April 2013

Strengthen Health Plan Privacy Compliance & Risk Management Using Lessons From New OCR Provider & Consumer Tools

April 30, 2013

Get More Key Information By Participating in 5/21 Workshop In LA

The U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) has developed an array of new tools to educate consumers and health care providers about the Health Insurance Portability and Accountability Act (HIPAA) Privacy and Security Rules.

Many consumers are unfamiliar with their rights under the HIPAA Privacy Rule. With that in mind, OCR has posted a series of factsheets, also available in eight languages, to inform consumers about their rights under the HIPAA Privacy Rule. These materials are available on OCR’s website here.

The fact sheets compliment a set of seven consumer-facing videos released earlier this year on OCR’s YouTube channel. An additional video, The HIPAA Security Rule, has been designed for providers in small practices and offers an overview of how to establish basic safeguards to protect patient information and comply with the Security Rule’s requirements. The videos are available on the HHS OCR YouTube Channel at here.

OCR has also launched three modules for health care providers on compliance with various aspects of the HIPAA Privacy and Security Rules, available at Medscape.org:

Patient Privacy: A Guide for Providers at here;
HIPAA and You: Building a Culture of Compliance here; and
Examining Compliance with the HIPAA Privacy Rule here.

The Medscape modules offer free Continuing Medical Education (CME) credits for physicians and Continuing Education (CE) credits for health care professionals.

Although the materials are primarily consumer and provider focused, health plans and their sponsors, fiduciaries, administrators, business associates and others in the health plan workforce should review and incorporate the materials and principles contained in these materials as part of their own HIPAA compliance efforts. With the deadline to comply with recent amendments to the HIPAA rules in September, 2013 and enforcement and penalties rising, the insights and resources provided these rules can help strengthen compliance efforts.

Participate In 5/21 Workshop In LA To Get Other Key Information Needed To Update Compliance & Risk Management

With the September 23, 2013 enforcement date of the new Omnibus HIPAA Rulemaking changes rapidly approaching and privacy and data breach penalties and enforcement rising, health care providers, health plans, health care clearinghouses and their business associates must get moving to update business associate contracts, policies and notices and processes to meet changing HIPAA rules while managing ongoing compliance and risks.

Armed with the latest insights from serving as the scribe for the ABA JCEB annual agency meeting with the Office of Civil Rights (OCR), attorney and author Cynthia Marcotte Stamer will discuss required changes and other recommended steps and strategies that covered entities and their business associates should take to maintain HIPAA compliance and manage HIPAA and other related risks in light of the Omnibus HIPAA Rulemaking changes, new OCR guidance for health care providers about disclosures to avert threats to health or safety, recent audit and enforcement activities and other changing risks and responsibilities including:

The latest on OCR’s regulatory guidance, audit and investigation and enforcement rules, actions and strategies and their implications on covered entities and business associates;
Changes to breach notification rules and their implications on covered entities and their business associates;
Practical implications of new rules on who is covered and their responsibilities;
Required and recommended updates to policies, business associate and other agreements, privacy notices and other HIPAA compliance arrangements;
Effective training and other risk management strategies;
Planning for, investigating and mitigating PHI privacy breaches and other compliance concerns under new rules other selected events; and
Other selected strategies for coordinating HIPAA and other privacy and data breach responsibilities and risk management; and
Participant questions.

To register, review the agenda, get details on sponsorship or for other information, see here.

For Help or More Information

If you need help with the SBC or other 2014 health plan decision-making or preparation, or with reviewing and updating, administering or defending your group health or other employee benefit, human resources, insurance, health care matters or related documents or practices, please contact the author of this update, Cynthia Marcotte Stamer.

A Fellow in the American College of Employee Benefit Council, immediate past Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Group and current Co-Chair of its Welfare Benefit Committee, Vice-Chair of the ABA TIPS Employee Benefits Committee, a council member of the ABA Joint Committee on Employee Benefits, and past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer is recognized, internationally, nationally and locally for her more than 25 years of work, advocacy, education and publications on cutting edge health and managed care, employee benefit, human resources and related workforce, insurance and financial services, and health care matters including extensive experience on HIPAA and other privacy and data security issues.

A board certified labor and employment attorney widely known for her extensive and creative knowledge and experienced with these and other employment, employee benefit and compensation matters, Ms. Stamer continuously advises and assists employers, employee benefit plans, their sponsoring employers, fiduciaries, insurers, administrators, service providers, insurers and others to monitor and respond to evolving legal and operational requirements and to design, administer, document and defend medical and other welfare benefit, qualified and non-qualified deferred compensation and retirement, severance and other employee benefit, compensation, and human resources, management and other programs and practices tailored to the client’s human resources, employee benefits or other management goals. A primary drafter of the Bolivian Social Security pension privatization law, Ms. Stamer also works extensively with management, service provider and other clients to monitor legislative and regulatory developments and to deal with Congressional and state legislators, regulators, and enforcement officials concerning regulatory, investigatory or enforcement concerns.

Extensively published and a popular speaker on HIPAA and other data security matters, Ms. Stamer works extensively with health care providers, health plans, employers, insurance and financial services, technology and other clients on privacy, data seurity and other privacy and cybercrime concerns. She also serves as the Scribe for the ABA JCEB Agency Techical Sessions Meetings with the Office of Civil Rights which occur each May in Washington, D.C.

Recognized in Who’s Who In American Professionals and both an American Bar Association (ABA) and a State Bar of Texas Fellow, Ms. Stamer serves on the Editorial Advisory Board of Employee Benefits News, the editor and publisher of Solutions Law Press HR & Benefits Update and other Solutions Law Press Publications, and active in a multitude of other employee benefits, human resources and other professional and civic organizations. She also is a widely published author and highly regarded speaker on these matters. Her insights on these and other matters appear in the Bureau of National Affairs, Spencer Publications, the Wall Street Journal, the Dallas Business Journal, the Houston Business Journal, Modern and many other national and local publications. You can learn more about Ms. Stamer and her experience, review some of her other training, speaking, publications and other resources, and register to receive future updates about developments on these and other concerns from Ms. Stamer here.

Other Resources

If you found this update of interest, you also may be interested in reviewing some of the other updates and publications authored by Ms. Stamer available including:

For important information about this communication click here. THE FOLLOWING DISCLAIMER IS INCLUDED TO COMPLY WITH AND IN RESPONSE TO U.S. TREASURY DEPARTMENT CIRCULAR 230 REGULATIONS. ANY STATEMENTS CONTAINED HEREIN ARE NOT INTENDED OR WRITTEN BY THE WRITER TO BE USED, AND NOTHING CONTAINED HEREIN CAN BE USED BY YOU OR ANY OTHER PERSON, FOR THE PURPOSE OF (1) AVOIDING PENALTIES THAT MAY BE IMPOSED UNDER FEDERAL TAX LAW, OR (2) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY TAX-RELATED TRANSACTION OR MATTER ADDRESSED HEREIN.

Comments Off on Strengthen Health Plan Privacy Compliance & Risk Management Using Lessons From New OCR Provider & Consumer Tools | Employee Benefits, Employers, ERISA, Excise Tax, Health Plans, Human Resources, Insurance, Tax, Uncategorized | Tagged: Affordable Care Act, annual limits, Business Associate, Covered Entity, Employee Benefits, ERISA, Health Insurance, Health Plans, HIPAA, Isurance, Personal Health Information, PHI, Privacy, RE, SBC, Summary of Benefits and Communications | Permalink
Posted by Cynthia Marcotte Stamer

Changing Plan Years Won’t Extend Health Plan’s Affordable Care Act Annual Limit Waiver Eligibility

April 29, 2013

Changing plan years won’t extend the period that a group health plan or group or individual health insurance policy can qualify for a waiver of the annual limitation restrictions (Annual Limit Rule) of the Patient Protection & Affordable Care Act (Affordable Care Act) according to new guidance issued by the US Departments of Health & Human Services (HHS), Treasury (IRS) and Labor (DOL)(collectively, the Agencies) on April 29, 2013.

