Employer H1N1 Virus Risk Management Requires Employer Care To Manage Virus Risks Without Violating Employment Discrimination or Other Laws

November 30, 2009

As the Centers for Disease Control (CDC) continues cautioning Americans to expect a resurgence of the H1N1 virus, employers should continue to take prudent steps to defend their organization and their workers against a widespread H1N1 outbreak and the attendant lost time, health and disability costs, OSHA and other liability exposures and other personal and financial consequences likely to result from an outbreak. 

Employers wishing to deter the spread of the disease in their workplace should educate workers about these recommendations and consider taking steps to encourage workers to comply with these recommendations. When planning or taking steps to protect their workplaces from the H1N1 virus pandemic or other outbreaks of communicable diseases, however, employers must use care to avoid violating the Americans With Disabilities Act or other employment laws.

Preventing, Recognizing & Mitigating Risks of H1N1

Although the number of reported cases of H1N1 virus cases has declined in many states in recent weeks, CDC officials are warning American’s that the crisis is not over yet.  CDC officials last week warned Americans to expect H1N1 infection to rise as the holiday approaches and the winter progresses. With flu activity already higher than what is seen during the peak of many regular flu seasons and the H1NA virus accounting for almost all of the flu viruses identified so for this season,  Accordingly,  the CDC continues to encourage Americans to be alert for symptoms of H1N1 or other flu and to take other precautions including to get vaccinated.

Employers should continue to encourage workers and their families to take precautions to avoid catching the virus, to be on the watch for H1N1 virus or other flu infection and to respond appropriately if they, members of their families or others in the workplace exhibit these symptoms.   To help promote health habits within their workforce, many businesses may want to download and circulate to employees and families the free resources published by the CDC here.  Businesses and other concerned parties also can track governmental reports about the swine flu and other pandemic concerns at here.   

For those not already suffering from the virus and particularly for those at higher risk, the CDC continues to recommend vaccination. People recommended by the CDC to receive the vaccine as soon possible include:  health care workers; pregnant women; people ages 25 through 64 with chronic medical conditions, such as asthma, heart disease, or diabetes; anyone from 6 months through 24 years of age; and people living with or caring for infants under 6 months old.  As the vaccine becomes available, many employers are encouraging workers and their families to get vaccinated by offering vaccination clinics at or near their worksites, arranging for health plan coverage for vaccinations with reduced or no co-payments or deductibles, and/or sharing information about government sponsored or other vaccination clinics. 

While the CDC says getting employees and their families to get a flu shot remains the best defense against a flu outbreak, it also says getting employees and family members to consistently practice good health habits like covering a cough and washing hands also is another important key to prevent the spread of germs and prevent the spread of respiratory illnesses like the flu.  Employers should encourage employees and their families to take the following steps: 

  • Avoid close contact with people who are sick. When you are sick, keep your distance from others to protect them from getting sick too;
  • Stay home when you are sick to help prevent others from catching your illness;
  •  Cover your mouth and nose;
  • Cover your mouth and nose with a tissue when coughing or sneezing. It may prevent those around you from getting sick;
  • Clean your hands to protect yourself from germs;
  • Avoid touching your eyes, nose or mouth;
  • Germs are often spread when a person touches something that is contaminated with germs and then touches his or her eyes, nose, or mouth; and
  • Practice other good health habits.  Get plenty of sleep, be physically active, manage your stress, drink plenty of fluids, and eat nutritious food.

Employers also should encourage workers and their families to be alert to possible signs of H1N1 or other flu symptoms and to respond appropriately to possible infection.  According to the CDC, all types of flu including H1NA typically include many common symptoms, including:

  • Fever
  • Coughing and/or sore throat
  • Runny or stuffy nose
  • Headaches and/or body aches
  • Chills
  • Fatigue

Patients suffering from H1N1 flu usually report these same symptoms, but the symptoms often are more severe. In addition to the above symptoms, a number of H1N1 flu cases reported vomiting and diarrhea.

CDC recommends individuals diagnosed with H1N1 flu should:

  • Stay home and avoid contact with others for at least 24 hours after a fever (100°F or 37.8°C) is gone without the use of fever reducing medicine except to get medical care or for other things that must be done that no one else can do;
  • Avoid close contact with others, especially those who might easily get the flu, such as people age 65 years and older, people of any age with chronic medical conditions (such as asthma, diabetes, or heart disease), pregnant women, young children, and infants;
  • Clean hands with soap and water or an alcohol-based hand rub often, especially after using tissues or coughing/sneezing into your hands;
  • Cover coughs and sneezes;
  • Wear a facemask when sharing common spaces with other household members to help prevent spreading the virus to others. This is especially important if other household members are at high risk for complications from influenza;
  • Drink clear fluids such as water, broth, sports drinks, or electrolyte beverages made for infants to prevent becoming dehydrated;
  • Get plenty of rest;
  • Follow doctor’s orders; and
  • Watch for signs for a need for immediate medical attention. Suffers should get medical attention right away if the sufferer has difficulty breathing or chest pain,  purple or blue discoloration of the lips, is vomiting and unable to keep liquids down, or shows signs of dehydration, such as feeling dizzy when standing or being unable to urinate.

In seeking to contain the spread of the virus within their workplace, employers also should be sensitive to workplace policies or practices that may pressure employees with a contagious disease to report to work despite an illness and consider whether the employer should adjust these policies temporarily or permanently in light of the ongoing pandemic.  For instance, financial pressures and the design and enforcement of policies regarding working from home and/or qualifying for paid or unpaid time off significantly impact the decisions employees make about whether to come to work when first experiencing symptoms of illness.  Employers of workers who travel extensively – may wish to delay or restrict travel for some period. 

Employers Must Employment Discrimination & Other Legal Compliance Risks

Many employers may want to evaluate and appropriately revise existing policies with an eye to better defending their workforce against a major outbreak.  Whether or not the disease afflicts any of its workers, businesses can anticipate the swine flu outbreak will impact their operations – either as a result of occurrences affecting their own or other businesses or from workflow disruptions resulting from safeguards that the business or other businesses implement to minimize swine flu risks for its workforce or its customers.  Many businesses also will want to prepare backup staffing and production strategies to prepare for disruptions likely to result if a significant outbreak occurs. 

Employers planning for or dealing with an H1N1 or other epidemic in their workplace should exercise care to avoid violating the nondiscrimination and medical records confidentiality provisions of the Americans with Disabilities Act (ADA) and/or the Genetic Information Nondiscrimination Act (GINA), the Family & Medical Leave Act of 1990 (FMLA), the Fair Labor Standards Act (FLSA) and applicable state wage and hour laws, and other employment and privacy laws.

Improperly designed or administered medical inquiries, testing, vaccination mandates and other policies or practices intended to prevent the spread of disease may expose an employer to disability discrimination liability under the ADA or GINA.  For instance, the ADA generally prohibits an employer from making disability-related inquiries and requiring medical examinations of employees, except under limited circumstances permitted by the ADA. Likewise, improperly designed or communicated employer inquiries into family medical status which could be construed as inquiring about family medical history also may raise exposures under genetic information nondiscrimination and privacy mandates of GINA that took effect November 21, 2009.

During employment, the ADA prohibits employee disability-related inquiries or medical examinations unless they are job-related and consistent with business necessity. Generally, a disability-related inquiry or medical examination of an employee is job-related and consistent with business necessity when an employer has a reasonable belief, based on objective evidence, that:

  • An employee’s ability to perform essential job functions will be impaired by a medical condition; or
  • An employee will pose a direct threat due to a medical condition.

This reasonable belief “must be based on objective evidence obtained, or reasonably available to the employer, prior to making a disability-related inquiry or requiring a medical examination.”

Additionally, the ADA prohibits employers from making disability-related inquiries and conducting medical examinations of applicants before a conditional offer of employment is made.  It permits employers to make disability-related inquiries and conduct medical examinations if all entering employees in the same job category are subject to the same inquiries and examinations.   All information about applicants or employees obtained through disability-related inquiries or medical examinations must be kept confidential. Information regarding the medical condition or history of an employee must be collected and maintained on separate forms and in separate medical files and be treated as a confidential medical record.  The EEOC Pandemic Preparedness In The Workplace and The Americans With Disabilities Act Guidance makes clear that employer inquiries and other H1N GINA’s inclusion of information about the “manifestation of a disease or disorder in family members” is likely to present a liability trap door for many unsuspecting employers H1N1 and other epidemic planning and response activities should be carefully crafted to avoid violating these proscriptions.

GINA’s inclusion of information about the “manifestation of a disease or disorder in family members” also could present a liability trap door for some employers designing pandemic or other workplace wellness, disease management or other programs.  GINA defines “genetic information” broadly as including not only information about genetic tests about an individual or his family member as well as information about the “manifestation of a disease or disorder in family members of such individual, GINA also specifies that any reference to genetic information concerning an individual or family member includes genetic information of a fetus carried by a pregnant woman and an embryo legally held by an individual or family member utilizing an assisted reproductive technology.  For more information about the new GINA genetic information employment discrimination rules, see here.

As part of their pandemic planning, employers also generally should review their existing wage and hour and leave of absence practices.  Employers should ensure that their existing or planned practices for providing paid or unpaid leave are designed to comply with the FLSA and other wage and hour and federal and state leave of absence laws. Employers also should review and update family and medical leave act and other sick leave policies, group health plan medical coverage continuation rules and notices and other associated policies and plans for compliance with existing regulatory requirements, which have been subject to a range of statutory and regulatory amendments in recent years.  If considering allowing or requiring employees to work from home, employers also need to implement appropriate safeguards to monitor and manage employee performance, to protect the employer’s ability to comply with applicable wage and hour, worker’s compensation, OSHA and other safety, privacy and other legal and operational requirements. 

Businesses, health care providers, schools, government agencies and others concerned about preparing to cope with pandemic or other infectious disease challenges also may want to review the publication “Planning for the Pandemic” authored by Curran Tomko Tarski LLP partner Cynthia Marcotte Stamer available at here.  FLU.gov is a one-stop resource with the latest updates on the H1N1 flu. An additional resource is CDC INFO, 1-800-CDC-INFO (1-800-232-4636), which offers services in English and Spanish, 24 hours a day, 7 days a week.  Schools, health care organizations, restaurants and other businesses whose operations involve significant interaction with the public also may need to take special precautions.  These and other businesses may want to consult the special resources posted  here. 

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending these or other labor and employment, compensation or benefit practices, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group and a nationally recognized author and speaker, Ms. Stamer is experienced with assisting employers and others about compliance with federal and state equal employment opportunity, compensation, health and other employee benefit, workplace safety, and other labor and employment laws, as well as advising and defending employers and others against tax, employment discrimination and other labor and employment, and other related audits, investigations and litigation, charges, audits, claims and investigations by the IRS, Department of Labor and other federal and state regulators. Ms. Stamer has advised and represented employers on these and other labor and employment, compensation, health and other employee benefit and other personnel and staffing matters for more than 22 years. Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  Examples of other recent updates you may have missed include:

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

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Posted by Cynthia Marcotte Stamer

New GINA Genetic Information Based Employment Discrimination & Confidentiality Mandates Take Effect

November 24, 2009

Updated Employment Poster, Policies & Procedures Required Immediately

Employers, unions, employment agencies, employment training agencies and their agents face significant new employment discrimination liability risks if they violate new genetic information-based employment non-discrimination or fail to comply with genetic information confidentiality requirements that took effect under Title II of the Genetic Information Nondiscrimination Act (GINA) on Saturday, November 21, 2009.  Employers need immediately to update their employment posters, carefully audit their existing records and practices to identify existing information and practices that may create special risks under GINA and take appropriate action to comply with the GINA rules. Employers needing an updated poster can find a copy on the Equal Employment Opportunity Commission website here.

Under the newly effective employment provisions of Title II of GINA, Federal law now prohibits employers of 15 or more employees and certain other entities from using individuals’ “genetic information” when making hiring, firing, job placement, or promotion decisions, requires “genetic information” be kept separately and confidential, and prohibits retaliation. 

When assessing their risk under GINA, employers should be careful not to overlook or underestimate the genetic information collected or possessed by their organizations and the risks attendant to this information.  Many employers will be surprised by the breadth of the depth of “genetic information.”   GINA defines “genetic information” broadly as including not only information about genetic tests about an individual or his family member as well as information about the “manifestation of a disease or disorder in family members of such individual.   GINA also specifies that any reference to genetic information concerning an individual or family member includes genetic information of a fetus carried by a pregnant woman and an embryo legally held by an individual or family member utilizing an assisted reproductive technology.  Pending issuance of regulatory guidance, GINA’s inclusion of information about the “manifestation of a disease or disorder in family members” is likely to present a liability trap door for many unsuspecting employers.

Failing to properly address GINA compliance could expose employers to substantial risk.  Violation of the employment provisions of Title II subjects an employer to potentially significant civil judgments like those that generally are available for race, sex, and other federal employment discrimination claims covered by the Civil Rights Act.  Accordingly, employers and others who have not already done so should act quickly to review and update their policies and procedures to manage their new compliance and liability exposures under GINA Title II.

While the agency responsible for construing and enforcing Title II of GINA, the Equal Employment Opportunity Commission (EEOC), to date has published only limited guidance about it, the absence of this final guidance should not be read by employers as a sign their compliance may be delayed.  While not yet issued in final form, proposed regulations interpreting Title II of GINA accessible here published by the EEOC in March, 2009  and a subsequently released factsheet accessible here published by the EEOC in May, 2009 titled “Background Information for EEOC Notice of Proposed Rulemaking On Title II of the Genetic Information Nondiscrimination Act of 2008” provide insights about how the EEOC may be expected to view its provisions.   While many employers have delayed taking action to update their policies and procedures in hopes that final guidance would be forthcoming before Title II took effect, time has now run out.  Accordingly, employers who have not already done so should act quickly to implement all necessary changes to position themselves to defend against a potential claim that their organization may have violated GINA Title II. 

Employment-Related Genetic Information Nondiscrimination Rules In Focus

Applicable to employers, unions, employment agencies, employment training agencies and their agencies based on genetic information by employers, Title II imposes sweeping prohibitions against employment discrimination based on genetic information.  Title II generally has three components:

Employment Discrimination Prohibited.  Section 202 of GINA makes it illegal for an employer:

  • To fail or refuse to hire, or to discharge, any employee, or otherwise to discriminate against any employee with respect to the compensation, terms, conditions, or privileges of employment of the employee, because of genetic information with respect to the employee;
  • To limit, segregate, or classify the employees of the employer in any way that would deprive or tend to deprive any employee of employment opportunities or otherwise adversely affect the status of the employee as an employee, because of genetic information with respect to the employee; or
  • To request, require, or purchase genetic information with respect to an employee or a family member of the employee except as specifically permitted by GINA and otherwise applicable law.

GINA §§ 203 and 204 extend similar prohibitions to employment agencies, labor unions and training programs.

Confidentiality Mandates. Under GINA § 206, an employer, employment agency, labor organization, or joint labor-management committee that possesses genetic information about an employee or member must protect the confidentiality of that information.  Under its provisions, employers and other covered entities must:

  •  Treat the genetic information as a confidential medical record of the employee or member and maintain it on separate forms and in separate medical files in the same manner as required for other medical records required to be maintained as confidential by Americans With Disabilities Act § 102(d)(3)(B); and
  • Only disclose it in the narrow circumstances specifically allowed by GINA.

Anti-Retaliation.  GINA also prohibits retaliation or other discrimination against any individual because such individual has opposed any act or practice prohibited by GINA, for making a charge, testifying or assisting or participating in any manner in an investigation, proceeding, or hearing under GINA. 

GINA’s Additional Group Health Plan Nondiscrimination & Privacy Rules Also Require Attention

In addition to taking appropriate steps to comply with the employment rules of Title II of GINA, employers and their group health plan fiduciaries and service providers also should ensure that the group health plan has been appropriately updated to comply with the group health plan nondiscrimination and privacy mandates of Title I of GINA. 

Effective for all group health plan years beginning on or after May 21, 2009, GINA’s new restrictions on the collection and use of genetic information by group health plans added under Title I of GINA are accomplished through the expansion of a series of already existing group health plan nondiscrimination and privacy rules.  GINA’s group health plan provisions amend and expand the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Employee Retirement Income Security Act of 1974 (ERISA), Title VII of the Civil Rights Act, the Public Health Service Act, the Internal Revenue Code of 1986, and Title XVIII (Medicare) of the Social Security Act to implement sweeping new federal restrictions on the collection, use, and disclosure of information that falls within its broad definition of “genetic information” by  group health plans.  For individual health insurers, GINA’s restrictions take effect May 22, 2009.  The broad definition of the term “genetic information” in GINA will require group health plan sponsors and insurers to carefully review and update their group health plan documents, communications, policies and practices to comply with forthcoming implementing regulations to avoid liability under new GINA’s rules governing genetic information collection, use, protection and disclosure in a series of areas.  

In this respect, wellness and disease management programs are likely to require special scrutiny and attention. GINA’s inclusion of information about the “manifestation of a disease or disorder in family members” raises potential challenges for a broad range of group health plan health assessment and other wellness and disease management programs which provide financial incentives or condition eligibility on the provision of family health histories or other information that could be construed as genetic information.  The implications of these GINA prohibitions are further complicated by recent changes in the disability nondiscrimination rules and guidance under the Americans With Disabilities Act.

Title I of GINA generally prohibits group health plans from collecting genetic information for underwriting or eligibility purposes.  It also expands already existing federal rules prohibiting group health plans from discriminating among individuals for purposes of determining eligibility or setting premiums based on health status previously enacted as part of HIPAA.   These existing rules already prohibit group health plans and health insurance issuers from discriminating based on health related factors including genetic information for purposes of determining eligibility or premiums. GINA expands these existing nondiscrimination requirements to further regulate group health plan’s use and collection of genetic information.   Under GINA’s nondiscrimination rules, group health plans and health insurers may not:

  • Request, require or purchase genetic information for underwriting purposes or in advance of an individual’s enrollment;
  • Adjust premiums or contribution amounts of the group based on genetic information;
  • Request or require an individual or family member to undergo a genetic test except in limited situations specifically allowed by GINA;
  • Impose a preexisting condition exclusion based solely on genetic information, in the absence of a diagnosis of a condition;
  • Discriminate against individuals in eligibility and continued eligibility for benefits based on genetic information; or
  • Discriminate against individuals in premium or contribution rates under the plan or coverage based on genetic information, although such a plan or issuer may adjust premium rates for an employer based on the manifestation of a disease or disorder of an individual enrolled in the plan.

GINA also prohibits insurers providing individual health insurance from establishing rules for eligibility, adjusting premiums or contribution amounts for an individual, imposing preexisting condition exclusions based on, requesting or requiring individuals or family members to undergo genetic testing.

Of particular concern to many plan sponsors and fiduciaries are the potential implications of these new rules on existing wellness and disease management features group health plans. Of particular concern is how regulators will treat the collection of family medical history and certain other information as part of health risk assessments used in connection with these programs. Although official guidance is still pending, many are concerned that regulators will construe certain commonly used practices of requiring covered persons to provide family medical histories or other genetic information through health risk assessments (HRAs) to qualify for certain financial incentives as a prohibited underwriting practice under GINA.  Even where health risk assessments are not used, however, most group health plan sponsors should anticipate that GINA will require specific amendments to their plan documents, communications and processes.

Taking timely action to comply with these nondiscrimination and collection prohibitions is important.  Under amendments to ERISA made by GINA, group health plan noncompliance can create significant liability for both the plan and its sponsor.  Participants or beneficiaries will be able to sue noncompliant group health plans for damages and equitable relief.  If the participant or beneficiary can show an alleged violation would result in irreparable harm to the individual’s health, the participant or beneficiary may not have to exhaust certain otherwise applicable Department of Labor administrative remedies before bringing suit.  In addition to these private remedies, GINA also authorizes the imposition of penalties against employers and other sponsors of group health plans that violate applicable requirements of GINA of up to $500,000. The minimum penalties generally are set at the greater of $100 per day or a minimum penalty amount ranging from $2,500 for de minimus violations corrected before the health plan received notice of noncompliance to $15,000 in cases in which the violations are more than de minimus.  GINA also includes language allowing the Secretary of Labor to reduce otherwise applicable penalties for violations that could not have been identified through the exercise of due diligence or when the plan corrects the violation quickly.

GINA Amendments To Health Plan Privacy Rules Under HIPAA

In addition to its nondiscrimination rules, GINA also amends HIPAA to make clear that “genetic information” as defined by HIPAA is protected health information protected by HIPAA’s Privacy & Security Standards of HIPAA. This means that it will require that all genetic information be treated as protected health information subject to the Privacy and Security Standards applicable to group health plans covered by HIPAA. Although the statutory provisions that accomplish these changes are deceptively simple, compliance with these requirements likely will require group health plans and their business associates to amend existing privacy policies, notices and practices to appropriately restrict disclosures for underwriting, operations and certain other uses to withstand scrutiny under the GINA privacy rule amendments. 

When contemplating these changes, many plan sponsors and administrators also will want to consider and begin preparing to comply with other refinements to their existing privacy and security practices required in response to HIPAA privacy and security rule amendments enacted as part of the HITECH Act provisions of the Health Information Technology for Economic and Clinical Health Act (“HITECH Act”) provisions of the American Recovery and Reinvestment Act of 2009 (ARRA).  As GINA specifies that violations of its privacy rule restrictions trigger the same sanctions as other privacy rule violations, group health plans and their business associates also should give due consideration to these penalty exposures.  The HITECH Act amended and increased civil penalties for HIPAA privacy violations in many circumstances effective February 17, 2009.  

GINA’s fractured assignment of responsibility and authority to develop, implement and enforce regulatory guidance of its genetic information rules can create confusion for parties involved in compliance efforts. Because the group health plan requirements of Title I of GINA are refinements to the group health plan privacy and nondiscrimination rules previously enacted as part of HIPAA, GINA specifically assigned authority to construe and enforce its group health plan requirements to the agencies responsible for the interpretation and enforcement of those original rules:  (1) the Department of Labor Employee Benefit Security Administration (EBSA); (2)  the Internal Revenue Services (IRS), and (3) the Department of Health & Human Services. 

These three agencies in early October published the interim final regulations construing the group health plan manatees of Title II of GINA, which are available for review here.  Group health plans, their employer and other sponsors, fiduciaries and service providers should act quickly to review and update their group health plan documents, procedures and other materials to comply with these new mandates.

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending these or other labor and employment, compensation or benefit practices, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group and a nationally recognized author and speaker, Ms. Stamer is experienced with assisting employers and others about compliance with federal and state equal employment opportunity, compensation, health and other employee benefit, workplace safety, and other labor and employment laws, as well as advising and defending employers and others against tax, employment discrimination and other labor and employment, and other related audits, investigations and litigation, charges, audits, claims and investigations by the IRS, Department of Labor and other federal and state regulators. Ms. Stamer has advised and represented employers on these and other labor and employment, compensation, health and other employee benefit and other personnel and staffing matters for more than 22 years. Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

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Posted by Cynthia Marcotte Stamer

House Passes Affordable Health Care For America, Health Care Reform Debate Focus Now Moves To The Senate

November 9, 2009

The U.S. House of Representatives passed the massive health care reform bill introduced by Representative John Dingle and backed by House Speaker Nancy Pelosi, H.R. 3962, the Affordable Health Care for America Act (HR 3962) by a recorded vote of 220 – 215 late Saturday, November 7, 2009 after a day of debate which lead to the adoption of an amendment prohibiting the use of federal funds for abortion services in the public option.  The health care reform debate now moves to the Senate. 

As of this morning (November 9, 2009), the U.S. Government Printing Office had not released an official copy of the text of H.R. 3962 revised to reflect the amendments adopted by the House on Saturday prior to its passage of H.R. 3962.  However, a record of the amendments approved by House members before passage of H.R. 3962 along with text of the bill prior as originally introduced on October 29, 2009 are available for review online here.

We also encourage you and others to join the discussion about these and other health care reform proposals and concerns by joining the Coalition for Responsible Health Care Reform Group on Linkedin, registering to receive these updates here

If you have questions about or need assistance monitoring, evaluating, commenting on or responding to this or any other health care reform proposal or other federal or state health care, workforce or other legislative, regulatory or other developments or concerns, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group, Ms. Stamer is experienced with assisting employers and others about compliance with federal and state health care, employee benefit, workforce and other legislation and regulation. Ms. Stamer has advised and represented clients about these and other health care labor and employment, compensation, employee benefit and other personnel and staffing matters for more than 20 years. Ms. Stamer also speaks and writes extensively on these and other related matters. Her public policy experience includes ongoing involvement in these concerns within the U.S. for 30 years, as well as serving as a policy advisor on Social Security Reform to the Government of Bolivia and providing input or other representation to various other clients on workforce, health care and other policies in various other regions of the world. 

For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here. 

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

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Posted by Cynthia Marcotte Stamer

SHRM Tells Members Say “NO!” To Pelosi-Backed Health Care Reform

November 6, 2009

In a rare weekend meeting, the House of Representatives is scheduled to  consider H.R. 3962, the Affordable Health Care for America Act and, if Speaker Nancy Pelosi has her way, vote to pass it as early as this weekend. 

In anticipation of this action, the Society For Human Resources (SHRM) is voicing strong opposition to H.R. 3962 and  urging U.S. citizens and businesses to express their strong opposition to it as well to members of Congress immediately.

According to communications circulated this week, SHRM “strongly supports comprehensive health care reform that strengthens the employer-based system, promotes wellness programs and health promotion initiatives, strengthens the Employee Retirement Income Security Act (ERISA), increases purchaser and consumer access to cost and quality information and increases access to affordable health coverage.  SHRM says the House bill fails to achieve these goals.  Accordingly, SHRM is urging American’s to contact their Representative today to urge a NO VOTE on H.R. 3962.

 SHRM’s concerns about the proposal include that H.R. 3962:

  • Does not include provisions to facilitate greater availability of wellness programs among employers and employees. 
  • Does not include meaningful cost, quality, or transparency provisions to ensure that both employers and employees have better access to health-related information.
  • Requires employers to provide and pay for “qualified” health care coverage or face an 8 percent payroll tax.  Employers must pay 72.5 percent of the premium for individuals and 65 percent of the premium for families.  In addition, even if an employer provides and pays for health insurance coverage for their workforce, that employer could still be subject to an 8 percent payroll tax if employees decline employer coverage because it is unaffordable – defined as more than 12 percent of the employee’s income.
  • Would erode the Employee Retirement Income Security Act (ERISA) by applying state law remedies to employer purchased coverage  in a health insurance exchange; prohibiting post-retirement reductions of retiree health benefits by group health plans, unless reductions are also made to active employees’ health benefits; and requiring employer-sponsored plans to meet detailed federal requirements that will increase costs.
  • Includes a public insurance plan option that raises serious concerns about cost-shifting to private plans. SHRM objects because inadequate reimbursement practices under Medicare and Medicaid has resulted in significant cost-shifting to private plans, increasing costs for both employers and employees. 

