Archived HBS Legislative Updates

San Jose, California Archived HBS Legislative Updates

The IRS Clarifies DOMA and We Have Answers!

September 4, 2013

Following up with the promise to issue clarifying DOMA the Treasury and the IRS announced on August 29th that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes.  This decision applies regardless of whether the couple lives in a jurisdiction that recognizes same-sex marriage or one that does not. 

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DOMA and your FSA

July 31, 2013

 

For a limited time only, a same-sex legally married spouse may make a change of election in their Flexible Spending Plan (FSA).

For federal purposes, including employee FSA benefits, the change became effective on June 26, 2013. Going forward, a same sex couple that is married under state law has the same right to use a spouse’s FSA as does a heterosexual married couple. Therefore, FSA administrators will administer FSA accounts for same sex couples exactly as for opposite sex couples. 

 

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IRS Releases HSA Maximums for 2014

July 24, 2013

The IRS recently released the HSA contributions, out-of-pocket spending limits and minimum deductibles for 2014.  These figures are applicable to Health Savings Account compatible high deductible health plans (HDHP) aka consumer directed health care.

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Defense of Marriage Law Struck Down. Lots of Changes for Benefits Coming

July 1, 2013

 

Last week’s decision by the U.S. Supreme Court in United States v. Windsor striking down the federal Defense of Marriage Act (DOMA) has many implications for the design and operation of employee benefit plans.  The immediate impact of the Court’s Windsor decision is that the term “spouse” when used in federal law must include same-gender spouses who are legally married under applicable state law.  Employee benefit plans are extensively regulated by federal law - both the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code (Code) - and the definition of “spouse” is integral to a number of important requirements.

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DOL issues Model Notices for State Exchanges

May 21, 2013

Beginning January 1, 2014, individuals and employees of small businesses will have access to health coverage through a state health insurance market (known as an "Exchange" or "Marketplace"). Open enrollment for the Marketplace begins October 1, 2013. The Affordable Care Act (ACA) requires employers to provide employees with a notice of their coverage options available through the Marketplace ("Exchange" or "Marketplace" Notice).

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The 90-Day Waiting Period and Newly Revised SBCs

April 30, 2013

 

The IRS, DOL and HHS released additional proposed regulations regarding the 90-day waiting period limitation and the DOL released a revised Summary of Benefits and Coverage (SBC) for 2014.

 

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HCR in California 2013

April 1, 2013

Recent California legislative and regulatory activity affects employers with insured California group health policies (AB 1083 and autism rules), as well as those with offices in California (pregnancy disability rules)

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FMLA Final Rules: Action Required by March 8, 2013

March 6, 2013

The Department of Labor published Final Rules implementing statutory amendments to the Family Medical Leave Act (FMLA). The Final Rules expand the military family leave provisions and made some additional regulatory changes. The 424-page Final Rules require covered employers to comply by March 8, 2013, including the posting of the newly updated FMLA poster. 

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Department of Labor issues good news about the Exchanges

February 8, 2013

 

Last week the Department of Labor (DOL) announced that the employer-provided notice (regarding the existence of the Exchanges, the availability of premium tax credits, and related matters) has been postponed until it issues supporting regulations. It anticipates issuing the regulations in late summer or fall of 2013.

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Healthcare Reform: 50 Employees is a Magic Number; Employee Subsidies from the Exchanges; and Employer Obligations

January 24, 2013

Most employers must prepare now to greet the full implementation of the Affordable Care Act (ACA) and Healthcare Reform. Employers with more than 50 employees must develop their strategies regarding future hires, choice of plans, and financial impacts. Employers approaching the 50 employee threshold must prepare for the eventuality of becoming subject to their obligations under the 2014 employer shared responsibility rules. To make that determination, employers must understand and apply the recently issued proposed regulations on the definition of employees and how to count them, as well as what their responsibilities and potential risks will be if they have at least 50 full time employees or equivalents (FTEs) in 2014. 

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The American Taxpayer Relief Act of 2012: How This “Fiscal Cliff” Resolution Impacts Employee Benefits in 2013

January 14, 2013

 

The legislation crafted over the final weekend of 2012 contains a number of employee benefit related changes. In addition to terminating the Bush-era tax rate for individuals with taxable income over $400,000 ($450,000 for joint filers) and making the Bush-era rates permanent for those making less than these amounts, the American Taxpayer Relief Act of 2012 (ATRA) restored or made permanent tax breaks for educational assistance plans, qualified commuter transit pans, adoption assistance benefits, education savings accounts (ESAs), and child and dependent care credits.

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Health Care Reform: The Regapalooza Has Arrived!

