Health & Welfare Plans Newsletter

November 14, 2017 logo logo
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Employee Benefits Attorney
Harter Secrest & Emery LLP
in NY

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Tri-State Plan Administration, Inc.
in OH

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Webcasts, Conferences

Demystifying Paid Family Leave Benefits: What New York Employers Need to Know
December 6, 2017 WEBCAST
Nixon Peabody LLP

WEB Atlanta Annual Holiday Social
December 7, 2017 in GA
Worldwide Employee Benefits Network [WEB] - Atlanta Chapter

New Year’s Resolution: Self-Audit Your Group Health Plan
December 14, 2017 WEBCAST
Thomson Reuters / EBIA

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[Guidance Overview]

A Prepper's Guide to ACA Employer Mandate Penalty Assessment
"[D]espite the fact that the 2015 Form 1095 instructions and other IRS guidance clearly instructed employers to leave line 16 blank in some circumstances, if the employer did so and the employee got subsidized coverage on one of the exchanges, the employer will very likely receive a penalty assessment notice.... IRS systems have been coded such that if the employer left Form 1094, Part III, column (a) (Minimum Essential Coverage Offer Indicator) blank ... it is presumed to be 'No.' ... Penalty assessments will be purely computer-driven ... Even if transition relief applies, and even if there's a perfectly acceptable reason for line 16 of Form 1095 to be blank, IRS is going to make the employer mount a defense."
LeFevre Law PC


Now is a great time to join Worldwide Employee Benefits Network (WEB)

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[Guidance Overview]

Massachusetts Issues Draft Regs for Employer Medical Assistance Contributions
"In 2018 and 2019, the [Employer Medical Assistance Contribution (EMAC)] contribution per employee will increase to 0.51% of the employee's wages each year from the current rate of 0.34%, up to the annual wage cap of $15,000 per employee. This increases the potential maximum cost to $77 per employee per year from the current $51 per employee per year."
ML Strategies

IRS Prepares to Issue ACA Employer Responsibility Penalties
"The guidance indicates that notices will start going out in 'late 2017,' so you should be on the alert for these notices. Because the IRS had well-documented problems processing the 2015 forms, [the authors] expect numerous errors with the assessments. Moreover, while 30 days sounds like plenty of time to respond, the actual timeframe may be significantly shorter by the time your organization receives and routes the letter to the right people. It may also take you some time to research your records as you prepare your response."
Warner Norcross & Judd LLP

Healthcare CEOs Say Leaders Need to Redefine Wellness
"As companies complete for talent and corporate culture becomes a differentiator in recruitment, it's clear that organizations need to shift focus from the financials to the people. And by making physical and mental wellness a number one priority, senior-level financial executives may discover an alternative solution to the health care crisis."
Financial Executives International Daily

How Does Health Care Fare in Congress' Attempts to Simplify the Tax Code?
"While the direct impact of tax reform on health care costs is still unknown, the federal budget resolution passed last month recommends a $1.8 trillion reduction in health care spending, including a $1.3 trillion cut to non-Medicare health programs and another $473 billion cut to Medicare over the next 10 years.... [A]ny decrease in public funding for health care will likely shift expenses to privately sponsored health insurance coverage."
The Alliance


This is a critical time for employer-sponsored benefit plans.

Sponsored by American Benefits Council

From education to advocacy, the American Benefits Council offers the resources you need to stay informed and make a difference in the policy debate. Just in time, to celebrate our 50th anniversary, special membership opportunities are now available.

President Taps Ex-Pharma Executive Azar as HHS Secretary
"President Donald Trump on Monday said he is nominating former pharmaceutical executive and industry lobbyist Alex Azar to serve as U.S. Health and Human Services secretary, saying Azar would push to lower the price of medicines. Republicans as well as the lead lobby groups for drugmakers and health insurers welcomed Azar as an experienced hand who could help overhaul the world's most costly healthcare system."