In light of these concerns, SHRM is asking all members and other concerned Americans to write mMembers of Congress TODAY and urge them to oppose the Affordable Health Care for America Act. It invites members to use SHRM’s HRVoice to share thes econcernings by:

  • Log ging onto HR Voice
  • Under the heading “Take Immediate Action on these Hot Issues,” click on:   “VOTE NO on the Affordable Health Care for America Act (H.R. 3962)” and
  • Personalizing and sending individualized letters by including specific information about the organization you work for, your experiences in the workplace, and why this legislation would negatively impact your organization. 

If you have questions about or need assistance monitoring, evaluating, commenting on or responding to this or any other health care reform proposal or other federal or state health care, workforce or other legislative, regulatory or other developments or concerns, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group, Ms. Stamer is experienced with assisting employers and others about compliance with federal and state health care, employee benefit, workforce and other legislation and regulation. Ms. Stamer has advised and represented clients about these and other health care labor and employment, compensation, employee benefit and other personnel and staffing matters for more than 20 years. Ms. Stamer also speaks and writes extensively on these and other related matters. Her public policy experience includes ongoing involvement in these concerns within the U.S. for 30 years, as well as serving as a policy advisor on Social Security Reform to the Government of Bolivia and providing input or other representation to various other clients on workforce, health care and other policies in various other regions of the world. 

For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

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Posted by Cynthia Marcotte Stamer

US and UK Agree to Share Information & Cooperate On Pension Security As US Defined Benefit Plan Sponsors Face Tough New Defined Benefit Plan Funding Requirements

November 5, 2009

Rising business failures, constricting budgets, employment losses and other business and workforce dislocations associated with the recent economic downturn are adding new urgency to efforts by U.S. and international leaders to act to mitigate threats to the security of worker pensions.   

In response to these concerns, the U.S. Pension Benefit Guaranty Corp. (PBGC), the United Kingdom’s The Pensions Regulator and Pension Protection Fund recently have reached an information sharing agreement intended to help the agencies in both countries protect retirement benefits earned by workers and retirees on both sides of the Atlantic.  Meanwhile, businesses that sponsoring defined benefit pension plans now are required to comply with newly released final Internal Revenue Service regulations that increase minimum contributions required by many sponsors, and impose other new mandates designed to accelerate plan funding and otherwise promote greater security of these benefit programs in an economically challenged business environment. 

Under a Memorandum of Understanding, signed on November 4, 2009, the three agencies will share any unrestricted information that advances the security of defined benefit plans sponsored by private sector companies. Confidential financial information from those companies will not be shared. While the agreement facilitates broad access to data, intelligence, and other records, it is not legally binding. Additionally, the agencies are not compelled to lend assistance to each other, especially if legal proceedings are underway, and such assistance would be contrary to the interests of either country.  The agreement can be canceled at any time by any party.

The Pensions Regulator oversees private sector defined benefit plans in the UK and is charged with protecting the retirement benefits of plan members. The Regulator is also charged with reducing the risk of claims for compensation from the Pension Protection Fund (PPF). The PPF was created to pay compensation to members of eligible defined benefit pension plans when the plan’s sponsor was unable to pay benefits.

The PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits earned by 44 million American workers and retirees participating in over 29,000 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by investment returns.

The Memorandum of Understanding is one of a variety of actions that the U.S. regulators are taking as part of their efforts to shore up the security of private retirement benefits and funding. On October 15, 2009, the Internal Revenue Service published final regulations regarding the “Measurement of Assets and Liabilities for Pension Funding Purposes; Benefit Restrictions for Underfunded Pension Plans” construing the amended single employer defined benefit plan minimum funding rules in Internal Revenue Code (“Code”) §§ 430(d), 430(f), 430(g), 430(h)(2), 430(i), and 436, added to the Code by the Pension Protection Act of 2006 (PPA ’06), Public Law 109-280 (120 Stat. 780) taking into account subsequent amendments made by the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA ’08), Public Law 110-458 (122 Stat. 5092). These new final regulations implement new federal rules that accelerate the time within which employers are required to fund defined benefit retirement benefit commitments made in single employer defined benefit pension plans and impose other complicated new requirements intended to improve the funding and security of these programs.  As implementation of these new rules proceeds, the PBGC is working to respond to the growing wave defined benefit pension plans whose plan sponsors have already gone bankrupt or otherwise have proven unable to meet already existing funding obligations.

If you have questions about or need assistance evaluating or complying these minimum funding rules or other employee benefit, employment, compensation, workplace health and safety, corporate ethics and compliance practices, concerns or claims, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group, Ms. Stamer has more than 20 years experience advising and representing employers, plan sponsors and fiduciaries, and others about these and other related workforce, benefits, compensation and compliance matters.  Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

 

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Posted by Cynthia Marcotte Stamer

Congress Considering Extending & Expanding Group Health Plan COBRA Subsidy Mandates On Heels of Enactment of Expanded Military Leave-Related Family Leave Mandates

November 5, 2009

Following up on its October expansion of federal requirements that employers and their group health plans provide family leave rights in relation to certain military related absences, Congress now is considering extending and expanding the “COBRA Premium Subsidy” rules for group health plans enacted by Congress on February 17, 2009 as part of the American Recovery and Reinvestment Act of 2009 (ARRA) beyond their currently scheduled December 31, 2009 expiration date and further to restrict the amount that group health plans can charge former employees and their dependents covered by the COBRA Premium Subsidy rules to maintain coverage under the coverage continuation mandates of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”).

COBRA generally allows employee and dependents who otherwise would lose eligibility for group health benefits under union or employer sponsored plans temporarily to continue enrollment in the group health plan by paying up to 102 percent of the full cost of that coverage (the “COBRA premium”) and fulfilling certain other conditions set forth in COBRA.  Under ARRA’s COBRA Premium Subsidy Rules, Congress among other things amended COBRA through December 31, 2009 to require that employers “subsidize” 65% of the otherwise applicable COBRA premium for employees or dependents electing COBRA coverage following a loss of eligibility due to the involuntary employment termination between September 15, 2008 and December 31, 2009 who otherwise qualify as “assistance eligible individuals” under ARRA.  The COBRA Premium Subsidy rules created a mechanism through which employers providing the required COBRA Premium Subsidy can claim a payroll tax credit for COBRA Premium Subsidy amounts paid with respect to assistance eligible individuals in accordance with ARRA’s mandates. 

Senator Sherrod Brown (D-Ohio) and Robert P. Casey (D-PA) now are proposing that Congress extend and expand ARRA COBRA Premium Subsidy requirements applicable to group health plans as proposed by the “COBRA Subsidy Extension and Enhancement Act” (S. 2730).  Introduced on November 5, 2009, the Government Printing Office had not published the text of S. 2730 as of the release of this publication.  However, It is expected that the official text of S. 2730 will be made available for review soon here. In the meanwhile, the reading of S. 2730 into the record when introduced in the Senate on November 4, 2009 and its sponsors’ news releases, the “COBRA Subsidy Extension and Enhancement Act” (S. 2730) proposes that Congress:

  • Extend the COBRA Premium Subsidy requirements an extra six months to 15 months;
  • Increase the required subsidy amount during the extended COBRA Premium Subsidy period from 65 percent to 75 percent of the COBRA premium; and
  • Clarify that the employees and dependents eligible to qualify as assistance eligible individuals under ARRA includes those losing group health plan eligibility due to an employment loss, whether from an actual employment termination or a decline in hours of employment.

Expanded FMLA Military Leave Related Mandates Added Under Defense Appropriations Laws Already Require Immediate Action

The proposal in S. 2730 to extend the ARRA COBRA Premium Subsidy mandates is the latest in a series of recently enacted and proposed federal laws and implementing regulations imposing an ever-expanding list of federal eligibility mandates on employment based group health plans.  These include not only an expanding list of federal mandates that group health plans make available continued coverage to individuals whose eligibility for coverage otherwise would end on account of an employment decline or loss such as those enacted as part of the National Defense Authorization Act for Fiscal Year 2010, Public Law 111-84 (“2010 NDAA”), signed into law by President Obama on October 28, 2009 and the National Defense Authorization Act for Fiscal Year 2008 the (“2008 NDAA”) signed into law by President Bush in January, 2008.  These FMLA military leave-related mandates are in addition to separate group health coverage continuation mandates separately imposed upon employers and group health plans under the Uniformed Services Employment and Reemployment Rights Act (USERRA).

For instance, the 2008 NDAA amended the Family and Medical Leave Act (“FMLA”) to add new family military-leave provisions, which were further expanded by the 2010 NDAA.  The 2008 NDAA adds two new qualifying circumstances under which eligible employees must be allowed to take FMLA leave and to continue group health plan coverage during that FMLA:

  •  “Qualifying exigency leave” and
  •  “Military caregiver leave,” also referred to as “leave to care for a covered servicemember.”

Final regulations implementing the 2008 NDAA FMLA mandates and other FMLA requirements took effect on January 16, 2009. The NDAA for 2010 further amended these family military-leave mandates to expand the circumstances under which the FMLA leave mandates employers and their group health plans extend FMLA leave rights in relation to military members. 

Beyond these military-leave related group health plan mandates, group health plans also are required to comply with a host of other recently-expanded federal eligibility and other mandates such as new mandates to offer up to 12-months coverage continuation for dependents whose coverage otherwise would terminate due to a medically required break in school enrollment, expanded group health plan special enrollment and nondiscrimination rules imposed under ARRA, the Genetic Information and Nondiscrimination Act (“GINA”) and the Health Insurance Portability & Accountability Act  (“HIPAA”) and various others.  Congress is considering further amendments to these and other federal mandates under proposals included in the various health care bills being heavily debated in Congress, as well as others included in legislation proposed separately from these broader health care reform proposals.

Take Prompt Action to Manage Risks

In addition to monitoring and sharing their input with Congress about S. 2730 and other proposed legislation impacting their group health plans, group health plans, their sponsoring employers or unions, insurers, fiduciaries and administrative service providers also should take prompt action to ensure that their group health plan documents, notices and other communications, processes and procedures have been properly updated in response to the statutory regulatory changes to federal group health plan eligibility and other mandates.

If you have questions about or need assistance reviewing or sharing your input with Congress about S. 2730 or other proposed legislation, evaluating and updating, administering or defending your group health plan in light of these or other federal regulations, or with other employee benefit, employment, compensation, workplace health and safety, corporate ethics and compliance practices, concerns or claims, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Group and past chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer has more than 20 years experience advising and representing employee benefit plans, employers, plan sponsors and fiduciaries, administrative services providers, insurers and others about these and other related matters.  Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

Comments Off on Congress Considering Extending & Expanding Group Health Plan COBRA Subsidy Mandates On Heels of Enactment of Expanded Military Leave-Related Family Leave Mandates | COBRA, Employers, ERISA, family leave, FMLA, Health Plans, Human Resources, Insurance, Leave, medical leave | Tagged: , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

November 15, 2009 Is Deadline To Send Required Group Health Plan Medicare Part D “Creditable Coverage” Notice

November 3, 2009

November 15, 2009 is the deadline for group health plans providing prescription drug coverage to send the annually-required notification (the “Part D Notice”) to Medicare-eligible participants whether the plan’s prescription drug coverage is or is not “creditable coverage” (“Creditable Coverage”) for purposes of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the “MMA”) “Part D” prescription drug coverage program.  Before distributing the required Part D Notice, group health plan sponsors and administrators should review and update the Part D Notice as needed in light of 2009 revisions to the Part D Notice requirements issued earlier this year by CMS.

The MMA generally mandates that covered employer-sponsored group health plans send a Part D Notice that complies with the form and content requirements established by the Centers for Medicare & Medicaid Services (“CMS”) to all Medicare Part D-eligible individuals covered under, or who apply for, enrollment in a group health plan providing prescription drug coverage at each of the following times:

  • Before the Medicare Part D annual coordinated election period (November 15 – December 31) each year;
  • Within the 12 months before an individual’s initial enrollment period for Medicare;
  • Before the effective date of coverage for a Medicare-eligible individual beginning participation in the group health plan;
  • When the plan’s prescription drug coverage ends or is no longer creditable; and
  • Upon a beneficiary’s request.

Because CMS posted revised model notices and updated guidance regarding creditable coverage disclosures earlier this year, plan sponsors and administrators before distributing their Part D Notice generally will need to:

  • Determine whether their group health plan does or does not provide creditable coverage for purposes of Medicare Part D regulations;
  • Determine which Medicare Part D notification should be provided in light of the existing group health plan design; and
  • Review and update, if necessary, the content and form of the Part D Notice to comply with the updated guidance issued earlier this year.

 

The Annual Part D Notice requirement generally applies to all group health plans not otherwise specifically excluded from coverage even those that do not provide retiree coverage.  The MMA generally requires notification to Medicare Part D-eligible employees and dependents, regardless of whether the member is enrolled under active or retired coverage or whether the group health plan coverage is primary or secondary to Medicare.

A group health plan must determine if its prescription drug coverage is “creditable coverage” in accordance with rules contained in the Medicare Part D regulations.  These regulations generally specify that prescription drug coverage qualifies as creditable coverage if the actuarial value of the coverage equals or exceeds the actuarial value of the Part D prescription drug coverage, as demonstrated through the use of generally accepted actuarial principles in accordance with CMS actuarial guidelines. This actuarial determination measures whether the expected amount of paid claims under the group health plan’s prescription drug coverage is at least as much as the expected amount of paid claims under the standard Medicare prescription drug benefit.   In lieu of an actuarial assessment, the Medicare Part D regulations alternatively allow group health plans to rely upon a safe harbor rule.  Under this safe harbor, group health plans offering prescription drug coverage qualify as providing Creditable Coverage without an actuarial assessment if the standards of the safe harbor rule are met. 

This determination of creditable coverage for Medicare Part D purposes is separate and distinct from the requirement that group health plans determine and provide notification of “creditable coverage” when group health plan coverage ends pursuant to the group health plan portability requirements imposed by the Health Insurance Portability & Accountability Act of 1996, as amended (“HIPAA”). 

When distributing the Part D Notice, group health plan sponsors and administrators also generally will want to make arrangements to ensure that separately required notifications to CMS regarding the creditable coverage status of the group health plan under Medicare Part D will be timely made as well as calendar reminders to prepare and provide the Part D Notice expected to be required in November, 2010. The Medicare Part D regulations also generally require group health plans also to provide a “Disclosure Notice” to CMS informing it whether the applicable group health plan provides Medicare Part D Creditable Coverage on an annual basis during the first 60 days of the plan year, and upon any change that affects whether the group health plan provides prescription drug coverage that is or is not creditable coverage for Medicare Part D purposes..

In addition to the Medicare Part D notice requirements, group health plans also are required to provide various other annual and other notifications by ERISA, the Health Insurance Portability & Accountability Act of 1996, as amended (“HIPAA”), Newborns’ and Mothers’ Health Protection Act, medical coverage e continuation requirements under the Consolidated Omnibus Budget Reconciliation Act, as amended (“COBRA”), the Family & Medical Leave Act and a host of other federal laws, many of require updates in response to statutory and/or regulatory changes in the past year.  In addition to updating and providing the required Medicare Part D Notice, many group health plan sponsors and administrators also should review and update  their group plan language, notifications and processes in response to amendments affecting these practices as well as a series of other recent changes to federal mandates affecting group health plans.  For more information about these and other developments affecting group health plans, checkout some of the writings and recorded presentations of Ms. Stamer available here.

If you need assistance reviewing or updating your group health plan’s implications of the MMA on your group health plans or other health or employee benefit plan requirements, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group and past Chair of the ABA Health Law Section Managed Care & Insurance Interest Group, Ms. Stamer is nationally recognized for her more than 20 years work, writing and leadership advising employers and other plan sponsors, plan administrators and fiduciaries, insurers, administrative services providers, brokers, and others about the design, documentation, administration and defense of health and other employee benefit, insurance, and other compensation and employment practices. Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  Some other recent updates that may be of interested include the following, which you can access by clicking on the article title:

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

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Posted by Cynthia Marcotte Stamer

IRS Updates Procedures Qualifying Small Employers Can Use To Qualify To Report Employment Taxes Annually Rather Than Quarterly

October 27, 2009

The Internal Revenue Service (IRS) today published updated procedures governing when certain employers may elect to report social security, Medicare and withheld federal income taxes (employment taxes) annually by filing IRS Form 944, rather than reporting those amounts quarterly for tax years beginning after December 31, 2009. 

Beginning in the 2010 tax year, Revenue Procedure 2009-51 will allow qualifying employers to opt out of filing Form 944 social security, Medicare and withheld federal income taxes (“employment taxes”) for any reason if they follow the procedures set forth in Revenue Procedure 2009-51 by the applicable deadline specified in the Revenue Procedure.  The procedures set forth in Revenue Procedure 2009-51 generally are available only to employers are those with an estimated annual employment tax liability of $1,000 or less for the entire calendar year, other than employers required to make a return on Form 943, Employer’s Annual Federal Tax Return For Agricultural Employees, or on Schedule H (Form 1040), Household Employment Taxes.

Revenue Procedure 2009-51 outlines the procedures that qualified employers can apply to report employment taxes annually on the Form 944.  Employers wishing to take advantage of this option must request to file the Form 944 by contacting the IRS as specified in Revenue Procedure 2009-51 and have received the written approval of their request from the IRS before using the Form 944 by the applicable deadline.  Alternatively employers who previously received notification of their qualification to file Form 944 must continue to file Form 944 unless the IRS notifies the employer that the employer no longer qualifies to file Form 944 or the employer opts out consistent with the procedures set forth in Revenue Procedure 2009-51.

Employers electing to report employment taxes annually rather than quarterly should ensure that they continue to timely deposit employment taxes as required by the Internal Revenue Code.  Generally, the same deposit rules apply to employers regardless of which form they file to report their employment tax liability; however, the de minimis deposit amount may be different. Employers who file Forms 941 and 944 still must deposit their employment tax liability in accordance with the rules in Treas. Reg. §§ 31.6302-1 and 31.6302-1T or, absent reasonable cause, the employers may be subject to the penalty for failure to deposit under section 6656.

Qualifying employers wishing to make elections under these rules must act in a timely fashion.  An employer wishing to request to opt in or out of filing Form 944 for the current tax year via telephone generally must call the IRS at the designated number on or before April 1st of the current tax year (e.g., April 1, 2010 for returns for tax year 2010); written requests generally must be postmarked on or before March 15th of the current tax year (e.g., March 15, 2010 for returns for tax year 2010).  Special deadlines apply for businesses that recently received an employer identification number or had an employer identification number but were not previously required to file Forms 941 or Form 944.  Consult your tax advisor if you have questions about these deadlines. 

If you have questions about or need assistance evaluating, commenting on or responding to these or other employment, compensation, employee benefit, workplace health and safety, corporate ethics and compliance practices, concerns or claims, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group, Ms. Stamer is experienced with assisting employers and others about compliance with federal and state employment, compensation and employee benefit, workplace safety, and other labor and employment, as well as advising and defending employers and others against tax, employment discrimination and other labor and employment, and other related audits, investigations and litigation, charges, audits, claims and investigations by the IRS, Department of Labor and other federal and state regulators. Ms. Stamer has advised and represented employers on these and other labor and employment, compensation, employee benefit and other personnel and staffing matters for more than 20 years. Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here.

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  

Comments Off on IRS Updates Procedures Qualifying Small Employers Can Use To Qualify To Report Employment Taxes Annually Rather Than Quarterly | Employers | Tagged: , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

EEOC Prepares To Broaden “Disability” Definition Under ADA Regulations

September 18, 2009

Proposed regulations modifying existing Equal Employment Opportunity Commission (EEOC) rules concerning the conditions that an individual must meet to qualify as having a “disability” for purposes of claiming protection under the Americans with Disabilities Act (ADA) are expected to be published in the Federal Register the week of September 21, 2009.

On September 16, 2009, the EEOC announced that Commissioners had approved a Notice of Proposed Rulemaking (Proposed Regulation) which would make several significant changes to the its current regulatory definition of the term “disability” for purposes of the ADA.  The EEOC announced this week that the Proposed Regulation is expected to be published in the Federal Register the week of September 21, 2009.  Interested persons will have 60 days from the publication date of the Proposed Rule to submit comments to the EEOC concerning the Proposed Regulation.

Why The Change?

The proposed changes are intended to respond to amendments enacted under the ADA Amendments Act (ADAAA), which took effect January 1, 2009.   Enacted on September 25, 2008, the ADAAA made a number of significant changes to the definition of “disability” in the ADA as well as directed EEOC to amend its existing ADA regulation to reflect the changes made by the ADAAA.

The ADAAA amendments to the ADA definition of “disability” make it easier for certain individuals alleging employment discrimination based on disability to establish disability status under the ADA’s definition of “disability” by overruling various Supreme Court holdings and portions of EEOC’s existing ADA regulations considered by many members of Congress as too narrowly applying the definition of “disability.”  

While the ADAAA retains the ADA’s basic definition of “disability” as an impairment that substantially limits one or more major life activities, a record of such an impairment, or being regarded as having such an impairment, provisions of the ADAAA that took effect on January 1, 2009 change the required interpretation of these terms.  Under the ADAAA, “major life activities” now include both many activities that the EEOC has recognized (e.g., walking) as well as activities that EEOC has not specifically recognized (e.g., reading, bending, and communicating), as well as major bodily functions (e.g., “functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions”). 

In addition to these clarifications, the ADAAA also broadens the reach of the ADA’s definition of “disability” in various other respects.  For instance, the ADAAA:

  • Asserts that mitigating measures other than “ordinary eyeglasses or contact lenses” shall not be considered in assessing whether an individual has a disability;
    Clarifies that an impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active;
  • Changes the definition of “regarded as” so that it no longer requires a showing that the employer perceived the individual to be substantially limited in a major life activity, and instead says that an applicant or employee is “regarded as” disabled if he or she is subject to an action prohibited by the ADA (e.g., failure to hire or termination) based on an impairment that is not transitory and minor; and
  • Provides that individuals covered only under the “regarded as” prong are not entitled to reasonable accommodation.

As part of the required implementation of its provisions, the ADAAA also mandates that the EEOC revise that portion of its existing regulations defining the term “substantially limits” and “major life activities” to comport to the changes enacted by the ADAAA.  In response to this statutory direction, the Proposed Regulation to be published next week proposes changes both to the ADA regulation itself and to the Interpretive Guidance (also known as the Appendix) that was published at the same time as the original ADA regulation. See 29 C.F.R. section 1630.  The Appendix provides further explanation from the EEOC on how its ADA regulations should be interpreted.

About The New Guidance and Proposed Regulations

In anticipation of the publication of the Proposed Regulation, the EEOC on September 16, 2009 sought to provided a peek into its new post-ADAAA construction of the ADA definition of disability by releasing its “Questions and Answers on the Notice of Proposed Rulemaking for the ADA Amendments Act of 2008” Questions and answers on the Notice of Proposed Rulingmaking for the ADA Amendments Act of 2008 (the “Q&As”). 

The Q&As and other EEOC statements released this week indicate that the Proposed Regulation will emphasize that the definition of disability — an impairment that poses a substantial limitation in a major life activity — must be construed broadly. It will provide that that major life activities include “major bodily functions;” that mitigating measures, such as medications and devices that people use to reduce or eliminate the effects of an impairment, are not to be considered when determining whether someone has a disability; and that impairments that are episodic or in remission, such as epilepsy, cancer, and many kinds of psychiatric impairments, are disabilities if they would “substantially limit” major life activities when active. The regulation also will provides a streamlined means through which persons claiming disability may demonstrate a substantial limitation in the major life activity of working, and implements the ADAAA’s new standard for determining whether someone is “regarded as” having a disability.

Required Response

Employers face increasing exposure to disability claims as a result of the ADAAA amendments, new genetic information nondiscrimination rules enacted under the Genetic Information Nondiscrimination Act (GINA), and a heightened emphasis on disabilities discrimination law enforcement by the Obama Administration.  In light of this rising exposure, employers and others covered by the ADA should evaluate their existing practices in light of the Q&As and make adjustments, submit comments regarding the Proposed Regulations or both as part of their efforts to manage their organization’s ADA liability exposure.  Because the ADAAA already is in effect, employers already face the possibility of being called upon to defend their hiring and employment practices under the amended ADAAA definition of disability, even though the EEOC has not issued final guidance.  For this reason, it is important that employers take timely action both to update relevant written policies and procedures, as well as to change hiring and other operational processes, conduct training, implement appropriate oversight and monitoring and take other steps to mitigate these exposures.

If you have questions about or need assistance evaluating, commenting on or responding to the  Proposed Regulations, the Q&As, or other employment, compensation, employee benefit, workplace health and safety, corporate ethics and compliance practices, concerns or claims, please contact the author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer.  Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization and Chair of the American Bar Association RPTE Employee Benefits & Other Compensation Group, Ms. Stamer is experienced with assisting employers and others about compliance with federal and state equal employment opportunity, compensation and employee benefit, workplace safety, and other labor and employment, as well as advising and defending employers and others against tax, employment discrimination and other labor and employment, and other related audits, investigations and litigation, charges, audits, claims and investigations by the IRS, Department of Labor and other federal and state regulators. Ms. Stamer has advised and represented employers on these and other labor and employment, compensation, employee benefit and other personnel and staffing matters for more than 20 years. Ms. Stamer also speaks and writes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.   For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi LLP team, see here. 

Other Information & Resources

We hope that this information is useful to you. 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 or e-mailing this information here or registering to participate in the distribution of our Solutions Law Press HR & Benefits Update distributions here.  Some other recent updates that may be of interested include the following, which you can access by clicking on the article title:

For important information concerning this communication click here.   If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject here.

©2009 Cynthia Marcotte Stamer. All rights reserved. 

Comments Off on EEOC Prepares To Broaden “Disability” Definition Under ADA Regulations | ADA, Disease Management, EEOC, Employee Benefits, Employers, GINA, Human Resources, Internal Controls, Internal Investigations, OFCCP, Retaliation, Retirement Plans | Tagged: , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Register Now For HITECH Act Health Data Security & Breach Update: Learn What You Must Do This Month To Comply With New Health Data Breach Regulations

September 2, 2009

September 10, 2009 – Noon to 1:30 P.M. Central Time       Participate In Person or Via Remote!

Health care providers, health plans, health clearinghouses and their business associates (Covered Entities) must comply with the new “Breach Notification For Unsecured Protected Health Information” regulation (Breach Regulation) by September 23, 2009. 