PHS §2711 as amended by the Affordable Care Act generally prohibit nongrandfathered group health plans and health insurance issuers offering group or individual health insurance coverage from imposing lifetime or annual limits on the dollar value of essential health benefits within the meaning of Affordable Care Act § 1302(b) but allow ‘‘restricted annual limits’’ with respect to essential health benefits for plan years (in the individual market, policy years) beginning before January 1, 2014 (hereafter, the Annual Limit Rule).

Interim regulations (IFR) implementing this Annual Limit Rule allowed the Secretary of HHS temporarily to waive compliance with the Annual Limit Rule for certain group health plans that showed that compliance with the IFR would result in a significant decrease in access to benefits or a significant increase in premiums and timely applied for and received a waiver in accordance with guidance established by HHS. See 26 CFR 54.9815-2711T; 29 CFR 2590.715-2711; 45 CFR 147.126. For a listing of relevant guidance, see here.

While HHS no longer allows new applications for waivers, certain group health plans previously timely applied and qualified to for waiver of compliance for the Annual Limit Rule for their group health plan for the plan or policy year in effect when the plan or issuer applied for the waiver. Many of these group health plans later extended and currently continue to qualify for relief from the obligation to comply with the Annual Limit Rule based on extensions of that waiver.

According to FAQs About Affordable Care Act Implementation (Part XV), changes in plan or policy years made subsequent to the application for an Affordable Care Act Annual Limitation waiver do not extend the expiration date of a waiver.

In the FAQ, the Agencies state changes in plan or policy years made after the waiver is obtained and while a waiver remains in effect do not change the termination date of an otherwise applicable waiver. Rather, Annual Limit Rule waivers are granted based on the date of the plan or policy year in effect when the initial application was submitted regardless of whether the plan or issuer later amends its plan or policy year. That said, the FAQ confirms that waiver recipients may end the waiver at any time prior to its otherwise applicable approved expiration date.

The Guidance nixes hopes of many group health plans and insurers that obtained waivers that they could extend temporarily their ability to avoid complying with the Annual Limit Rule by cutting short their current plan or policy year so as as to cause a new plan year to start before January 1, 2014. The idea suggested by some was that starting a plan year mid-year during 2013 would push back the start of the first plan or policy year beginning after December 31, 2013, and thereby delay the deadline for complying with the Annual Limit Rule until a later day in 2014. Today’s Guidance makes clear that the Agencies do not intend to allow such delays. Therefore, group health plans and health insurance issuers with current waivers should be ready to begin complying with the Annual Limit Rule no later than the date that their existing waiver is scheduled to expire and budget accordingly.

For Help or More Information

Other Resources

If you found this update of interest, you also may be interested in reviewing some of the other updates and publications authored by Ms. Stamer available including:

Comments Off on Changing Plan Years Won’t Extend Health Plan’s Affordable Care Act Annual Limit Waiver Eligibility | Employee Benefits, Employers, ERISA, Excise Tax, Health Plans, Human Resources, Insurance, Tax, Uncategorized | Tagged: Affordable Care Act, annual limits, Employee Benefits, ERISA, Health Insurance, Health Plans, Isurance, RE, SBC, Summary of Benefits and Communications | Permalink
Posted by Cynthia Marcotte Stamer

Deadline To Send ACA Summary of Benefits & Coverage Adds Pressure To Finalize 2014 Plan Designs As Agencies Add MEC & MV Disclosures To SBC

April 25, 2013

Employer and union group health plan sponsors and insurers of group and individual health plans (Health Plans) agonizing over 2014 health plan design decisions need to keep in mind that impending deadlines to update and deliver required Summary of Benefits and Communications (SBC) disclosures mandated by the Patient Protection and Affordable Care Act (Affordable Care Act) shorten the time to finalize decisions including new requirements to disclose whether the Affordable Health Plan-covered Health Plans provide “minimum essential coverage” (MEC) and “minimum value” within the meaning of the Affordable Care Act.

The Affordable Care Act’s requirement that Health Plans distribute updated SBCs before the beginning of the enrollment period for coverage to be provided in 2014 creates added urgency and pressure for Health Plans and their employer and other sponsors to finalize and implement their decisions on their Health Plans 2014 plan designs and coverages to allow adequate lead time to prepare and deliver the required SBCs for 2014.

The Departments of Health & Human Services (HHS), Labor (DOL) and Treasury (IRS)(collectively, the Agencies) announced April 23, 2013 that SBCs for periods of coverage after December 31, 2013 must disclose if the Health Plans provide MEC and minimum value. Health Plans, their sponsors, fiduciaries, and insurers generally will need to update their Health Plans’ SBCS to include these disclosures as well as to incorporate other changes necessary to accurately disclose other plan design changes made to post-December 31, 2013 coverage before the enrollment period begins. Plan sponsors planning changes to their health plans must allow sufficient lead time to finalize plan designs and contracts, amend plan documents, make MEC and minimum value determinations, and then timely update and distribute the SBC in accordance with the SBC rules. This means that most plan sponsors of Health Plans have much less time than historically used to finalize their decisions.

ACA SBC Mandate Overview

As amended by the Affordable Care Act amended the Public Health Services Act (PHS) § 2715, Employee Retirement Income Security Act (ERISA) § 715 and the Internal Revenue Code (Code) §§ 9815 require that Health Plans provide a SBC and a “Uniform Glossary” that “accurately describes the benefits and coverage under the applicable plan or coverage” in a way that meets the format, content and other detailed SBC standards set for the Affordable Care Act as implemented by the Departments regulatory guidance.

The Summary of Benefits and Coverage and Uniform Glossary Final Regulation (Final Regulation) implementing this requirement published February 14, 2012 generally requires Health Plans at specified times including before the first offer of coverage under the Plan as well as following certain material changes to the Plan. For Health Plans providing group health plan coverage, FAQs About Affordable Care Act Implementation (Part VII)[*] set the deadline for Health Plan to deliver a SBC as follows, while at the same time indicating that the Departments would not impose penalties on plans and issuers “working diligently and in good faith” to provide the required SBC content in an appearance consistent with the Final Regulations:

To covered persons enrolling or re-enrolling in an open enrollment period (including late enrollees and re-enrollees) as the first day of the first open enrollment period that begins on or after September 23, 2012; and
For individuals enrolling in coverage other than through an open enrollment period (including individuals who are newly eligible for coverage and special enrollees) as the first day of the first plan year that begins on or after September 23, 2012. See FAQs About Affordable Care Act Implementation (Part VIII).

The Final Regulation and other existing guidance generally dictates that Health Plans follow a required template for providing the SBC and accompanying glossary. When publishing the Final Regulation, the Departments also published the required SBC template form (2013 SBC Template) and instructions for Health Plans to use to prepare and provide the required SBC for coverage beginning before January 1, 2014 and promised updated guidance and templates for use in providing SBCs for post-2013 coverage. While the Agencies clarified certain other details about the SBC rules, they did not materially change the required content or form of the 2013 SBC Template until their April 23, 2013 release of FAQs About Affordable Care Act Implementation (Part XIV). See e.g. FAQs About Affordable Care Act Implementation Part IX and Part X.

