Health & Welfare Plans Newsletter

April 13, 2018

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Jobs

Benefits Associate
Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
in TX

Retirement Plans Specialist
Benefit Plans Plus, LLC [BPP]
in MO, Telecommute

COBRA Eligibility Account Administrator
Alerus Financial
in MN

Financial Consultant
Nolan Financial
in MD, Telecommute

Retirement Distribution Processor
Alerus Financial
in MN

Plan Administrator
Stones River Consulting
in TN, Telecommute

Payroll Manager
S. L. Nusbaum Realty Co.
in VA

Senior Manager - Benefits Compliance
Reynolds American
in NC

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[Official Guidance]

Text of CMS Guidance Ending Special Enrollment Periods for Coverage during Calendar Year 2017 (PDF)
"[Special Enrollment Period (SEP)] requests for 2017 coverage that were received on or before March 31, 2018 may be processed by CMS after April 1, 2018. However, as of April 1, 2018, all new SEP requests to CMS seeking 2017 coverage, with the exception of SEPs issued as a result of an eligibility appeal described [in this guidance], will be given a coverage effective date no earlier than January 1, 2018, if eligible for retroactive coverage."
Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS]

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Unpacking the Final 2019 Payment Notice, Part 3
"CMS made fairly significant changes to the risk adjustment model for plan years 2017 and 2018.... For 2019, CMS will simply recalibrate the 2018 plan year model, with small modifications in the drug classes used in the 2019 plan year adult models and incorporation of 2016 plan year enrollee-level EDGE data."
Katie Keith, in Health Affairs

State Attorneys General File Motion to Intervene in Individual Mandate Litigation
"On April 9, 2018, Democratic attorneys general from 15 states and the District of Columbia, led by California, filed a motion to intervene in a lawsuit initially brought by Republican attorneys general from 20 other states to strike down the [ACA].... The lawsuit at issue, Texas v. United States , was filed by 20 states against [HHS and IRS] ... These states argue that the zeroing out of the individual mandate penalty by Congress in December 2017 is fatal to the ACA. They ask the court to enjoin the entirety of the ACA and its regulations -- or, at a minimum, strike down the law's guaranteed issue and community rating provisions alongside the individual mandate."
Katie Keith, in Health Affairs

Sixth Circuit Allows Health Plan Participant's ERISA Section 510 Interference and Retaliation Claims to Proceed
"[T]he US Court of Appeals for the Sixth Circuit reversed a district court's grant of summary judgment in an employer's favor concerning a health plan participant's claims for interference and retaliation under [ERISA]. In the court's view, a reasonable jury could find that the participant's termination was motivated by the employer's desire to avoid the ongoing medical costs incurred by the participant's dependent." Stein v. Atlas Industries, Inc. , No. 17-3737 (6th Cir. Apr. 9, 2018)]
Thomson Reuters Practical Law

Court Awards Benefits Based on Flawed Eligibility Procedures for Dependent Life/AD&D Insurance
"Although the son lost eligibility for the dependent life and AD&D coverage when he turned 23 in 2014, the employee did not notify her employer or the insurer. Neither the employer nor the insurer notified the employee that her son was no longer eligible for the coverage, and they continued to collect premiums from the employee's wages. After the son's death in 2015, the insurer denied the employee's claim for benefits due to his age and refunded the premiums." [ Frye v. Metropolitan Life Ins. Co. , No. 17-31 (E.D. Ark. Feb. 20, 2018)]
Thomson Reuters / EBIA

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DOL Opinion Letter Provides Guidance on Compensability of FMLA Protected Leave
"[ DOL Opinion Letter FLSA2018-19 ] addressed the issue of FMLA-protected employees who need fifteen-minute breaks every hour. The DOL concluded that such large, frequent break times were non-compensable under both the FLSA and the FMLA because the breaks predominantly benefitted the employee. It noted, however, that these FMLA-protected employees must be compensated for break time provided to all employees, such as two fifteen-minute breaks per day."
FordHarrison

CMS Proposes 'Wind Down' Plan for Federal Exchanges
"[CMS] announced in its Fiscal Year 2019 Performance Budget ... a proposal to 'wind down' its financial support for the federal health insurance exchanges. Specifically, the Budget explains that if Congress repeals the ACA, CMS will withdraw its support of the federal exchanges by plan year 2020."
Sheppard Mullin

CMS Paid Practitioners for Telehealth Services That Did Not Meet Medicare Requirements
"For 69 of the 100 claims in our sample, telehealth services met requirements. However, for the remaining 31 claims, services did not meet requirements.... 24 claims were unallowable because the beneficiaries received services at nonrural originating sites, 7 claims were billed by ineligible institutional providers, 3 claims were for services provided to beneficiaries at unauthorized originating sites ... Medicare could have saved approximately $3.7 million during our audit period if practitioners had provided telehealth services in accordance with Medicare requirements."
Office of Inspector General [OIG], U.S. Department of Health and Human Services [HHS]

[Opinion]

Impact of State and Federal Actions on Health Coverage for Middle-Income Americans
"There are ... steps states could take to stabilize the market for all. They could enact their own individual mandate ... State reinsurance programs under ACA state innovation waivers ... could reduce premiums across the market. State efforts to regulate short-term or association health plans could fend off the destruction of the ACA-compliant market.... In the end, however, the federal government must confront a basic question of fairness."
The Commonwealth Fund

Benefits in General

Voluntary Severance Plans: Case on Point
"A [recent] decision from Delaware's federal district court ... involves a typical [voluntary severance plan (VSP)] structure, and a litigation risk for employers to avoid.... [E]mployers need to be sure the VSP is communicated to eligible employees through FAQs or other means that generally address how the VSP differs from the RIF. Imprecision or ambiguity can open the door for claims that employees were misled or under-informed about their choices." [ Girardot v. The Chemours Co. , No. 16-263 (D. Del. Mar. 29, 2018)]
Paul Hastings LLP

Executive Compensationand Nonqualified Plans

IRS Filing Deadlines and Stock Compensation Planning for 2018
"In any tax season, the recognition of income from stock compensation or an employee stock purchase plan can complicate your return. Examples include income from an NQSO exercise, an ISO or ESPP disqualifying disposition, or the vesting of restricted stock.... [T]his tax season has the potential to be more confusing than most if you sold any stock last year. Issues are especially likely to arise with the cost basis as reported on Form 1099-B and with the tax-return reporting on Form 8949 and Schedule D."
myStockOptions.com

Selected Discussionson the BenefitsLink Message Boards

Church Plan and Definition of Spouse
Can a non-ERISA steeple church 403b plan use a definition of spouse that does not reflect the Windsor amendment to DOMA? So can a church plan define Spouse to mean a person of the opposite sex to whom the participant is married, but then state that for RMD purposes, Spouse reflects the changes to DOMA as of June 26, 2013? The document to be used is a pre-approved plan that does not define Spouse in this manner, and we would need to write this definition into the plan, which could take it out of pre-approved status (which I guess is the second issue). First issue is the legality of using this definition in a church plan.
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BenefitsLink Health & Welfare Plans Newsletter, ISSN no. 1536-9595. Copyright 2018 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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