Catch up on what the Breach Rule means for your organization and how it must respond by participating in the “HITECH Act Health Data Security & Breach Update” on Thursday, September 10, 2009 from Noon to 1:30 P.M. Central Time for a registration fee of $45.00. Registrants will have the option to participate via teleconference or in person at the offices of Curran Tomko Tarski LLP, 2001 Bryan Street, Suite 2050, Dallas Texas 75201.  For information about registering for this program or other questions here,

The Breach Rule requires Covered Entities to notify affected individuals following a “breach” of “unsecured” protected health information. Just published August 24th, the Breach Regulation is part of a series of guidance that HHS is issuing to implement new and stricter personal health information privacy and data security requirements for Covered Entities added to HIPAA under the Health Information Technology for Economic and Clinical Health (HITECH) Act signed into law on February 17, 2009 as part of American Recovery and Reinvestment Act of 2009 (ARRA).  The briefing will cover:

  • Who must comply, health plans, employers, others?
  • What your organization must do
  • How to qualify protected health information as exempt from the breach regulations as “secure” protected health information
  • What is considered a breach of unsecured protected health information
  • What steps must a covered entity take if a breach of unsecured protected information happens
  • What liabilities do covered entities face for non-compliance
  • What new contractual requirements, policies and procedures Covered Entities and Business Associates will need
  • How the Breach Regulation, the Privacy Regulation, impending FTC red flag rules and state data breach and privacy rules interrelate
  • Other recent developments
  • Practical tips for assessing, planning, moving to and defending compliance
  • Participant questions
  • More

About The Presenter

The program will be presented by Curran Tomko and Tarski LLP Health Care & Employee Benefits Practice Leader and Partner Cynthia Marcotte Stamer.  Ms. Stamer is nationally known for her work, publications and presentations on privacy and security of health and other sensitive information in health and managed care, employment, employee benefits, financial services, education and other contexts.  Chair of the ABA RPTE Employee Benefits & Other Compensation Committee, a ABA Joint Committee on Employee Benefits Council Representative, Vice President of the North Texas Health Care Compliance Professionals Association, Past Chair of the ABA Health Law Section Managed Care & Insurance Section and the former Board Compliance Chair of the National Kidney Foundation of North Texas, Ms. Stamer has more than 20 years experience advising clients about health and other privacy and security matters.  A popular lecturer and widely published author on privacy and data security and other related health care and health plan matters, Ms. Stamer is the Editor in Chief of the forthcoming 2010 edition of the Information Security Guide to be published by the American Bar Association Information Security Committee in 2010, as well as the author of “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security Beyond HIPAA,” and a host of other highly regarded publications. She has continuously advises employers, health care providers, health insurers and administrators, health plan sponsors, employee benefit plan fiduciaries, schools, financial services providers, governments and others about privacy and data security, health care, insurance, human resources, technology, and other legal and operational concerns. Ms. Stamer also publishes and speaks extensively on health and managed care industry privacy, data security and other technology, regulatory and operational risk management matters.  Her insights on health care, health insurance, human resources and related matters appear in the Atlantic Information Service, Bureau of National Affairs, World At Work, The Wall Street Journal, Business Insurance, the Dallas Morning News, Managed Healthcare, Health Leaders, and a many other national and local publications.  For additional information about Ms. Stamer, her experience, involvements, programs or publications, see here. 

We hope that this information is useful to you.  If you need assistance monitoring, evaluating or responding to these or other compliance, risk management, transaction or operation concerns, please contact the author of this update, Cynthia Marcotte Stamer, at (214) 270-2402, cstamer@cttlegal.com or another Curran Tomko Tarski LLP Partner of your choice.

Other Helpful Resources & Other Information 

If you find this of interest, you also be interested in one or more of the following other recent articles published on our electronic Curran Tomko Tarski LLP publications available for review 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 at here. You can access other recent updates and other informative publications and resources provided by Curran Tomko Tarski LLP attorneys and get information about its attorneys’ experience, briefings, speeches and other credentials here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@cttlegal.net.

©2009 Solutions Law Press.   All rights reserved.

Comments Off on Register Now For HITECH Act Health Data Security & Breach Update: Learn What You Must Do This Month To Comply With New Health Data Breach Regulations | Corporate Compliance, Data Security, Disease Management, Employers, GINA, Health Plans, HIPAA, Human Resources, Insurance, Internal Controls, Privacy, Protected Health Information | Tagged: , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

ADAAA Amendment Broader ADA “Disability” Definition Not Retroactive, Employer Action Needed To Manage Post 1/1/2009 Risks

August 25, 2009

Provisions of the ADA Amendments Act (ADAAA) that expand the definition of “disability” under the Americans with Disabilities Act (ADA) “in favor of broad coverage of individuals” do not apply to actions taken before effective date of the ADAAA, January 1, 2009, according to a recent decision of the U.S. Circuit Court of Appeals for the District of Columbia. While the holding provides some comfort for employers in relation to pre-January 1, 2009 actions, employers need to take appropriate steps to mitigate disability claim risks for actions on or after the January 1, 2009 effective date of the ADAAA.

As signed into law on September 25, 2008, the ADAAA amended the definition of “disability” for purposes of the disability discrimination prohibitions of the ADA to make it easier for an individual seeking protection under the ADA to establish that that has a disability within the meaning of the ADA.  The ADAAA retains the ADA’s basic definition of “disability” as an impairment that substantially limits one or more major life activities, a record of such an impairment, or being regarded as having such an impairment. However, provisions of the ADAAA that took effect January 1, 2009 change the way that these statutory terms should be interpreted in several ways. Most significantly, the Act:

  • Directs EEOC to revise that portion of its regulations defining the term “substantially limits;”
  • Expands the definition of “major life activities” by including two non-exhaustive lists: (1) The first list includes many activities that the EEOC has recognized (e.g., walking) as well as activities that EEOC has not specifically recognized (e.g., reading, bending, and communicating); and (2) The second list includes major bodily functions (e.g., “functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions”);
  • States that mitigating measures other than “ordinary eyeglasses or contact lenses” shall not be considered in assessing whether an individual has a disability;
  • Clarifies that an impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active;
  • Changes the definition of “regarded as” so that it no longer requires a showing that the employer perceived the individual to be substantially limited in a major life activity, and instead says that an applicant or employee is “regarded as” disabled if he or she is subject to an action prohibited by the ADA (e.g., failure to hire or termination) based on an impairment that is not transitory and minor; and
  • Provides that individuals covered only under the “regarded as” prong are not entitled to reasonable accommodation.

The ADAAA also emphasizes that the definition of disability should be construed in favor of broad coverage of individuals to the maximum extent permitted by the terms of the ADA and generally shall not require extensive analysis.

In Lytes v. DC Water and Sewer Authority, D.C. Cir. No. 08-7002 (July 21, 2009), the D.C. Court of Appeals considered and rejected the retroactivity argument made by Lytes in his appeal from a trial court’s finding that he was not disabled under the ADA.  As the ADAAA took effect while his action was pending, Lytes sought to convince the Appeals Court to apply the ADAAA amended definition retroactively.  Contending that the ADAAA amendment merely clarified the existing law under the ADA, Lytes argued that the Court should apply the broader definition of disability when considering the legality of his termination from employment in 2004.

Rejecting Lytes’ retroactivity argument, the Court of Appeals ruled that the ADAAA amendment of the definition of “disability” under the ADA applies only on a prospective basis based on its finding that Congress had clearly provided that the ADAAA amendments only would apply to post-December 31, 2008 actions. Accordingly, the Court of Appeals affirmed the District Court’s finding that Lytes termination in 2004 did not violate the ADA as then effective as his lack of disabled status under the then-applicable definition of disability meant he was not entitled to accommodation.

In adopting these changes, Congress expressly sought to overrule existing employer-friendly judicial precedent construing the current provisions of the ADA and to require the Equal Employment Opportunity Commission (EEOC) to update its existing guidance to confirm with the ADAAA Amendments.

Violations of the ADA can expose businesses to substantial liability. Violations of the ADA may be prosecuted by the EEOC or by private lawsuits.  Employees or applicants that can prove they were subjected to prohibited disability discrimination under the ADA generally can recover actual damages, attorneys’ fees, and up to $300,000 of exemplary damages (depending on the size of the employer).   

While the Lytes decision indicates that businesses will not be required to defend pre-2009 actions under the amended disability standards enacted by the ADAAA, businesses should prepare to meet new challenges in defending ADA claims arising from actions taken after December 31, 2008.  The ADAAA amendments make it likely that businesses generally will face more disability claims from a broader range of employees and will possess fewer legal shields to defend themselves against these claims. These changes will make it easier for certain employees to qualify as disabled under the ADA.  Consequently, businesses should act strategically to mitigate their ADA exposures in anticipation of these changes.  

To help mitigate the expanded employment liability risks created by the ADAAA amendments, businesses generally should act cautiously when dealing with applicants or employees with actual, perceived, or claimed physical or mental impairments to minimize exposures under the ADA.  Management should exercise caution to carefully and appropriate the potential legal significance of physical or mental impairments or conditions that might be less significant in severity or scope, correctable through the use of eyeglasses, hearing aids, daily medications or other adaptive devices, or that otherwise have been assumed by management to fall outside the ADA’s scope. Employers should no longer assume, for instance, that a visually impaired employee won’t qualify as disabled because eyeglasses can substantially correct the employee’s visual impairment. 

Likewise, businesses should be prepared for the EEOC and the courts to treat a broader range of disabilities, including those much more limited in severity and life activity restriction, to qualify as disabling for purposes of the Act. Businesses should assume that a greater number of employees with such conditions are likely to seek to use the ADA as a basis for challenging hiring, promotion and other employment decisions.  For this reason, businesses generally should tighten job performance and other employment recordkeeping to enhance their ability to demonstrate nondiscriminatory business justifications for the employment decisions made by the businesses.

Businesses also should consider tightening their documentation regarding their procedures and processes governing the  collection and handling records and communications that may contain information regarding an applicant’s physical or mental impairment, such as medical absences, worker’s compensation claims, emergency information, or other records containing health status or condition related information.  The ADA generally requires that these records be maintained in separate confidential files and disclosed only to individuals with a need to know under circumstances allowed by the ADA. 

As part of this process, businesses also should carefully review their employment records, group health plan, family leave, disability accommodation, and other existing policies and practices to comply with, and manage exposure under the new genetic information nondiscrimination and privacy rules enacted as part of the Genetic Information and Nondiscrimination Act (GINA) signed into law by President Bush on May 21, 2008.  Effective November 21, 2009, Title VII of GINA amends the Civil Rights Act to prohibit employment discrimination based on genetic information and restricts the ability of employers and their health plans to require, collect or retain certain genetic information. Under GINA, employers, employment agencies, labor organizations and joint labor-management committees face significant liability for violating the sweeping nondiscrimination and confidentiality requirements of GINA concerning their use, maintenance and disclosure of genetic information. Employees can sue for damages and other relief like currently available under Title VII of the Civil Rights Act of 1964 and other nondiscrimination laws.  For instance, GINA’s employment related provisions include rules that will:

  • Prohibit employers and employment agencies from discriminating based on genetic information in hiring, termination or referral decisions or in other decisions regarding compensation, terms, conditions or privileges of employment;
  • Prohibit employers and employment agencies from limiting, segregating or classifying employees so as to deny employment opportunities to an employee based on genetic information;
  • Bar labor organizations from excluding, expelling or otherwise discriminating against individuals based on genetic information;
  • Prohibit employers, employment agencies and labor organizations from requesting, requiring or purchasing genetic information of an employee or an employee’s family member except as allowed by GINA to satisfy certification requirements of family and medical leave laws, to monitor the biological effects of toxic substances in the workplace or other conditions specifically allowed by GINA;
  • Prohibit employers, labor organizations and joint labor-management committees from discriminating in any decisions related to admission or employment in training or retraining programs, including apprenticeships based on genetic information;
  • Mandate that in the narrow situations where limited cases where genetic information is obtained by a covered entity, it maintain the information on separate forms in separate medical files, treat the information as a confidential medical record, and not disclosure the genetic information except in those situations specifically allowed by GINA;
  • Prohibit any person from retaliating against an individual for opposing an act or practice made unlawful by GINA; and
  • Regulate the collection, use, access and disclosure of genetic information by employer sponsored and certain other health plans.

These employment provisions of GINA are in addition to amendments to the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Employee Retirement Income Security Act of 1974 (ERISA), the Public Health Service Act, the Internal Revenue Code of 1986, and Title XVIII (Medicare) of the Social Security Act that are effective for group health plan for plan years beginning after May 20, 2009.

If you have any questions or need help reviewing and updating your organization’s employment and/or employee practices in response to the ADAAA, GINA or other applicable laws, or if we may be of assistance with regard to any other workforce management, employee benefits or compensation matters, please do not hesitate to contact the author of this update, Curran Tomko Tarksi LLP Labor & Employment Practice Chair Cynthia Marcotte Stamer at 214.270.2402.

About The Author

Management attorney and consultant Cynthia Marcotte Stamer helps businesses, governments and associations solve problems, develop and implement strategies to manage people, processes, and regulatory exposures to achieve their business and operational objectives and manage legal, operational and other risks. Board certified in labor and employment law by the Texas Board of Legal Specialization, with more than 20 years human resource and employee benefits experience, Ms. Stamer helps businesses manage their people-related risks and the performance of their internal and external workforce though appropriate human resources, employee benefit, worker’s compensation, insurance, outsourcing and risk management strategies domestically and internationally. Recognized in the International Who’s Who of Professionals and bearing the Martindale Hubble AV-Rating, Ms. Stamer also is a highly regarded author and speaker, who regularly conducts management and other training on a wide range of labor and employment, employee benefit, human resources, internal controls and other related risk management matters.  Her writings frequently are published by the American Bar Association (ABA), Aspen Publishers, Bureau of National Affairs, the American Health Lawyers Association, SHRM, World At Work, Government Institutes, Inc., Atlantic Information Services, Employee Benefit News, and many others. For a listing of some of these publications and programs, see here. Her insights on human resources risk management matters also have been quoted in The Wall Street Journal, various publications of The Bureau of National Affairs and Aspen Publishing, the Dallas Morning News, Spencer Publications, Health Leaders, Business Insurance, the Dallas and Houston Business Journals and a host of other publications. Chair of the ABA RPTE Employee Benefit and Other Compensation Committee, a council member of the ABA Joint Committee on Employee Benefits, and the Legislative Chair of the Dallas Human Resources Management Association Government Affairs Committee, she also serves in leadership positions in numerous human resources, corporate compliance, and other professional and civic organizations. For more details about Ms. Stamer’s experience and other credentials, contact Ms. Stamer, information about workshops and other training, selected publications and other human resources related information, see here or contact Ms. Stamer via telephone at 214.270.2402 or via e-mail here.

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 publication available for review 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 at here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@solutionslawyer.net.

©2009 Cynthia Marcotte Stamer.   All rights reserved. 

Comments Off on ADAAA Amendment Broader ADA “Disability” Definition Not Retroactive, Employer Action Needed To Manage Post 1/1/2009 Risks | ADA, Corporate Compliance, EEOC, Employers, GINA, Human Resources, OFCCP, Retaliation | Tagged: , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Employer & Other Health Plans & Other HIPAA-Covered Entities & Their Business Associates Must Comply With New HHS Health Information Data Breach Rules By September 23

August 24, 2009

Employer and other health plans, health care providers, health clearinghouses and their business associates must start complying with new federal data breach notification rules on September 23, 2009.   

The new “Breach Notification For Unsecured Protected Health Information” regulation (Breach Regulation) published here  in today’s Federal Register requires health plans, health care providers, health care clearinghouses and their business associates (Covered Entities) covered under the personal health information privacy and security rules of the Health Insurance Portability & Accountability Act (HIPAA) to notify affected individuals following a “breach” of “unsecured” protected health information.The Breach Regulation is part of a series of guidance that HHS is issuing to implement new and stricter personal health information privacy and data security requirements for Covered Entities added to HIPAA under the Health Information Technology for Economic and Clinical Health (HITECH) Act signed into law on February 17, 2009 as part of American Recovery and Reinvestment Act of 2009 (ARRA). 

You are invited to catch up on what these new rules mean for your organization and how it must respond by participating in the “HITECH Act Health Data Security & Breach Update” on Wednesday, September 9 2009 from Noon to 1:30 P.M. Central Time.  

HITECH Act Data Breach and Unsecured PHI Rules 

Published in the August 24, 2009 Federal Register, the new Breach Regulation implements the HITECH Act requirement that Covered Entities and their business associates notify affected individuals, the Secretary of HHS, and in some cases, the media, when a breach of “unsecured protected health information” happens and the form, manner, and timing of that notification. Covered Entities must begin complying with the new Breach Regulation on September 23, 2009.

Part of a series of new HHS rules implementing recent changes to HIPAA enacted under the HITECH Act to strengthen existing federally mandates requiring Covered Entities to safeguard protected health information, the Breach Regulation will obligate Covered Entities and business associates to provide certain notifications following a breach of “protected health information” that not secured at the time of the breach through the use of a technology or methodology meeting minimum standards issued by HHS pursuant to other provisions of the HITECH Act.

Under the HITECH Act, the breach notification obligations contained in the Breach Notification only apply to a breach of “unsecured protected health information.” The Breach Regulation exempts breaches of protected health information that qualify as “secured” under separately issued HHS and Federal Trade Commission (FTC) standards for encryption and destruction of protected health information from its breach notification requirements.  

 For purposes of the HITECH Act, electronic protected health information is considered “unsecured” unless the Covered Entity has satisfied certain minimum standards for the protection of that data established pursuant to the HITECH Act.  Earlier this year, HHS and the FTC issued interim rules defining the minimum encryption and destruction technologies and methodologies that Covered Entities must use to render protected health information unusable, unreadable, or indecipherable to unauthorized individuals for purposes of determining when protected health information is “unsecured” for purposes of the HITECH Act.  Concurrent with its publication of the Breach Regulation, HHS also released guidance updating and clarifying this previously issued guidance. 

Read the Breach Regulation here .  To review the HITECH Act Breach Notification Guidance and Request for Information, see here .

Register For September 9, 2009  “HITECH Act Health Data Security & Breach Update”

Interested persons are invited to register here now  to learn what these new rules mean for your organization and how it must respond by participating in the “HITECH Act Health Data Security & Breach Update” on Wednesday, September 9, 2009 from Noon to 1:30 P.M. Central Time. For a registration fee of $45.00, registrants will have the option to participate via teleconference or in person at the offices of Curran Tomko Tarski LLP, 2001 Bryan Street, Suite 2050, Dallas Texas 75201.  For questions or other information about this program, e-mail here.

Conducted by Curran Tomko and Tarski LLP Partner Cynthia Marcotte Stamer, the briefing will cover: 

  • Who must comply
  • What your organization must do
  • How to qualify protected health information as exempt from the breach regulations as “secure” protected health information
  • What is considered a breach of unsecured protected health information
  • What steps must a covered entity take if a breach of unsecured protected information happens
  • What liabilities do covered entities face for non-compliance
  • What new contractual requirements, policies and procedures Covered Entities and Business Associates will need
  • How the Breach Regulation, the Privacy Regulation, impending FTC red flag rules and state data breach and privacy rules interrelate
  •  Other recent developments
  • Practical tips for assessing, planning, moving to and defending compliance
  • Participant questions
  • More

About The Presenter

The program will be presented by Curran Tomko Tarski LLP Partner Cynthia Marcotte Stamer.  Ms. Stamer is nationally known for her work, publications and presentations on privacy and security of health and other sensitive information in health and managed care, employment, employee benefits, financial services, education and other contexts. 

 Past Chair of the ABA Health Law Section Managed Care & Insurance Section and currently the Chair of the American Bar Association (ABA) RPTE Employee Benefits & Other Compensation Section and a Council Representative of the ABA Joint Committee On Employee Benefits, Ms. Stamer has more than 20 years experience advising clients about health and other privacy and security matters.  A popular lecturer and widely published author on privacy and data security and other related health care and health plan matters, Ms. Stamer is the Editor in Chief of the forthcoming 2010 edition of the Information Security Guide to be published by the American Bar Association Information Security Committee in 2010, as well as the author of “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security Beyond HIPAA,” and a host of other highly regarded publications. She has continuously advises employers, health care providers, health insurers and administrators, health plan sponsors, employee benefit plan fiduciaries, schools, financial services providers, governments and others about privacy and data security, health care, insurance, human resources, technology, and other legal and operational concerns. Ms. Stamer also publishes and speaks extensively on health and managed care industry privacy, data security and other technology, regulatory and operational risk management matters.  Her insights on health care, health insurance, human resources and related matters appear in the Atlantic Information Service, Bureau of National Affairs, World At Work, The Wall Street Journal, Business Insurance, the Dallas Morning News, Managed Healthcare, Health Leaders, and a many other national and local publications.  For additional information about Ms. Stamer, her experience, involvements, programs or publications, see here.  

We hope that this information is useful to you.  If you need assistance monitoring, evaluating or responding to these or other compliance, risk management, transaction or operation concerns, please contact the author of this update, Cynthia Marcotte Stamer, at (214) 270-2402, cstamer@cttlegal.com or another Curran Tomko Tarski LLP Partner of your choice.

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 on our electronic Curran Tomko Tarski LLP publications available for review 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 at here. You can access other recent updates and other informative publications and resources provided by Curran Tomko Tarski LLP attorneys and get information about its attorneys’ experience, briefings, speeches and other credentials here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@cttlegal.com.

©2009 Cynthia Marcotte Stamer.   All rights reserved. 

Comments Off on Employer & Other Health Plans & Other HIPAA-Covered Entities & Their Business Associates Must Comply With New HHS Health Information Data Breach Rules By September 23 | ARRA, Corporate Compliance, Data Security, Employee Benefits, Employers, ERISA, GINA, Health Plans, HIPAA, Human Resources, Insurance, Internal Controls, Preemption, Privacy, Protected Health Information, Risk Management, Stimulus Bill, Tax | Tagged: , , , , , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Health Plans Must Comply with New HHS Interim Final Data Breach Rules Beginning September 24; Register to Participate In September 10th Briefing on New Rules In Person or Via Telephone

August 20, 2009

Employers and other health plan sponsors, fiduciaries, insurers and service providers need to move quickly to prepare to comply with  “breach notification” regulations issued by the U.S. Department of Health and Human Services (HHS) yesterday (August 19, 2009).  The new data breach regulations will require health plans, as well as  health care providers, business associates and other covered entities (Covered Entities) under the personal health information privacy and security rules of the Health Insurance Portability & Accountability  (HIPAA) to notify affected individuals following a “breach” of “unsecured” protected health information. Scheduled for publication in the Federal Register on August 24, 2009, the new breach notification regulations are part of a series of new rules that implement new electronic personal health information data security and data breach notification requirements for Covered Entities added to HIPAA under the Health Information Technology for Economic and Clinical Health (HITECH) Act signed into law on February 17, 2009 as part of American Recovery and Reinvestment Act of 2009 (ARRA).  Covered entities must begin complying with the new rules no later than September 24, 2009.

Curran Tomko Tarski, LLP Health Practice leader Cynthia Marcotte Stamer will conduct a briefing on these new protected health information data security and data breach rules on Thursday, September 10, 2009 from Noon to 1:30 P.M. Central Time. For a registration fee of $45.00, registrants will have the option to participate via teleconference or in person at the offices of Curran Tomko Tarski LLP, 2001 Bryan Street, Suite 2050, Dallas Texas 75201.  For more information, e-mail here.

 HITECH Act Data Breach and Unsecured PHI Rules

The new data breach notification rules are part of a series of recent HIPAA enacted under the HITECH Act to strengthen the federal rules requiring HIPAA covered entities to safeguard electronic and certain other protected health information. Enhanced data security and data breach rules added as part of these HITECH Act amendments obligate  covered entities and business associates to provide certain notifications following a breach of “unsecured”  “protected health information” within the meaning of HIPAA, as amended.  “Unsecured protected health information” is defined as protected health information that is not secured through the use of a technology or methodology specified by the HHS Secretary.

The new data breach regulations implement the HITECH Act requirement that Covered Entities and their business associates notify affected individuals, the Secretary of HHS, and in some cases, the media, of a breach and the form, manner, and timing of that notification.  For purposes of the HITECH Act, electronic protected health information is considered “unsecured” unless the covered entity has satisfied certain minimum standards for the protection of that data established pursuant to the HITECH Act.  HHS and the Federal Trade Commission previously issued certain initial guidance concerning the HITECH Act standards for determining when electronic personal health information qualifies as secure.  To help further define when electronic health information is treated as “unsecured” and therefore subject to the breach notification requirements, the data breach rules also update and clarify the previously issued existing HHS guidance specifying encryption and destruction as the technologies and methodologies that render protected health information unusable, unreadable, or indecipherable to unauthorized individuals published earlier this year by HHS to for purposes of determining when protected health information will be considered “unsecured” for purposes of the HITECH Act data breach rules.  Entities subject to the HHS and FTC regulations that secure health information as specified by the guidance through encryption or destruction are relieved from having to notify in the event of a breach of such information.  

The HHS interim final regulations are effective September 24, 2009, which is the date 30 days after the date they will be published on the Federal Register and include a 60-day public comment period. To review the interim final data breach regulations, see here.  To review the HITECH Act Breach Notification Guidance and Request for Information, see here.

For More Information

The author of this article, Curran Tomko and Tarski LLP Labor and Employment and Health Care Practice Chair Cynthia Marcotte Stamer has extensive experience advising and assisting employer and other health plan sponsors, insurers, managed care providers and other health and insurance industry clients about HIPAA and other privacy and data security matters, as well as a diverse range of health care, employment, and emplyee benefit policy, regulatory, compliance, risk management and operational concerns. 

Current Chair of the American Bar Association (ABA) Real Property, Trusts & Estates Employee Benefit & Other Compensation Committee, an ABA Joint Committee on Employee Benefits Council member, past chair of the American Bar Association Health Law Section Managed Care & Insurance Section, Martindale Hubble AV-rated and recognized in International Who’s Who of Professionals, Ms. Stamer continuously advises health care providers, health care payers and administrators, employers, governments and others about health care, insurance, human resources, privacy and data security, technology, and other legal and operational concerns.  A popular lecturer and widely published author on privacy and data security and other related health care and health plan matters, Ms. Stamer also writes and speaks extensively on health and managed care industry privacy, data security and other technology, regulatory and operational risk management matters.  She currently serves as the Editor in Chief of the forthcoming 2010 edition of the Information Security Guide to be published by the American Bar Association Information Security Committee in 2010.  Examples of her other works include “Protecting & Using Patient Data In Disease Management: Opportunities, Liabilities And Prescriptions,” “Privacy Invasions of Medical Care-An Emerging Perspective,” “Cybercrime and Identity Theft: Health Information Security Beyond HIPAA,” and a host of others.  Her insights on health care, health insurance, human resources and related matters appear in the Atlantic Information Service Privacy Report, The Wall Street Journal, Business Insurance, the Dallas Morning News, Managed Healthcare, Health Leaders, and a various other national and local publications.  For additional information about Ms. Stamer, her experience, involvements, programs or publications, see here.  

We hope that this information is useful to you.  If you need assistance monitoring, evaluating or responding to these or other proposed health care or other regulatory reforms or with other health care compliance, risk management, transaction or operation concerns, please contact the author of this update, Curran Tomko Tarski LLP Health Practice Group Chair, Cynthia Marcotte Stamer, at (214) 270-2402, cstamer@cttlegal.com or your other favorite Curran Tomko Tarski LLP Partner.