OPM Withdraws Proposed Rule on Health Care Premiums for Some Feds
"On the eve of open enrollment for 2018, the Office of Personnel Management announced that it is withdrawing a proposed rule that would have required some federal employees to keep paying their health insurance premiums when they are on unpaid leave.... Currently, agencies generally pay for the entirety of FEHBP premiums for employees on leave without pay. Employees then repay their portion of the insurance contribution when they return to work."
Government Executive

Employees Wary of Narrow Networks? Here's How to Win Them Over
"Only 7% of self-insured employers offer narrow networks to their employees.... 38% of the biggest (5000+ employee) firms operate what are known as high-performance networks.... Employers should be completely transparent about how they construct their networks.... Employers need to aggressively combat the misconceptions surrounding narrow networks.... Patient access must be protected.... employers need to ensure that the high-performers in their network are, in fact, high-performers."


Hospital Impact: The Upside of Narrow-Network Insurance Plans
"Nationwide, disjointed care channels are preventing providers from reaching the quadruple aim: exceptional health outcomes, an exceptional experience for the people we serve, and an exceptional experience for providers, at an affordable cost. The ability to truly execute the quadruple aim depends on having an individual receive care within a defined network. The advantage of more targeted choice in narrow network plans is that providers can deliver quality across the continuum of care while being responsible stewards of resources."


Narrow Networks Benefit Insurers, Not Patients
"Narrow networks are a tool of private insurance companies designed to enhance their business model rather than to improve patient service. They add to the administrative waste that characterizes the private insurance model of health care financing."
Physicians for a National Health Program [PNHP]

Benefits in General

AICPA's Progress Toward Improving Employee Benefit Plan Audits
"An enhanced peer review program was created with subject matter experts specific to employee benefit plan audits to review these engagements. The enhanced peer review program identified the following two trends: [1] 20% of engagements had material nonconformity related to improper utilization of SOC reports and certifications; and [2] More than 50% of engagements had material nonconformity related to inadequate or no documentation."
Schneider Downs

A Look at the House Ways and Means Committee Revisions and the Senate Mark of Tax Cuts and Jobs Act (PDF)
"The Senate Mark also introduced a five percent Federal income tax withholding obligation on compensation paid to independent contractors and included other differences to the final House bill impacting [1] compensation-related deductions, [2] employer-provided fringe benefits, [and] [3] retirement plans ... [T]he House bill and Senate Mark are aligned on changes to section 162(m), including the proposed elimination of the performance-based compensation exception to the $1 million limit on the deductibility of covered employee compensation"
Baker McKenzie

Deadlines Loom for Retirement, Health & Welfare Plans
"If it is true that change is the only constant in life, it is equally true that knowledge is the great equalizer. Irrespective of the uncertainty relating to potential Income Tax Reform legislation, employers should be aware of important year-end deadlines and considerations related to their retirement and health and welfare plans."
Husch Blackwell

Executive Compensation
and Nonqualified Plans

Executive Comp Programs Still on the Chopping Block in Senate Version of Tax Reform (PDF)
"[The proposed Code section 409B would exclude] from the definition of non-qualified deferred compensation death, disability, sick leave, compensatory time and vacation leave programs. Unfortunately, the Senate proposal specifically prohibits the IRS from creating an exception from these rules for any type of severance pay plan, which means employers would no longer be able to provide for multiyear severance pay or benefits.... However, the Senate proposal states that it would not apply to section 83 property or amounts contributed to a Code section 402(b) nonqualified employee trust."
Trucker Huss

House and Senate Have Their Sights on Deferred Compensation in Proposed Tax Bills
"The key changes that the Ways and Means Committee made to the bill include ... [1] Code Section 409B was withdrawn from the bill, meaning that Code Sections 409A and 457(b), and all other current guidance for nonqualified plans, should remain in place.... [2] New Code Section 83(i) was added, which would allow certain privately held company employees to defer recognition of income related to stock options."
Porter Wright Morris & Arthur LLP

Press Releases

Prime Pensions, Inc. is Certified to Industry Best Practices
Centre for Fiduciary Excellence [CEFEX]

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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2017, 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, 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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