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February 10, 2003 - 7,947 subscribers
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Bethlehem Steel Might End Retiree Health Benefits
Excerpt: "Bankrupt and only a shadow of its former might, Bethlehem Steel on Friday announced it was seeking bankruptcy court approval to terminate health and life insurance benefits for 95,000 retired workers and their dependents on March 31. The move, seen as essential to the company's bid to sell its assets to International Steel Group, followed news in December that Bethlehem Steel's pension plan was underfunded by $3.2 billion and would be turned over to a government agency." (AP via Lycos News)
Independent Contractor May Sue as Plan Beneficiary Under LTD Policy That Is Subject to ERISA
Turnoy v. Liberty Life Assur. Co. (N.D. Ill. 2003). Excerpt: "EBIA Comment: [Many cases address the issue of] what constitutes enough employer involvement to make voluntary insurance plans subject to ERISA. Given the level of employer involvement here, this was an easy determination for the court. This case also reminds us that ERISA is not just for employees." (EBIA Weekly)
Court Overturns Claim Denial Because of Inconsistent Decisions on Similar Claims
Scaglione v. CIGNA HealthCare of St. Louis Inc. (E.D. Mo. 2002). Excerpt: "[B]oth before and after the date of the participant's claim, the plan had paid several claims for the same back treatment and presumably (according to the court) for the same or similar back ailment. The court rejected the plan's explanation that the payments resulted from a 'coding error' because the payments continued even after the error should have been discovered as part of the participant's claim denial." (EBIA Weekly)
Including Employer-Paid LTD Premiums in Taxable Wages Makes LTD Benefit Payments Nontaxable
IRS Priv. Ltr. Rul. 200305013 (Oct. 18, 2002). Excerpt: "This ruling is consistent with other rulings issued by the IRS ... It confirms the IRS's position that premiums do not have to be paid from an employee's salary on an after-tax payroll deduction basis in order for any LTD benefit payments to be nontaxable to the employee." (EBIA Weekly)
Opinion: Bush Proposal Gets It Right by Getting States Out of Section 529 Business
Excerpt: "Not all the fine print is clear, and Congress could certainly change it, but, at least for now, it looks like Lifetime Savings Accounts could effectively replace 529s. The new accounts would have fewer restrictions, be uniform from coast to coast, and, most importantly, remove the temptation of individual state governments to trap or monopolize their citizens' savings." (Andrew Cassel in The Philadelphia Inquirer)
Developments in Washington State Involving Partial-Day Leave Bank Deductions For Exempt Employees
Excerpt: "Recently, the Washington Supreme Court and the Department of Labor and Industries [indicated] that (1) partial-day deductions from leave banks are generally permissible, but may invalidate exempt status [for salaried employees, from wage and hour laws] in some cases, and (2) deductions from pay may be made in whole-day increments by private employers and in partial-day increments by public employers once a sick leave bank is exhausted." (Davis Wright Tremaine LLP)
Grin and Bear It: Your Options for Dental Benefits
Excerpt: "If you work at a company with more than 500 employees, you're probably among the 175 million Americans who have a dental plan. About 89 percent of large employers offer some type of dental benefit to their workers, according to the National Association of Dental Plans (NADP) ..." (Insure.com)
Association Health Plans Seek Strong Dose of Support
Excerpt: "The idea behind association health plans has been around for decades, but it's enjoying a surge of support from small-business lobbying groups and Bush as insurance premiums rapidly escalate." (Chicago Tribune; one-time registration required)
HIPAA Compliance a Challenge for Employers
Excerpt: "April 14 is the HIPAA compliance deadline for group health plans that are insured with an insurance carrier and pay at least $5 million in premiums annually or that are self-insured and pay at least $5 million in claims annually. For group health plans with less than $5 million in claims or premiums, the compliance deadline is April 14, 2004. Failure to comply with the privacy standards under HIPAA can result in civil or criminal penalties." (Birmingham Business Journal via bizjournals.com; one-time registration required)
Health Spending Growth To Increase Over Next 10 Years, Then Slow Slightly, Report Says
Excerpt: "Private and public health care spending nationwide will likely grow an average of 7.3% between 2002 and 2012 but will slow to a 6.7% growth rate by 2012, according to a CMS report published online in Health Affairs, the Wall Street Journal reports." (KaiserNetwork.org)
Do HIPAA Special Enrollment Rights Arise When Group Health Plan Coverage Is Dropped Voluntarily?