FAQ Part XIV Updates To SBC

FAQs About Affordable Care Act Implementation (Part XIV) published April 23, 2013 announces the updated required 2014 SBC Template that the Agencies are requiring to SBCs for periods of health coverage from January 1, 2014 to December 31, 2014. Along with the 2014 SBC Template, the Agencies also published 2014 Sample Completed SBC, which provides an example of a SBC completed for a hypothetical health plan prepared by the Agencies.

The 2014 SBC Template updates the 2013 SBC Template and Sample Completed Template to add information the Agencies believe individuals eligible for Health Plan coverage should know in light of the impending implementation of the individual shared responsibility requirements of Internal Revenue Code (Code) § 5000A and the employer shared responsibility rules of Code § 4980H commonly called the Affordable Care Act’s “pay-or-play” rules. These were the “penalty” provisions that the Supreme Court ruled are taxes last Summer.

Rationale For SBC Changes

Beginning in 2014, Code § 4980H generally requires employers of 50 or more full-time employees to pay a penalty if the employer fails to offer a group health plan providing MEC and meeting the “minimum value” requirements of the Affordable Care Act. Code § 36B(c)(2)(C)(ii) provides that an employer-sponsored Health Plan provides MV if the ratio of the share of total costs paid by the Health Plan relative to the total costs of covered services is no less than 60% of the anticipated covered medical spending for covered benefits paid by a group health plan for a standard population, computed in accordance with the plan’s cost-sharing, and divided by the total anticipated allowed charges for covered benefits provided to a standard population is no less than 60%. See Patient Protection and Affordable Care Act: Standards Related to Essential Health Benefits, Actuarial Value, and Accreditation Regulation. HHS has published a MV Calculator for use in calculating this percentage.

Meanwhile, Code § 5000A generally imposes a penalty tax on individuals that fail to maintain enrollment in “minimum essential coverage” (MEC) within the meaning of Code § 5000A(f) and not otherwise exempt under Code § 5000A(d).

SBC Changes Required By FAQs XIV In Response To Pay-Or-Play Rules

Since choosing to enroll in an employer-sponsored health plan providing MEC is one of the options that individuals can choose to avoid incurring the individual penalty under Code § 5000A, the Agencies feel that the SBC should disclose whether the offered Health Plan provides MEC and provides the requisite Minimum Value. Accordingly, the 2014 SBC Template requires that the SBC disclose if the Health Plan provides MEC and meets Minimum Value. The Agencies did not make any changes to the uniform glossary, Instructions for Completing the SBC, “Why This Matters” language, or to the coverage examples for the SBC.

In general, the SBC requires that Health Plans update their existing SBCs to make the following disclosures for post-December 31, 2013 periods of coverage:

”Does this Coverage Provide Minimum Essential Coverage?

The Affordable Care Act requires most people to have health care coverage that qualifies as “minimum essential coverage.” This plan or policy [does/does not] provide minimum essential coverage.

Does this Coverage Meet the Minimum Value Standard?

In order for certain types of health coverage (for example, individually purchased insurance or job-based coverage) to qualify as minimum essential coverage, the plan must pay, on average, at least 60 percent of allowed charges for covered services. This is called the “minimum value standard.” This health coverage [does/does not] meet the minimum value standard for the benefits it provides.”

Health Plans will need to finalize plan designs and conduct the necessary analysis to decide the correct way to complete this language, then update SBCs to be provided for post-December 31, 2013 periods of coverage to include the required language appropriately completed based on the findings. Where the design of the 2014 SBC is too advanced already to do this, the Guidance allows Health Plans to provide the required language by sending the language in a supplemental SBC communication. However, most Health Plans will want to avoid the added cost and expense of the printing and distribution of this notification.

Other SBC Requirement Clarifications in FAQs XIV

While the 2014 SBC Template remains unchanged other than for the additional required statements about the MEC and minimum essential coverage, FAQs XIV does provide various other helpful clarifications about how to complete the 2014 SBC Template about the applicability of lifetime and annual limits in light of the Affordable Care Act’s restrictions on these limitations.

In addition, FAQs XIV also continues for another year the guidance in:

Affordable Care Act Implementation FAQs Part VIII, Q2 (regarding the Departments’ basic approach to implementation of the SBC requirements during the first year of applicability) for another year;
Affordable Care Act Implementation FAQs Part IX, Q1 regarding the circumstances in which an SBC may be provided electronically and associated enforcement relief;
Affordable Care Act Implementation FAQs Part IX, Q8 (regarding penalties for failure to provide the SBC or uniform glossary);
Affordable Care Act Implementation FAQs Part IX, Q9 (regarding the coverage examples calculator); and related information related to use of the coverage examples calculator;
Affordable Care Act Implementation FAQs Part IX, Q10 (regarding an issuer’s obligation to provide an SBC with respect to benefits it does not insure); and
Affordable Care Act Implementation FAQs Part IX, Q13 (regarding expatriate coverage);
Current enforcement relief about the Special Rule contained in the Instruction Guides for Group and Individual Coverage and about Medicare Advantage Plans contained in Affordable Care Act Implementation FAQs Part X, Q1
Continues Affordable Care Act Implementation FAQs Part VIII, Q5 regarding use of carveout arrangements “until further guidance is issued.”
Extends to September 23, 2014 existing relief for plans and issuers with respect to an insured health insurance product is not being actively marketed where the health insurance issuer has not actively marketed the product at any time on or after September 23, 2012 provided the SBC is provided for that product no later than September 23, 2014; and
The anti-duplication rule for student group health coverage in the Final SBC regulations.

SBC Delivery Deadline Means Time Short To Finalize 2014 Plan Designs

Employer and other health plan sponsors, insurers, administrators and others involved in 2014 Health Plan decisions and preparations must take into account the deadline for distributing the SBC before the enrollment period begins and allow adequate lead time to properly finalize their Health Plan design decisions and the analysis required to accurately prepare and deliver the SBC.

Since Health Plan design decisions must be finalized to properly prepare the newly added MEC and minimum value and other required SBC disclosures, the need to prepare and distribute the SBC by the beginning of enrollment periods for post-December 31, 2013 periods of coverage means time running short to finalize 2014 plan designs. Employer and other Health Plan sponsors and others involved in 2014 Health Plan decision-making must take into account the SBC requirements and deadlines to ensure that they allow adequate time to complete the analysis and other preparations necessary timely to prepare and distribute SBCs in respond to the design decisions ultimately elected.

For Help or More Information

Other Resources

If you found this update of interest, you also may be interested in reviewing some of the other updates and publications authored by Ms. Stamer available including:

Comments Off on Deadline To Send ACA Summary of Benefits & Coverage Adds Pressure To Finalize 2014 Plan Designs As Agencies Add MEC & MV Disclosures To SBC | Employee Benefits, Employers, ERISA, Excise Tax, Health Plans, Human Resources, Insurance, Tax, Uncategorized | Tagged: Affordable Care Act, Employee Benefits, ERISA, Health Insurance, Health Plans, Isurance, RE, SBC, Summary of Benefits and Communications | Permalink
Posted by Cynthia Marcotte Stamer

Study Finds Down Economy, Not Health Care Reform Accounts For Slower Health Care Cost Increases; Projects Renewed Costs When Economy Improves

April 22, 2013

Bad economic times, and not health care reform, account for the record slowdown in U.S. health care spending, according to a new Kaiser Family Foundation study, Assessing the Effects of the Economy on the Recent Slowdown in Health Spending (Study). The Study findings call into question assertions by Obama Administration officials crediting health care reform, pressure on health plans applied by the Obama Administration officials and other regulatory and enforcement efforts with reducing the curve on health care costs.