December 31, 2012

 

We finish 2012 with a look at what is coming down the road.  The coming year (2013) again, will bring a flood of new clarifications and final regulations.  The beloved 2100+ page Healthcare Reform Act will look like cliff notes when all the government agencies finish publishing the details.  So expect to see your in box deluged with BenAlerts in 2013.  So starting with the next one, will be numbering them to help you file them.  Of course, you can still find them on our website

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2015 Group Term Life Table 1

December 1, 2015

There were no changes to the rate table from last year. Section 79 of the Internal Revenue Code (IRC) requires that employers calculate imputed taxable income for employees that receive group life insurance coverage in excess of $50,000. The amount of imputed taxable income must be reported on the employee's Form W-2. The IRC Section 79 allows employees to exclude up to $50,000 from taxable income.

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Wellness Programs and California Legislative Update

December 3, 2012

There is a considerable amount of legislative news coming at year-end, so this Ben Alert is very long, however, it contains a wealth of critical news for you.  included are proposed regulations regarding both discrimination and rewards for wellness programs slated for 2014 as a result of Healthcare Reform.  We also have a California Legislative update on new mandates for 2013 that will affect you,  your company and your employees.

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Year-End Compliance and Checklist 2012 - 2013

November 5, 2012

It would be an understatement to say that all is well in the welfare plan world. 2011 and 2012 has been a landmark period for the issuance of regulations affecting welfare benefit plans and for states passing new laws to achieve compliance with the Affordable Care Act (ACA).  Please read carefully and contact us with your questions.

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2012 Medicare Part-D Annual Notice

September 18, 2012

Each year at this time, health care Plan Sponsors whose plans contain prescription drug coverage must distribute an Annual Notice to plan participants who are or who might be eligible for Medicare Part-D coverage or have covered family members who may be eligible.

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Health Care Reform - Employee Eligibility for 2014

September 12, 2012

For plan years beginning on or after January 1, 2014, group health plans with 50 or more employees, whether grandfathered or not, must provide coverage to employees who work at least 30 hours per week and whose initial waiting period for coverage must not exceed 90 days.

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Health Care Reform - Preventive Services for Women

August 27, 2012

Section 2713 of the Affordable Care Act (ACA) relating to preventive services for women goes into effect for non-grandfathered plan years beginning on or after August 2, 2012.

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Medical Loss Ratios - Dealing with Rebate Checks

August 1, 2012

In early July, insurance companies (issuers) required to pay rebates to policyholders issued checks to deserving policyholders.  Who would have thought it would become so complicated!

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Supreme Court Upholds Health Care Mandate, Strikes Down Medicaid Expansion

June 28, 2012

At 10:15 A.M. Eastern Time today, June 28, 2012 Chief Justice Roberts released the U.S. Supreme Court decision on the constitutionality of various provisions of the Patient Protection Affordable Care Act (PPACA).

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IRS Provides Guidance on the $2,500 FSA Annual Limit

June 1, 2012

This week the IRS issued Notice 2012-40, which offers long-awaited guidance on the $2,500 limit for Health FSA salary reduction contributions. This rule is effective January 1, 2013 under the Affordable Care Act (ACA).

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Calculating & Paying the Comparative Effectiveness Research Fee

May 14, 2012

As we get deeper into the The Affordable Care Act mandates, you will hear of more fees (taxes) that will be imposed on group health plans.

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IRS HSA 2013 Maximums

May 3, 2012

The Internal Revenue Service (IRS) announced the 2013 inflation adjusted amounts for health savings accounts (HSAs) in Revenue Procedure 2012-26.

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How To Be A Medical Consumer

April 20, 2012

A recent article in the LA Times addresses an issue we thought would be of interest to you - How To Be A Medical Consumer.  We also include a link to Healthcare Blue Book, a free guide to healthcare pricing in your area.

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Anthem and HCA Reach Agreement

April 6, 2012

We are pleased to inform you that Hospital Corporation of America's California hospitals once again participate in Anthem Blue Cross' network. These facilities include: Good Samaritan Hospital of San Jose; Regional Medical Center of San Jose; Los Robles Regional Medical Center; Riverside Community Hospital; West Hills Hospital and Medical Center.

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Healthy San Francisco Update

April 3, 2012

As you know, San Francisco's Health Care Security Ordinance (Healthy San Francisco) requires for-profit employers with 20 or more employees (and nonprofits with 50 or more employees) to spend a minimum amount on health care for covered employees and to report on these expenditures annually.

