Breach
"UNITE HERE Health must pay $5.5 million to Greenbrier Hotel Corp. and its employees for breaching its ERISA fiduciary duties by amending plan documents to retain excess assets when the plan was terminated... [T]he court said that UNITE HERE's trustees removed certain language pertaining to their fiduciary obligations and then amended the plan's termination clause in an effort to 'bolster' the fund's claim to the excess assets. In doing so, the trustees failed to follow the plan's amendment procedures and thus the amendment was invalid." [Greenbrier Hotel Corp. v. UNITE HERE Health, No. 13-11644 (S.D. W.Va. Aug. 26, 2016)]
Bloomberg BNA

Ninth Circuit Deems Compensation of Outside Medical Reviewers Relevant in LTD Litigation
"[A recent] decision by the Ninth Circuit ... [addressed] whether (and, if so, how) the number of reviews done by, and compensation earned by, outside medical reviewers used by an insurer to evaluate long term disability claims is relevant to arbitrary and capricious review.... [T]he majority of the panel found (at least implicitly) that evidence of this nature is discoverable in a case governed by arbitrary and capricious review, and must be considered by a court in passing on the question of whether a decision to deny benefits was arbitrary and capricious." [Demer v. IBM Corp. LTD Plan and Metropolitan Life Ins. Co., No. 13-17196 (9th Cir. Aug. 26, 2016)]
Stephen Rosenberg, The Wagner Law Group

Overtime and FMLA Leave
"Does overtime missed because of a FMLA-qualifying reason count against the employee and, correspondingly, is the employee entitled to additional hours of FMLA leave because the employee sometimes works overtime? As is the case with many legal questions, the answer is -- 'It depends'. In this instance, it depends upon whether the overtime the employee normally works is considered to be voluntary or mandatory."
Ice Miller LLP

The Impact of an HSA-Eligible Health Plan on Health Care Services Use and Spending by Worker Income (PDF)
24 pages. "The HSA-eligible health plan was associated with a decline in (non-preventive) outpatient office visits for workers at all income levels, but the decline was over twice as large for workers and their dependents with incomes less than $50,000 as compared with those with in comes of at least $100,000.... There was an across-the-board decline in prescription drug fills regardless of worker income.... [T]he HSA-eligible health plan was associated with an increase in emergency department visits and inpatient hospital admissions among lower-income individuals."
Employee Benefit Research Institute [EBRI]

Estimating the Value of Public Disability Insurance Using Complementary Private Insurance
"[The authors] use premium variation among the employer-provided disability policies to quantify the surplus that would be generated by increasing the replacement rate of disability insurance for [the] sample population ... In addition, [they] estimate a lower bound on the surplus generated by public disability insurance in this context.... [F]indings suggest that public disability insurance generates substantial surplus for this population, and there may be gains to increasing the generosity of coverage in this context."
National Bureau of Economic Research [NBER]

CMS Moves to Shore Up ACA Insurance Markets
"Starting in 2018, risk adjustment would factor in prescription drug data in addition to all the normal conditions and illnesses that are factored into someone's risk score. Health insurers have argued their members look healthier than they actually are because the program doesn't account for the medicines people are taking. But some risk-adjustment experts believe using drug data could create perverse incentives for doctors to write unnecessary prescriptions.... Risk adjustment in 2018 also would account for 'partial-year' members who enroll outside of open enrollment. Insurers have said people who enroll mid-year have higher healthcare costs and therefore are riskier to cover."
Modern Healthcare Online; free registration required

Benefits in General

EBSA Launches New Website [Video]
"This video provides an overview of the new EBSA website organization to help visitors become familiar with the new navigation."
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL], via YouTube

Distributional Effects of Applying Social Security Taxes to Employer-Sponsored Health Insurance Premiums
"This policy brief analyzes how applying the Social Security tax to employer-sponsored health insurance premiums could affect Social Security beneficiaries.... [F]or most Social Security beneficiaries aged 60 or older from 2017 to 2080, benefits would gradually increase and the poverty rate would decrease faster than the rate under current law. Counting employer-sponsored health insurance premiums as wages for Social Security purposes would increase Social Security taxes for most individuals and those taxes would increase more than Social Security benefits for individuals at all earning levels."
Office of Retirement and Disability Policy, U.S. Social Security Administration [SSA]

HSA Plans: A Retirement Benefit in Disguise? [Podcast]
"[This discussion explains] how employees at various stages in life can take advantage of HSAs, how they contribute to the evolving conversation of improving both health and wealth and ideas around creating benefits bundles to guide employee decision making. [It also includes] insights for employers about the importance of setting up internal cross functional teams between health and retirement benefits, how involving company leadership is paramount to success and why you need to have a three year plan for your benefits strategy."
Lockton

[Opinion]

Joint Comment Letter to IRS Requesting Extension of Time for Comments on Proposed Revision of Annual Information Return/Reports (Form 5500) (PDF)
"We respectfully request a 90-day extension of the deadline for public comments on the Proposal, currently scheduled to end on October 4, 2016.... The comment period coincides with the busiest time of the year for Form 5500 practitioners ... Those within firms that will need to review the Proposal and develop meaningful comments are fully engaged in implementing the final fiduciary rule.... The effect of the Proposal on plan sponsors -- particularly smaller employers -- requires sufficient time to assess.... Major changes to health plan reporting must be analyzed carefully while resources are still being expended to deal with ACA reporting."
The SPARK Institute, American Benefits Council, Investment Company Institute [ICI], and Plan Sponsor Council of America [PSCA]

Press Releases

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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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