According to Kaiser Foundation, government statistics show that the period from 2009-2011 had the slowest growth (3.9%) in health care expenditures since the government began tracking health expenditure data in 1960.

The Study that evaluated how the economy affects U.S. health spending concluded that economic factors beyond the health system explain 77 percent of the slowdown and predicts more rapid growth when the economy strengthens. Meanwhile, the Study credits only 23 percent of the slowdown in the growth of expenditures as resulting from higher deductibles and other cost-sharing or other health care system changes.

Based on these findings, the Study warns that Americans should expect health care costs to resume increasing in future years after lags resulting from the economic slowdown resolve.

“The problem of health costs is not solved and we need to be realistic that health spending increases will return to more typical levels as the economy improves,” Foundation President and CEO Drew E. Altman said. “But the analysis also shows that the economy is not the entire story, and if we could shave even a percentage point or more off annual health care spending increases, we could save trillions of dollars over the next decade.”

Researchers at the Kaiser Family Foundation prepared the Study by conducting statistical modeling and analysis of 50 years of health spending and economic trends using data on the U.S. economy and national health care expenditures data from actuaries at the Centers for Medicare and Medicaid Services through 2011, and from the Center for Sustainable Health Spending at the Altarum Institute for 2012.

Join Discussion By Participating In Project COPE: The Coalition On Patient Empowerment & Its Coalition on Responsible Health Policy

Want to share and exchange ideals and information about health care and collaborate about opportunities to make it work? Sharing and promoting the use of practical practices, tools, information and ideas that patients and their families, health care providers, employers, health plans, communities and policymakers can share and offer to help patients, their families and others in their care communities to understand and work together to better help the patients, their family and their professional and private care community plan for and manage these needs is the purpose of Project COPE, The Coalition on Patient Empowerment & It’s Affiliate, the Coalition on Responsible Health Policy.

The best opportunity to improve access to quality, affordable health care for all Americans is for every American, and every employer, insurer, and community organization to seize the opportunity to be good Samaritans. The government, health care providers, insurers and community organizations can help by providing education and resources to make understanding and dealing with the realities of illness, disability or aging easier for a patient and their family, the affected employers and others. At the end of the day, however, caring for people requires the human touch. Americans can best improve health care by not waiting for someone else to step up: Step up and help bridge the gap when you or your organization can. Speak up to help communicate and facilitate when you can. Building health care neighborhoods filled with good neighbors throughout the community is the key.

The outcome of this latest health care reform push is only a small part of a continuing process. Whether or not the Affordable Care Act makes financing care better or worse, the same challenges exist. The real meaning of the enacted reforms will be determined largely by the shaping and implementation of regulations and enforcement actions which generally are conducted outside the public eye. Americans individually and collectively clearly should monitor and continue to provide input through this critical time to help shape constructive rather than obstructive policy. Regardless of how the policy ultimately evolves, however, Americans, American businesses, and American communities still will need to roll up their sleeves and work to deal with the realities of dealing with ill, aging and disabled people and their families. While the reimbursement and coverage map will change and new government mandates will confine providers, payers and patients, the practical needs and challenges of patients and families will be the same and confusion about the new configuration will create new challenges as patients, providers and payers work through the changes.

We also encourage you and others to help develop real meaningful improvements by joining Project COPE: Coalition for Patient Empowerment here by sharing ideas, tools and other solutions and other resources. The Coalition For Responsible Health Care Policy provides a resource that concerned Americans can use to share, monitor and discuss the Health Care Reform law and other health care, insurance and related laws, regulations, policies and practices and options for promoting access to quality, affordable healthcare through the design, administration and enforcement of these regulations.

For Help or More Information

If you need help reviewing and updating, administering or defending your group health or other employee benefit, human resources, insurance, health care matters or related documents or practices to respond to emerging health plan regulations, monitoring or commenting on these rules, defending your health plan or its administration, or other health or employee benefit, human resources or risk management concerns, please contact the author of this update, Cynthia Marcotte Stamer.

A Fellow in the American College of Employee Benefit Council, immediate past Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Group and current Co-Chair of its Welfare Benefit Committee, Vice-Chair of the ABA TIPS Employee Benefits Committee, a council member of the ABA Joint Committee on Employee Benefits, and past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer is recognized, internationally, nationally and locally for her more than 24 years of work, advocacy, education and publications on cutting edge health and managed care, employee benefit, human resources and related workforce, insurance and financial services, and health care matters.

A board certified labor and employment attorney widely known for her extensive and creative knowledge and experienced with these and other employment, employee benefit and compensation matters, Ms. Stamer continuously advises and assists employers, employee benefit plans, their sponsoring employers, fiduciaries, insurers, administrators, service providers, insurers and others to monitor and respond to evolving legal and operational requirements and to design, administer, document and defend medical and other welfare benefit, qualified and non-qualified deferred compensation and retirement, severance and other employee benefit, compensation, and human resources, management and other programs and practices tailored to the client’s human resources, employee benefits or other management goals. A primary drafter of the Bolivian Social Security pension privatization law, Ms. Stamer also works extensively with management, service provider and other clients to monitor legislative and regulatory developments and to deal with Congressional and state legislators, regulators, and enforcement officials on regulatory, investigatory or enforcement concerns.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides business risk management, legal compliance, management effectiveness and other resources, training and education on human resources, employee benefits, compensation, data security and privacy, health care, insurance, and other key compliance, risk management, internal controls and other key operational concerns. If you find this of interest, you also be interested in exploring other Solutions Law Press, Inc. ™ tools, products, training and other resources here.

Other Helpful Resources & Other Information

We hope that this information is useful to you. If you found these updates of interest, you also be interested in one or more of the following other recent articles published on the Coalition for Responsible Health Care Reform electronic publication available here, our electronic Solutions Law Press Health Care Update publication available here, or our HR & Benefits Update electronic publication available here . You also can get access to information about how you can arrange for training on “Building Your Family’s Health Care Toolkit,” using the “PlayForLife” resources to organize low-cost wellness programs in your workplace, school, church or other communities, and other process improvement, compliance and other training and other resources for health care providers, employers, health plans, community leaders and others here. If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail by creating or updating your profile here. You can reach other recent updates and other informative publications and resources.

Recent examples of these publications include:

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail by creating or updating your profile at here.

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Posted by Cynthia Marcotte Stamer

IRS Witholding Calculator Can Help Avoid Over & Underwithholding

April 21, 2013

If you have employees that had too much or too little tax taken out of their paychecks, refer them to this new YouTube video about using the IRS withholding calculator at inbox:body:0000000001510000020000000800000000000000:Read#Third.

For Help With These Or Other Matters

If you need assistance in conducting a risk assessment of or responding to an IRS, Labor Department or other legal challenges to your organization’s labor and employment, employee benefit or compensation practices, please contact the author of this update, attorney Cynthia Marcotte Stamer.

Ms. Stamer has more than 24 years experience advising and representing employer, employee benefit and other clients before the Internal Revenue Service, the Department of Labor, Immigrations & Customs, and other agencies, private plaintiffs and others on worker classification and related human resources, employee benefit, internal controls and risk management matters.

A featured presenter in the recent “Worker Classification & Alternative Workforce: Employee Plans & Employment Tax Challenges” teleconference sponsored by the American Bar Association Joint Committee on Employee Benefits, Ms. Stamer also is a widely published author and highly regarded speaker on these and other employee benefit and human resources matters who is active in many other employee benefits, human resources and other management focused organizations.