We also encourage you and others to join the discussion about these and other health care reform proposals and concerns by joining the Coalition for Responsible Health Care Reform Group on Linkedin, registering to receive these updates 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 our electronic Solutions Law Press Health Care Update publication available here. If you or someone else you know would like to receive future updates about developments on these and other concerns, please register to receive this Solutions Law Press Health Care Update here and be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here. You can access other recent updates and other informative publications and resources provided by Curran Tomko Tarski LLP attorneys and get information about its attorneys’ experience, briefings, speeches and other credentials here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

©2009 Cynthia Marcotte Stamer.  All rights reserved. 

Comments Off on Health Plans Must Comply with New HHS Interim Final Data Breach Rules Beginning September 24; Register to Participate In September 10th Briefing on New Rules In Person or Via Telephone | Corporate Compliance, ERISA, GINA, Health Plans, HIPAA, Human Resources, Insurance, Internal Controls, Internal Investigations | Tagged: , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

House Democratic Majority Hopes To Iron Out Differences In Key Health Care Reform Legislation During August Recess

August 4, 2009

Democratic Leaders in the House of Representatives plan to hammer out differences three versions of the America’s Affordable Health Choices Act (H.R. 3200) as separately passed by three key House Committees in July before House members return from their August recess in hopes of bringing the agreed to version of H.R. 3200 to the full house in September.   Each version of H.R. 3200 would impose significant new obligations, regulations and costs on employers, health insurers and health plans, and employees.

After negotiating a last minute pre-August recess deal with certain Blue Dog Democrat Committee members, the House Energy and Commerce Committee on July 31, 2009 passed its version of H.R. 3200, the America’s Affordable Health Choices Act (H.R. 3200). The version of H.R. 3200 passed by the House Energy and Commerce Committee incorporates a series of amendments to the language of H.R. 3200 as originally introduced.  For instance, this version of H.R. 3200 provides incentives for states to adopt certain tort reforms, provides for a public plan option that would reimburse physicians based on negotiated rates rather Medicare rates, and would allow states to offer both state-based heath insurance exchanges and health insurance co-ops. To review H.R. 3200 as amended by the House Energy and Commerce Committee, see here.

The approval by the Energy and Commerce Committee of its version of H.R. 3200 follows the July 17, 2009 approval by the House Ways and Means Committee and Education and Labor Committee of their own versions of H.R. 3200.  For details on the version of H.R. 3200 approved by the House Ways and Means Committee, see here.  For details on the version of H.R. 3200 approved by the House Education and Labor Committee, see here. 

Leading House Democrats have announced their intention to work to resolve differences between these three versions of H.R. 3200 as passed by these Committees during August recess in hopes of  bringing the agreed to version of H.R. 3200 to a vote  of the full House of Representatives in September.

Meanwhile, House members from both parties also generally are using the August recess as an opportunity to reconnect with local constituents on health care reform and other core issues.

For More Information

The author of this article, Curran Tomko and Tarski LLP Partner  Cynthia Marcotte Stamer has extensive experience advising and assisting employers and other health plan sponsors, insurers and others about health benefit and other benefits, human resources and health care matters.  The current Chair of the American Bar Association Real Propoerty, Probate & Trust Section Employee Benefit Plans and Other Compensation Committee and former Chair of the ABA Health Law Section Managed Care & Insurance Group, she regularly advises these and other clients about the design, administration, defense  and regulation of health benefit, wellness and disease management, managed care, onsight wellness, and other benefit and insurance regulations, legislative and regulatory reforms impacting these and other arrangements, and related matters.  

We hope that this information is useful to you.  If you need assistance monitoring, evaluating or responding to these or other proposed health care or other regulatory reforms or with other health care compliance, risk management, transaction or operation concerns, please contact the author of this update, Curran Tomko Tarski LLP Health Practice Group Chair, Cynthia Marcotte Stamer, at (214) 270-2402, cstamer@cttlegal.com or your other favorite Curran Tomko Tarski LLP Partner.

We also encourage you and others to join the discussion about these and other health care reform proposals and concerns by joining the Coalition for Responsible Health Care Reform Group on Linkedin, registering to receive these updates 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 at here or e-mailing this information to cstamer@cttlegal.com.  If you prefer not to receive these updates via e-mail in the future, e-mail your request with “remove” in the subject to support@solutionslawyer.net.

Comments Off on House Democratic Majority Hopes To Iron Out Differences In Key Health Care Reform Legislation During August Recess | Disease Management, Employee Benefits, Employers, ERISA, Health Care Reform, Health Plans, Insurance, Malpractice, Preemption, Privacy, Public Policy, Tax, Wellness | Tagged: , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

HHS Reassignment Of HIPAA Enforcement Duties Signals Rising Seriousness of Enforcement Commitment

August 3, 2009

The Department of Health & Human Services (HHS) today (August 3, 2009) transferred authority for the administration and enforcement of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Security Rule to the Office for Civil Rights (OCR).  Prior to this announcement, responsibility for interpretation and enforcement of the Security Rule rested with the Centers for Medicare & Medicaid Services (CMS).  The change reflects the growing seriousness of HHS and others about enforcing federal privacy and data security mandates for health information.  HHS anticipates the transfer of authority will eliminate duplication and increase efficiencies in how the department ensures that Americans’ health information privacy is protected.

HHS has the authority for administration and enforcement of the federal standards for health information privacy called for in HIPAA. The Privacy Rule provides federal protections for personal health information held by covered entities and gives patients an array of rights with respect to that information. OCR has been responsible for enforcement of the Privacy Rule since 2003. The Security Rule specifies a series of administrative, technical, and physical security procedures for covered entities to use to assure the confidentiality of electronic protected health information. The Health Information Technology for Economic and Clinical Health (HITECH) Act, part of the American Recovery and Reinvestment Act of 2009 (ARRA), mandated improved enforcement of the Privacy Rule and the Security Rule.

Through a separate delegation, CMS continues to have authority for administration and enforcement of the HIPAA Administrative Simplification regulations, other than privacy and security of health information.

The transfer of Security Rule enforcement authority comes as guidance about new data breach rules for electronic protected health information is impending.  This impending guidance relates to  the implementation of new breach notification rules for covered entities and their business associates concerning their obligation to use of technologies and methodologies that render protected health information unusable, unreadable, or indecipherable to unauthorized individuals, as required by amendments to HIPAA enacted under the Health Information Technology for Economic and Clinical Health (HITECH) Act passed as part of the American Recovery and Reinvestment Act of 2009 (ARRA) last February.  OCR officials have stated that they are working to publish the next set of regulations regarding these new breach notifications before the end of August, 2009. 

In addition to adding the breach notification requirements, the HITECH Act also tightened the HIPAA mandates in several other respects.  Among other things, it amended HIPAA to:

  • Broaden the applicability of the HIPAA’s Privacy Rules and penalties to include business associates;
  • Clarify that HIPAA’s criminal sanctions apply to employees or other individuals that wrongfully use or access PHI held by a covered entity;
  • Increase criminal and civil penalties for HIPAA Privacy Rules violators;
  • Allow State Attorneys General to bring civil damages actions on behalf of certain state citizens who are victims of HIPAA Privacy and Security Rule violations;
  • Modify certain HIPAA use and disclosure and accounting requirements and risks;
  • Prohibits sales of PHI without prior consent;
  • Tighten certain other HIPAA restrictions on uses or disclosures;
  • Tighten certain HIPAA accounting for disclosure requirements;
  • Clarify the definition of health care operations to excludes certain promotional communications; and
  • Expand the Business Associates Agreement Requirements.

These and other developments make it imperative HIPAA covered entities and their business associates take prompt action to immediately review and update their data security and privacy practices to guard against growing liability exposures under HIPAA and other federal and state laws. Covered entities must update policies and practices to avoid these growing liabilities. Business associates that have not already done so also must appoint privacy officers and adopt and implement privacy and data security policies and procedures fully compliant with HIPAA and other applicable federal and state rules, including amendments enacted as part of the American Recovery and Reinvestment Act of 2009 signed into law on February 17, 2009.

For more information about today’s announcement, see here.  See here for the initial guidance and request for comments issued by HHS regarding these new security standards.

Chair Elect of the American Bar Association RPTE Employee Benefits & Compensation Committee, an ABA Joint Committee on Employee Benefits  Council member, and Chair of the Curran Tomko Tarski Labor, Employment & Employee Benefits Practice, Cynthia Marcotte Stamer is  nationally and internationally recognized for her work assisting businesses, employee benefit plan fiduciaries and vendors, governments, and other entities to develop administer and defend cost-effective employee benefit other human resources programs, policies and procedures to meet their budgetary, risk management and compliance and other objectives.  Board certified in Labor & Employment law, Ms. Stamer applies her extensive experience regarding employment, employee benefit, tax, privacy and data security and other related laws to assists clients in a wide range of business and litigation contexts.   The co-founder of the Solutions Law Consortium, Ms. Stamer also makes extensive use of cloud computing and other technology in her own practice and provides input to human resources and other clients others about the use of these and other technology tools to manage employee benefit, human resources, internal controls and other operations.  In connection with this work, Ms. Stamer has works, writes and consults extensively with a diverse range of clients about  the development, use technology and other processes to streamline health and other benefit, payroll and other human resources, employee benefits, tax, compliance and other business processes and the management and protection of sensitive personal and other information and data.

If your organization or employee benefit plan needs assistance managing or evaluating options or responsibilities associated with the use of technology and data in connection with its health care, employee benefits, tax or other operation or other human resources, employee benefits or and compliance concerns, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see here.

More Information & Resources

You can review other recent human resources, employee benefits and internal controls publications and resources and additional information about the employment, employee benefits and other experience of Ms. Stamer here /the Curran Tomko Tarski LLP attorneys 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 or e-mailing this information to Cstamer@CTTLegal.com or registering to participate in the distribution of these and other updates on our Solutions Law Press HR & Benefits Update distributions here. For important information concerning this communication click here.    If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on HHS Reassignment Of HIPAA Enforcement Duties Signals Rising Seriousness of Enforcement Commitment | Employee Benefits, HIPAA, Human Resources, Insurance, Internal Controls, Privacy | Tagged: , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Speak Up America: Where & How To Read & Share Your Feedback About The Health Care Reform Legislation

August 1, 2009

As the health care reform policy debate continues, Americans increasingly are asking where to read the text of the health care reform legislation that members of Congress are debating and how to share their input. 

 While numerous alternatives presently are pending before Congress, much of recent discussion and debate has focused around one of the following bills:

  • H.R. 3200: America’s Affordable Health Choices Act of 2009,  introduced in the House by Rep Dingell, John D. on July 14, 2009  the text of which as originally introduced may be reviewed  here.  It has been the focus of significant mark up negotiation through out July before the following House Energy and Commerce, House Ways & Means, and House Education & Labor Committees; and
  • S. __, the Affordable Health Choices Act approved by the Senate Committee on Health, Education, Labor and Pensions, the text of which as approved may be reviewed here.

When reviewing these bills, Americans should keep in mind that members of Congress are engaged in ongoing negotiations about the specific provisions and language of these bills, as well as other legislation.  Official developments generally may be monitored here.

Many American businesses and individuals also are asking about how and where to share their views, how to organize others to do the same and other questions about getting the word out. Here a some quick ideas. We encourage others to share. 

  • The Coalition For Patient Empowerment and the Coalition for Responsible Health Care Reform linkedin group are two one of many resources where individuals are sharing information about these matters. 
  • Concerned individuals should share their views both by faxing, e-mailing or telephoning key decisionmakers in Congress, as well as joining and participating in activities of other individuals and groups that share their concerns.  Contact and get involved with this and other groups that share your concerns.
  • Contact the offices of your Congressional representatives in the House and Senate as well as other members of Congress that support your views and ask them about other groups and ways that you can share your views. They will welcome your input and involvement.
  •  If you are aware of or involved in a group that shares your views, we encourage you to share it on the Coalition for Responsible Health Care Reform linkedin group.  If you or others are planning a town hall or other health care reform meeting, use this or other linked in groups to spread the word.
  • If you are interested in volunteering to plan events in your region, let us know.   

We also encourage you and others to join the discussion about these and other health care reform proposals and concerns by joining the Coalition for Responsible Health Care Reform Group on Linkedin, and registering to receive these updates here.

When communicating, consider targeting your messages to members of Congress whose votes are likely to be impacted by your communications. 

For instance, with both the House and Senate in the majority in Congress, Democrats generally have greater control over what legislation moves forward.  The Democratic Leadership of the House and Sentate generally can get legislation passed by their members as long as they can maintain consensus among the members of their parties.  In connection with the health care reform proposals, however, cost and other considerations have made maintaining a consensus more difficult than on other legislation.  Certain fiscally moderate members of the Democratic Party have expressed concern about the expense and other aspects of their Leadership proposed health care reform proposals.  These Democrats in Congress generally the members of Congress whose votes are most likely to be impacted by public input and feedback generally and from voters in their districts and contributors specifically. 

In the House of Representatives, these members likely are the “Blue Dog Democrats.”  Read about Blue Dog Democrats here.    

The fiscal conservatism of Blue Dog Democrats makes them more likely to listen to concerns about the cost and other concerns relating to the health care reform bills touted by the Democrat Leadership in the House and Senate.  In fact, many Blue Dog Democrats already are speaking out about their concerns about the cost and other aspects of the Bill. 

Contact from voters and contributors in their districts and others could make a major difference in the ability that the House Democrat Leadership needs to pass their Bill.  Immediately contacting these members and getting others – particularly voters and contributors in the districts that elect these members – is one of the most important steps that concerned Americans can do to position their concerns to be heard.   

For most concerned voters, telephone or fax contact is the best means to convey these messages.  To minimize spam, most members only accept e-mail submitted through their website links.  Security concerns can delay receipt of written correspondence for weeks.

For persons interested in making their voices heard and sharing information with others who wish to do the same, the following contact information may be of interest:

The number of the Capital Switchboard is 202-224-3121.

The Blue Dog Leadership Team and there telephone and fax numbers are:

Rep. Stephanie Herseth Sandlin (SD), Blue Dog Co-Chair for Administration, Telephone: 202.225.2801 , Fax: 202.225.5823

Rep. Baron Hill (IN-09), Blue Dog Co-Chair for Policy,Telephone: 202-225-4031, Fax: (202) 226-6866

Rep. Charlie Melancon (LA-03), Blue Dog Co-Chair for Communications, Telephone: 202-225-4031, Fax: (202) 226-3944

Rep. Heath Shuler (NC-11), Blue Dog Whip, Telephone:  202-225-6401, Fax: (202) 226-6422

The Blue Dog Members and their telephone numbers are :

  • Altmire, Jason (PA-04),(202)225-2565
  • Arcuri, Mike (NY-24), (202)225-3665
  • Baca, Joe (CA-43),(202)225-6161
  • Barrow, John (GA-12), (202) 225-2823
  • Berry, Marion (AR-01), (202) 225-4076
  • Bishop, Sanford (GA-02), (202) 225-3631
  • Boren, Dan (OK-02), (202) 225-2701
  • Boswell, Leonard (IA-03), (202) 225-3806
  • Boyd, Allen (FL-02), (202) 225-5235
  • Bright, Bobby (AL-02), (202) 225-2901
  • Cardoza, Dennis (CA-18), (202) 225-6131
  • Carney, Christopher (PA-10), (202) 225-3731
  • Chandler, Ben (KY-06), (202) 225-4706
  • Childers, Travis (MS-01), (202) 225-4306
  • Cooper, Jim  (TN 5th), (202) 225-4311
  • Costa, Jim  (CA 20th), (202) 225-3341
  • Cuellar, Henry  (TX 28th), (202)  225-1640
  • Dahlkemper, Kathleen A. (PA 3rd), (202) 225-5406
  • Davis, Lincoln (TN 4th),(202) 225-6831
  • Donnelly, Joe  (IN 2nd), (202) 225-3915
  • Ellsworth, Brad  (IN 8th), (202) 225-4636
  • Giffords, Gabrielle  (AZ 8th), (202) 225-2542
  • Gordon, Bart  (TN 6th), (202) 225-4231
  • Griffith, Parker  (AL 5th), (202) 225-4801
  • Harman, Jane  (CA 36th), (202) 225-8220
  • Herseth Sandlin, Stephanie  (SD At Large), (202) 225-2801
  • Hill, Baron P.  (IN 9th), (202) 225-5315
  • Holden, Tim  (PA 17th), (202) 225-5546
  • Kratovil, Frank Jr. (MD 1st), (202) 225-5311
  • McIntyre, Mike  (NC 7th), (202) 225-2731
  • Marshall, Jim  (GA 8th), (202) 225-6531
  • Matheson, Jim  (UT 2nd), (202) 225-3011
  • Melancon, Charlie  (LA 3rd), (202) 225-4031
  • Michaud, Michael H. (ME 2nd), (202) 225-6306
  • Minnick, Walt  (ID 1st), (202) 225-6611
  • Mitchell, Harry E.  (AZ 5th), (202) 225-2190
  • Moore, Dennis  (KS 3rd), (202) 225-2865
  • Murphy, Patrick J.  (PA 8th), (202) 225-4276
  • Nye, Glenn C.  (VA 2nd), (202) 225-4215
  • Peterson, Collin C.  (MN 7th), (202) 225-2165
  • Pomeroy, Earl  (ND At Large), (202) 225-2611
  • Ross, Mike  (AR 4th), (202)  225-3772
  • Salazar, John T.  (CO 3rd), (202) 225-4761
  • Sanchez, Loretta  (CA 47th), (202) 225-2965
  • Schiff, Adam B.  (CA 29th), (202) 225-4176
  • Scott, David  (GA 13th), (202) 225-2939
  • Shuler, Heath  (NC 11th), (202) 225-6401
  • Space, Zachary T. (OH 18th), (202) 225-6265
  • Tanner, John S.  (TN 8th), (202) 225-4714
  • Taylor, Gene  (MS 4th), (202) 225-5772
  • Thompson, Mike  (CA 1st), (202) 225-3311
  • Wilson, Charles (OH-06), (202) 225-5705

You and others also are invited to join the discussion about these and other health care reform proposals and concerns by:

  • Joining the Coalition for Responsible Health Care Reform Group on Linkedin and registering to receive these updates here; and
  • E-mailing Cstamer@cttlegal.com to participate in the Coalition for Patient Empowerment.

Curran Tomko Tarski LLP Can Help

If your business needs assistance monitoring or providing input on health care reform or other human resources, employee benefit or compensation legislation or regulations, or auditing, updating or defending its health or other employee benefit, human resources, or compensation arrangements, or responding to employee benefits, employment or compensation related charges or suits, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see here.

The author of this article, Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with assisting employer and employee benefit plan sponsors, administrators and others about labor and employment, compensation and employee benefit compliance and risk management concerns, as well as advising and defending these and other clients in labor and employment, compensation, and employee benefit related audits, investigations and litigation, charges, audits, claims and investigations.  

Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization, Chair of the ABA RPTE Employee Benefit Plans and Other Compensation Group, a 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 has extensive experience with health and retirement, work force and other employee benefit and employment matters.  She is nationally and internationally known for her innovative work with employers, associations, churches, insurers and others to develop health benefit, onsight medical, wellness and other employee benefit and employment arrangements, as well as her involvement in health care, pension and other public policy advocacy.

More Information & Resources

You can review other recent human resources, employee benefits and internal controls publications and resources and additional information about the employment, employee benefits and other experience of Ms. Stamer here /the Curran Tomko Tarski LLP attorneys 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 or e-mailing this information to Cstamer@CTTLegal.com or registering to participate in the distribution of these and other updates on our Solutions Law Press HR & Benefits Update distributions here. For important information concerning this communication click here.    If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on Speak Up America: Where & How To Read & Share Your Feedback About The Health Care Reform Legislation | Employee Benefits, Employers, Employment Tax, ERISA, Health Care Reform, Health Plans, Human Resources, Immigration, Income Tax, Insurance, Malpractice, Preemption, Professional Liability, Tax, Uncategorized | Tagged: , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Contact House Blue Dog Democrats About Health Care Reform Bill Concerns

July 18, 2009

Individuals concerned about the  “American’s Affordable Health Care Choices Act of 2009” health care reform proposal introduced by the House Democratic Leadership earlier this week should target their input on the Democrats in Congress most likely to listen to those concerns. In the House of Representatives, these members likely are the “Blue Dog Democrats” in the House.  Read about Blue Dog Democrats here.    

The fiscal conservatism of Blue Dog Democrats makes them more likely to listen to concerns about the cost and other concerns relating to the health care reform bills touted by the Democrat Leadership in the House and Senate.  In fact, many Blue Dog Democrats already are speaking out about their concerns about the cost and other aspects of the Bill. 

Contact from voters and contributors in their districts and others could make a major difference in the ability that the House Democrat Leadership needs to pass their Bill.  Immediately contacting these members and getting others – particularly voters and contributors in the districts that elect these members – is one of the most important steps that concerned Americans can do to position their concerns to be heard.   

For most concerned voters, telephone or fax contact is the best means to convey these messages.  To minimize spam, most members only accept e-mail submitted through their website links.  Security concerns can delay receipt of written correspondence for weeks.

For persons interested in making their voices heard and sharing information with others who wish to do the same, the following contact information may be of interest:

The number of the Capital Switchboard is 202-224-3121.

The Blue Dog Leadership Team and there telephone and fax numbers are:

Rep. Stephanie Herseth Sandlin (SD), Blue Dog Co-Chair for Administration, Telephone: 202.225.2801 , Fax: 202.225.5823

Rep. Baron Hill (IN-09), Blue Dog Co-Chair for Policy,Telephone: 202-225-4031, Fax: (202) 226-6866

Rep. Charlie Melancon (LA-03), Blue Dog Co-Chair for Communications, Telephone: 202-225-4031, Fax: (202) 226-3944

Rep. Heath Shuler (NC-11), Blue Dog Whip, Telephone:  202-225-6401, Fax: (202) 226-6422

The Blue Dog Members and their telephone numbers are :

Altmire, Jason (PA-04),(202)225-2565

Arcuri, Mike (NY-24), (202)225-3665

Baca, Joe (CA-43),(202)225-6161

Barrow, John (GA-12), (202) 225-2823

Berry, Marion (AR-01), (202) 225-4076

Bishop, Sanford (GA-02), (202) 225-3631

Boren, Dan (OK-02), (202) 225-2701

Boswell, Leonard (IA-03), (202) 225-3806

Boyd, Allen (FL-02), (202) 225-5235

Bright, Bobby (AL-02), (202) 225-2901

Cardoza, Dennis (CA-18), (202) 225-6131

Carney, Christopher (PA-10), (202) 225-3731

Chandler, Ben (KY-06), (202) 225-4706

Childers, Travis (MS-01), (202) 225-4306

Cooper, Jim  (TN 5th), (202) 225-4311

Costa, Jim  (CA 20th), (202) 225-3341

Cuellar, Henry  (TX 28th), (202)  225-1640

Dahlkemper, Kathleen A. (PA 3rd), (202) 225-5406

Davis, Lincoln (TN 4th),(202) 225-6831

Donnelly, Joe  (IN 2nd), (202) 225-3915

Ellsworth, Brad  (IN 8th), (202) 225-4636

Giffords, Gabrielle  (AZ 8th), (202) 225-2542

Gordon, Bart  (TN 6th), (202) 225-4231

Griffith, Parker  (AL 5th), (202) 225-4801

Harman, Jane  (CA 36th), (202) 225-8220

Herseth Sandlin, Stephanie  (SD At Large), (202) 225-2801

Hill, Baron P.  (IN 9th), (202) 225-5315

Holden, Tim  (PA 17th), (202) 225-5546

Kratovil, Frank Jr. (MD 1st), (202) 225-5311

McIntyre, Mike  (NC 7th), (202) 225-2731

Marshall, Jim  (GA 8th), (202) 225-6531

Matheson, Jim  (UT 2nd), (202) 225-3011

Melancon, Charlie  (LA 3rd), (202) 225-4031

Michaud, Michael H. (ME 2nd), (202) 225-6306

Minnick, Walt  (ID 1st), (202) 225-6611

Mitchell, Harry E.  (AZ 5th), (202) 225-2190

Moore, Dennis  (KS 3rd), (202) 225-2865

Murphy, Patrick J.  (PA 8th), (202) 225-4276

Nye, Glenn C.  (VA 2nd), (202) 225-4215

Peterson, Collin C.  (MN 7th), (202) 225-2165

Pomeroy, Earl  (ND At Large), (202) 225-2611

Ross, Mike  (AR 4th), (202)  225-3772

Salazar, John T.  (CO 3rd), (202) 225-4761
Sanchez, Loretta  (CA 47th), (202) 225-2965

Schiff, Adam B.  (CA 29th), (202) 225-4176
Scott, David  (GA 13th), (202) 225-2939

Shuler, Heath  (NC 11th), (202) 225-6401

Space, Zachary T. (OH 18th), (202) 225-6265

Tanner, John S.  (TN 8th), (202) 225-4714

Taylor, Gene  (MS 4th), (202) 225-5772

Thompson, Mike  (CA 1st), (202) 225-3311

Wilson, Charles (OH-06), (202) 225-5705

We also encourage you and others to join the discussion about these and other health care reform proposals and concerns by joining the Coalition for Responsible Health Care Reform Group on Linkedin, registering to receive these updates here The author of this article, Curran Tomko and Tarski LLP Health Care Practice Chair Cynthia Marcotte Stamer has extensive experience advising and assisting health industry clients and others about a diverse range of health care policy, regulatory, compliance, risk management and operational concerns.  You can get more information about her health industry experience here.  

If you need assistance evaluating or formulating comments on the proposed reforms contained in the House Bill or on other health industry matters please contact Cynthia Marcotte Stamer, CTT Health Care Practice Group Chair, at cstamer@cttlegal.com, 214.270.2402 or your other favorite Curran Tomko Tarski LLP attorney. 

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 our electronic Solutions Law Press Health Care Update publication available here. If you or someone else you know would like to receive future updates about developments on these and other concerns, please register to receive this Solutions Law Press Health Care Update here and be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here. You can access other recent updates and other informative publications and resources provided by Curran Tomko Tarski LLP attorneys and get information about its attorneys’ experience, briefings, speeches and other credentials here.

For important information concerning this communication click here.  If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

©2009 Cynthia Marcotte Stamer.  All rights reserved.

Comments Off on Contact House Blue Dog Democrats About Health Care Reform Bill Concerns | Employers, Health Care Reform, Health Plans, Income Tax, Public Policy, Tax | Tagged: , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Democrats Introduce Health Care Reform Legislation, Work To Fast Track Enactment

June 11, 2009

Coalition For Responsible Health Care Reform Founded To Help Concerned Americans Respond

Americans concerned about plans of President Obama and Congressional Democrats to enact comprehensive health care reform this year must speak up now.

Senator Edward M. Kennedy yesterday (June 9, 2009) circulated a 625 page proposal to radically reform the U.S. health care system.  The latest draft of the “Affordable Health Choices Act” (the “Act”) details the comprehensive health care reforms that President Obama and Democrats in Congress propose to enact before year end. 

