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January 28, 2019 logo logo
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Howard & Howard
in CA, IL, MI, NV

Enrolled Actuary
TPA specializing in small plans
in CA

Senior Pension Administrator
Yang's Pension Consulting
in CA

Retirement Plan Administrator (F/T)
Tycor Benefit Administrators, Inc.
in PA

Compliance Analyst -- QKA
Newport Group
in AL, CA, FL, IL, MD, NC, Telecommute

Compliance Analyst
in CA

Pension Enrolled Actuary
Consulting Actuaries Incorporated
in NJ, Telecommute

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[Official Guidance]

Text of 2018 Instructions for IRS Form 8994: Employer Credit for Paid Family and Medical Leave (PDF)

"An eligible employer uses Form 8994 to figure the employer credit for paid family and medical leave for tax years beginning after 2017. The credit ranges from 12.5% to 25% of certain wages paid to a qualifying employee while the employee is on family and medical leave. You can claim or elect not to claim the employer credit for paid family and medical leave any time within 3 years from the due date of your return on either your original return or an amended return." [Also available: 2018 IRS Form 8994]
Internal Revenue Service [IRS]


Utilizing Opt-Out Incentives to Cut Health Care Costs

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Jan. 29 webinar. Although these programs may seem simple enough, they are rife with multiple 'compliance landmines' that can trip up unwary employers. Learn how to spot problem spots and develop compliant and effective programs. BenefitsLink discount.

[Guidance Overview]

New Parking Expense Rules for Taxable Employers and Tax-Exempt Organizations

"Employers should first calculate the 'total parking expenses' (not the fair market value of parking) and the total number of parking spots it provides. [Four] steps allow the employer to classify each parking spot, and its allocated parking expense, as tax deductible or non-deductible (or included in UBTI). [1] Calculate reserved spots for employees ... [2] Determine primary use of remaining spots aka 'The Primary Use Test' ... [3] Calculate allowance for reserved nonemployee spots ... [4] Determine use for remaining spots and allocate expenses."
Williams Mullen

[Guidance Overview]

Massachusetts Department of Family and Medical Leave Releases Proposed Regs

"The [Massachusetts Family and Medical Leave Law (MFMLL)] will require all private employers in Massachusetts to provide covered individuals with paid family and medical leave funded through a payroll tax. Under the proposed regulations, ... the Department will be responsible for, among other things, making decisions about whether to approve employees for paid leave under the MFMLL once the law goes into effect on January 1, 2021.... [T]he proposed regulations left some questions unanswered, and raised some new questions."

Employer Must Pay Dependent Life Insurance Benefits to Employee Due to Failure to Provide Summary Plan Description

"[T]he court found that the conversion was not timely exercised after the divorce because Snitselaar was not provided the SPD as required by ERISA. The court entered judgment in favor of Snitselaar against Mount Mercy for $60,000, the full amount of the dependent basic and supplemental life insurance coverages." [Snitselaar v. Unum Life Ins. Co. of America, No. 17-014 (N.D. Iowa Jan. 22, 2019)]
Kantor & Kantor

CMS Addresses Drug Manufacturer Coupons in Proposed 2020 Payment Notice

"Currently, the amount that patients save using drug manufacturer coupons goes toward their annual cost-sharing maximum. However, in the Proposed 2020 Payment Notice, CMS states that drug manufacturer coupons can cause prescribing physicians and beneficiaries to choose expensive brand-name drugs over less expensive generics. In addition, CMS expresses concern that, by reducing patients' copayment obligations, drug manufacturer coupons relieve manufacturers of market constraints on drug prices, distorting the market."


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TRICARE Issues Request for Information on Formulary Management

"The Defense Health Agency (DHA), which manages the TRICARE health care benefits, has issued a Request for Information (RFI) regarding inpatient-clinic administered pharmaceuticals formulary management.... [R]esponding vendors have the opportunity to shape the standard list of drugs prescribed across all military medical treatment facilities, as well as the broader program administering the list. Responses are due February 5, 2019."
Sheppard Mullin

California Makes Waves with Pharma Benefits, Purchasing Plan

"California is planning to take control of the pharmacy benefit for all of the state's Medi-Cal beneficiaries -- the vast majority of which currently have that part of their care administered by private insurers and their PBMs. What's more, the order directs state agencies to create bulk-purchasing arrangements for high-priority drugs and establish a framework for letting private businesses and insurers join the state's buying pool."

GAO Decision: HHS Adoption of the Methodology for the HHS-Operated Permanent Risk Adjustment Program for the 2018 Benefit Year Final Rule

"The final rule adopts the HHS-operated risk adjustment methodology for the 2018 benefit year. In February 2018, a district court vacated the use of statewide average premium in the HHS-operated risk adjustment methodology for the 2014 through 2018 benefit years.... HHS is adopting for the 2018 benefit year an HHS-operated adjustment methodology that utilizes the statewide average premium and is operated in a budget-neutral manner ... [This report provides GAO's] assessment of CMS's compliance with the procedural steps required by section 801(a)(1)(B)(i) through (iv) of title 5 with respect to the rule." [B-330639, Jan. 11, 2019]
U.S. Government Accountability Office [GAO]

IFRS 17: Considerations for Health Insurers (PDF)

"Like most general insurers, short-term health insurers may consider the Premium Allocation Approach (PAA) over the Building Block Approach (BBA) as most of the health contracts have a coverage period of 12 months or less. However, there are a few things to consider before deciding on the model for measuring liabilities."


Pulling Back Curtain on Hospital Prices Adds New Wrinkle in Cost Control

"For years, these prices have been a tightly guarded industrial secret. When advocates have tried to wrest them free, hospitals have argued that they are proprietary information. And, hospitals claim, these rates are irrelevant, since -- after insurers whittle them down -- no one actually pays them. Of course, the argument is false, and our wallets know it.... [H]ospitals set prices crazy high so they can tout their generous discounts (while insurers tout their negotiating prowess)."
Kaiser Health News

Benefits in General

[Guidance Overview]

Editor's Pick Tax Cuts and Jobs Act: A Comparison for Businesses

"The Tax Cuts and Jobs Act (TCJA) changed deductions, depreciation, expensing, tax credits and other tax items that affect businesses. This side-by-side comparison can help businesses understand the changes and plan accordingly."
Internal Revenue Service [IRS]

Agencies Release Advance Informational Copies of 2018 Form 5500

"The instructions have been updated to reflect that the new maximum penalty for a plan administrator who fails or refuses to file a complete or accurate Form 5500 report has been increased to up to $2,140 a day for penalties assessed after January 2, 2018, whose associated violations occurred after November 2, 2015."
United Benefit Advisors

2018 Benefits Strategy and Benchmarking Survey -- Wholesale Industry Addendum (PDF)

"Faced with industry consolidation, slim margins and often, a small HR staff, wholesale employers are challenged with balancing the need to control compensation and benefit costs with the ability to attract and retain a high-performing workforce. As a result, employers in the sector may benefit from exploring innovative cost-containment tactics that do not have a negative impact on employee wellbeing. This benchmarking report explores these key issues, trends in the industry and potential solutions."

Press Releases

New App Displays What Original Medicare Covers
Centers for Medicare & Medicaid Services [CMS]

Most Popular Items in the Previous Issue

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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2019, 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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