A Fellow in the American College of Employee Benefits Council, the immediate past Chair and current Welfare Benefit Committee Co-Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Committee, a Council Representative on the ABA Joint Committee on Employee Benefits, the Vice Chair of the ABA TIPS Employee Benefits Committee, the Gulf States Area TEGE Council Exempt Organizations Coordinator, past-Government Affairs Committee Legislative Chair for the Dallas Human Resources Management Association, past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, and the editor and publisher of Solutions Law Press HR & Benefits Update and other Solutions Law Press Publications, She also is recognized for her publications, industry leadership, workshops and presentations on these and other human resources concerns and regularly speaks and conducts training on these matters. Her insights on these and other matters appear in the Bureau of National Affairs, Spencer Publications, the Wall Street Journal, the Dallas Business Journal, the Houston Business Journal, and many other national and local publications.

You can learn more about Ms. Stamer and her experience, find out about upcoming training or other events, review some of her past training, speaking, publications and other resources, and register to receive future updates about developments on these and other concerns from Ms. Stamer at www.CynthiaStamer.com.

About Solutions Law Press

Solutions Law Press™ provides business risk management, legal compliance, management effectiveness and other resources, training and education on human resources, employee benefits, compensation, data security and privacy, health care, insurance, and other key compliance, risk management, internal controls and other key operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press resources available at www.solutionslawpress.com.

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Comments Off on IRS Witholding Calculator Can Help Avoid Over & Underwithholding | 105(h), Cafeteria Plans, COBRA, Corporate Compliance, Disability, Disability Plans, Discrimination, Employee Benefits, Employers, Employment Tax, ERISA, Fair Labor Standards Act, family leave, FMLA, Government Contractors, Health Plans, HIPAA, Human Resources, I-9, Immigration, Income Tax, Insurance, Internal Controls, Internal Investigations, Labor Management Relations, Leave, medical leave, Military Leave, Nonresident aliens, OSHA, Payroll Tax, Restructuring, Retirement Plans, Tax, Tax Qualification, Unemployment Benefits, Unemployment Insurance, Union, VEVRRA, Wage & Hour | Tagged: contract labor, Determination Letters, Employee, Employee Benefits, Independent Contractor, leased employee, misclassificaton, payroll tax, plan qualification, Retirement Plans, staffing, Tax, Worker Classification | Permalink
Posted by Cynthia Marcotte Stamer

Responding To West, Texas, Boston & Other Tragedies: Information and Reassurance Resources

April 18, 2013

As our concern and prayers go out to the citizens of West, Texas struggle to deal with the injuries and damages resulting from the April 17, 2013 explosion in the wake of the Boston bombing tragedy earlier in the week, the Solutions Law Press, Inc. is sharing the following resources and information provided by Congressman Sam Johnson’s office, which may be of help to individuals dealing with or affected by this heartbreaking tragedy in Texas.

Emergency information

Family Phone Lines:
To check on injured residents admitted to Hillcrest Baptist Medical Center call (254) 202-1100

For family inquiries about patients at Scott & White call (888) 394-4947

Family inquiries about patients at Providence Health Center (254) 761-7200

Hotline for information on victims and survivors (254) 826-4115

Blood Donations:
Carter Blood Care Center will accept donations beginning at 9 a.m. Thursday in Waco

Providence Hospital will hold a blood drive between 11 am-5 pm

Scott & White Blood Donation Center accept donations starting at 8 am

Shelter:
First Baptist Church of Lott has room for anyone needing a place to stay. Call (254) 829-2321

The Aquilla ISD opened facilities for those seeking refuge. Please report to the gym entrance.

Blair’s Cove Apartments in Waco offering housing to any West residents affected by the explosion at 2425 S. 21st St. (254) 447-0810

Latham Springs Baptist Camp is open to displaced residents at 134 Private Road 223 in Aquilla

The Abbott gym is open to displaced residents

Valley mills Nursing Home has rooms available for nursing home residents if placement is needed for any of the West nursing home residents. Call 254-932-6288.

First Baptist Church of Gholson is open for anyone who needs a place to stay

Gholson ISD open for those seeking shelter

Brazos Meadows Baptist Church at 625 S. Hewitt Dr., next to Castleman Creek Elementary will be open for anyone who needs a place to stay

Antioch Community Church at 501 North 20th Street in Waco is open to displaced residents

Alliance Auto Auction between Elm Mott and West on I-35 is open to anyone needing a place to stay

Penelope School is open for displaced residents at 309 Avenue D

Central United Methodist Church off Bagby Avenue near Hillcrest Baptist Medical Center is open overnight

American Legion Post 121 in Elm Mott is open for displaced residents

Sykora Family Ford in West has opened for residents who need a safe place to rest

Town Hall Estates in Hillsboro was taking in displaced residents

Google Document for Housing

Medical Assistance:
Central Texas Urgent Care clinics in Hewitt and Lacy Lakeview will remain open all night to treat those with minor injuries

HEB Pharmacy in the Woodway area is staying open all night to help accommodate West residents who may be injured and need prescriptions filled

Donation Locations:
The Extraco Events Center will be setting up to take donations starting tomorrow at 9:00 am. For information call 254-776-1660

The Home Depot store in Bellmead will be open all night for those who need plywood, generators, etc.

Both Peas & Tots and Smarty Pants consignment stores in Waco are accepting clothing donations in all sizes for those in West

Axtell High School will be taking any kind of donations at the school tomorrow! Please donate anything! The PALS organization is taking all donations and will be accepting tomorrow and Friday during school.

BCBSTX Member Resources

Earlier today, Blue Cross Blue Shield of Texas also shared an e-mail with its employer group plan sponsors containing resources for members of plans it insures or administers.

BCBSTX News Alert: April 18, 2013Assistance Available for Members Impacted by Explosion at West, Texas, Fertilizer PlantDuring a crisis situation, you never know where you may end up. We at Blue Cross and Blue Shield of Texas (BCBSTX) understand that a number of our members living, working or traveling in the West, Texas, area may be impacted and/or displaced as a result of the explosion at the West Fertilizer Co. plant that occurred yesterday,
April 17.BCBSTX is prepared to assist our members by:

Explaining the options for accessing care
Helping to locate a network provider, hospital or dialysis center
Assisting with early refills of prescription medications
Working to ensure transition of care or continuity of care needs are met
Accessing member identification information

Please share this information with your employees:

For an emergency situation, members should go directly to the nearest hospital.
For non-emergency care needs, members can call the customer service number on the back of their member ID card to locate a network provider.
When arriving at the participating doctor’s office or hospital, the member will need to present his/her BCBSTX ID card.
If a member does not have his/her member ID card, needs help finding care or has coverage questions, our customer service representatives will assist them. They can also log in to Blue Access for Members^SM on the BCBSTX website or access our mobile site to search for a doctor, access their ID card and more.
BlueCard^® participants (indicated by a suitcase on the member ID card) can call the National BlueCard access number to be routed to the appropriate customer service center.

Watch for continuing updates as we respond to the needs of our groups and members impacted by this tragedy. Please contact your BCBSTX account representative should you have any questions.

Important Blue Cross Phone Numbers

BCBSTX Customer Service for all group plan members: 800-521-2227
BCBSTX Customer Service for individual/family policyholders: 888-697-0683
BCBSTX Customer Service for Medicare Supplement policyholders: 800-654-9390
Federal Employee Information: 800-442-4607
National BlueCard access: 800-810-BLUE (2583)

The tragedies in West and Boston are felt across the nation and the world. The direct impact that these events have on the victims and their families is unimaginable and overwhelming. Beyond the impact to those injured or killed and their families and friends, the unexpected and devastating losses and powerlessness stemming from these events also significantly impact those who never knew the victims. As governments, health care providers, and communities work to redress the existing fallout and strengthen our defenses against future similar events and the media obsessively covers all real and suspected development, it is to be expected that these resultant concerns will draw the attention of children as well as adults across the nation. Business and community leaders should expect that this absorption will naturally result in distraction and concern. In addition to exhibiting empathy for the victims and understanding for the horrid distraction of those observers impacted less directly, consider the opportunity to offer reassurance by reminding those in your workplaces and communities of the planning, resources and procedures that your community and organization has in place to prevent, mitigate and respond in the event of a family or community disaster.