President Obama and key Congressional Democrats are moving quickly to enact their vision for “comprehensive health reform” this year.   The Act circulated yesterday by Senator Kennedy would radically change the U.S. health care system in enacted as currently proposed. 

Consistent with announced plans by President Obama and key Congressional Democrats to enact “comprehensive health care reform” this year, Democratic leaders in Congress are rushing to enact this legislation well before year end.  In furtherance of plans to fast track enactment of the Act, the Senate Committee on Health, Education, Labor and Pensions (HELP) chaired by Senator Kennedy will hold a hearing on the Act this week in anticipation of meetings to mark up of the Act on Tuesday, June 16 at 2:30 p.m. in Russell 325. 

The Act, as proposed, would make sweeping changes to the U.S. health care system and radically expand the involvement of government in the delivery and financing of health care.  Among other things, the Act as proposed would:

  • Establish government provided “Gateway” health care coverage programs to provide coverage for Americans not insured under qualifying employer or other privately run “qualified health plan” to be financed in part through surcharges on private health plans and health insurers and other taxes and assessments and in part through premiums on enrolled individuals
  • Require that Americans participating in the Gateway health care coverage programs be offered the opportunity to enroll in at least one “public health insurance option”  
  • Require Americans to chose either to enroll in a government run Gateway health program or enroll in qualifying coverage under a privately run qualified health plan
  • Impose sweeping new mandates on employer and union-sponsored group health plans and insurers
  • Impose newly created taxes on individuals that fail to maintain enrollment in health coverage under either a Gateway health program or a private qualified health plan
  • Tax and/or eliminate the deductibility of health coverage premiums and certain other amounts paid by certain employers and employees
  • Impose new federal mandates for health care providers, health plans and health insurers relating to the quality standards, the use of health care technology and other matters
  • Grant federal regulators sweeping authority to define what qualifies as appropriate health care and health care coverage, the health care services that qualify for health care coverage and the payment and delivery of health care services.

You can review a copy of currently proposed provisions of the 615 page Act here. 

Individuals concerned about these and other proposed health care reforms must act immediately to become familiar and share their input on the proposals.

Assistance Monitoring & Responding To Health Care Reform Proposals

If you or someone else you know would like to receive updates about health care reform proposals and other related legislative, regulatory, and enforcement developments, please:

  • Register for this resource at the link above;
  • Join the Coalition for Responsible Health Policy group at linkedin.com to share information and input;
  • Share your input by communicating with key members of Congress on committees responsible for this legislation and your elected officials directly and by actively participating in and contributing to other like-minded groups; and
  • Be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here. 

You can register to receive future updates on legislative and regulatory health care reform proposals and other related information by registering for this resource or access other publications by Ms. Stamer and access other helpful resources here.

Long-time health policy advocate and advisor Cynthia Marcotte Stamer has more than 22 years of experience advising and assisting clients to evaluate and respond to health care reform proposals and other proposed or adopted changes in federal or state health care, employee benefit, employment, tax and other federal and state laws.  Former Chair of the American Bar Association’s Managed Care & Insurance Section, Ms. Stamer is highly regarded legal advisor, policy advocate, author and speaker recognized both nationally and internationally for her more than 20 years of work assisting U.S. public and private employers, health care providers, health insurers, and a broad range of other clients to respond to these and other health care, employee benefit and workforce public policy, regulatory and compliance and risk management concerns within the U.S. as well as internationally.  Her work includes extensive involvement providing input and assistance about health care, workforce, pensions and social security and other reforms domestically and internationally.  In addition to her continuous involvement in U.S. health care, pensions and savings, and workforce policy matters, Ms. Stamer has served as an advisor on these matters internationally.  As part of this work, she served as a lead advisor to the Government of Bolivia on its social security reform as well as has provided input on ethics, medical tourism, workforce and other reforms internationally.

Ms. Stamer is a widely published author and popular speaker on health plan and other human resources, employee benefits and internal controls issues.   Her work has been featured and published by the American Bar Association, BNA, SHRM, World At Work, Employee Benefit News and the American Health Lawyers Association.  Her insights on human resources risk management matters have been quoted in The Wall Street Journal, the Dallas Business Journal, Managed Care Executive, HealthLeaders, Business Insurance, Employee Benefit News and the Dallas Morning News.

Ms. Stamer also serves in a number of professional leadership roles including the leadership council of the ABA Joint Committee on Employee Benefits, Vice Chair of the ABA Real Property, Probate & Trust Section and Employee Benefits & Compensation Group.

If your organization needs assistance with monitoring, assessing, or responding to these or other health care, employee benefit or human resources reforms,  please contact Ms. Stamer via e-mail here, or by calling (214) 270-2402.  For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here. 

Additional Resources & Information

We hope that this information is useful to you. For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here.  

©2009 Cynthia Marcotte Stamer. All rights reserved.

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Posted by Cynthia Marcotte Stamer

September 8, 2009 New Deadline For Government Contractors, Subcontractors Deadline To Use E-Verify

June 9, 2009

September 8 now is the deadline for federal government contractors and subcontractors to begin using U.S. Citizenship and Immigration Services’ (USCIS) E-Verify system to verify the eligibility of employees to work in the United States. 

The Obama Administration recently delayed implementation of the final rule requiring federal contractors and subcontractors to use E-Verify to confirm the eligibility of employees to work in the U.S. The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (collectively known as the Federal Acquisitions Regulatory Councils) published an amendment in the Federal Register on June 5, 2009, postponing the applicability of the final rule until Sept. 8, 2009. 

As originally published November 14, 2008, the final rule requiring that federal government contractors and subcontractors agree to electronically verify the employment eligibility of their employees went into effect January 19, 2009.  However, the compliance deadline was delayed in January and again in April, 2009 by the Obama Administration.  Prior to the delay granted this month, the deadline to begin using U.S. Citizenship and Immigration Services’ (USCIS) E-Verify system was delayed to June 30, 2009.

Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers and others to respond to proposed legislation and regulations and addressing other leave and other labor and employment, employee benefit, compensation, and internal controls concerns. If your organization needs assistance with assessing or responding to H.R. 2450 or assistance with leave and absence management or other labor and employment, compensation or benefit concerns or regulations, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see here.

Other Information & Resources

You can review other recent human resources, employee benefits and internal controls publications and resources and additional information about the employment, employee benefits and other experience of the Curran Tomko Tarski LLP attorneys at 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 or e-mailing this information to Cstamer@CTTLegal.com or registering to participate in the distribution of these and other updates on our HR & Employee Benefits Update distributions here. Also stay abreast of emerging internal controls and compliance challenges by registering for our Corporate Compliance, Risk Management & Internal Controls distributions. For important information concerning this communication click here.    If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net. 

©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on September 8, 2009 New Deadline For Government Contractors, Subcontractors Deadline To Use E-Verify | Corporate Compliance, E-Verify, Employee Benefits, Employment Agreement, Government Contractors, Human Resources, I-9, Immigration, Internal Controls, Public Policy, Risk Management | Tagged: , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Stamer Moderates June 25 ABA Teleconference On When Benefits Lawyers and Other Service Providers Be Sued for Malpractice for Services to ERISA Plans

June 9, 2009

Cynthia Marcotte Stamer will moderate a June 25, 2009 teleconference on “Can Benefits Lawyers and Other Service Providers Be Sued for Malpractice for Services to ERISA Plans?”

The telephone conference hosted by the American Bar Association (ABA) Joint Committee on Employee Benefits (JCEB) is scheduled for Thursday, June 25, 2009 from 1:00-2:00 pm Eastern Time, 12:00-1:00 pm Central Time, 11:00 am-12:00 pm Mountain Time, and 10:00 am-11:00 am Pacific Time.

The teleconference will feature a discussion by Hogan & Hartson LLP attorney Kurt Lawson and AARP Foundation Litigation attorney Mary Ellen Signorille about how the federal precedent governing when and how ERISA preemption affects state malpractice and misfeasance claims against accountants, lawyers, health care providers, actuaries and others has evolved during the five year period since the United State’s Aetna v. Davila decision reframed when ERISA preempts state law malpractice claims and the implications of this precedent on the viability and litigation of these state law malpractice claims.

To register or for additional information, go to here.

About Cynthia Marcotte Stamer

The immediate past Chair of the American Bar Association’s Managed Care & Insurance Section, Cynthia Marcotte Stamer is a highly regarded legal advisor, author and speaker recognized both nationally and internationally for her expertise in the areas of health benefits and other human resource compliance matters. Board Certified in Labor and Employment Law by the Texas Board of Legal Specialization, “Cindy” recently joined Curran Tomko Tarski, LLP as the Chair of its Labor & Employment and Health Care Practices April 1, 2009.

The Managing Editor of Solutions Law Press and an Editorial Advisory Board Member and author for Employee Benefit News and other publications, Ms. Stamer is a widely published author and popular speaker. In addition to hundreds of publications on health plan and other human resources, employee benefit and internal controls issues, Ms. Stamer is the author of the “Health Plan Eligibility Toolkit.” Her work has been featured and published by the American Bar Association, BNA, SHRM, World At Work, Employee Benefit News and the American Health Lawyers Association. Her insights on human resources risk management matters have been quoted in The Wall Street Journal, the Dallas Business Journal, Managed Care Executive, HealthLeaders, Business Insurance, Employee Benefit News and the Dallas Morning News.

Ms. Stamer also serves in a number of professional leadership roles including the leadership council of the ABA Joint Committee on Employee Benefits, Vice Chair of the ABA Real Property, Probate & Trust Section and Employee Benefits & Compensation Group.

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other health plan and other employee benefit,  labor and employment, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer via e-mail here, or by calling (214) 270-2402.  For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here,   For more information and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website.

We hope that this information is useful to you. For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here,   For more information and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website.

 

You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources here.  If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.

©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on Stamer Moderates June 25 ABA Teleconference On When Benefits Lawyers and Other Service Providers Be Sued for Malpractice for Services to ERISA Plans | Employee Benefits, Employers, ERISA, Health Plans, Human Resources, Insurance, Internal Controls, Malpractice, Preemption, Professional Liability, Retirement Plans, Risk Management | Tagged: , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Registration Open For June 23 Dallas HR 2009 Health Plan Eligibility Update Program

June 9, 2009

Amid soaring health care costs and tightening corporate budgets, employers and other group health plan sponsors, fiduciaries and administrations now also must update their group health plan eligibility and enrollment practices to comply with the American Recovery and Reinvestment Act of 2009 (the “Stimulus Bill”), COBRA subsidy mandates, HIPAA special enrollment rule amendments and a host of other changes to federal eligibility mandates that already have or will take effect this year.  Meanwhile, employers must keep a careful watch on Congress as it considers enacting sweeping health care reforms that are likely to place more obligations on employers.

Health plan eligibility design and administration plays a critical role in controlling health benefit costs and is a leading and growing source of health plan legal risk for employers, fiduciaries and administrators.  Understanding and properly managing these concerns is imperative for employers and others sponsoring or administering these programs.

Stamer Discusses Health Plan Eligibility Rules June 23

Cynthia Marcotte Stamer will explain newly effective COBRA Subsidy Rules, genetic information nondiscrimination rules and other recent and impending changes to federal health plan eligibility mandates will be explained on June 23, 2009 during a 2009 Health Plan Eligibility Update briefing hosted by the Dallas Human Resources Management Association including:

Cynthia Stamer will explain to attendees what they need to know and do about:

  • New Stimulus Bill COBRA Subsidy Rules and other special COBRA rules that took effect on February 17
  • New GINA group health plan information scheduled to take place in 2009
  • Changes to HIPAA special enrollment and nondiscrimination rules
  • Implications for group health plans based on recent changes to FMLA and USERRA regulations
  • Medicare, Medicaid and CHIP nondiscrimination rules
  • Impending college student continuation mandates
  • And more….

Get  details or register on line here or by telephoning Dallas Human Resources Management Association at 214-631-8775.

Stamer’s Health Plan Experience Extensive

The immediate past Chair of the American Bar Association’s Managed Care & Insurance Section, Cynthia Marcotte Stamer is a highly regarded legal advisor, author and speaker recognized both nationally and internationally for her expertise in the areas of health benefits and other human resource compliance matters. Board Certified in Labor and Employment Law by the Texas Board of Legal Specialization, “Cindy” recently joined Curran Tomko Tarski, LLP as the Chair of its Labor & Employment and Health Care Practices April 1, 2009.

The Managing Editor of Solutions Law Press and an Editorial Advisory Board Member and author for Employee Benefit News and other publications, Ms. Stamer is a widely published author and popular speaker. In addition to hundreds of publications on health plan and other human resources, employee benefit and internal controls issues, Ms. Stamer is the author of the “Health Plan Eligibility Toolkit.” Her work has been featured and published by the American Bar Association, BNA, SHRM, World At Work, Employee Benefit News and the American Health Lawyers Association. Her insights on human resources risk management matters have been quoted in The Wall Street Journal, the Dallas Business Journal, Managed Care Executive, HealthLeaders, Business Insurance, Employee Benefit News and the Dallas Morning News.

Ms. Stamer also serves in a number of professional leadership roles including the leadership council of the ABA Joint Committee on Employee Benefits, Vice Chair of the ABA Real Property, Probate & Trust Section and Employee Benefits & Compensation Group.

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other health plan and other employee benefit,  labor and employment, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer via e-mail here, or by calling (214) 270-2402.  For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here,   For more information and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website.

We hope that this information is useful to you. For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here,   For more information and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website.

You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources here.  If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.

 ©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on Registration Open For June 23 Dallas HR 2009 Health Plan Eligibility Update Program | Absenteeism, ADA, COBRA, Disease Management, Employee Benefits, Employers, Employment Tax, ERISA, family leave, GINA, Health Care Reform, Health Plans, Human Resources, Income Tax, Insurance, Internal Controls, medical leave, Military Leave, Privacy, Risk Management, Stimulus Bill, Tax | Tagged: , , , , , , , , , , , , , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

102 House Members Back New Bill To Mandate Employers Give 56 Hours Paid Leave Per Year

June 9, 2009

Virtually all employers will be require to allow employees provide up to 56 hours of paid if Congress passes the “Healthy Families Act” (H.R. 2460) introduced by Representative Rosa DeLauro with the support of 101 co-sponsors on May 18, 2009.  Given the significant number of co-sponsors already on record as supporting the legislation, employers concerned about the proposed legislation need to act quickly to communicate their concerns to Congress.

If enacted as currently introduced, H.R. 2460 both would significantly expand the number of employers required by federal law to provide sick leave and overlay a mandate to provide paid sick leave in addition to the existing unpaid leave mandates currently applicable under the Family and Medical Leave Act to employers of more than 50 employees.

As proposed, H.R. 2460 would require all employers of 15 or more employees:

  • To accrue at least 1 hour of paid sick time (up to a maximum of 56 hours per calendar year) for every 30 hours worked by each employee from beginning with the first day of employment of the employee.  Exempt employees generally would be assumed to work 40 hours in each workweek for purposes of calculating accrued sick leave;
  • Guarantee employees the right to begin using accrued paid sick time for one of the purposes qualifying for sick leave under H.R. 2460 beginning with the 60th calendar day following commencement of the employee’s employment and thereafter as he accrues additional paid sick time;
  • To allow employees to carry over earned but unused paid sick time from  one calendar year to the next except under certain limited conditions; and
  • To reinstate accrued but unused leave for any employee rehired within 12 months after separating from employment and continue to recognize additional paid sick time accruals beginning with the recommencement of employment with the employer.

The purposes that H.R. 2460 would require employers to allow employees to use accrued sick leave also would be broader than those currently protected under the medical leave provisions of the FMLA.  Under H.R. 2460, employees could use sick leave for any of the following absences:

  • An absence resulting from a physical or mental illness, injury, or medical condition of the employee;
  • An absence resulting from obtaining professional medical diagnosis or care, or preventive medical care, for the employee
  • In absence for the purpose of caring for a child, a parent, a spouse, or any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship (a “family member”), who has any of the conditions or needs for diagnosis or care of a physical or mental illness, injury, or medical condition or in the case of someone who is not a child, is otherwise in need of care; and
  • An absence resulting from domestic violence, sexual assault, or stalking, if the time is to seek medical attention for the employee or a family member to recover from physical or psychological injury or disability caused by domestic violence, sexual assault, or stalking or obtain or assist a family member in obtaining services from a victim services organization, psychological or other counseling; to seek relocation; or to take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic violence, sexual assault, or stalking.

In addition, H.R. 2460 also would require covered employers:

  • To notify employees about their sick leave rights as dictated by H.R. 2460; and
  • Not to discharge or discriminating against (including retaliating against) any individual, including a job applicant, for exercising, or attempting to exercise, any right provided or for opposing any practice made unlawful by H.R. 2460;
  • Not to use the taking of paid sick time under H.R. 2460 as a negative factor in an employment action, such as hiring, promotion, or a disciplinary action;  
  • Not to count the paid sick time under a no-fault attendance policy or any other absence control policy;
  • Not otherwise to interfere with, restrain, or deny the exercise of, or the attempt to exercise, any right provided under H.R. 2460; and
  • Not to discharge or in any other manner discriminate against (including retaliating against) any individual, including a job applicant, because such individual has filed an action, or has instituted or caused to be instituted any proceeding, under or related to H.R. 2450; has given, or is about to give, any information in connection with any inquiry or proceeding relating to any right provided under H.R. 2450; or has testified, or is about to testify, in any inquiry or proceeding relating to any right provided under H.R. 2450.

Even before the current economic downturn, many employers already viewed the unpaid leave mandates imposed by the FMLA and other laws as burdensome.  The added costs and complexities of providing more paid time off under another federally imposed mandate couldn’t come at a worse time for many employers.  Given the number of co-sponsors, many commentators view the proposed mandates in H.R. 2450 as likely to pass the House unless businesses act quickly to educate members of Congress about their concerns.

 Curran Tomko Tarski LLP Labor & Employment Practice Group Chair Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers and others to respond to proposed legislation and regulations and addressing other leave and other labor and employment, employee benefit, compensation, and internal controls concerns. If your organization needs assistance with assessing or responding to H.R. 2450 or assistance with leave and absence management or other labor and employment, compensation or benefit concerns or regulations, 

If you need help responding to these proposals or with other questions relating to compliance or risk management under other federal or state employment, employee benefits, compensation, or internal controls laws or regulations, please contact Curran Tomko Tarski LLP Labor & Employment Practice Group Chair, Cynthia Marcotte Stamer at (214) 270.2402 or via e-mail here.   Board Certified in Labor and Employment Law by the Texas Board of Legal Specialization, “Cindy” works with businesses, speaks and publishes extensively on these and other labor and employment, employee benefit, internal controls and compensation matters.

Other Information & Resources

We hope that this information is useful to you. For additional information about the experience, services, publications and involvements of Ms. Stamer specifically or to access some of her many publications, see here,   For more information and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website.

 

You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources here.  If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.

 ©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on 102 House Members Back New Bill To Mandate Employers Give 56 Hours Paid Leave Per Year | Absenteeism, ADA, Corporate Compliance, Employers, family leave, Health Plans, Human Resources, Internal Controls, Internal Investigations, Leave, medical leave | Tagged: , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Legislation To Exempt Health Benefits For Domestic Partners and Other Beneficiaries Introduced In House & Senate.

June 3, 2009

June 3, 2009

Domestic partner benefits provided under employer or union sponsored health plans no longer would be taxable to enrolling employees if Congress adopts legislation recently proposed in the House and Senate.

HR 2625, the Tax Equity for Health Plan Beneficiaries Act and a companion bill, S 1153 S 1153 would amend the Internal Revenue Code of 1986 to extend the exclusion from gross income for employer-provided health coverage for employees’ spouses and dependent children to coverage provided to other eligible designated beneficiaries of employees, including domestic partners. According to a press release from Rep. McDermott, the bill would eliminate federal income and payroll taxes on health benefits provided to domestic partners. 

Currently, the value of health benefits provided to domestic partners of employees under an employer’s group health plan typically are taxable income to the employee for purpose of the Internal Revenue Code.  Valuing and reporting taxable payments on domestic partner benefits can be a headache for employers that provide those benefits.

If you need help responding to these proposals or with other questions relating to compliance or risk management under other federal or state employment, employee benefits, compensation, or internal controls laws or regulations, please contact Curran Tomko Tarski LLP Labor & Employment Practice Group Chair, Cynthia Marcotte Stamer at (214) 270.2402 or via e-mail here.   Board Certified in Labor and Employment Law by the Texas Board of Legal Specialization, “Cindy” works with businesses, speaks and publishes extensively on these and other labor and employment, employee benefit, internal controls and compensation matters.  For additional information about Curran Tomko Tarski LLP see the Curran Tomko Tarski Website.

Other Information & Resources

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources here. For additional information about Ms. Stamer and her experience, see here or contact Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at here.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.

 ©2009 Cynthia Marcotte Stamer. All rights reserved.

Comments Off on Legislation To Exempt Health Benefits For Domestic Partners and Other Beneficiaries Introduced In House & Senate. | COBRA, Employee Benefits, Employers, ERISA, Health Plans, Human Resources, Income Tax, Insurance, Tax | Tagged: , , , , , , , , , , , , , | Permalink
Posted by Cynthia Marcotte Stamer

Labor Department Gears Up To Enforce COBRA Premium Subsidy Rules

May 29, 2009

Pressure is mounting for group health plans and their employer and other sponsors and administrators to complete the details required to comply with special medical coverage continuation rules (COBRA Subsidy Rules) added to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (COBRA) by the American Recovery and Reinvestment Act of 2009 (Stimulus Bill). 

The U.S. Department of Labor Employee Benefits Security Administration (EBSA) recently (May 21, 2009) announced its appeal process for assistance eligible individuals to use to complain to the EBSA when they believe they wrongfully have been denied a premium subsidy for their group health plan continuation coverage in violation of the temporary modifications (COBRA Subsidy Rules) to the group health plan medical coverage continuation requirements of the COBRA Stimulus Rules.  These are the expedited complaint and appeals procedures mandated under the Stimulus Bill.

The COBRA Subsidy Rules, new genetic information nondiscrimination rules and other recent and impending changes to federal health plan eligibility mandates will be explained on June 23, 2009 during a 2009 Health Plan Eligibility Update briefing hosted by the Dallas Human Resources Management Association.  Get  details or register here.

The Stimulus Bill allows individuals denied the premium subsidy to get expedited review by the EBSA. Under the appeals procedures announced May 21, individuals begin this review process by completing an appeals application available on line at http://www.dol.gov/ebsa/COBRA/main.

Employers and group health plans and their plan administrators and plan insurers have been required to provide notifications and COBRA premium subsidies for certain former employees and their dependents that qualify as assistance eligible individuals and take other actions to comply with the COBRA Subsidy Rules since the COBRA Subsidy Rules took effective on February 17, 2009.  While many employers and plan administrators undertaken some efforts to comply with these new COBRA mandates,  many still have not fully completed all of the compliance arrangements.

With procedures to receive and administer appeals, the EBSA now is prepared to investigate possible violations of the Stimulus Bill COBRA rules.  Accordingly, employers, plan administrators and insurers sponsoring or administering group health plan should prepare to respond to investigations that may be initiated by the filing of a request for EBSA review.

You can read details about the COBRA Subsidy Rules here.

 

Stimulus COBRA Rules In A Nutshell

Congress enacted the COBRA Subsidy Rules that took effect February 17, 2009 to help certain involuntarily terminated former employees and their dependents maintain COBRA coverage by requiring COBRA-covered group health plans temporarily to extend certain special COBRA treatment for “assistance eligible individuals.”

The Stimulus Bill temporarily limits the COBRA premium that a COBRA-covered group health plan can require an “assistance eligible individual” to pay for COBRA Coverage to 35% of the otherwise applicable COBRA premium (the “Reduced Premium”) for a period of up to 9 months (the “Subsidy Period”) beginning with the individual’s first period of COBRA Coverage beginning after February 17, 2009.  The employer or insurer that collects this Reduced Premium must pay the remaining 65% of the COBRA premium (the “COBRA Subsidy”) for the assistance eligible individual during the Subsidy Period.  However, the Stimulus Bill provides for that employer or insurer to claim a payroll tax credit equal to the amount of these COBRA Subsidy payments by complying with applicable IRS procedures. 

The Stimulus COBRA Rules also requires group health plans to offer a second COBRA enrollment period to each assistance eligible individual not enrolled in COBRA Coverage on February 17, 2009.  These second electors must be allowed to elect prospectively to enroll in COBRA coverage until the date that their COBRA Coverage eligibility otherwise would have ended if they had maintained COBRA Coverage since their termination.

Additionally, COBRA-covered group health plans that offer employees different plan options allow assistance eligible individuals the option to change their coverage choice from a higher cost option to a lesser cost option.  Group health plan administrators also must provide certain notifications to assistance eligible individuals concerning these changes.

 

“Assistance Eligible Individuals”

The Stimulus COBRA Rules only apply to qualified beneficiaries whose loss of coverage resulted from the “involuntary termination of employment” of a covered employee. The Stimulus Bill definition of “assistance eligible individual” generally includes any COBRA “qualified beneficiary” who meets all of the following requirements:

ü       Has a loss of coverage within the meaning of COBRA (“qualifying event”) as a result of the “involuntary termination of employment” of a covered employee from September 1, 2008 to December 31, 2009;

ü       Is eligible for COBRA Coverage at any time during the period beginning September 1, 2008 and ending December 31, 2009; and

ü       Elects COBRA coverage when first offered or as during the additional second election period required for assistance eligible individuals not enrolled in COBRA Coverage on February 17, 2009.

IRS Notice 2009-27 defines an “involuntary termination” as “a severance from employment due to the independent exercise of the unilateral authority of the employer to terminate the employment, other than due to the employee’s implicit or explicit request, where the employee was willing and able to continue performing services” based on all the facts and circumstances. 

For COBRA Premium Assistance purposes, the facts and circumstances determine whether a termination is involuntary. Thus, IRS Notice 2009-27 states that a termination designated as voluntary or as a resignation nevertheless will be considered involuntary where the facts and circumstances indicate that the employer would have terminated the employee’s services, and that the employee had knowledge that the employee would be terminated.