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Anthem Blue Cross Unable to Reach Agreement with Good Samaritan Hospital of San Jose and Regional Medical Center of San Jose

We have recently been notified that Anthem Blue Cross and two San Jose area hospitals, The Regional Medical Center of San Jose and Good Samaritan Hospital of San Jose, have been unable to reach an agreement regarding mutually acceptable rates of reimbursement. Therefore, effective March 3, 2012, these two facilities are not part of the Anthem Blue Cross networks. These two hospitals are affiliates of the Hospital Corporation of America (HCA) a nationwide provider of healthcare with over 160 hospitals. As such, this termination will also apply to several other HCA facilities in other parts of California.

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Employers Required to Provide a Summary of Benefits and Coverage (SBC)

February 24, 2012

Health care reform's latest addition to the alphabet soup of plan participant notices is the SBC – the Summary of Benefits and Coverage. Not to be confused with the SPD (Summary Plan Description) or SMM (Summary of Material Modifications), the SBC is a new, separate notice that both grandfathered and non-grandfathered group health plan sponsors must be ready to provide by plan years beginning September 23, 2012. (Sample SBC Template (PDF File))

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401(k) Fee Disclosure Deadlines Extended

February 10, 2012

Plan sponsors will now have until July 1, 2012 to meet the much-discussed regulations on 401(k) fee disclosure, following Department of Labor announcements last week on the final rulings.

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FSA $2,500 Limit Applies to 2012 Fiscal Plan Year Plans

January 19, 2012

Although most Internal Revenue Code (IRC) Section 125 plans (Cafeteria Plans) are calendar year plans, there are some plans that are fiscal years plans (e.g. February 1 – January 31). To the delight of tax lawyers everywhere, the IRC contains traps for the unwary! In this instance, plan sponsors with fiscal plan years (all plan years other than calendar years) whose Cafeteria Plans include Health Care Spending Accounts (HCSA), must institute the $2,500 pre-tax contribution account maximum beginning with the first day of the 2012 fiscal year.

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A New Maternity Mandate for California

January 12, 2012

As the cornerstone of four new laws, the California legislature intends to assure health care coverage for pregnancy, childbirth, and related conditions. These new laws expand protection under California insurance policies and health care plans in a significant way.

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W-2 Health Care Reporting Requirements: Once and For All – For Now

December 22, 2011

What is the Form W-2 Reporting provision all about? Essentially, this provision is about transparency and education, requiring employers to report the total value of an individual employee's health benefits on their Form W-2. As a result, employees will better understand the true benefit they receive through their employers, and at the same time gain awareness of the true cost to obtain health coverage.

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Healthy San Francisco: Ordinance Now Modified, But Is It Over?

December 1, 2011

The Board of Supervisors for the City and County of San Francisco, seeing an apparent loophole in its attempts to provide health care expense assistance to employees of employers in San Francisco, have debated throughout the last few months on how to assure employees get a real benefit out of employer contributions.

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2012 California Legislative Update

November 21, 2011

As 2012 approaches, Health Care Reform remains center stage. However, California employers also must pay attention to changes in state and local laws/regulations. These are just some of the new legislation and state mandates that will be taking effect in 2012.

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2012 IRS Pension, Retirement and Benefit Limits

October 31, 2011

The Internal Revenue Service has announced cost-of-living adjustments applicable to dollar limitations for retirement plans and other benefits for 2012. This marks the first notable adjustment to the limits since 2009.

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4th Quarter Compliance Checklist

October 5, 2011

This time of year brings a number of additional administrative burdens for organizations of every size. You should have these items on your 4th Quarter calendar to ensure compliance with the myriad of state and federal regulations. If you have any questions about the requirements, procedures, or regulations, please give us a call.

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Group Term Life Table 1

October 6, 2011

There were no changes to the rate table from last year. Section 79 of the Internal Revenue Code (IRC) requires that employers calculate imputed taxable income for employees that receive group life insurance coverage in excess of $50,000. The amount of imputed taxable income must be reported on the employee's Form W-2. The IRC Section 79 allows employees to exclude up to $50,000 from taxable income.

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Anthem Blue Cross drops Stanford Medical Center from PPO and HMO Networks

September 20, 2011

We have recently been notified that Anthem Blue Cross and Stanford Medical Center have been unable to reach an agreement regarding mutually acceptable rates of reimbursement. Therefore, effective September 1, 2011, Stanford University Hospital, Lucile Salter Packard Children's Hospital (LPCH) and Stanford Medical Group are not part of the Anthem Blue Cross PPO or HMO networks. We are sending this to all of our clients because of the importance of this situation.