For Help or More Information

A Fellow in the American College of Employee Benefit Council, immediate past Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Group and current Co-Chair of its Welfare Benefit Committee, Vice-Chair of the ABA TIPS Employee Benefits Committee, a council member of the ABA Joint Committee on Employee Benefits, and past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer is recognized, internationally, nationally and locally for her more than 24 years of work, advocacy, education and publications on cutting edge health and managed care, employee benefit, human resources and related workforce, insurance and financial services, and health care matters.

A board certified labor and employment attorney widely known for her extensive and creative knowledge and experienced with these and other employment, employee benefit and compensation matters, Ms. Stamer continuously advises and assists employers, employee benefit plans, their sponsoring employers, fiduciaries, insurers, administrators, service providers, insurers and others to monitor and respond to evolving legal and operational requirements and to design, administer, document and defend medical and other welfare benefit, qualified and non-qualified deferred compensation and retirement, severance and other employee benefit, compensation, and human resources, management and other programs and practices tailored to the client’s human resources, employee benefits or other management goals. A primary drafter of the Bolivian Social Security pension privatization law, Ms. Stamer also works extensively with management, service provider and other clients to monitor legislative and regulatory developments and to deal with Congressional and state legislators, regulators, and enforcement officials on regulatory, investigatory or enforcement concerns.

About Solutions Law Press, Inc.™

Other Helpful Resources & Other Information

If you found these updates of interest, you also be interested in one or more of the following other recent articles published in this electronic Solutions Law publications available for review here including:

1 Comment | 105(h), Bankruptcy, Corporate Compliance, Employee Benefits, Employers, Employment Tax, ERISA, Fair Labor Standards Act, Human Resources, I-9, Immigration, Insurance, Internal Controls, Patient Protection and Affordable Care Act, Payroll Tax, Tax, Uncategorized | Tagged: Safety, Texas Tragedies, West, Workplace Disaster | Permalink
Posted by Cynthia Marcotte Stamer

Justice Department Charges Employer, Pension Plan With Violating USERRA Reemployment Rights

April 17, 2013

The Justice Department’s announcement today of its filing of a lawsuit charging County Employees’ and Officers’ Annuity and Benefit Fund of Cook County (Cook Pension Plan) and Cook County with willfully violating the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) by refusing to allow an employee to make catch up contributions to the employer’s pension plan when she returned from military leave. As the Obama Administration continues to withdraw troops from Afghanistan and other deployments, the suit is a timely reminder to employers of the importance of ensuring that their businesses properly honor the rights of returning service members under USERRA, the expanded military related medical leave rules of the Family & Medical Leave Act and other applicable laws.

USERRA & Other Reemployment Rights

USERRA generally provides that an individual who leaves a job to serve in the uniformed services is generally entitled to continue medical coverage for up to 26 months while absent for a qualifying military leave, reemployment by the previous employer upon timely return from military leave and, upon reemployment, to restoration of service, promotion, benefits and other rights of employment.

As part of these reemployment rights, qualifying service members timely returning from military leave are entitled to receive credit for benefits, including employee pension plan benefits, that would have accrued but for the employee’s absence due to the military service. USERRA’s pension-related provisions generally require that pension plans treat a service member who is called to active duty as if the service member had no break in service for purpose of the administration of pension benefits when the service member timely returns to employment at the end of a military leave. In addition to these pension rights, USERRA also requires employers honor other rights to employment, promotion and other benefits and rights of employment.

Beyond these USERRA employment rights, service members taking or returning from active duty often enjoy various other employment and other protections under various other federal and state laws, many of which have been expanded in recent years. Under requirements of the Soldiers’ and Sailors’ Civil Relief Act (SSCRA), for instance, creditors including a pension plan, employer loan program or credit union generally are required to drop interest charges down to 6 percent on debt owed by those called to active duty for the period of such military service. Further, under the Employee Retirement Income Security Act (ERISA), the loan will not fail to be a qualified loan under ERISA solely because the interest rate is capped by SSCRA. These and other provisions of federal law often require pension and profit-sharing plans that allow plan loans to change loan terms and tailor other special treatment of participants who are on military leave.

In addition to the specific protection given to a service member, employers also need to be ready to honor certain family leave protections afforded to qualifying family members or caregivers of service members added to the Family & Medical Leave Act (FMLA) in recent years. As amended to include these military leave related protections, the FMLA may require certain employees who are the spouse, son, daughter, or parent of a military member to take to 12 weeks of FMLA leave during any 12-month period to address the most common issues that arise when a military member is deployed to a foreign country, such as attending military sponsored functions, making appropriate financial and legal arrangements, and arranging for alternative childcare. This provision applies to the families of members of both the active duty and reserve components of the Armed Forces. Meanwhile, the “Military Caregiver Leave” provisions added to the FMLA may entitle certain employees who are the spouse, son, daughter, parent or next of kin of a covered service member to up to 26 weeks of FMLA leave during a single 12-month period to care for the service member who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness incurred or aggravated in the line of duty on active duty. These provisions apply to the families of members of both the active duty and reserve components of the Armed Forces. The expansion of these requirements, updating of regulation, and rising enforcement by private plaintiffs and the government make it advisable that businesses take all necessary steps to ensure their employment practices, employee benefit plans, fringe benefit programs and other practices are updated and administered to comply with the current requirements of USERAA, SSCRA, the FMLA and other applicable federal and state laws.

Justice Department Cook County Lawsuit

The latest in a growing number of lawsuits against businesses for violating the employment and other rights of military service members brought by the Justice Department, Department of Labor and private plaintiffs, the lawsuit against Cook County and the Cook Pension Plan highlights the growing enforcement and liability risks that U.S. employers and their employee benefit plans face for failing to properly honor the rights of military service people under USERRA and other laws.

On April 17, 2013, the Justice Department sued Cook County and the Cook Pension Plan with violating USERRA by refusing to allow U.S. Army Reserve Member Latoya Hayward to lawfully contribute to her pension for the time she was serving in the armed forces.

The Justice Department complaint charges that Hayward began working for John H. Stroger Jr. Hospital, which is owned and operated by Cook County in 2008. During her employment with Stroger Hospital, Hayward was mobilized for a two year tour of duty with the Army Reserves starting on July 27, 2009. While on active service, Hayward served as a nurse case manager at Walter Reed Hospital as part of the Warrior Transition Brigade.

The Justice Department complaint alleges that when Hayward returned from duty, the County Employees’ and Officers’ Annuity and Benefit Fund of Cook County notified her not only that she was ineligible to make payments into her pension for the 90-day grace period following her active military service, but also that her employee contributions for the two-year period of her active military service would be subject to a 3 percent interest fee.

According to Hayward’s complaint, both of the County Employees’ and Officers’ Annuity and Benefit Fund of Cook County’s requirements for her participation in her employer’s pension plan violated USERRA’s pension protection provisions.

Enforcement of USERRA & Other Rights of Military Service Members Rising

In announcing the suit against Cook County and the Cook Pension Plan, Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division warned, “The Justice Department is committed to vigorously enforcing federal laws that protect the employment rights of our service members.”

