Health & Welfare Plans Newsletter

October 20, 2017

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[Guidance Overview]

On the Rollercoaster: How Plan Sponsors Could Be Affected by Recent ACA Developments
"As the price of individual policies available on the marketplace increases, individuals are more likely to look for coverage from their employer's plans which may not look as expensive when the subsidies that helped to reduce the individual policy costs are gone.... The ACA coverage and benefit mandates are still the law for employer sponsored group health plans, as are the reporting mandates and the employer shared responsibility tax for employers with 50 or more full-time employees ... [E]mployers subject to such tax should move forward on preparing the new 2017 Forms 1095-C."
Winstead PC

[Advert.]

Online Learning Course: HSA and HRA Basics

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

This e-learning course will provide an in-depth look at HSA and HRA programs as well as how these programs interact with an HCFSA.


Tying Health Plan Premiums to Salary Can Aid Lower-Paid Earners
"As the cost of health insurance continues to increase ... more employers are considering plan premium tiers that base employees' contributions for health coverage on their pay level. Higher-paid employees are then, in effect, subsidizing coverage for their lower-paid co-workers.... [Aon Hewitt's] health benefits data covering 1,600 employers found that 21 percent set health insurance premium amounts based on employee pay levels."
Society for Human Resource Management [SHRM]

New Health Care Bill Would Offer Stability, Respite on Premiums
"The legislation from Republican Sen. Lamar Alexander of Tennessee and Democratic Sen. Patty Murray of Washington ... would send a reassuring message to insurers selling individual health policies ... Consumers who get subsidized coverage ... would benefit, since the bill is expected to deter more insurers from exiting the market. That would maintain access to coverage. But it seems unlikely that the legislation will provide relief from premium increases for 2018, already set in many cases. It does include a rebate mechanism for consumers."
Associated Press, via InsuranceNewsNet.com

ACA Round-Up: Oregon 1332 Waiver Approved, Silent Returns Rejected, and More
"Oregon is financing part of its program through a 0.3 percent tax on major medical premiums but projects that the program will reduce premiums by 7.5 percent in 2018, 7 percent in 2019, and 6.4 percent in 2027 compared to what premiums would have been without the waiver. The waiver approval does not state how much federal money will be passed through to Oregon from reduced federal payments for premium tax credits and cost-sharing reductions to assist in paying for the program."
Timothy Jost, in Health Affairs

[Opinion]

Growth of Underinsurance Now Rampant in Employer-Sponsored Plans
"[P]rotection provided by employer-sponsored plans is rapidly deteriorating, including in the highly touted large group plans. A relatively high percentage of individuals with these plans are finding that they are underinsured. They are experiencing financial barriers to health care and are suffering financial hardship when they must access that care."
Physicians for a National Health Program [PNHP]

[Advert.]

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[Opinion]

Options to Expand Health Insurance Enrollment in the Individual Market
"Options to enhance, increase, or extend tax credits could increase total enrollment in the individual market by 1.0 million to 3.4 million and the insured population by 800,000 to 2.6 million. Adding reinsurance could increase enrollment by 1.2 million to 5.4 million and total coverage by 900,000 to 3.4 million. Costs for these options range from $2.5 billion to $18.8 billion, with those policies producing the biggest coverage gains generally requiring the biggest public investments."
The Commonwealth Fund

[Opinion]

NASE Applauds Senate Introduction of 'Copper Plan' Health Insurance Legislation
"We applaud this bipartisan group of Senators who understand that greater flexibility in the health insurance marketplace creates access to more affordable care and greater participation. As many small business owners and entrepreneurs continue to face costly health care premiums impeding their ability to secure affordable coverage, the Copper-level plan would help bring relief and guarantee hundreds of thousands more Americans have access to care[.]"
National Association for the Self-Employed [NASE]

Benefits in General

Employee Benefits Cases in the Supreme Court Since ERISA's Enactment
32 pages. "[In] the Court's last 42 terms [since ERISA's 1975 effective date] ... the Court has issued merits opinions in 125 argued cases and one unargued case directly involving employee benefit arrangements including IRAs, and two additional argued cases substantially implicating these arrangements ... for an astonishing total of 128 decisions.... [T]he Court has been concerned with who can bring claims involving employee benefits, what kind of claims can they bring, what kind of remedies can they seek ... and whether State laws implicating employee benefits will be enforced, as frequently as it has considered substantive issues affecting employee benefits."
Eversheds Sutherland

ERISA Preempts State Law Revoking Beneficiary Designation Upon Divorce
"The court determined that the state law at issue here 'related to' an ERISA plan in that it required the plan administrator to look to state law to determine the recipient of plan payments, rather than to the plan itself. The court concluded that the state law implicates an area of core ERISA concern by abrogating ERISA's requirements that a plan must specify the basis on which payments are to be made, and that plan fiduciaries must make payments to beneficiaries designated by participants or by the terms of the plan." [Jackson v. Parks, No. 17-14 (D. Mont. Sept. 14, 2017)]
Thomson Reuters / EBIA

Workers Willing to Compromise on Salary for the Right Benefits, Culture, and Growth Opportunities
"Benefits are almost as important as culture when considering a job offer, with a signing bonus and financial support for training topping the 'most wanted' list. Employers who offer health and dental, 401k contributions, and paid vacation time are probably not standing out from the crowd. Three-quarters of employers offer health and dental and two-thirds offer 401k and 3+ weeks of paid vacation."
HR Daily Advisor

Executive Compensation
and Nonqualified Plans

[Opinion]

Update on Clawback Policy Issues
"[Some practitioners] believe that executives will rebel at attempts to impose a too-strong clawback policy, and that it would not be fair to give the board too much power and discretion over compensation paid out or promised. Clearly, the process of crafting a policy that allows a compensation clawback or forfeiture under appropriate circumstances, while being fair to executives, requires careful deliberation and drafting."
Winston & Strawn LLP

Discussions
on the BenefitsLink Message Boards

Transit/Parking IRS Monthly Limits
Regarding the IRS 2017 Transit/Parking limit of $255/month -- we have some clients who have set up pretax transit/parking and also after tax parking/transit employee deductions. From an IRS limit perspective under the cafeteria plans, do I also include EE after tax transit/parking payroll deductions combined with the EE pretax transit/parking deduction limit of $255/ month? Or is the limit of $255 just for pretax transit/parking EE payroll deductions and the employee can contribute more than $255/month for aftertax transit/parking to their account?
BenefitsLink Message Boards

HSA Eligibility with Double HDHP Coverage
Husband and wife each sign up for family HDHP coverage, creating a double HDHP coverage situation. Each signs up for an HSA plan for the individual (not family) limit. So far so good -- neither one has coverage that is not a Qualified HDHP. But the carrier reports coordinating benefits for the double HDHP coverage so that all plan deductibles and/or co-payments are waived, resulting in no-cost medical services being received. Hmmm. While the employees seem to have done everything right, the carrier's action seems to negate the intent of the law. Agree?
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David Rhett Baker, J.D., Editor and Publisher  davebaker@benefitslink.com
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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2017 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 those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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