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Blue Shield drops Lucile Salter Packard Children's Hospital from PPO and HMO

September 9, 2011

We have recently been notified that Blue Shield and Lucile Salter Packard Children's Hospital have been unable to reach an agreement regarding mutually acceptable rates of reimbursement. Therefore, effective September 1, 2011, Lucile Salter Packard Children's Hospital is not part of the Blue Shield PPO or HMO networks. We are sending this to all of our clients because of the importance of this situation.

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COBRA Subsidies End? Maybe Not!

September 9, 2011

Yesterday the Department of Labor, Employee Benefits Security Administration (EBSA) published a notice on its website regarding the apparent cessation of COBRA subsidies. Since eligibility for the COBRA/ARRA subsidy ceased as of May 31, 2010, it would seem no one would be eligible for the 15-month subsidy beyond August 31, 2011.

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Healthcare Reform Update PPACA: Womens' Preventive Care Services

August 22, 2011

The Patient Protection and Affordable Care Act (PPACA), or as we call it, "healthcare reform," now requires all non-grandfathered group health plans to offer a number of womens' preventive care services. On August 1, 2011, the Departments of the Treasury, Labor and Health and Human Services issued an amendment on preventive services, specifically regarding the guidelines for first dollar (no deductible) coverage.

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IRS HSA 2012 Maximums

July 28, 2011

The Internal Revenue Service (IRS) announced the 2012 inflation adjusted amounts for health savings accounts (HSAs) in Revenue Procedure 2011-32.

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Medicare Part D – Creditable Coverage Notices and Complying with Medicare Part D Guidelines

July 14, 2011

Deadline for Compliance is October 15, 2011. Medicare Part-D -- 2011 Annual Notices. Each year at this time, health care Plan Sponsors whose plans contain prescription drug coverage must distribute an Annual Notice to Plan Participants who are or who might be eligible for Medicare Part-D coverage or have covered family members who may be eligible. This year, however, there are changes to the Part-D enrollment period as a result of the Patient Protection and Affordable Care Act of 2010 (PPACA). These changes will affect the timing of your notices and may potentially require you to send a supplement to your notices if you have already sent them for 2011.

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Important Legislative Update Related to the Patient Protection and Affordable Care Act

April 28, 2011

The following is a legislative update on recent actions taken by California Governor Brown, the U.S. Congress and the IRS which are related to the Patient Protection and Affordable Care Act. Although signed into law on March 23, 2010 by President Obama, fine tuning of the health care reform law continues as the state and federal governments conform, clarify and in some cases repeal certain provisions.

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California Legislation Provides Tax Relief

April 8, 2011

Last week, the California legislature passed and sent to Governor Brown legislation (AB 36) which will provide both administrative and tax relief to California employers and their employees. At this time the Governor has yet to sign it into law. Upon its enactment, California will adopt the federal rules regarding the tax treatment of adult dependents electing group health care coverage pursuant to the Patient Protection and Affordable Care Act (PPACA) and related laws (HCR).

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Overage Dependents: California Issues New Guidance

February 15, 2011

In our Open Enrollment meetings when we discuss Federal Healthcare Reform, employees are pleased to hear that their overage dependents up to age 26 are eligible to enroll on their healthcare policy. However, they are "surprised" to learn that California is entitled to imputed income state tax based on the cost for medical coverage for their overage dependents.

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2010 Group-Term Life Table 1

There were no changes to the rate table from last year. Section 79 of the Internal Revenue Code (IRC) requires that employers calculate imputed taxable income for employees that receive group life insurance coverage in excess of $50,000. The amount of imputed taxable income must be reported on the employee's Form W-2. The IRC Section 79 allows employees to exclude up to $50,000 from taxable income.

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Health Care Reform: California Taxation and Related Issues

In the last few days, we have received a number of questions surrounding the failure of the California Legislature to adopt the federal income tax rules governing the tax treatment of health care coverage provided to adult children (age 24-26). Additionally, there has been some confusion over the availability of dental and vision benefits to adult children under California law (SB 1088). The purpose of this BenAlert is to address these two specific issues.

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Maximum Benefit and Contribution Limits 2011

Maximum Benefits and Contributions limits for 2011. Plans covered include, 401 (k) Elective Deferrals, Catch-Up contributions, Defined Contributions Plans, Annual Compensation Limit, among others.

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Communicating Health Care Reform to Employees

As you know, the first provisions of the Patient Protection and Affordable Care Act (PPACA) take effect on the first day of the plan year on or after September 23, 2010. Generally, companies with plan renewals on October 1, 2010 will be the first to feel the effect of the mandates. For companies with calendar year plans, these provisions will begin January 1, 2011. The mandates will affect each employer health plan differently, and Howitt will provide the necessary language to communicate these changes to employees, as mandated by PPACA.