Viewed in the context of a series of other recent suits and settlements, the suit against Cook County and the Cook Pension Plan is one of a growing number of lawsuits brought by the Justice Department, Department of Labor Department of Veterans Affairs and other government and private litigants reflects that the Obama Administration is acting on this commitment.

The Department of Labor Veterans’ Employment & Training Service (VETS) reported to Congress that in Fiscal Year (FY) 2011, VETS reviewed 1,548 new unique USERRA complaint cases, up 110 cases from those received in FY 2010. Nearly 35 percent of the complaints reviewed by VETS contained allegations of some form of employment discrimination on the basis of past, present, or future, military service, status, or obligations. An additional 25 percent of the complaints involved allegations of improper reinstatement into civilian jobs following military service. See 2011 VETS USERRA Report To Congress.

Recent litigation and settlements by the Justice Department and other agencies bear out that the Obama Administration is continuing to make enforcement of military service member rights a priority during the 2012 FY that began in October. See, e.g., Michael Sipos and Gary Smith v. FlightSafety Services Corporation, Co. Consent Decree (April 4, 2013); Mervin Jones v. Jerome County Sheriff’s Office, ID complaint (January 7, 2013); Service Members to Receive $39 Million for Violations of the Servicemembers Civil Relief Act; Justice Department Settles Disability Discrimination Case Involving Disabled Veteran in Utah; Justice Department Reaches $12 Million Settlement to Resolve Violations of the Servicemembers Civil Relief Act by Capital One; and Justice Department Files Complaint Against Forsyth County, North Carolina, Sheriff for Violating the Employment Rights of Army National Guard Soldier.

Given this heightened emphasis on enforcement, U.S. businesses should act to update their policies, practices, training and other compliance and risk management practices to ensure that their employment, lending, and other practices for dealing with military service members and their families are properly designed and administered to minimize the risk that their business will become one of these enforcement statistics.

For Help or More Information

If you need help reviewing and updating, administering or defending your human resources, employee benefits or other compliance and risk management practices in these or other areas, please contact the author of this update, Cynthia Marcotte Stamer.

A Fellow in the American College of Employee Benefit Council, immediate past Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Group and current Co-Chair of its Welfare Benefit Committee, Vice-Chair of the ABA TIPS Employee Benefits Committee, a council member of the ABA Joint Committee on Employee Benefits, and past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer is recognized, internationally, nationally and locally for her more than 24 years of work, advocacy, education and publications on cutting edge health and managed care, employee benefit, human resources and related workforce, insurance and financial services, and health care matters.

A board certified labor and employment attorney widely known for her extensive and creative knowledge and experienced with these and other employment, employee benefit and compensation matters, Ms. Stamer continuously advises and assists employers, employee benefit plans, their sponsoring employers, fiduciaries, insurers, administrators, service providers, insurers and others to monitor and respond to evolving legal and operational requirements and to design, administer, document and defend medical and other welfare benefit, qualified and non-qualified deferred compensation and retirement, severance and other employee benefit, compensation, and human resources, management and other programs and practices tailored to the client’s human resources, employee benefits or other management goals. As a part of this practice, Ms. Stamer extensively has worked with U.S. businesses and benefit plans to manage, prevent and resolve concerns involving the rights of military service members and others as well as spoken and written extensively on these concerns. Examples of some of her recent articles on military service members employment and other risks include her workshop and accompanying training manual, When The Military Comes Home: USERRA, VEVRRA, FMLA, COBRA, HIPAA and Beyond, New USERRA Militarty Reservist Regulations; Big Penalty for Lender Shows Risks of Violating Military Service or Vets Rights and others.

A primary drafter of the Bolivian Social Security pension privatization law, Ms. Stamer also works extensively with management, service provider and other clients to monitor legislative and regulatory developments and to deal with Congressional and state legislators, regulators, and enforcement officials on regulatory, investigatory or enforcement concerns.

About Solutions Law Press, Inc.™

Other Helpful Resources & Other Information

1 Comment | 105(h), Bankruptcy, Corporate Compliance, Employee Benefits, Employers, Employment Tax, ERISA, Fair Labor Standards Act, Human Resources, I-9, Immigration, Insurance, Internal Controls, Patient Protection and Affordable Care Act, Payroll Tax, Tax, Uncategorized | Tagged: ACA, Affordable Care Act, Employer, Health Care Reform, Health Plans, Insurance, Military Leave, Patient Protection & Affordable Care Act, Pay or Play, Shared Responsibility, USERRA | Permalink
Posted by Cynthia Marcotte Stamer

Administration Proposes To Let PBGC Board Set Premiums In Effort To Shore Up Finances

April 10, 2013

The Obama Administration again is proposing that the Board of the Pension Benefit Guaranty Corporation (PBGC) get the power to set premium rates based on the financial soundness of company sponsors to shore up the agency’s finances in hopes of heading off the need for a government bailout of the agency’s liabilities.

PBGC, which insures traditional pensions offered by non-governmental employers continues to struggle for funding to meet the costs of funding its program of insuring failed private defined benefit pension plans. Always challenging, maintaining financial solvency has become particularly problematic with company failures soaring and investment returns down in the ailing economy. On November 16, 2012, the agency said its deficit increased to $34 billion, the largest in PBGC’s 38-year history.

The PBGC currently relies exclusively on premiums set by Congress and assets recovered from failed plans to operate and fund its private pension guarantee obligations. It presently doesn’t receive taxpayer dollars. Premiums, set by Congress, have historically been too low to meet the agency’s needs.

The Government Accountability Office issued a report saying Congress should consider “revising PBGC’s premium structure to better reflect the agency’s risk from individual plans and sponsors

The proposal to give the PBGC authority to determine premiums is intended to shore up the agency’s funding. “Without premium increases PBGC will be faced with requesting a taxpayer bailout or shutting down,” said PBGC Director Josh Gotbaum. “The current system punishes responsible companies by making them pay for the mistakes of others and punishes plans by raising rates just when companies can least afford it. Tha’s why administrations of both parties, and recently GAO, have supported giving PBGC what the FDIC has long had — the ability to set its own rates and to set them in ways that are fair.”

The Administration originally introduced the idea of allowing the PBGC to set its own premiums in 2012. It now has reintroduced the effort that ties premiums to company risk in its 2014 budget. Under the current proposal, the PBGC Board, which consists of secretaries of Labor, Commerce, and Treasury, with the secretary of Labor as chair, wouldn’t get the authority to set rates until 2015. The budget requires the board to perform a one-year study with a public comment period. Additionally, premium increases would be gradually phased in to give company sponsors time to prepare for the new rates.

For Help With These Or Other Matters

If you need help dealing with pension or other employee benefit funding, design or administration challenges, dealing with the PBGC, IRS, Labor Department or other agency or legal challenge to your organization’s existing employee benefit or other practices, or other workforce re-engineering, labor and employment, employee benefit or compensation practices, please contact the author of this update, attorney Cynthia Marcotte Stamer.

Ms. Stamer has more than 26 years experience advising and representing employer, employee benefit and other clients on human resources, employee benefit, internal controls and risk management matters including extensive work on workforce re-engineering and other human resources and employee benefits challenges of distressed and other companies, and related matters.

A board certified labor and employment attorney widely known for her extensive and creative knowledge and experience worker classification and other employment, employee benefits and workforce matters, Ms. Stamer works extensively with employers, employee benefit plan sponsors, insurers, administrators, and fiduciaries, payroll and staffing companies, technology and other service providers and others to develop and operate legally defensible programs, practices and policies that promote the client’s human resources, employee benefits or other management goals. Ms. Stamer also is a widely published author and highly regarded speaker on these and other employee benefit and human resources matters who is active in many other employee benefits, human resources and other management focused organizations.