Notice 2009-27 identifies as examples of terminations that fall within this definition of “involuntary termination” as including the following facts and circumstances:

ü       The employer’s failure to renew a contract at the time the contract expires, if the employee was willing and able to execute a new contract providing terms and conditions similar to those in the expiring contract and to continue providing the services;

ü       An employee-initiated termination from employment if the termination from employment constitutes a termination for good reason due to employer action that causes a material negative change in the employment relationship for the employee;

ü       An involuntary reduction of hours of employment to zero hours, such as a lay-off, furlough, or other suspension of employment, resulting in a loss of health coverage;

ü       An employee’s voluntary termination of employment in response to an employer imposed reduction of hours of employment where the reduction in hours is a material negative change in the employment relationship for the employee;

ü       An employer’s action to end an individual’s employment while the individual is absent from work due to illness or disability (but not mere absence from work due to illness or disability before the employer has taken action to end the individual’s employment);

ü       A termination designated on account of “retirement” if the facts and circumstances indicate that, absent retirement, the employer would have terminated the employee’s services, and the employee had knowledge that the employee would be terminated;

ü       The covered employee resigned as the result of a material change in the geographic location of employment for the employee;

ü       A lockout initiated by an employer but not a work stoppage as the result of a strike initiated by employees or their representatives; and

ü       A termination elected by the employee in return for a severance package (a “buy-out”) where the employer indicates that after the offer period for the severance package, a certain number of remaining employees in the employee’s group will be terminated

Notice 2009-27 also clarifies that the termination of employment giving rise to the loss of group health plan coverage and the loss of the group health plan coverage both must occur between September 1, 2008 and December 31, 2009 in order for an individual to qualify as an assistance eligible individual. Consequently, if the involuntary termination occurs before September 1, 2008, but the loss of coverage resulting in eligibility for COBRA Coverage occurs after September 1, 2008 (but no later than December 31, 2009), Notice 2009-28 states that the individual will not qualify as an assistance eligible individual.  Likewise, where an individual’s involuntary termination occurs by December 31, 2009, but the loss of coverage resulting in eligibility for COBRA Coverage occurs after December 31, 2009, the qualified beneficiary will not qualify as an assistance eligible individual for purposes of the Subsidy COBRA Rules.  According to Notice 2009-27, where the involuntary termination of employment and loss of coverage as a covered employee or dependent occur between September 1, 2008 and December 31, 2009, the election of COBRA Coverage need not occur by December 31, 2009.

Many group health plans are drafted to provide that the date that employee or dependent coverage ends or changes as a result of an employment loss is the last day of the month or some other date after the actual date of the employment termination.  Under group health plans where the loss of coverage due to the qualifying event is delayed, Notice 2009-27 also reminds employers and plan administrators of the need to focus on how group health plan provisions, separation agreements and other related documents define when the loss of coverage occurs under a group health plan when applying these rules.

For purposes of COBRA, Notice 2009-27 states that when a loss of coverage under a group health plan occurs under these circumstances depends on how the group health plan treats the provision of health coverage between the date of the employment loss and the date of the resulting loss of employee and/or dependent coverage. If the plan treats the provision of health coverage as deferring the loss of coverage, Notice 2009-27 indicates the loss of coverage generally occurs when the individual ceases to be entitled to employee or dependent coverage on the same terms and conditions as would have applied had he not experienced the qualifying event.  However, if the plan treats the continued provision of health coverage from the termination date until employee or dependent coverage later ends as a result as reducing the period of required COBRA Coverage, then the loss of coverage occurs on the termination date or other later date.  Appropriate drafting is important to support the desired characterization.

 

Calculation of 35% of COBRA Premium

Based on the guidance in Notice 2009-27, many employers will want to terminate severance or other arrangements under which former employees are allowed to pay less than the maximum COBRA premium for some period of time.  According to Notice 2009-29,.the premium used to determine the 35% share that must be paid by (or on behalf of) an assistance eligible individual is the cost that would be charged to the assistance eligible individual for COBRA Coverage if the individual were not an assistance eligible individual. If absent the Stimulus COBRA Rules, the group health plan would require the assistance eligible individual to pay 102% of the “applicable premium” for continuation coverage, i.e., generally the maximum permitted, the Reduced Premium equals 35% of the 102% of the applicable premium. As no good deed goes unpunished, however, if the premium the group health plan would charge the assistance eligible individual is less than the maximum allowable COBRA premium, the Reduced Premium will be 35% of that lesser amount.  In determining whether an assistance eligible individual has paid 35% of the premium, payments on behalf of the individual by another person (other than the employer with respect to which the involuntary termination occurred) are taken into account.

 

Coverage Eligible For Premium Reduction

Notice 2009-27 also provides guidance about what types of group health plan coverage qualifies for premium reduction.  According to the Notice, the premium reduction is available for COBRA Coverage of any group health plan, except a health flexible spending arrangement (FSA) under section 106(c) offered under a section 125 cafeteria plan. This includes vision-only or dental-only plans, “mini-med plans” and certain health reimbursement accounts (HRAs). 

The Notice 2009-27 distinguishes exempted FSAs from covered health reimbursement arrangements (HRAs) for purposes of these rules.  According to Notice 2009-27, while an HRA may qualify as an FSA under section 106(c), the exclusion of FSAs from the premium reduction is limited to FSAs provided through a section 125 cafeteria plan, which would not include an HRA. 

Notice 2009-27 also indicates that retiree coverage can qualify for the premium reduction where the retiree coverage does not differ from the coverage made available to similarly situated active employees.

 

Premium Reduction Period Duration

Notice 2009-27 also provides guidance about when periods of coverage and the Premium Reduction Period begin and end.  Under the Stimulus COBRA Rules, the premium reduction applies as of the first period of coverage beginning on or after February 17, 2009 (February 17, 2009)  for which the assistance eligible individual is eligible to pay only 35% of the premium  and be treated as having made full payment.   For this purpose, a period of coverage is a monthly or shorter period with respect to which premiums are charged by the plan with respect to such coverage.  

According to Notice 2009-27, when the Premium Reduction Period begins for an assistance eligible individual depends on the period the plan charges COBRA premiums.  Where a group health plan requires an individual who loses coverage other than on the last day of the month who wishes to enroll in COBRA Coverage to pay a pro-rata portion of the monthly premium, Notice 2009-27 states the first period of coverage to which the premium reduction applies for an assistance eligible individual who loses coverage after February 17, 2009 generally is the individual’s first partial month of coverage.  A different rule applies when the assistance eligible individual elects COBRA Coverage under the second election period required by the Stimulus Bill Rules, however.  Whether a plan requires COBRA Coverage be paid for based on a calendar month or pro rata basis, March 1, 2009 is the beginning of the first period of coverage within the Premium Reduction Period for any assistance eligible individual enrolling during the second enrollment period and the Reduced Premium only applies to that individual for COBRA Coverage from March 1, 2009 through the end of his otherwise applicable Premium Reduction Period.

 

End Of Premium Reduction Period

An assistance eligible individual ceases to qualify for the premium reduction on the earliest of:

ü       The first date the assistance eligible individual becomes eligible for other group health plan coverage (with certain exceptions) or Medicare coverage,

ü       The date that is nine months after the first day of the first month for which the Stimulus Bill premium reduction provisions apply to the individual, or

ü       The date the individual ceases to be eligible for COBRA Coverage.

Notice 2009-27 confirms that the Premium Reduction Period of an assistance eligible individual ends on the first date he becomes eligible for other group health plan coverage or Medicare effect even if the assistance eligible individual does not enroll in the other group health plan coverage.  

According to Notice 2009-27, whether an offer of retiree coverage that is not COBRA Coverage simultaneously with the offering of COBRA Coverage ends the Premium Reduction Period depends on whether the retiree coverage is offered under the same group health plan as the COBRA Coverage or under a different group health plan.  If offered under the same group health plan, the offer of the retiree coverage has no effect on the Premium Reduction Period.  If offered under a different group health plan, the offer of retiree coverage that is not COBRA coverage ends the Premium Reduction Period.  However Notice 2009-27, however, If offered to someone whose eligibility for COBRA coverage arose between September 1, 2008 and February 17, 2009, the offer render the individual ineligible for the premium reduction only if the period the individual is given for enrolling in the retiree coverage extends to at least February 17, 2009.

Notice 2009-27 also addresses when eligibility for coverage under an HRA ends eligibility for the premium reduction.  It states that becoming eligible for HRA coverage ends the Premium Reduction Period unless the HRA qualifies as an FSA under section 106(c).   Under section 106(c), an FSA is health coverage under which the maximum amount of reimbursement which is reasonably available to a participant of the coverage is less than 500% of the value of the coverage. For this purpose, the maximum amount of reimbursement which is reasonably available is generally the balance of the HRA and the value of the HRA coverage would generally be the applicable premium for COBRA continuation of the HRA coverage.

Notice 2009-27 also clarifies that the Premium Reduction Period of an eligible individual may extend beyond December 31, 2009 for individuals who qualify as assistance eligible individuals on or before December 31, 2009.  For example, the Premium Reduction Period of an assistance eligible individual whose Premium Reduction Period begins on December 1, 2009 could extent until August 31, 2010, assuming the individual does not become eligible for other group health plan coverage or Medicare or lose eligibility for COBRA Coverage before that date.

With regard to the effect of Medicare eligibility on an assistance eligible individual’s Premium reduction Period, Notice 2009-27 indicates that an individual currently enrolled in Medicare when the involuntary termination of employment occurs is ineligible for premium reduction, even though they may be eligible to elect COBRA continuation coverage by paying the otherwise applicable unreduced COBRA premium.

 

Dealing With Assistance Eligible Individuals Not Eligible For Premium Subsidy Based On Eligibility For Other Group Coverage

Under the Stimulus Bill, assistance eligible individuals are required to provide notification and resume paying the unreduced usual COBRA premium when they become eligible for Medicare or other group health coverage.  Where an assistance eligible individual fails to provide the required notice and continues to take advantage of the premium reduction after his Premium Reduction Period terminates due to his becoming eligible for other coverage or Medicare, Notice 2009-27 states the employer is not responsible for recovering the additional premium or otherwise recouping the COBRA premium. 

 

Dealing With Assistance Eligible Individuals Subject to Phase Out of Premium Subsidy Eligibility Based On Income

The Stimulus COBRA Rules include tax provisions designed phase out the COBRA Subsidy for certain highly compensated employees by taxing a portion of those amounts.  Notice 2009-7 discusses the mechanics through which highly compensated employees can avoid this tax liability by electing to waive the Premium Reduction and Premium Subsidy. 

An assistance eligible individual who wants to make a permanent election to waive the right to the premium reduction makes the election by providing a signed and dated notification (including a reference to “permanent waiver”) to the employer or other person who is reimbursed for the premium reduction under the COBRA Premium Subsidy provisions of Code § 6432. No separate additional notification to any government agency. If an assistance eligible individual makes the permanent election to waive the right to the premium reduction, the individual may not later reverse the election and may not receive the premium reduction for any future period of COBRA Coverage in 2009 or 2010, regardless of modified adjusted gross income in those years.

Notice 2009-27 makes clear that these rules don’t allow employers to deny the Reduced Premium to these assistance eligible individuals.  According to Notice 2009-27, “Even if an assistance eligible individual’s income is high enough that the recapture of the premium reduction would apply, COBRA Coverage must be provided upon payment of 35% of the premium unless the individual has notified the plan that the individual has elected the permanent waiver of the premium reduction (or the period for the premium reduction has ended).

 

Second COBRA Election Period

The Stimulus Bill also requires group health plans to offer a second election period to assistance eligible individuals not enrolled in COBRA Coverage on February 17, 2009 whose employment terminated between September 1, 2008 and February 16, 2009.  Notice 2009-27 confirms that any individual (including a dependent) who did not have an election of COBRA Coverage in effect on February 17, 2009, but who would have been an assistance eligible individual if the election were in effect must be offered this second election period. For those electing COBRA Coverage during this second election period, the resulting coverage begins with the first period of COBRA continuation coverage beginning on or after February 17, 2009.   Notice 2009-27 confirms that this extended election period is available for all individuals who are qualified beneficiaries as the result of an involuntary termination during the period from September 1, 2008, through February 17, 2009, even if they still have an open COBRA election period as of February 17, 2009. If these individuals elect COBRA under their original COBRA election period, COBRA coverage is retroactive to their loss of coverage and the premium reduction does not apply to the periods of coverage prior to the first period of coverage beginning on or after February 17, 2009 (generally, periods of coverage before March 2009 for plans with monthly coverage periods).

If, as a result of the extended election period, an assistance eligible individual becomes eligible for COBRA Coverage under a group health plan that requires payment of COBRA premiums on a calendar month basis, the individual’s first period of coverage will begin on March 1 and the Reduced Premium only applies prospectively from that date. According to Notice 2009-27, this does not change even if the plan otherwise requires individuals who lose coverage before the last day of the month and who wish to enroll in COBRA continuation coverage to pay a pro-rata portion of the monthly premium for the first partial month of coverage.

In contrast, where a group health plan determines the required COBRA premiums based on the loss of coverage, Notice 2009-27 states that the first period of coverage begins on the first day after the loss of coverage and ends on the day of the following month corresponding to the day of the loss of coverage. For example, if the last day of coverage was October 3, 2008, the period of coverage runs from the fourth of the month to the third of the following month, and thus the first period of coverage on or after February 17, 2009, is the period March 4, 2009, through April 3, 2009.

Notice 2009-27 also discusses the operation of these rules as applied to certain HRAs

 

Who Pays The Premium Subsidy & Claims The Payroll Tax Credit

In previously issued guidance, the IRS indicated that between the sponsoring employer or union and a group insurer, the party that collects the Reduced Premium bears responsibility to pay the 65% Premium Subsidy then claiming the payroll tax credit under the Stimulus COBRA Rules.  According to Notice 2009-27, if the insurer and the employer of insured, single employer group health plan have agreed that the insurer will collect the premiums directly from the qualified beneficiaries, the insurer must treat an assistance eligible individual paying 35 of the premium as having paid the full premium, even before the employer pays the insurer the remaining 65%. If the insurer fails to treat a 35% payment by an assistance eligible individual as a payment of the full premium, the insurer may be liable for the excise tax under Code § 4980B(e)(1)(B), which applies to persons responsible for administering or providing benefits under the plan and whose act or failure to act caused (in whole or in part) the failure, if the person assumed responsibility for the performance of the act to which the failure relates.

 

For More Information or Assistance

If your organization needs help responding to the COBRA Subsidy Rules or other group health plan or other employee benefit or human resources matters, please contact Cynthia Marcotte Stamer.  Ms. Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at e-mail, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website or Cynthia Marcotte Stamer, P.C. Website.

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources at CynthiaStamer.com For additional information about Ms. Stamer and her experience, see here or contact Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your Currant contact information – including your preferred e-mail- by creating or updating your profile at CynthiaStamer.com.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.  For important information concerning this communication click here.

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Posted by Cynthia Marcotte Stamer

Tell Senate Committee Today Not To Mess Up Health Benefits

May 27, 2009

Today is the last day that individuals and businesses concerned about health care can provide feedback to Congress on health care reform proposals on the fast track for adoption by Congress and have their opinion included in the official hearing record of the  May 12, 2009 Senate Finance Committee Hearing on  “Financing Comprehensive Health Care Reform.”  Start speaking up today and keep speaking out until you are heard.

Senate health care reform leaders have announced their intention to have the Senate vote and pass health care reform legislation that would drastically change the U.S. health care and health insurance system during June. Individuals and businesses concerned about Congressional proposals to private health benefits with federal government benefits, to tax individuals and businesses on health benefits, and to make other radical changes in our health care programs should e-mail their concerns to Congress today.  Recent statements by Congressional leaders and President Obama indicate that the intend to act quickly to pass major health care reforms within the next few months, beginning with action by the Senate in June.

The Senate Finance Committee discussed the proposed changes during a “Roundtable Discussion” hearing on May 12, 2009.  Among the changes that this hearing reflects to be under serious consideration by Congress are proposals:

  • To tax individuals on health benefits and/or coverage
  • Reduce or eliminate employer tax benefits for providing health coverage
  • Mandate individuals and/or employees pay government mandated health insurance premiums
  • Replace existing employer and private health insurance programs with government run or mandated benefit programs
  • Involve the federal government  in deciding who and when Americans get care
  • Establish other burdensome federal requirements and regulations on health benefits and health care providers.

 You can review or listen to the testimony and learn more about what Congress plans to do to your and your employees’ health benefits here.

If you or others that you know are concerned about all or any of these proposals, we urge you to share your feedback TODAY as follows and staying involved as Congress moves to act: 

  • E-mail the Health Care Reform Leadership of the Senate Finance Committee at Health_reform@finance_dem.senate.gov
  • E-mail each member of the Senate Finance Committee at http://finance.senate.gov/sitepages/committee.htm
  • Call (202) 224-4515 and share your views with Congressional Staffers Erin Shields (Baucus) and Jill Gerber (Grassley), Committee on Finance, 219 Dirksen Senate Office Building, Washington, D.C. 20510-6200
  • Tell your Senators and Representatives you oppose Congressional plans to fast track health care reform the way Congress enacted the Stimulus Bill
  • Tell your Senators and Representatives you will support members of Congress who vote responsibly on health care reform
  • Tell your Senators and Representatives in Congress and political party leaders you will work to defeat members and candidates that advocate these and other irresponsible health care reform legisltation
  • Carry through on your promises
  • Keep speaking out until you are heard and Congress gets the message.    

Cynthia Marcotte Stamer is an attorney, author and health care advocate known for her work and writings nationally and internationally on health care and coverage policy and legal matters . If your organization needs assistance with assessing, managing or communicating its concerns about this legislation or other health care and insurance, employment or employee benefit practices, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see the http://www.cttlegal.com.

Other Information & Resources

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at e-mail, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website or Cynthia Marcotte Stamer, P.C. Website.

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources at CynthiaStamer.com For additional information about Ms. Stamer and her experience, see here or contact Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your Currant contact information – including your preferred e-mail- by creating or updating your profile at CynthiaStamer.com.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.  For important information concerning this communication click here.    If you do not wish to receive these updates in the future, send an e-mail with the word “Remove” in the Subject to support@SolutionsLawyer.net.

 

©2009 Cynthia Marcotte Stamer.  Permission to forward with attribution granted to concerned parties.  All other rights reserved.

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Posted by Cynthia Marcotte Stamer

New GINA Health Plan Nondiscrimination Rules Effective For Plan Years Beginning On or After Today

May 21, 2009

New restrictions on the collection, use and disclosure of genetic information applicable to employer and union-sponsored group health plans enacted under Title I of the Genetic Information Nondiscrimination Act of 2008, Public Law No. 110-233 (GINA) for group health plan years that begin on or after today (May 21, 2009). For non-calendar year plans with plan years beginning between June 1 and December 1, the effective date occurs on first day of their 2009 plan year. For example, the effective date will be June 1, 2009 for a plan with a 2009 plan year that begins June 1.  For calendar year plans, the compliance deadline is January 1, 2010.   All employer-sponsored group health plans are required to comply with GINA.  There are no small group exceptions.

GINA In A Nutshell

GINA amended federal law to include specific prohibitions against certain discrimination based on genetic information by group health plans and health insurers (Title I) and to prohibit discrimination based on genetic information by employers of 15 or more employees (Title II).

Effective for all group health plan years beginning on or after May 21, 2009, GINA’s new restrictions on the collection and use of genetic information by group health plans added under Title I of GINA are accomplished through the expansion of a series of already existing group health plan nondiscrimination and privacy rules.  GINA’s group health plan provisions amend and expand the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Employee Retirement Income Security Act of 1974 (ERISA), Title VII of the Civil Rights Act, the Public Health Service Act, the Internal Revenue Code of 1986, and Title XVIII (Medicare) of the Social Security Act to implement sweeping new federal restrictions on the collection, use, and disclosure of information that falls within its broad definition of “genetic information” by  group health plans.  For individual health insurers, GINA’s restrictions take effect May 22, 2009.  The broad definition of the term “genetic information” in GINA will require group health plan sponsors and insurers to carefully review and update their group health plan documents, communications, policies and practices to comply with forthcoming implementing regulations to avoid liability under new GINA’s rules governing genetic information collection, use, protection and disclosure in a series of areas. 

Meanwhile, employers, unions and others face their own new prohibitions against genetic information based employment discrimination added by Title II of GINA, which take effect November 21, 2009. The Equal Employment Opportunity Commission (EEOC) published proposed regulations interpreting Title II of GINA in March, 2009.

Broad Definition of “Genetic Information”

The broad range of information included within GINA’s broad definition of “genetic information” means its new restrictions have a sweeping reach when applied to most group health plans.  GINA defines “genetic information to include with respect to any individual, information about:

  • Such individual’s genetic tests;
  • The genetic tests of family members of such individual; and
  • The manifestation of a disease or disorder in family members of such individual.

GINA also specifies that any reference to genetic information concerning an individual or family member includes genetic information of a fetus carried by a pregnant woman and an embryo legally held by an individual or family member utilizing an assisted reproductive technology.

Pending issuance of regulatory guidance, GINA’s inclusion of information about the “manifestation of a disease or disorder in family members” raises potential challenges for a broad range of group health plan health assessment and other wellness and disease management programs which provide financial incentives or condition eligibility on the provision of family health histories or other information that could be construed as genetic information. 

Group Health Plan Genetic Testing Collection and Nondiscrimination Rules

Under GINA’s nondiscrimination rules, group health plans and health insurers may not:

  • Request, require or purchase genetic information for underwriting purposes or in advance of an individual’s enrollment;
  • Adjust premiums or contribution amounts of the group based on genetic information;
  • Request or require an individual or family member to undergo a genetic test except in limited situations specifically allowed by GINA;
  • Impose a preexisting condition exclusion based solely on genetic information, in the absence of a diagnosis of a condition;
  • Discriminate against individuals in eligibility and continued eligibility for benefits based on genetic information; or
  • Discriminate against individuals in premium or contribution rates under the plan or coverage based on genetic information, although such a plan or issuer may adjust premium rates for an employer based on the manifestation of a disease or disorder of an individual enrolled in the plan.

GINA also prohibits insurers providing individual health insurance from establishing rules for eligibility, adjusting premiums or contribution amounts for an individual, imposing preexisting condition exclusions based on, requesting or requiring individuals or family members to undergo genetic testing.

Of particular concern to many plan sponsors and fiduciaries are the potential implications of these new rules on existing wellness and disease management features group health plans. Of particular concern is how regulators will treat the collection of family medical history and certain other information as part of health risk assessments used in connection with these programs. Although official guidance is still pending, many are concerned that regulators will construe certain commonly used practices of requiring covered persons to provide family medical histories or other genetic information through health risk assessments (HRAs) to qualify for certain financial incentives as a prohibited underwriting practice under GINA.  Even where health risk assessments are not used, however, most group health plan sponsors should anticipate that GINA will require specific amendments to their plan documents, communications and processes.

Taking timely action to comply with these nondiscrimination and collection prohibitions is important.  Under amendments to ERISA made by GINA, group health plan noncompliance can create significant liability for both the plan and its sponsor.  Participants or beneficiaries will be able to sue noncompliant group health plans for damages and equitable relief.  If the participant or beneficiary can show an alleged violation would result in irreparable harm to the individual’s health, the participant or beneficiary may not have to exhaust certain otherwise applicable Department of Labor administrative remedies before bringing suit.  In addition to these private remedies, GINA also authorizes the imposition of penalties against employers and other sponsors of group health plans that violate applicable requirements of GINA of up to $500,000. The minimum penalties generally are set at the greater of $100 per day or a minimum penalty amount ranging from $2,500 for de minimus violations corrected before the health plan received notice of noncompliance to $15,000 in cases in which the violations are more than de minimus.  GINA also includes language allowing the Secretary of Labor to reduce otherwise applicable penalties for violations that could not have been identified through the exercise of due diligence or when the plan corrects the violation quickly.

GINA Amendments To Health Plan Privacy Rules Under HIPAA

In addition to its nondiscrimination rules, GINA also amends HIPAA to make clear that “genetic information” as defined by HIPAA is protected health information protected by HIPAA’s Privacy & Security Standards of HIPAA. This means that it will require that all genetic information be treated as protected health information subject to the Privacy and Security Standards applicable to group health plans covered by HIPAA. Although the statutory provisions that accomplish these changes are deceptively simple, compliance with these requirements likely will require group health plans and their business associates to amend existing privacy policies, notices and practices to appropriately restrict disclosures for underwriting, operations and certain other uses to withstand scrutiny under the GINA privacy rule amendments. 

The HITECH Act amended and increased civil penalties for HIPAA privacy violations in many circumstances effective February 17, 2009.   

Regulatory Guidance Status

 As the the deadline for compliance for post May 20, 2009 plan years is rapidly approaching, however, many group health plans and their sponsors will need forward with their compliance arrangements in the absence of regulatory guidance interpreting these requirements. 

GINA’s fractured assignment of responsibility and authority to develop, implement and enforce regulatory guidance of its genetic information rules can create confusion for parties involved in compliance efforts. Because the group health plan requirements of Title I of GINA are refinements to the group health plan privacy and nondiscrimination rules previously enacted as part of HIPAA, GINA specifically assigned authority to construe and enforce its group health plan requirements to the agencies responsible for the interpretation and enforcement of those original rules:

  • The Department of Labor Employee Benefit Security Administration (EBSA);
  • The Internal Revenue Services (IRS), and
  • The Department of Health & Human Services. 

While these three agencies previously published a request for public comments about issues under Title I’s provisions, see http://edocket.access.gpo.gov/2008/pdf/E8-24194.pdf, none of these three agencies as of May 20, 2009 has published interim or other regulations interpreting the GINA provisions within their scope of responsibility since the formal comments period ended December 9, 2009.  Although the EBSA Spring 2009 regulatory agenda reflected it intended to publish interim regulations by today and agency officials continue to indicate they intend to publish guidance “soon,” no guidance had been published as of May 20, 2009.

Even if the agencies issue guidance by the end of May plan sponsors and administrators of group health plans with new plan years beginning in the next 60 to 90 days are expressing concern that they will have inadequate time to complete compliance arrangements.  As a result, in addition to guidance about GINA’s requirements generally, some are hopeful that the guidance with include transition rules or other relief to allow more time to comply with the regulations when finally issued.  Regulators as of May 20, 2009 had not given any indication that they plan or perceive that they are authorized to provide such relief.

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see the http://www.cttlegal.com.

Other Information & Resources

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at e-mail, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see the Curran Tomko Tarski Website or Cynthia Marcotte Stamer, P.C. Website.

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources at CynthiaStamer.com For additional information about Ms. Stamer and her experience, see here or contact Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your Currant contact information – including your preferred e-mail- by creating or updating your profile at CynthiaStamer.com.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.

 ©Cynthia Marcotte Stamer. All rights reserved.

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Posted by Cynthia Marcotte Stamer

Most Employers, Plans Still Have Work To Do To Comply With Stimulus Bill COBRA Rules

May 14, 2009

Many employers have used the Model Notices posted March 19, 2009 by the Department of Labor (DOL) to meet the April 17, 2009 deadline to provide initial notification to employees and dependents whose group health coverage terminated as a result of an involuntary termination of employment between September 1, 2008 and February 17, 2009 under the temporary rules added to the group health plan medical coverage continuation requirements of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) by the American Recovery and Reinvestment Act of 2009 (“Stimulus Bill”).  However, most employers including many distressed and reorganizing companies and their group health plan administrators, fiduciaries and insurers have additional work to do to complete the arrangements to comply with these new Stimulus Bill COBRA rules

Although many employers and group health plans have taken preliminary action to comply, most employers and group health plan insurers, administrators and fiduciaries have not fully completed the steps needed to complete compliance arrangements.  Among the companies sponsoring group health plans most likely to be behind in their compliance efforts are those in bankruptcy and distressed companies, where internal human resources and employee benefit staff and outside vendor relationships are likely to be reduced, overextended, or otherwise distracted.