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Health Care Reform – W-2 Reporting Relief for 2011 and No OTC Drugs for FSA's and HSA's

On October 12, 2010, the Internal Revenue Service (IRS) announced in Notice 2010-69 that it would make the reporting of employer-sponsored healthcare costs on Form W-2 OPTIONAL for the 2011 tax year. The W-2 disclosure requirement will become mandatory for the 2012 tax year in January 2013. The IRS has also issued a draft 2011 Form W-2 that includes the codes that employers may use to report the cost of health care coverage.

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Medicare Part D – Creditable Coverage Notices and Complying with Medicare Part D Guidelines

Deadline for Compliance is November 15, 2010. Medicare Part D -- Creditable Coverage Notices. Each year at this time, health care Plan Sponsors whose plans contain prescription drug coverage must distribute an Annual Notice to plan participants who are or who might be eligible for Medicare Part-D coverage or have covered family members who may be eligible. Annual notices issued earlier this year will satisfy this notice requirement.

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Health Care Reform Update - August 16, 2010

There is so much happening with Healthcare reform - it can be difficult to keep it all straight. With that in mind, we have put together a list of key points that can affect Employers in the coming years. We are listing the change or requirement; the proposed effective date; some comments about who may be the responsible party (employer or carrier, etc), and when it may actually effect you and your group - mid-plan year or at renewal. Some rules have a 'true' effective date, and some are due at the first renewal AFTER the rule goes into effect.

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Health Care Reform: September 23, 2010 The First Mile Marker

At present, most health plan sponsors are thinking about the impact healthcare reform will have on their upcoming group health plan renewals under the Health Care Reform Rules which go into effect for plan years beginning on or after September 23, 2010. The purpose of this Memorandum is to provide a summary and an analysis of those Health Care Reform Rules and their impact on the renewal process.

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New Interim Rules for Preexisting Condition Exclusions, Lifetime and Annual Limits, Coverage Rescissions, and Patient Protections

The Patient Protection and Affordable Care Act (PPACA) requires all group health plans to comply with certain mandates. This issue focuses on the Act's provisions related to preexisting condition exclusions, annual and lifetime limits, rescissions and certain patient protections. The Department of the Treasury, the Department of Labor and the Department of Health and Human Services ("HHS"), the three agencies responsible for implementing the Act's provisions related to group health plans, jointly issued Interim Final Rules ("the Rules") related to these provisions which will be published June 28, 2010 in the Federal Register. Most of the changes discussed in these Rules become effective January 1, 2011, for calendar year plans.

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IRS HSA 2011 Maximums

The Internal Revenue Service (IRS) announced the 2011 inflation adjusted amounts for health savings accounts (HSAs) in Revenue Procedure 2010-22. IRS Announces No Change to HSA Maximums For 2011.

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Rules Defining Grandfathered Employee Benefit Plans Issued June, 2010

Rules clarifying the criteria health plans must meet in order to keep their grandfather status under PPACA were released on June 14.

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Health Care Reform's Expansion of Coverage to Over-Age Dependents

As we all know by now, the Health Care Reform Law mandates that all health plans, whether grandfathered or not, must extend health care coverage to eligible dependents to age 26. In recent days we have seen both the IRS Notice (2010-38) and the Interim Final Rule, jointly issued by the IRS, Health and Human Services (HHS), and the Department of Labor (DOL). The purpose of this Memorandum is to provide you with an overview of the rulemaking as well as a discussion of health plan issuers' offer for early adoption of the Age 26 Mandate.

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Kaiser Permanente to Cover Dependents up to Age 26 Beginning June 1st

The Affordable Care Act allows young adults to stay on their parents' health care plan until age 26. Before the President signed this landmark Act into law, many health plans and issuers could and did in fact remove young adults from their parents' policies because of their age, leaving many college graduates and others with no insurance.

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COBRA Subsidy Period Extended Once Again

On April 15th, 2010, the President signed into law the Continuing Extension Act of 2010 (HR 4851). Among other provisions, this law once again extends the COBRA subsidy eligibility period under ARRA, this time through May 31st, 2010.

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Healthcare Reform: An Employer's Timeline

The Patient Protection and Affordable Care Act, as signed by President Obama on March 23, 2010, presents provisions and modifications that will affect all employers. To help our clients understand the implications we are presenting in the form of timeline the major modifications and provisions that will affect all employers.

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Small Business Health Care Tax Credit

In our continuing effort to keep you informed regarding the practical implementation of the new health care reform laws, we are passing along new information about the small business health care tax credit that is of interest to many business owners.