About Solutions Law Press

Comments Off on Administration Proposes To Let PBGC Board Set Premiums In Effort To Shore Up Finances | 105(h), Cafeteria Plans, COBRA, Corporate Compliance, Disability, Disability, Disability Plans, Discrimination, Employee Benefits, Employers, Employment Tax, ERISA, Fair Labor Standards Act, family leave, FMLA, Government Contractors, Health Plans, HIPAA, Human Resources, I-9, Immigration, Income Tax, Insurance, Internal Controls, Internal Investigations, Labor Management Relations, Leave, medical leave, Military Leave, Nonresident aliens, OSHA, Payroll Tax, Restructuring, Retirement Plans, Tax, Tax Qualification, Unemployment Benefits, Unemployment Insurance, Union, VEVRRA, Wage & Hour | Tagged: Bankruptcy, contract labor, defined benefit, Determination Letters, distressed, Employee, Employee Benefits, Independent Contractor, leased employee, misclassificaton, payroll tax, PBGC, Pension, Pension Funding, plan qualification, Reengineering, Retirement Plans, staffing, Tax, Worker Classification | Permalink
Posted by Cynthia Marcotte Stamer

Administration Proposes Expanding Eligibility, Simplifying Small Employer Health Care Tax Credit

April 10, 2013

The Obama Administration’s Fiscal Year 2014 Revenue Proposals include a proposal to expand the group of employers eligible for the Small Employer Health Care Tax Credit (Health Credit) enacted as part of the Patient Protection and Affordable Care Act (ACA) retroactive to January 1, 2013. See General Explanations of the Administration’s Fiscal Year 2014 Revenue Proposals pages 39-40.

Current Law

Under long-standing provisions of the Internal Revenue Code (Code), the cost to an employer of providing health coverage for its employees is generally deductible as an ordinary and necessary business expense for employee compensation and the value of employer-provided health coverage is not subject to employer-paid Federal Insurance Contributions Act tax. Meanwhile, unless the program violates the non-discrimination rules of Internal Revenue Code §105 or the employees are offered a choice in a manner that violates Code §125, employees are generally not taxed on the premiums or the value of employer-provided health coverage for themselves, their spouses and their dependents.

As an additional inducement for small employers to provide health coverage for low-income employees, the ACA created the Health Credit. During 2010 through 2013, the maximum credit is 35 percent (25 percent for tax-exempt employers) of the employer’s contributions to the premium. For 2014 and later years, the maximum credit percentage is 50 percent (35 percent for tax-exempts). The amount of the available credit recently was reduced as part of the reductions implemented under sequester.

To qualify for the Health Credit, the Code currently limits the availability of the Health Credit to amounts paid for health coverage for employees with average annual full-time equivalent wages of no more than $50,000 (indexed beginning 2014) by an employer that employs no more than 25 full-time equivalent employees during the taxable year and pays at least 50 percent of the premium for coverage. For taxable years beginning in 2010 through 2013, the credit is available for any health insurance coverage purchased from an insurance company licensed under State law. For taxable years beginning after December 31, 2013, the credit is available only for health insurance purchased through a Health Insurance Exchange and only for a maximum coverage period of two additional consecutive taxable years, beginning with the first year in which the employer or any predecessor first offers any qualified plans to its employees through an Exchange.

While for-profit firms may claim the tax credit as a general business credit and may carry the credit back for one year and carry the credit forward for 20 years, the Health Credit only currently is available for tax liability under the alternative minimum tax. For tax-exempt organizations, the credit is refundable and is capped at the amount of income tax withholding for employees and both the employee and employer portion of the health insurance (Medicare) payroll tax.

Eligible employer contributions are limited by the amount the employer would have contributed under the State average premium. Also, the credit is phased out on a sliding scale between 10 and 25 full-time equivalent employees as well as between an average annual wage of $25,000 (indexed) and $50,000 (indexed). Because the reductions are additive, an employer with fewer than 25 full-time employees paying an average wage less than $50,000 might not be eligible for any tax credit.

Proposed Change

The proposal would expand the group of employers who are eligible for the credit to include employers with up to 50 full-time equivalent employees and would begin the phase-out at 20 full-time equivalent employees for taxable years beginning after January 31, 2012. In addition, there would be a change in the coordination of the phase-outs based on average wage and the number of employees (using a formula that is multiplicative rather than additive) so as to provide a more gradual combined phase-out.

According to the Administration, the proposal is intended to ensure that employers with fewer than 50 employees and an average wage less than $50,000 would be eligible for the credit, even if they are nearing the end of both phase-outs. The proposal would also eliminate the requirement that an employer make a uniform contribution on behalf of each employee (although applicable nondiscrimination laws will still apply), and would eliminate the limit imposed by the State average premium.

The Administration says expanding eligibility for the credit and simplifying its operation would:

Increase the utilization of the tax credit
Encourage more small employers to provide health benefits to employees and their families
Incent small employers to join an Exchange, thereby broadening the risk pool
Enhance fairness among employers
Remove complexity and potential discouragement to small employers claiming the Health Credit resulting from the uniform contribution requirement and the State premium contribution limit.

Health Care Reform Coping Steps For All Businesses

The proposal to expand the Health Credit comes as many employers continue to struggle to understand the potential implications of ACA’s health care reforms sand determine how to respond.

For tips about coping with health care reform for employers, check out 13 Employer Tips For Responding To Health Care Reform Now and other resources in the Solutions Law Press, Inc. HR & Benefits Update at www.solutionslawpress.com.

For Help or More Information

A Fellow in the American College of Employee Benefit Council, immediate past Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Group and current Co-Chair of its Welfare Benefit Committee, Vice-Chair of the ABA TIPS Employee Benefits Committee, a council member of the ABA Joint Committee on Employee Benefits, and past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer is recognized, internationally, nationally and locally for her more than 24 years of work, advocacy, education and publications on cutting edge health and managed care, employee benefit, human resources and related workforce, insurance and financial services, and health care matters.

A board certified labor and employment attorney widely known for her extensive and creative knowledge and experienced with these and other employment, employee benefit and compensation matters, Ms. Stamer continuously advises and assists employers, employee benefit plans, their sponsoring employers, fiduciaries, insurers, administrators, service providers, insurers and others to monitor and respond to evolving legal and operational requirements and to design, administer, document and defend medical and other welfare benefit, qualified and non-qualified deferred compensation and retirement, severance and other employee benefit, compensation, and human resources, management and other programs and practices tailored to the client’s human resources, employee benefits or other management goals. A primary drafter of the Bolivian Social Security pension privatization law, Ms. Stamer also works extensively with management, service provider and other clients to monitor legislative and regulatory developments and to deal with Congressional and state legislators, regulators, and enforcement officials on regulatory, investigatory or enforcement concerns.

About Solutions Law Press, Inc.™

Other Helpful Resources & Other Information

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Study Finds Down Economy, Not Health Care Reform Accounts For Slower Health Care Cost Increases; Projects Renewed Costs When Economy Improves

IRS Witholding Calculator Can Help Avoid Over & Underwithholding

Responding To West, Texas, Boston & Other Tragedies: Information and Reassurance Resources

Justice Department Charges Employer, Pension Plan With Violating USERRA Reemployment Rights

Administration Proposes To Let PBGC Board Set Premiums In Effort To Shore Up Finances

Administration Proposes Expanding Eligibility, Simplifying Small Employer Health Care Tax Credit

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