In some instances, parties responsible for sending notifications and making other compliance arrangements have not begun to comply.  More typically, however, employers sponsoring group health plans, their administrators, insurers or fiduciaries may mistakenly believe that preliminary compliance efforts fulfilled their compliance responsibilities.  As a result, many have failed to complete all of the steps necessary to comply.  For instance:

  • Many employers, health plan fiduciaries and administrators have not formally amended their group health plans, updated their COBRA initital notifications and summary plan descriptions, implemented required procedures and finished other arrangements necessary to bring their group health plans into compliance with the Stimulus Bill COBRA requirements.  
  • Many employers, insurers, administrators and fiduciaries  who used the Model Notices initially to provide required notices are finding additional refinements to their notices and procedures to reduce questions and confusion by recipients attributable to poor tailoring of the information to their particular plan design. 
  • Many employers who outsource the collection of COBRA premiums or other aspects of COBRA administration will want to revise Model Notice language to avoid unnecessarily undermining previously negotiated allocations of fiduciary responsibility to those third parties for responsibilities outsourced.

Employers, health plan administrators, and health insurers involved in the sponsorship or administration of COBRA-covered group health plans should consult with counsel about the suitability of using the Model Notices to provide required notifications of the new Stimulus Bill COBRA rules and other steps necessary to comply with the new requirements.  Compliance with the Stimulus Bill COBRA rules is mandatory for all COBRA-covered group health plans and certain other arrangements including group health plans sponsored by businesses in bankruptcy where the entity or a commonly controlled or affiliated entity continues to maintain a group health plan.

Stimulus Bill COBRA Rule Basics

The Stimulus Bill provisions that took effect on February 17, 2009 require special COBRA treatment for “assistance eligible individuals.” See “Stimulus Bill COBRA Amendments Require Immediate Group Health Plan Action” for more information. The Stimulus Bill COBRA amendments are intended to help certain involuntarily terminated former employees and their dependents maintain COBRA coverage.  Employers must amend their plans to comply with these mandates and, if they wish to seek reimbursement for COBRA Subsidies, must comply with IRS requirements. Meanwhile, group health plan administrators and insurers must take immediate action to provide required notifications and implement other administrative changes necessary to comply with the new rules.

The Stimulus Bill definition of “assistance eligible individual” generally includes any COBRA “qualified beneficiary” who meets all of the following requirements:

  • Is eligible for COBRA continuation coverage at any time during the period beginning September 1, 2008 and ending December 31, 2009;
  • Elects COBRA coverage (when first offered or during the additional election period): and
  • Has a qualifying event for COBRA coverage that is the employee’s involuntary termination during the period beginning September 1, 2008 and ending December 31, 2009.

This definition includes both involuntarily terminated employees and their dependents who lost coverage under a group health plan due to the involuntary termination. 

As part of their COBRA amendments, the Stimulus Bill limits the COBRA premium that a COBRA-covered group health plan can charge an “assistance eligible individual” to 35% of the otherwise applicable COBRA premium for a period of up to 9 months (the “Subsidy Period”) beginning March 1, 2009.  Employers sponsoring these group health plans must pay the remaining 65% of the COBRA premium (the “COBRA Subsidy”) for the assistance eligible individual during the Subsidy Period.  However, the Stimulus Bill allows an employer to seek reimbursement by claiming a payroll tax credit for these COBRA Subsidy payments by complying with applicable IRS procedures.  

The Stimulus Bill also requires certain assistance eligible individuals whose employment terminated between September 1, 2008 and February 16, 2009 and did not elect COBRA coverage when previously offered or who allowed COBRA coverage to lapse after electing that coverage be offered a second COBRA enrollment period in which to elect prospectively to enroll in COBRA coverage.  It also requires that group health plans that offer employees different plan options allow assistance eligible individuals the option to change their coverage choice.  Also Group health plan administrators must provide certain notifications to assistance eligible individuals concerning these changes.

March 19, 2009 & Other Piecemeal Guidance

The March 19, 2009 DOL Guidance containing the Model Notices is part of a series of interim and evolving guidance separately issued by the IRS and DOL between February and April.  The March 19, 2009 DOL Guidance includes:

  • Various  Model Notices
  •  New FAQs for Employers on the COBRA Premium Reduction
  •  Expanded FAQs for Employees on the COBRA Premium Reduction
  •  Updated FAQs for Employees on General COBRA Provisions

In addition to the March 19, 2009 Guidance, the DOL and IRS previous also had issued a series of other guidance relating to the implementation and application of the Stimulus Bill COBRA rules on a piecemeal basis.  These include separately issued IRS guidance detailing the documentation and procedures that the IRS has indicated that employers or others who collect discounted COBRA premiums from Stimulus Bill assistance eligible individuals must meet in order to comply with the COBRA Stimulus Bill mandates and to recover additional amounts that the employer pays as a COBRA premium subsidy on behalf of assistance eligible individuals through the payroll tax credit provisions of the Stimulus Bill COBRA rules.  You can review:

While the Model Notices and other guidance provides helpful insights about the new requirements, many group health plan sponsors, administrators and fiduciaries are likely to find it necessary or desirable to specifically tailor the notifications and other procedures they provide to more clearly communicate the workings of the new requirements as they relate to their specific plans so as to minimize administrative burdens of compliance and fiduciary risks.

More Resources, Information & Assistance

Curran Tomko Tarski LLP Partner Cynthia Marcotte Stamer consults with clients and writes and speaks extensively about COBRA and other group health plan matters.  Author of the “Health Care Eligibility Toolkit” and nationally known for her experience on COBRA matters, her  Solutions Law Press article discussing the highlights of these IRS requirements and other previous guidance at http://www.cynthiastamer.com/documents/alerts/20090303_NEW%20IRS%20&%20DOL%20Guidance%20On%20Stimulus%20Bill%20COBRA%20Relief.pdf  is just one of many helpful publications she has written on the Stimulus Bill COBRA Rules and other related matters. The Stimulus Bill COBRA rules were among the updates discussed by Cynthia Marcotte Stamer during a March 11, 2009 Health Plan Update Teleconference she presented for Solutions Law Press. 

If you are an employer or other group health plan sponsor, administrator, insurer or fiduciary and need assistance in preparing required notifications or with other matters relating to the Stimulus Bill COBRA Rules or any other health or other employee benefits matter, contact Cynthia Marcotte Stamer at CStamer@SolutionsLawyer.net or via telephone at 972.419.7188. For information about how to purchase a recording of this teleconference or to review other breaking news updates about these Stimulus Bill COBRA Rules, e-mail CStamer@cttlegal.com.

You also can register to receive these and other updates by registering for this blog or by registering to receive other helpful Curran Tomko Tarski LLP publications at CTTLegal.com.

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Posted by Cynthia Marcotte Stamer

EEOC GIVES EMPLOYERS LIMITED EMPLOYER GUIDANCE ABOUT ADA ISSUES IN SWINE FLU RESPONSE

May 13, 2009

Recent concerns over the H1N1 Swine Flu (swine flu) pandemic and warnings of a possible resurgence of the swine flu pandemic or some other pandemic in the future is forcing many employers to question when concerns that an employee suffers from a contagious disease can justify the employer making inquires about the health of an employee or the exclusion of the employee from the workplace. New guidance set forth in the “U.S. Equal Employment Opportunity Commission ADA-Compliant Employer Preparedness For the H1N1 Flu Virus” (Guidance) published by the U.S. Department of Labor Equal Employment Opportunity Commission (EEOC) on May 4, 2009 provides some insights for employers about the EEOC’s perspective on these questions. 

The Guidance details the EEOC’s answers to certain basic questions about when the EEOC views certain workplace preparation strategies for responding to the 2009 flu virus as compliant with the Americans with Disabilities Act (ADA).  Employers considering updates to their current pandemic and infectious disease response plans are cautioned that in addition to potential ADA exposures, practices for periods after November 21, 2009 also generally must be tailored to comply with new restrictions on employer’s collection of and discrimination based on genetic information based on the Genetic Information Nondiscrimination Act of 2008 (GINA).  Proposed regulations interpreting the employment provisions of GINA published by the EEOC in March 2009 do not specifically address the implications of GINA on employer planning or response to pandemic concerns.

ADA Concerns Apply To Employers  Planning For & Applying Swine Flu Response 

Title I of the Americans with Disabilities Act (ADA) protects applicants and employees from disability discrimination. Among other things, the ADA regulates when and how employers may require a medical examination or request disability-related information from applicants and employees, regardless of whether the individual has a disability.  The Guidance confirms that the EEOC views this requirement as affecting when and how employers may request health information from applicants and employees regarding H1N1 flu virus.  

Effective January 1, 2009, Congress amended the Americans with Disabilities Act pursuant to the Americans with Disabilities Act Amendments Act of 2008 (ADAAA) to change the way that the ADA’s statutory definition of the term “disability” historically has been interpreted by certain courts.  The ADAAA amendments generally are intended and expected to make it easier for certain individuals to qualify as disabled under the ADA.  While the Guidance announces that the EEOC intends to revise its ADA regulations to reflect the broader group of persons protected as disabled under the ADAAA amendments, it also indicates that the EEOC does not perceive that the ADAAA changes the actions prohibited by the ADA as they relate to common pandemic planning and response activities.  Consequently, the Guidance states that the EEOC views the  guidance in “Disability-Related Inquiries & Medical Examinations of Employees Under the ADA” published by the EEOC in 2000 and its “Enforcement Guidance: Preemployment Disability-Related Questions & Medical Examinations” published in 1995 as setting forth the governing rules for medical testing, inquires and other pandemic response planning under the ADA.

Under the ADA, an employer’s ability to make disability-related inquiries or require medical examinations is analyzed in three stages: pre-offer, post-offer, and employment.

  • At the first stage (prior to an offer of employment), the ADA prohibits all disability-related inquiries and medical examinations, even if they are related to the job.
  • At the second stage (after an applicant is given a conditional job offer, but before s/he starts work), an employer may make disability-related inquiries and conduct medical examinations, regardless of whether they are related to the job, as long as it does so for all entering employees in the same job category.
  • At the third stage (after employment begins), an employer may make disability-related inquiries and require medical examinations only if they are job-related and consistent with business necessity.
  • The ADA requires employers to treat any medical information obtained from a disability-related inquiry or medical examination (including medical information from voluntary health or wellness programs), as well as any medical information voluntarily disclosed by an employee, as a confidential medical record. Employers may share such information only in limited circumstances with supervisors, managers, first aid and safety personnel, and government officials investigating compliance with the ADA.

Employers deviating from these requirements when administering their pandemic planning or response risk disability discrimination liability under the ADA unless they otherwise can defend their action under one of the exceptions to the ADA’s disability discrimination prohibitions.  When making post-offer inquiries or requiring post offer examinations or imposing other conditions for safety reasons, the Guidance and EEOC in unofficial discussions have emphasized the importance of the employer’s ability to demonstrate the job or safety relevance of the medical inquiry or examination based on credible scientific evidence such as the latest scientific evidence available from the World Health Organization (WHO) and the Centers for Disease Control and Prevention (CDC). 

Other than emphasizing the importance of acting appropriately in response to credible scientific evidence and pointing to preexisting guidance, the Guidance does not extensively address with specificity the circumstances under which the EEOC will view any particular action taken by an employer as defensible under the safety or other exceptions of the ADA.  Likewise, the Guidance does not discuss in any details the conditions, if any, under which the EEOC would view suffering, a history of suffering or association with or exposure to swine flu as qualifying an individual as disabled or perceived to be disabled for purposes of the ADA.  Consequently, employer must rely on other less specifically tailored guidance for purposes of assessing the defensibility of a proposed action on these grounds.

Planning for Absenteeism Under ADA

When planning for a possible pandemic, employers must be careful about when and how they ask employees about factors, including chronic medical conditions that may cause them to miss work in the event of a pandemic.  According to the Guidance, an employer may survey its workforce to gather personal information needed for pandemic preparation if the employer asks broad questions that are not limited to disability-related inquiries.  An inquiry would not be disability-related if it identified non-medical reasons for absence during a pandemic (e.g., mandatory school closures or curtailed public transportation) on an equal footing with medical reasons (e.g., chronic illnesses that weaken immunity). The Guidance includes a sample of what the EEOC views as ADA-compliant survey that could be given to all employees before a pandemic.

The Guidance also indicates that where appropriate safeguards are applied to comply with the ADA, it also may be appropriate for an employer under certain limited circumstances, to require entering employees to have a medical test post-offer to determine their exposure to the influenza virus.  According to the EEOC, the ADA permits an employer to require entering employees to undergo a job relevant medical examination after making a conditional offer of employment but before the individual starts work, if all entering employees in the same job category must undergo such an examination.  Thus, the Guidance reflects that the requirement by an employer as part of its pandemic influenza preparedness plan that all entering employees in the same job categories undergo the same post offer medical testing for the virus in accordance with recommendations by the WHO and the CDC in response to a new influenza virus may be ADA-compliant.

Infection Control in the Workplace Under the ADA

The Guidance also discusses the EEOC’s perceptions about the ADA implications of employer use of certain infection control practices in the workplace during a pandemic provided that the requirements are applied in a nondiscriminatory fashion consistent with the ADA.  For instance, the Guidance states that employers generally may apply with following infection control practices without implicating the ADA:

  • Require all employees to comply with certain infection control practices, such as regular hand washing, coughing and sneezing etiquette, and tissue usage and disposal without implicating the ADA;
  • May require employees to wear personal protective equipment provided that where an employee with a disability needs a related reasonable accommodation under the ADA (e.g., non-latex gloves, or gowns designed for individuals who use wheelchairs), employer provides these accommodations absent undue hardship;
  • Encourage or require employees to telework as an infection-control strategy, based on timely information from public health authorities about pandemic conditions or offer telework as a possible reasonable accommodation.  

In all cases, of course, the Guidance cautions that employers must not single out employees either to telework or to continue reporting to the workplace on a basis prohibited by the ADA or any of the other federal Equal Employment Opportunity laws.

Impending GINA Rules

 As signed into law, GINA amends Title VII of the Civil Rights Act, the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the Employee Retirement Income Security Act of 1974 (ERISA), the Public Health Service Act, the Internal Revenue Code of 1986, and Title XVIII (Medicare) of the Social Security Act to implement sweeping new federal restrictions on the collection, use, and disclosure of  “genetic information” by employers, employment agencies, labor organizations, joint labor-management committees, group health plans and insurers and their agents.  GINA’s group health plan restrictions are scheduled to take effect May 21, 2009.  The employment related genetic testing rules of GINA take affect November 21, 2009.  Employers and other covered entities will need to carefully review and timely update their pandemic and other infectious disease response practices as well as their group health plan, family leave, disability accommodation, and other existing policies in light of these new federal rules.

Although EEOC has not finalized its implementing regulations for GINA yet, employers should anticipate that GINA will impact their pandemic and other related practices.  The implications of GINA for employers and other entities covered by its provisions because of its broad definition of genetic information. 

Under GINA, “genetic information” is defined to mean with respect to any individual, information about:

  • Such individual’s genetic tests;
  • The genetic tests of family members of such individual; and
  • The manifestation of a disease or disorder in family members of such individual.

GINA also specifies that any reference to genetic information concerning an individual or family member includes genetic information of a fetus carried by a pregnant woman and an embryo legally held by an individual or family member utilizing an assisted reproductive technology.

Pending issuance of final regulatory guidance, Gina’s inclusion of information about the “manifestation of a disease or disorder in family members” raises potential challenges for a broad range of wellness and safety, leave, and other employment and benefit practices, particularly as apparently will reach a broader range of conditions than those currently protected under the disability discrimination prohibitions of the Americans With Disabilities Act (“ADA”).  

Depending on the contemplated inquiry or practice, certain inquiries or actions intended for use as part of an employer’s pandemic preparedness or response activities could fall within the scope of GINA’s protections. For this reason, employers also should consider the potential treatment of a proposed pandemic preparation or response activity intended to be applied after GINA takes effect in light of GINA.  Additionally, employers also should consider the risk that information collected under existing or previously applied pandemic or other infectious disease prevention and response activities might qualify for additional protection when GINA takes effect in November, 2009.

Other Resources

Businesses, health care providers, schools, government agencies and others concerned about preparing to cope with pandemic or other infectious disease challenges also may want to review the following resources authored by Curran Tomko Tarski LLP partner Cynthia Marcotte Stamer:

Cynthia Marcotte Stamer and other members of Curran Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curran Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curran Tomko Tarksi, LLP team, see the www.cttlegal.com.

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Posted by Cynthia Marcotte Stamer

COBRA Premium Reduction and Extended Eligibility Provisions in the American Recovery and Reinvestment Act of 2009

May 2, 2009

The U.S. Department of Labor (“DOL”) today (May 1, 2009) continued its efforts to increase awareness of the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) provisions in the American Recovery and Reinvestment Act of 2009 (“ARRA”) by sharing information with state agencies and asking their assistance in helping dislocated workers, businesses, and partners in understanding the new law.

Under ARRA, employees involuntarily terminated between September 1, 2008 and December 31, 2009 and their dependents may be able to qualify for a 65% discount in the required premium they must pay to maintain COBRA coverage under their former employer’s group health plan for up to 9 months.  Special rules also apply to former employees who qualify for Trade Adjustment Assistance or affected by certain Pension Benefit Guarantee Corporation insurance programs.

Employers must pay the remaining amount of the otherwise required COBRA premium, but can request reimbursement from the Internal Revenue Service by filing for a payroll tax credit under the provisions of ARRA. 

Group health plans were required to begin complying with the new ARRA rules beginning February 17, 2009 and to notify workers of the new rules no later than April 18, 2009.  Many employers and their group health plan sponsors are still working to complete the necessary arrangements to comply with these new requirements.

The communication of information about the new provisions by the DOL, group health plans, employers and the media have prompted an outpouring of questions from many employees and their dependents, confused about their eligibility for the ARRA COBRA Subsidy and its workings.

In Training And Employment Notice No. 42-08, which is addressed to state workforce agencies, labor commissioners and other state workforce regulators, the Employment and Training Administration (“ETA”):

  •  Shared certain basic information about ARRA’s COBRA, Trade Adjustment Assistance and other workforce assistance relief;
  • Detailed some of the training and other resources provided by the DOL to help States and their citizens understand these new provisions and the procedures for their use; and
  • Asked the regulators to assist in communicating and disseminating the information to individuals who might qualify for benefits and other interested parties.

Interested persons can review the announcement at http://wdr.doleta.gov/directives/attach/TEN/ten2008/TEN42-08acc.pdf.

Cynthia Marcotte Stamer is nationally known for her knowledge and experience on COBRA and other health benefit and employee benefit matters,.  You will find several of these previous publications on the new ARRA COBRA provisions on prior editions of the Solutions Law Press HR & Benefits Update.  You also can access some of the many practical updates that she has prepared on these and other COBRA matters by e-mailing or contacting her.  She and other members of Curren Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its COBRA or other employee benefit or human resources practices, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402 or your favorite Curren Tomko Tarski, LLP attorney. 

For additional information about the experience and services of Ms. Stamer and other members of the Curren Tomko Tarksi, LLP team, see the http://www.cttlegal.com.

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Posted by Cynthia Marcotte Stamer

Texas Supreme Court Broadens Circumstances Where Texas Non-Competes May Be Enforced But Employers Must Still Exercise Care

April 23, 2009

Many Texas businesses view non-competition agreements as a critical component to their strategy to protect their trade secrets and other intellectual property.  In its April 19, 2009 decision in Frankfort Stein & Lipp Advisors, Inc. v. Fielding (“Frankfort Stein”), the Texas Supreme Court gave a another boost to the ability of Texas employers to enforce non-compete agreements signed by existing at-will employees during their employment under the Texas Covenants Not To Compete Act (the “Act”) Section 15.50, which governs the enforceability of employee agreements not to compete in Texas. Despite this helpful ruling, however, Texas employers still must exercise care to comply with all requirements of the Act if they want to position their non-compete agreements for enforceability in Texas.

 

Building on its prior October 20, 2006 employer-helpful decision in Alex Sheshunoff Management Services, L.P v. Johnson (“Sheshunoff”), the Texas Supreme Court in Frankfort Stein clarified that an employer’s implied covenant to provide confidential information to an at-will may constitute adequate consideration to support enforcement of a non-compete under the Act..  The holding expands the Supreme Court’s prior holding in Sheshunoff to apply to both express or implied employer covenants to provide confidential information.

 In Sheshunoff, the Texas Supreme Court previously ruled that that an employer’s express promise to provide confidential information to an at-will employee in exchange for the employee’s express promise not to disclose or use such information, may create an enforceable non-compete covenant under the Act. However, the Supreme Court made clear that employers that desire enforce non-competition agreements still must fulfill the Act’s requirement to provide access to confidential information, training or other appropriate consideration for the employee’s promise not-to compete and the other requirements of the Act before Texas courts will enforce an at-will employee’s agreement not to compete in Texas.

 

The Frankfort Stein decision further clarifies the Court’s interpretation of the Act in Sheshunoff by holding that an implied promise to provide confidential information to an at-will employee also can constitute the required consideration for the employee’s promise to disclose serve as the provision of confidential information required to support enforcement of a non-compete under Texas law.   

The Frankfort Stein decision may offer an additional opportunity for employers that have provided at-will employees access to confidential information to enforce a less than optimally drafted or implemented written non-competition agreement that otherwise complies with the Act under circumstances where the employer can establish it provided the information subject to an implied promise by the employee not to disclose the information.  To avoid the cost and uncertainty of proving the existence and scope of such an implied promise, however, Texas employers desiring to best position their non-compete agreements for enforceability should consult with experienced employment counsel for assistance in reviewing their existing non-competition agreements and practices.  These (and as appropriate, the employer’s employee handbook) should be written and administered:

ü       To require employees to sign non-competition agreements that expressly and appropriately set forth the employers promise to provide the confidential information conditional upon the employee’s agreement not to compete and to protect the confidential information;

ü        To ensure that the agreement appropriately defines confidential information and expressly requires that the employee protect and maintain the confidentiality of trade secrets and other confidential information;

ü       To ensure that the agreement incorporates other procedural provisions that can help minimize the cost and burden to the employer to enforce its provisions;

ü       To ensure that the agreement between the employer and the employee otherwise clearly fulfills all otherwise applicable conditions of the Act and to maintain the confidentiality of the information the requirements of the Act; and

ü       To position the employer to be able to easily prove that it actually engaged in the sharing of confidential information that the Sheshunoff decision identifies as a necessary step to enforce the non-competition agreement under Texas law.

Employers also should position themselves to best investigate possible breaches of these protections by securing written background check consents in accordance with the Fair Credit Reporting Act and ensuring that their handbooks and employment agreements include appropriate privacy, investigations and other policies.

Cynthia Marcotte Stamer and other members of Curren Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at cstamer@cttlegal.com, (214) 270-2402; or your favorite Curren Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curren Tomko Tarksi, LLP team, see the www.cttlegal.com.

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Posted by Cynthia Marcotte Stamer

Military Leave Differential Payments Subject To Income Tax, Not FICA or FUTA

April 17, 2009

Employers that pay differential pay to employees absent on active duty military leave job must withhold income tax, but need not withhold or pay Federal Insurance Contributions Act (“FICA”) or Federal Unemployment Tax Act (“FUTA”) taxes on those payments, according to an Internal Revenue Service (IRS) ruling to be published May 4, 2009.

According to Revenue Ruling 2009-11, employers must withhold income tax and include military duty differential pay in wages reported on the recipient employee’s Form W-2. It also states employers may use the aggregate procedure or optional flat rate withholding to calculate the amount of income taxes required to be withheld on these payments.

Proper tax withholding and reporting is one of the expanding responsibilities that employers must juggle when a member of their workforce is a current or former members of the military and their family members including, for example, federal and state military leave mandates and new military caregiver and other family leave requirements for family members of members of the military that took effect during the past year. Employers should review their employment and employee benefit practices to confirm they are up to date with these expanded requirements.

Cynthia Marcotte Stamer and other members of Curren Tomko and Tarski LLP are experienced with advising and assisting employers with these and other labor and employment, employee benefit, compensation, and internal controls matters. If your organization needs assistance with assessing, managing or defending its wage and hour or other labor and employment, compensation or benefit practices, please contact Ms. Stamer at e-mail, (214) 270-2402; or your favorite Curren Tomko Tarski, LLP attorney.  For additional information about the experience and services of Ms. Stamer and other members of the Curren Tomko Tarksi, LLP team, see the Curren Tomko Tarski Website or Cynthia Marcotte Stamer, P.C. Website.

More Information

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and access other helpful resources at CynthiaStamer.com For additional information about Ms. Stamer and her experience, see here or contact Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at CynthiaStamer.com.  If you would prefer not to receive these updates, please send a reply e-mail with “Remove” in the subject line to support@SolutionsLawyer.net. You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog here.

 

 

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Posted by Cynthia Marcotte Stamer

New IRS COBRA Subsidy Guidance Defines Involuntary Termination; Other Workings of Rules

April 3, 2009

 

Employers, plan administrators and group health plan insurers have more information about what terminations are considered “involuntary” and the meaning of other requirements imposed by temporary modifications (COBRA Subsidy Rules) to the group health plan medical coverage continuation requirements of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (COBRA) enacted under the American Recovery and Reinvestment Act of 2009 (Stimulus Bill).

The Internal Revenue Service (IRS) yesterday (April 1, 2009) released additional guidance about the COBRA Subsidy Rules.  Part of a series of guidance trickling out from the IRS, the Department of Labor (DOL) and the Department of Health & Human Services (HHS) about the COBRA Subsidy Rules.  The IRS publication of this guidance follows the release by March 20, 2009 of its Model Notices notify certain current and former participants and beneficiaries about some of the Stimulus COBRA Rules.

IRS Notice 2009-27 includes guidance about:

ü       Who qualifies as an “assistance eligible individual;

ü       When the IRS views a reduction in hours or termination of employment as qualifying as an involuntary termination of employment for purposes of the COBRA Premium Assistance Rules;

ü       How to calculate the 35% of the standard COBRA premium is calculated for purposes of determining the reduced COBRA premium amount (the “Reduced Premium”) that an assistance eligible individual must pay during the period (Premium Reduction Period) he qualifies for the premium subsidy assistance provided for under the Stimulus Bill;

ü       The types of group health plan coverage eligible for the Reduced Premium under the Stimulus Bill;

ü       The beginning and end of the Premium Reduction Period;

ü       When and how an assistance eligible individual’s income and eligibility for Medicare or other group health plan coverage affects his eligibility for the Reduced Premium;

ü       The mechanics that employers and highly compensated assistance eligible individuals must use if the individual wishes to waive the Reduced Premium and resulting COBRA Subsidy

ü       The application of the second election period required for assistance eligible individuals not enrolled in COBRA Coverage on February 17, 2009 and

ü       Other details of the COBRA Subsidy Rules.