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Jumping into Health Reform

On March 23, I published a brief overview of the immediate changes we can expect from the New Health Reform law and the potential impact of the Reconciliation Bill. As we all know, the Reconciliation Bill (H.R. 4822) did go to the Senate which amended it and sent it back to the House for approval. On Thursday, March 25, 2010 the House took final action and delivered the Bill to the White House for enactment.

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Health Reform Implementation

Late Sunday, the U.S. House of Representatives passed two bills: H.R. 3590 (the Reform Bill), as previously passed by the U.S. Senate on December 24, 2009, which is now law with the President's signature this morning, and H.R. 4872 (the Reconciliation Bill) containing significant changes to the Senate bill. The Reconciliation Bill now goes across the Capitol to the U.S. Senate which must now vote on its passage before it becomes law. At present, its passage (although not assured) is projected to occur by the end of March.

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Healthcare Reform

As your trusted insurance advisor all of us here at Howitt Benefit Services have been following the healthcare reform process very closely over the last year in an effort to help our clients understand, adapt, and take advantage of any changes that would take place if new legislation were to be signed into law.

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COBRA Temporary Extension to March 31, 2010: COBRA Subsidy Extended, Plus Technical Tweaks

Once again, Congress has extended the benefits of the ARRA COBRA subsidy to COBRA Subsidy Events occurring on or before March 31, 2010. On Tuesday, March 2, 2010, the Senate voted 78-19 to enact H.R. 4691 (http://www.govtrack.us/congress/bill.xpd?bill=h111-4691) , the Temporary Extension Act of 2010 (TEA), which contains an extension of the COBRA Subsidy Events through March 31, 2010 along with the extension of unemployment benefits through April 5, 2010. The purpose of this Memorandum is to describe the COBRA Subsidy extension and other significant COBRA subsidy changes found in TEA.

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Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA) Notices Published: Actions Required

As required by the Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA), the Department of Labor has issued a Model Notice for group health places to use in notifying employees about their potential CHIPRA rights. The purpose of this Memorandum is to assist employers in achieving compliance with the CHIPRA Notice Requirements.

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DOL Publishes Model ARRA NDAA Notices for the COBRA Extension Subsidy

As promised, the Department of Labor (DOL) reduced our collective anxiety yesterday by publishing the COBRA Subsidy Extension notices to be used for compliance with the notice provisions of the COBRA Extension legislation included in the National Defense Appropriations Act (NDAA) enacted into law on December 19, 2009.

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FMLA: Expanding Military Leave Entitlement and Sample Amendment

On October 28, 2009, President Obama signed the 2010 National Defense Authorization Act (NDAA) into law. The NDAA contains an expansion of Family Leave Rights. The FMLA provision actually contains no specific effective date. As a result, most practitioners advise employers to treat the expansion as being effective immediately.

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COBRA Extension Legislation on President's Desk

On Saturday, December 19, 2009, Congress extended the COBRA subsidy first enacted on February 13, 2009 from nine (9) months to fifteen (15) months for those who undergo an involuntary termination of employment between September 1, 2008 through the end of February 2010.

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Group-Term Life Table 1

There were no changes to the rate table from last year. Section 79 of the Internal Revenue Code (IRC) requires that employers calculate imputed taxable income for employees that receive group life insurance coverage in excess of $50,000. The amount of imputed taxable income must be reported on the employee's Form W-2. The IRC Section 79 allows employees to exclude up to $50,000 from taxable income.

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A Model Creditable Coverage Disclosure Notice

Please read this notice carefully and keep it where you can find it. This notice has information about your current prescription drug coverage with [Insert Name of Organization] and about your options under Medicare's prescription drug coverage. This information can help you decide whether or not you want to join a Medicare drug plan. If you are considering joining, you should compare your current coverage, including which drugs are covered at what cost, with the coverage and costs of the plans offering Medicare prescription drug coverage in your area. Information about where you can get help to make decisions about your prescription drug coverage is at the end of this notice.

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BenAlert - Medicare Part D Compliance

Employers who provide prescription drug coverage to Medicare eligible individuals must provide notice annually regarding whether the offered coverage is "creditable". (Coverage is deemed creditable when the actuarial value of the coverage is equal to or exceeds the coverage provided under Medicare Part D.) If notice is provided to all plan participants annually prior to November 15 each year, CMS will consider this notice requirement met.

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HITECH Proposed Interim Final Rule - Breach Notifications (09/09)

The American Recovery and Reinvestment Act of 2009 made several changes to the HIPAA privacy rules - including adding a requirement for notice to affected individuals of any breach of unsecured protected health information. On September 23, 2009, the interim final rule from the Department of Health and Human Services (HHS) goes into effect. This Ben Alert summarizes the Ruling. HHS has stated that while it expects covered entities to comply with this Rule as of September 23, it will not impose sanctions for failure to provide the required notifications for breaches discovered through February 22, 2010. Instead, during such period it will work with covered entities to achieve compliance through technical assistance and voluntary corrective action. Please read the entire Alert to understand what your organization must do to comply.