Excerpt: "Our open enrollment takes place next month, and one of our employees would like to drop coverage under our plan and enroll for coverage through her spouse's employer. However, the other plan's open enrollment is several months away. Would our employee be entitled to HIPAA special enrollment rights under the other plan if she dropped her coverage under our plan?" (EBIA Weekly (Question of the Week))
Critics Say Pharmacy Benefit Managers Are Now Part of the Problem
Excerpt: "Today, prescription drug spending is the fastest-growing sector of U.S. medical outlays. And critics now regard [Pharmacy Benefit Managers], the supposed cost cutters, as part of the problem. Many PBMs that once earned most of their revenue by holding down drug costs for health plans now earn a large portion of their money from drug companies that pay them undisclosed rebates and other financial incentives for promoting certain medications." (Knight Ridder via International Foundation of Employee Benefit Plans)
U.S. Healthcare Spending to Double Within a Decade
Excerpt: "Total U.S. health care spending will more than double in the next 10 years to about $3.1 trillion in 2012, outpacing the anticipated rate of economic expansion, the government said Thursday." (The Dallas Morning News via International Foundation of Employee Benefit Plans)
Opinion: Affordability is Basic in Healthcare Reform
Excerpt: "HMO executives around the country are sudden converts to universal health care because they know skyrocketing costs, in the long run, can have only one result -- a universal health-care system that lets government tackle what corporations cannot handle." (The San Francisco Chronicle via the Foundation for Taxpayer and Consumer Rights)
Commentary: Nonprofit 'Front' Groups Enable Drug Industry to Pull Strings from Afar
Excerpt: "[A]n investigation by the AARP Bulletin shows that virtually all of their largest contributions in recent years have come from the same source-- the nation's pharmaceutical industry." (AARP)
Links to Items on Executive Comp, Benefits in General
Auditor-Accountants' Close Link to Executives Is Questioned
Excerpt: "For more than a year, critics have warned that the more money accountants receive for nonaudit work, the more likely they are to let their evaluations of corporate finances be swayed.... The S.E.C. adopted rules just weeks ago restricting the kinds of services that accountants can sell to the companies that they audit. Though the agency requested comment on potential restrictions on services sold to corporate executives, few focused on the issue and no rule has yet been proposed." (New York Times; one-time registration required)
Employee Benefits Library Modified to Reflect New 2003 Guidance
The Employee Benefits Library has now been updated to add links to regulations, revenue rulings, revenue procedures, Joint Committee on Taxation documents, and other items issued in 2003. (BenefitsLink and Carol Calhoun's Employee Benefits Site)
Opinion: Corporate Fat Cats Getting Even Fatter
Excerpt: "The startling hike in CEO pay, which has gone from 42 to 400 times that of the average worker in the past two decades, is 'terribly bad social policy and perhaps even bad morals,' William McDonough, president of the Federal Reserve Bank of New York, has said.... There's no sign yet, though, that CEOs and their boards have gotten religion about a genuine pay-for-performance culture." (David Olive in the Toronto Star)
Costly Questions Arise on Legal Opinions for Tax Shelters
Excerpt: "Like sellers of treasure maps, promoters of tax shelters promise that for a large fee one can navigate a secret route. What clinches these deals is not the chart itself but a second document that appears to warrant that the map is as good as gold. That document is called an opinion letter and it blesses the tax shelter as a legitimate way to reduce taxes." (New York Times; one-time registration required)
Opinion: Nasdaq Letter to Accounting Board on Stock Options Betrays Best Interest of Shareholders
Excerpt: "If Nasdaq had a Minister of Common Sense, a recent letter by its vice chairman, Alfred Berkeley, would've never seen the light of day. Berkeley sent it to the Financial Accounting Standards Board (FASB) in response to its request for public comment on a proposal to consider the expensing of stock options put forth by the International Accounting Standards Board (IASB)." (Bill Mann of the Motley Fool via Yahoo! Finance)
Commentary: Stock Options-- Boon or Simply Boondoggle?
Excerpt: "Corporate America thinks the granting of stock options entitles companies to deduct the value of exercised options from corporate taxes. But conveniently, companies don't claim options as an expense. Why should the corporations get both?" (Bill Fleckenstein on CNBC via MSN Money)
Newly Posted or Renewed Job Openings
Sr. Account Manager
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HR Compensation & Benefits Analyst Administrator
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in CA
Pension Administrator
for Pension Administration Firm
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Pension Representative
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Pension Administrator
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in MD
Newly Posted Webcasts
( Post Yours! )
HIPAA: The Eleventh Hour
on February 20, 2003
presented by International Foundation of Employee Benefit Plans
Participant Loans
on February 24, 2003
presented by ASPA
Newly Posted Conferences
( Post Yours! )
Legal Issues in the Medical Errors Debate
in ALL STATES
February 14, 2003
American Health Lawyers Association
Newly Posted Press Releases
( Post Yours! )
HIPAA: The Eleventh Hour -- Teleweb Seminar Clarifies Compliance Requirements
(International Foundation of Employee Benefit Plans)
Labor Department Proposes Class Exemption On Settlement of Litigation
(U.S. Department of Labor, Employee Benefits Security Administration)
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research
- Employee Benefits Library
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