 

Stimulus COBRA Rules In A Nutshell

Congress enacted the COBRA Subsidy Rules that took effect February 17, 2009 to help certain involuntarily terminated former employees and their dependents maintain COBRA coverage by requiring COBRA-covered group health plans temporarily to extend certain special COBRA treatment for “assistance eligible individuals.”

The Stimulus Bill temporarily limits the COBRA premium that a COBRA-covered group health plan can require an “assistance eligible individual” to pay for COBRA Coverage to 35% of the otherwise applicable COBRA premium (the “Reduced Premium”) for a period of up to 9 months (the “Subsidy Period”) beginning with the individual’s first period of COBRA Coverage beginning after February 17, 2009.  The employer or insurer that collects this Reduced Premium must pay the remaining 65% of the COBRA premium (the “COBRA Subsidy”) for the assistance eligible individual during the Subsidy Period.  However, the Stimulus Bill provides for that employer or insurer to claim a payroll tax credit equal to the amount of these COBRA Subsidy payments by complying with applicable IRS procedures. 

The Stimulus COBRA Rules also requires group health plans to offer a second COBRA enrollment period to each assistance eligible individual not enrolled in COBRA Coverage on February 17, 2009.  These second electors must be allowed to elect prospectively to enroll in COBRA coverage until the date that their COBRA Coverage eligibility otherwise would have ended if they had maintained COBRA Coverage since their termination.

Additionally, COBRA-covered group health plans that offer employees different plan options allow assistance eligible individuals the option to change their coverage choice from a higher cost option to a lesser cost option.  Group health plan administrators also must provide certain notifications to assistance eligible individuals concerning these changes.

 

“Assistance Eligible Individuals”

The Stimulus COBRA Rules only apply to qualified beneficiaries whose loss of coverage resulted from the “involuntary termination of employment” of a covered employee. The Stimulus Bill definition of “assistance eligible individual” generally includes any COBRA “qualified beneficiary” who meets all of the following requirements:

ü       Has a loss of coverage within the meaning of COBRA (“qualifying event”) as a result of the “involuntary termination of employment” of a covered employee from September 1, 2008 to December 31, 2009;

ü       Is eligible for COBRA Coverage at any time during the period beginning September 1, 2008 and ending December 31, 2009; and

ü       Elects COBRA coverage when first offered or as during the additional second election period required for assistance eligible individuals not enrolled in COBRA Coverage on February 17, 2009.

IRS Notice 2009-27 defines an “involuntary termination” as “a severance from employment due to the independent exercise of the unilateral authority of the employer to terminate the employment, other than due to the employee’s implicit or explicit request, where the employee was willing and able to continue performing services” based on all the facts and circumstances. 

For COBRA Premium Assistance purposes, the facts and circumstances determine whether a termination is involuntary. Thus, IRS Notice 2009-27 states that a termination designated as voluntary or as a resignation nevertheless will be considered involuntary where the facts and circumstances indicate that the employer would have terminated the employee’s services, and that the employee had knowledge that the employee would be terminated.

Notice 2009-27 identifies as examples of terminations that fall within this definition of “involuntary termination” as including the following facts and circumstances:

ü       The employer’s failure to renew a contract at the time the contract expires, if the employee was willing and able to execute a new contract providing terms and conditions similar to those in the expiring contract and to continue providing the services;

ü       An employee-initiated termination from employment if the termination from employment constitutes a termination for good reason due to employer action that causes a material negative change in the employment relationship for the employee;

ü       An involuntary reduction of hours of employment to zero hours, such as a lay-off, furlough, or other suspension of employment, resulting in a loss of health coverage;

ü       An employee’s voluntary termination of employment in response to an employer imposed reduction of hours of employment where the reduction in hours is a material negative change in the employment relationship for the employee;

ü       An employer’s action to end an individual’s employment while the individual is absent from work due to illness or disability (but not mere absence from work due to illness or disability before the employer has taken action to end the individual’s employment);

ü       A termination designated on account of “retirement” if the facts and circumstances indicate that, absent retirement, the employer would have terminated the employee’s services, and the employee had knowledge that the employee would be terminated;

ü       The covered employee resigned as the result of a material change in the geographic location of employment for the employee;

ü       A lockout initiated by an employer but not a work stoppage as the result of a strike initiated by employees or their representatives; and

ü       A termination elected by the employee in return for a severance package (a “buy-out”) where the employer indicates that after the offer period for the severance package, a certain number of remaining employees in the employee’s group will be terminated

Notice 2009-27 also clarifies that the termination of employment giving rise to the loss of group health plan coverage and the loss of the group health plan coverage both must occur between September 1, 2008 and December 31, 2009 in order for an individual to qualify as an assistance eligible individual. Consequently, if the involuntary termination occurs before September 1, 2008, but the loss of coverage resulting in eligibility for COBRA Coverage occurs after September 1, 2008 (but no later than December 31, 2009), Notice 2009-28 states that the individual will not qualify as an assistance eligible individual.  Likewise, where an individual’s involuntary termination occurs by December 31, 2009, but the loss of coverage resulting in eligibility for COBRA Coverage occurs after December 31, 2009, the qualified beneficiary will not qualify as an assistance eligible individual for purposes of the Subsidy COBRA Rules.  According to Notice 2009-27, where the involuntary termination of employment and loss of coverage as a covered employee or dependent occur between September 1, 2008 and December 31, 2009, the election of COBRA Coverage need not occur by December 31, 2009.

Many group health plans are drafted to provide that the date that employee or dependent coverage ends or changes as a result of an employment loss is the last day of the month or some other date after the actual date of the employment termination.  Under group health plans where the loss of coverage due to the qualifying event is delayed, Notice 2009-27 also reminds employers and plan administrators of the need to focus on how group health plan provisions, separation agreements and other related documents define when the loss of coverage occurs under a group health plan when applying these rules.

For purposes of COBRA, Notice 2009-27 states that when a loss of coverage under a group health plan occurs under these circumstances depends on how the group health plan treats the provision of health coverage between the date of the employment loss and the date of the resulting loss of employee and/or dependent coverage. If the plan treats the provision of health coverage as deferring the loss of coverage, Notice 2009-27 indicates the loss of coverage generally occurs when the individual ceases to be entitled to employee or dependent coverage on the same terms and conditions as would have applied had he not experienced the qualifying event.  However, if the plan treats the continued provision of health coverage from the termination date until employee or dependent coverage later ends as a result as reducing the period of required COBRA Coverage, then the loss of coverage occurs on the termination date or other later date.  Appropriate drafting is important to support the desired characterization.

 

Calculation of 35% of COBRA Premium

Based on the guidance in Notice 2009-27, many employers will want to terminate severance or other arrangements under which former employees are allowed to pay less than the maximum COBRA premium for some period of time.  According to Notice 2009-29,.the premium used to determine the 35% share that must be paid by (or on behalf of) an assistance eligible individual is the cost that would be charged to the assistance eligible individual for COBRA Coverage if the individual were not an assistance eligible individual. If absent the Stimulus COBRA Rules, the group health plan would require the assistance eligible individual to pay 102% of the “applicable premium” for continuation coverage, i.e., generally the maximum permitted, the Reduced Premium equals 35% of the 102% of the applicable premium. As no good deed goes unpunished, however, if the premium the group health plan would charge the assistance eligible individual is less than the maximum allowable COBRA premium, the Reduced Premium will be 35% of that lesser amount.  In determining whether an assistance eligible individual has paid 35% of the premium, payments on behalf of the individual by another person (other than the employer with respect to which the involuntary termination occurred) are taken into account.

 

Coverage Eligible For Premium Reduction

Notice 2009-27 also provides guidance about what types of group health plan coverage qualifies for premium reduction.  According to the Notice, the premium reduction is available for COBRA Coverage of any group health plan, except a health flexible spending arrangement (FSA) under section 106(c) offered under a section 125 cafeteria plan. This includes vision-only or dental-only plans, “mini-med plans” and certain health reimbursement accounts (HRAs). 

The Notice 2009-27 distinguishes exempted FSAs from covered health reimbursement arrangements (HRAs) for purposes of these rules.  According to Notice 2009-27, while an HRA may qualify as an FSA under section 106(c), the exclusion of FSAs from the premium reduction is limited to FSAs provided through a section 125 cafeteria plan, which would not include an HRA. 

Notice 2009-27 also indicates that retiree coverage can qualify for the premium reduction where the retiree coverage does not differ from the coverage made available to similarly situated active employees.

 

Premium Reduction Period Duration

Notice 2009-27 also provides guidance about when periods of coverage and the Premium Reduction Period begin and end.  Under the Stimulus COBRA Rules, the premium reduction applies as of the first period of coverage beginning on or after February 17, 2009 (February 17, 2009)  for which the assistance eligible individual is eligible to pay only 35% of the premium  and be treated as having made full payment.   For this purpose, a period of coverage is a monthly or shorter period with respect to which premiums are charged by the plan with respect to such coverage.  

According to Notice 2009-27, when the Premium Reduction Period begins for an assistance eligible individual depends on the period the plan charges COBRA premiums.  Where a group health plan requires an individual who loses coverage other than on the last day of the month who wishes to enroll in COBRA Coverage to pay a pro-rata portion of the monthly premium, Notice 2009-27 states the first period of coverage to which the premium reduction applies for an assistance eligible individual who loses coverage after February 17, 2009 generally is the individual’s first partial month of coverage.  A different rule applies when the assistance eligible individual elects COBRA Coverage under the second election period required by the Stimulus Bill Rules, however.  Whether a plan requires COBRA Coverage be paid for based on a calendar month or pro rata basis, March 1, 2009 is the beginning of the first period of coverage within the Premium Reduction Period for any assistance eligible individual enrolling during the second enrollment period and the Reduced Premium only applies to that individual for COBRA Coverage from March 1, 2009 through the end of his otherwise applicable Premium Reduction Period.

 

End Of Premium Reduction Period

An assistance eligible individual ceases to qualify for the premium reduction on the earliest of:

ü       The first date the assistance eligible individual becomes eligible for other group health plan coverage (with certain exceptions) or Medicare coverage,

ü       The date that is nine months after the first day of the first month for which the Stimulus Bill premium reduction provisions apply to the individual, or

ü       The date the individual ceases to be eligible for COBRA Coverage.

Notice 2009-27 confirms that the Premium Reduction Period of an assistance eligible individual ends on the first date he becomes eligible for other group health plan coverage or Medicare effect even if the assistance eligible individual does not enroll in the other group health plan coverage.  

According to Notice 2009-27, whether an offer of retiree coverage that is not COBRA Coverage simultaneously with the offering of COBRA Coverage ends the Premium Reduction Period depends on whether the retiree coverage is offered under the same group health plan as the COBRA Coverage or under a different group health plan.  If offered under the same group health plan, the offer of the retiree coverage has no effect on the Premium Reduction Period.  If offered under a different group health plan, the offer of retiree coverage that is not COBRA coverage ends the Premium Reduction Period.  However Notice 2009-27, however, If offered to someone whose eligibility for COBRA coverage arose between September 1, 2008 and February 17, 2009, the offer render the individual ineligible for the premium reduction only if the period the individual is given for enrolling in the retiree coverage extends to at least February 17, 2009.

Notice 2009-27 also addresses when eligibility for coverage under an HRA ends eligibility for the premium reduction.  It states that becoming eligible for HRA coverage ends the Premium Reduction Period unless the HRA qualifies as an FSA under section 106(c).   Under section 106(c), an FSA is health coverage under which the maximum amount of reimbursement which is reasonably available to a participant of the coverage is less than 500% of the value of the coverage. For this purpose, the maximum amount of reimbursement which is reasonably available is generally the balance of the HRA and the value of the HRA coverage would generally be the applicable premium for COBRA continuation of the HRA coverage.

Notice 2009-27 also clarifies that the Premium Reduction Period of an eligible individual may extend beyond December 31, 2009 for individuals who qualify as assistance eligible individuals on or before December 31, 2009.  For example, the Premium Reduction Period of an assistance eligible individual whose Premium Reduction Period begins on December 1, 2009 could extent until August 31, 2010, assuming the individual does not become eligible for other group health plan coverage or Medicare or lose eligibility for COBRA Coverage before that date.

With regard to the effect of Medicare eligibility on an assistance eligible individual’s Premium reduction Period, Notice 2009-27 indicates that an individual currently enrolled in Medicare when the involuntary termination of employment occurs is ineligible for premium reduction, even though they may be eligible to elect COBRA continuation coverage by paying the otherwise applicable unreduced COBRA premium.

 

Dealing With Assistance Eligible Individuals Not Eligible For Premium Subsidy Based On Eligibility For Other Group Coverage

Under the Stimulus Bill, assistance eligible individuals are required to provide notification and resume paying the unreduced usual COBRA premium when they become eligible for Medicare or other group health coverage.  Where an assistance eligible individual fails to provide the required notice and continues to take advantage of the premium reduction after his Premium Reduction Period terminates due to his becoming eligible for other coverage or Medicare, Notice 2009-27 states the employer is not responsible for recovering the additional premium or otherwise recouping the COBRA premium. 

 

Dealing With Assistance Eligible Individuals Subject to Phase Out of Premium Subsidy Eligibility Based On Income

The Stimulus COBRA Rules include tax provisions designed phase out the COBRA Subsidy for certain highly compensated employees by taxing a portion of those amounts.  Notice 2009-7 discusses the mechanics through which highly compensated employees can avoid this tax liability by electing to waive the Premium Reduction and Premium Subsidy.  

An assistance eligible individual who wants to make a permanent election to waive the right to the premium reduction makes the election by providing a signed and dated notification (including a reference to “permanent waiver”) to the employer or other person who is reimbursed for the premium reduction under the COBRA Premium Subsidy provisions of Code § 6432. No separate additional notification to any government agency. If an assistance eligible individual makes the permanent election to waive the right to the premium reduction, the individual may not later reverse the election and may not receive the premium reduction for any future period of COBRA Coverage in 2009 or 2010, regardless of modified adjusted gross income in those years.

Notice 2009-27 makes clear that these rules don’t allow employers to deny the Reduced Premium to these assistance eligible individuals.  According to Notice 2009-27, “Even if an assistance eligible individual’s income is high enough that the recapture of the premium reduction would apply, COBRA Coverage must be provided upon payment of 35% of the premium unless the individual has notified the plan that the individual has elected the permanent waiver of the premium reduction (or the period for the premium reduction has ended).

 

Second COBRA Election Period

The Stimulus Bill also requires group health plans to offer a second election period to assistance eligible individuals not enrolled in COBRA Coverage on February 17, 2009 whose employment terminated between September 1, 2008 and February 16, 2009.  Notice 2009-27 confirms that any individual (including a dependent) who did not have an election of COBRA Coverage in effect on February 17, 2009, but who would have been an assistance eligible individual if the election were in effect must be offered this second election period. For those electing COBRA Coverage during this second election period, the resulting coverage begins with the first period of COBRA continuation coverage beginning on or after February 17, 2009.   Notice 2009-27 confirms that this extended election period is available for all individuals who are qualified beneficiaries as the result of an involuntary termination during the period from September 1, 2008, through February 17, 2009, even if they still have an open COBRA election period as of February 17, 2009. If these individuals elect COBRA under their original COBRA election period, COBRA coverage is retroactive to their loss of coverage and the premium reduction does not apply to the periods of coverage prior to the first period of coverage beginning on or after February 17, 2009 (generally, periods of coverage before March 2009 for plans with monthly coverage periods).

If, as a result of the extended election period, an assistance eligible individual becomes eligible for COBRA Coverage under a group health plan that requires payment of COBRA premiums on a calendar month basis, the individual’s first period of coverage will begin on March 1 and the Reduced Premium only applies prospectively from that date. According to Notice 2009-27, this does not change even if the plan otherwise requires individuals who lose coverage before the last day of the month and who wish to enroll in COBRA continuation coverage to pay a pro-rata portion of the monthly premium for the first partial month of coverage.

In contrast, where a group health plan determines the required COBRA premiums based on the loss of coverage, Notice 2009-27 states that the first period of coverage begins on the first day after the loss of coverage and ends on the day of the following month corresponding to the day of the loss of coverage. For example, if the last day of coverage was October 3, 2008, the period of coverage runs from the fourth of the month to the third of the following month, and thus the first period of coverage on or after February 17, 2009, is the period March 4, 2009, through April 3, 2009.

Notice 2009-27 also discusses the operation of these rules as applied to certain HRAs

 

Who Pays The Premium Subsidy & Claims The Payroll Tax Credit

In previously issued guidance, the IRS indicated that between the sponsoring employer or union and a group insurer, the party that collects the Reduced Premium bears responsibility to pay the 65% Premium Subsidy then claiming the payroll tax credit under the Stimulus COBRA Rules.  According to Notice 2009-27, if the insurer and the employer of insured, single employer group health plan have agreed that the insurer will collect the premiums directly from the qualified beneficiaries, the insurer must treat an assistance eligible individual paying 35 of the premium as having paid the full premium, even before the employer pays the insurer the remaining 65%. If the insurer fails to treat a 35% payment by an assistance eligible individual as a payment of the full premium, the insurer may be liable for the excise tax under Code § 4980B(e)(1)(B), which applies to persons responsible for administering or providing benefits under the plan and whose act or failure to act caused (in whole or in part) the failure, if the person assumed responsibility for the performance of the act to which the failure relates.

 

If you have questions or concerns about the matters discussed in this publication or other human resources, employee benefits or compensation matters, wish to obtain information about arranging for training or presentations by Ms. Stamer, wish to suggest a topic for a future program or publication, or wish to request other information or materials, please contact Ms. Stamer via telephone at (214) 270-2402 or via e-mail to Cstamer@Solutionslawyer.net. .

 

More Information

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and other helpful resources or additional information about Ms. Stamer at CynthiaStamer.com or by contacting Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at CynthiaStamer.com.   You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog at https://slphrbenefitsupdate.wordpress.com.

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Posted by Cynthia Marcotte Stamer

Employers Must Begin using New I-9 Form April 3, 2009; Government Contractor E-Verify Rules Take Effect May 21, 2009

April 2, 2009

 

U.S. employers must begin using the revised U.S. Citizenship and Immigration Services (USCIS) Employment Eligibility Verification Form known as the I-9 (Form I-9) on April 3, 2009.  Meanwhile, certain federal contractors and subcontractors also must prepare to comply with impending requirements to use USCIS E-Verify when hiring employees scheduled to take effect May 21, 2009.

New Form I-9

The use of the new Form I-9 is required under an interim rule published by USCIS in December 2008.  The interim rule also changes the types of acceptable identity and employment authorization documents employers can accept from new hires and prohibits employees from using expired identification documents to verify their work eligibility beginning April 3, 2009.  Employers will be required to use the new Form I-9 and to secure documentation of proof of eligibility to work in accordance with the revised rules contained in the interim rule for all new hires and to reverify any employee with expiring employment authorization in accordance with the interim regulations beginning on April 3, 2009.

Employers can download a copy of the new Form I-9 at http://www.uscis.gov/files/form/I-9_IFR_02-02-09.pdf. The interim regulations are available for review at http://edocket.access.gpo.gov/2008/E8-29874.htm.  USCIS presently is updating the Handbook for Employers, Instructions for Completing the Form I-9 (M-274). 

The new Form I-9 replaces the June 5, 2007 edition of the Form I-9 (the Old Form I-9), which will not be valid for use after April 2, 2009.  A big change in the new Form I-9 requirements is that expired documents cannot be accepted as proof of eligibility to work. All documents presented during the Form I-9 completion process now must be unexpired.  The new Form I-9 and interim regulations also add and remove certain documents to the list of documents that employers can accept of proof of identity and/or eligibility to work in the U.S.

The interim rule originally was scheduled to take effect on Feb. 2, 2009.  The Obama Administration extended the effective date to April 3, 2009 under a directive issued in January.

Federal Contractor  E-Verify Rule Scheduled To Take Effect May 21, 2009

Certain federal contractors and subcontractors also need to prepare to comply with a new federal rule that will require them to use E-Verify to verify the employment eligibility of new hires scheduled to take effect May 21, 2009.  The rule will only affect federal contractors who are awarded a new contract after May 21st that includes the Federal Acquisition Regulation (FAR) E-Verify clause.  Federal contractors may NOT use E-Verify to verify current employees until the rule becomes effective and they are awarded a contract that includes the FAR E-Verify Clause. 

The new rule implements Executive Order 12989, as amended by President George W. Bush on June 6, 2008, directing federal agencies to require that federal contractors agree to electronically verify the employment eligibility of their employees.   The amended Executive Order reinforces the policy, first announced in 1996, that the federal government does business with companies that have a legal workforce. This new rule requires federal contractors to agree, through language inserted into their federal contracts, to use E-Verify to confirm the employment eligibility of all persons hired during a contract term, and to confirm the employment eligibility of federal contractors’ current employees who perform contract services for the federal government within the United States.

Interested persons can review the final regulation and read frequently asked questions about this new rule on the internet at the following cites:

ü      Final Regulation at http://edocket.access.gpo.gov/2008/E8-26904.htm

ü      Frequently Asked Questions at http://www.uscis.gov/portal/site/uscis/menuitem.5af9bb95919f35e66f614176543f6d1a/?vgnextoid=cb2a535e0869d110VgnVCM1000004718190aRCRD&vgnextchannel=75bce2e261405110VgnVCM1000004718190aRCRD

If you have questions or concerns about the matters discussed in this publication or other human resources, employee benefits or compensation matters, wish to obtain information about arranging for training or presentations by Ms. Stamer, wish to suggest a topic for a future program or publication, or wish to request other information or materials, please contact Ms. Stamer via telephone at (214) 270-2402 or via e-mail to Cstamer@Solutionslawyer.net. .

 

More Information

We hope that this information is useful to you. You can register to receive future updates and information about upcoming programs, access other publications by Ms. Stamer and other helpful resources or additional information about Ms. Stamer at CynthiaStamer.com or by contacting Ms. Stamer directly. If you or someone else you know would like to receive updates about developments on these and other human resources and employee benefits concerns, please be sure that we have your current contact information – including your preferred e-mail- by creating or updating your profile at CynthiaStamer.com.   You also can register to participate in the distribution of these updates by registering to participate in the Solutions Law Press HR & Benefits Update Blog at https://slphrbenefitsupdate.wordpress.com.

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Posted by Cynthia Marcotte Stamer

DOL Releases Stimulus Bill Model COBRA Notices, Other Guidance

March 19, 2009

The U.S. Department of Labor (“DOL”) this morning (March 19, 2009) posted Model Notices and other additional guidance about temporary requirements added to the group health plan medical coverage continuation requirements of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) by the American Recovery and Reinvestment Act of 2009 (“Stimulus Bill”). Employers, health plan administrators, and health insurers involved in the sponsorship or administration of COBRA-covered group health plans should consult with counsel about the suitability of using the Model Notices to provide required notifications of the new Stimulus Bill COBRA rules and other steps necessary to comply with the new requirements.  Compliance with the Stimulus Bill COBRA rules is mandatory for all COBRA-covered group health plans and certain other arrangements including group health plans sponsored by businesses in bankruptcy where the entity or a commonly controlled or affiliated entity continues to maintain a group health plan.

 

The new guidance posed today includes:

 

  • Various  Model Notices
  •  New FAQs for Employers on the COBRA Premium Reduction
  •  Expanded FAQs for Employees on the COBRA Premium Reduction
  •  Updated FAQs for Employees on General COBRA Provisions

 

While the Model Notices and other guidance provides helpful insights about the new requirements, many group health plan sponsors, administrators and fiduciaries are likely to find it necessary or desirable to specifically tailor the notifications and other procedures they provide to more clearly communicate the workings of the new requirements as they relate to their specific plans so as to minimize administrative burdens of compliance and fiduciary risks.

 

The Stimulus Bill provisions that took effect on February 17, 2009 require special COBRA treatment for “assistance eligible individuals.” See “Stimulus Bill COBRA Amendments Require Immediate Group Health Plan Action” for more information. The Stimulus Bill COBRA amendments are intended to help certain involuntarily terminated former employees and their dependents maintain COBRA coverage.  Employers must amend their plans to comply with these mandates and, if they wish to seek reimbursement for COBRA Subsidies, must comply with IRS requirements. Meanwhile, group health plan administrators and insurers must take immediate action to provide required notifications and implement other administrative changes necessary to comply with the new rules.

 

The Stimulus Bill definition of “assistance eligible individual” generally includes any COBRA “qualified beneficiary” who meets all of the following requirements:

  • Is eligible for COBRA continuation coverage at any time during the period beginning September 1, 2008 and ending December 31, 2009;
  • Elects COBRA coverage (when first offered or during the additional election period): and
  • Has a qualifying event for COBRA coverage that is the employee’s involuntary termination during the period beginning September 1, 2008 and ending December 31, 2009.

 

This definition includes both involuntarily terminated employees and their dependents who lost coverage under a group health plan due to the involuntary termination. 

 

As part of their COBRA amendments, the Stimulus Bill limits the COBRA premium that a COBRA-covered group health plan can charge an “assistance eligible individual” to 35% of the otherwise applicable COBRA premium for a period of up to 9 months (the “Subsidy Period”) beginning March 1, 2009.  Employers sponsoring these group health plans must pay the remaining 65% of the COBRA premium (the “COBRA Subsidy”) for the assistance eligible individual during the Subsidy Period.  However, the Stimulus Bill allows an employer to seek reimbursement by claiming a payroll tax credit for these COBRA Subsidy payments by complying with applicable IRS procedures. 

 

The Stimulus Bill also requires certain assistance eligible individuals whose employment terminated between September 1, 2008 and February 16, 2009 and did not elect COBRA coverage when previously offered or who allowed COBRA coverage to lapse after electing that coverage be offered a second COBRA enrollment period in which to elect prospectively to enroll in COBRA coverage.  It also requires that group health plans that offer employees different plan options allow assistance eligible individuals the option to change their coverage choice.  Also Group health plan administrators must provide certain notifications to assistance eligible individuals concerning these changes.

 

The guidance posted today supplements preliminary guidance previously posted by the Internal Revenue Service and the Department of Labor over the past month. You can review the current Deparment of Labor Guidance at http://www.dol.gov/ebsa/COBRA.html and the current IRS Guidance at http://www.irs.gov/newsroom/article/0,,id=204505,00.html/COBRA.html .

 

The Stimulus Bill COBRA rules were among the updates discussed by Cynthia Marcotte Stamer during a March 11, 2009 Health Plan Update Teleconference.  If you are an employer or other group health plan sponsor, administrator, insurer or fiduciary and need assistance in preparing required notifications or with other matters relating to the Stimulus Bill COBRA Rules or any other health or other employee benefits matter, contact Cynthia Marcotte Stamer at CStamer@SolutionsLawyer.net or via telephone at 972.419.7188.

 

For information about how to purchase a recording of this teleconference or to review other breaking news updates about these Stimulus Bill COBRA Rules, register at Cynthia Stamer.com.

 

©2009 Cynthia Marcotte Stamer, P.C.

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