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The Obama Health Care Agenda: What it Means for Benefits Professionals (08/09)

Health care reform has been discussed for nearly 100 years and it appears that the latest convergence of economic, political and social factors has created the final push to significant health care reform in the United States. This discussion will explore the history and drivers of health reform, the economic and political factors that were in play during previous attempts and why this time may be different. We'll also explore the potential economic and employment challenges facing employers and what role government policy and regulation may play in determining the fate of employer-sponsored health benefit programs.

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COBRA Subsidy: The Heat is On IRS Notice 2009-27 (04/09)

With the introduction of the model federal notices, most Plan Sponsors and all COBRA administrators are working to comply with the COBRA subsidy notice requirements. With IRS Notice 2009-27, issued today, we have some further guidance. The purpose of this Memorandum is to discuss and hopefully bring a degree of certainty to the election process.

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COBRA Subsidy Model Notices (03/09)

This morning, the Department of Labor (DOL) published model notices for use by employers to notify individuals regarding their potential right to qualify for COBRA premium assistance. Employer/Plan Sponsors must provide one of the four model notices to each individual whose coverage terminated, regardless of the type of qualifying event, at any time from September 1, 2008 to the present within 60 days from the date of enactment (February 17, 2009) of the American Recovery and Reinvestment Act of 2009 (ARRA). The DOL calculates this deadline date to be April 18, 2009.

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Children's Health Insurance Program Reauthorization Act of 2009 (03/09)

As many of us were ruminating over the prospect of potential COBRA changes, ultimately adopted into law through the Stimulus Bill (American Recovery and Reinvestment Act of 2009) on February 17, 2009, President Obama signed H.R. 2 into law on February 4, 2009: The Children's Health Insurance Program Reauthorization Act of 2009 (CHIPRA), which contains additional employer obligations becoming generally effective on April 1, 2009.

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COBRA Premium Subsidy Now Reality: Overview (02/09)

The act will provide subsidized COBRA benefits to workers (and their families) who lose health care coverage because of involuntary termination of employment. Those who retire or otherwise terminate their employment voluntarily, and those who become eligible for COBRA coverage as a result of reduced hours, divorce, loss of dependent status or another qualifying event are not eligible for subsidized coverage.

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COBRA Premium Subsidy Now Reality: Immediate Action Required

Employers / Plan Sponsors who are subject to state or federal COBRA must provide premium subsidies of no less than 65% of regular COBRA premium to "Assistance Eligible Individuals" beginning March 1, 2009. Employers must provide notice of the subsidy's availability to all eligible individuals within 60 days of the law's enactment.

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Healthy San Francisco Update (02/09)

As you know, the Health Care Security Ordinance (Healthy San Francisco) requires for-profit employers with 20 or more employees (and nonprofits with 50 or more employees) to spend a minimum amount on health care for covered employees and to report on these expenditures annually. On January 15, 2009, San Francisco's Office of Labor Standards Enforcement (OLSE) released an updated Annual Reporting Form (ARF) to be completed by covered employers by April 30, 2009. Attached are the Annual Reporting Form Instructions and Form.

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New Family and Medical Leave Regulations (01/09)

As you may recall, Congress enacted the Family and Medical Leave Act in 1993. The Department of Labor (DOL) issued its only set of FMLA regulations in 1995. Since that time, federal courts have interpreted the FMLA (sometimes inconsistently) and the U.S. Supreme Court actually invalidated portions of the current regulations. So now, the DOL has issued new Final Regulations (New Regulations) which are more comprehensive than the 1995 regulations. Many of the enhancements respond to court decisions; others are a result of comments made during what became a two year comment period (2006-2008). Since the New Regulations are very detailed and require serious study, we have limited this BenAlert to a discussion of the key changes.

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San Francisco Commuter Benefits: Sample Documents and Additional Discussion (12/08)

In September 2008, we published a BenAlert on the City and County of San Francisco's mandate requiring employers to make certain commuter transit benefits available. San Francisco employers with 20 or more employees working at least 10 hours per week (in or outside of San Francisco) must offer the benefit to its employees as of January 19, 2009. The purpose of this Memorandum is to provide additional information about this program and to provide two sample documents (for review by the employer's counsel) as tools for implementation of this program: a pre-tax program and an employer-paid program. These samples are issued subject to review by your client's counsel.

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The Bicycle Commuters Act (12/08)

Effective January 1, 2009, for expenses incurred on or after that date, federal law will allow employers to make bicycle commuting expense reimbursements under IRC Section 132(f) up to $20.00 per month to employees who regularly commute to work by bicycle. Although this is the same section of the Internal Revenue Code as transit passes and parking, very different rules apply to the bicycle benefit.

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Group-Term Life Table 1 (12/08)

There were no changes to the rate table from last year. Section 79 of the Internal Revenue Code (IRC) requires that employers calculate imputed taxable income for employees that receive group life insurance coverage in excess of $50,000. The amount of imputed taxable income must be reported on the employee's Form W-2. The IRC Section 79 allows employees to exclude up to $50,000 from taxable income.

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California Same-Sex Marriages: Impact of Proposition 8 (11/08)

On November 4, 2008, California voters approved an initiative to amend the California Constitution to define marriage as between a man and a woman. Special interest groups already have filed petitions with the California Supreme Court urging invalidation of Proposition 8. The purpose of this BenAlert is to discuss the impact of Proposition 8 at this moment.

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2008 Plan Year End: Compliance Highlights (11/08)

The purpose of this BenAlert is to provide you with a turnkey list of benefits issues that requires attention between now and the end of 2008, whether or not your plans are calendar year plans. For some of you, 2009 benefits are fixed and open enrollments have begun or are about to begin. 2009 plan design and communication strategies are in place. For others, budget constraints are calling for significant changes in plan design. Regardless of which stage you are in, at some point before year-end you must address your plan compliance obligations.

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New Federal Mental Health Parity Law: What it Means for Plan Sponsors (11/08)

On October 3, 2008, Congress passed and President Bush signed into law the Emergency Economic Stabilization act of 2008 (EESA), also know s the "700 Billion Dollar Bailout Bill" (HR 1424), to encourage certain members of Congress to vote for its passage, EESA contains a number of unrelated but pet legislative proposals which became law with the Bailout Bill. The most well known of these proposals was "The Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008", Section 511 et seq. of the Bailout Bill (MHPAEA). The MHPAEA amends the Employee Retirement and Income Security Act (ERISA), the Internal Revenue Code (IRC), and the Public Health Service Act. The following is an overview of the MHPAEA.

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IRS 2009 HSA Maximums (11/08)

Annual contribution limitation. For calendar year 2009, the annual limitation on deductions under § 223(b)(2)(A) for an individual with self-only coverage under a high deductible health plan is $3,000. For calendar year 2009, the annual limitation on deductions under § 223(b)(2)(B) for an individual with family coverage under a high deductible health plan is $5,950.

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2009 Maximum Benefit and Contribution Limits (10/08)

Maximum Benefits and Contributions limits for 2009. Plans covered include, 401 (k) Elective Deferrals, Catch-Up contributions, Defined Contributions Plans, Annual Compensation Limit, among others.

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Complying with Medicare Part D Guidelines (10/08)

You are required to provide annual notification to the CMS (Centers for Medicare and Medicaid) that your prescription drug coverage for the current year was either Creditable or Not Creditable for the purposes of Medicare Part-D anytime between February 15, 2008 and November 15, 2008. This is for their data bank for Medicare-eligible employees and their dependents.

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San Francisco Health Care Security Ordinance (10/08)

The Ninth Circuit, US Court of Appeals ruled last week in favor of the San Francisco Health Care Security Ordinance. We do expect this to be challenged in the Supreme Court, however in the meantime, the ruling remains in effect.

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Federal Benefit Law Notice Requirements as of September 30, 2008 (09/08)

Federal Benefit Law Notice Requitrements as of September 30, 2008. Covers Annual Notices, Event Driven Notices, and Other Notices as in a Military Rights Notice or an Exemption from Mental Health Parity Law.

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Domestic Partner and Same-Sex Marriage Partner Imputed Income Calculator for Federal Income Tax Purposes (09/08)

For federal income tax purposes, providing group health care benefits to a domestic partner or same-sex marriage partner (collectively: Partner) is a taxable event to the employee, requiring the employer to impute income reflecting the value of the coverage provided to the Partner.

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City and County of San Francisco Mandates Transit Benefits (09/08)

On August 22, 2008, Mayor Gavin Newsome signed a new Transit Benefit Ordinance in to law requiring employers with offices in San Francisco to provide one of three transit benefit options to its San Francisco employees; A pre-tax Transit Pass program; A program which reimburses employees for them; Or, door-to-door van pool program at no cost to employees.

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Heroes Earnings Assistance and Relief Act of 2008 (HEART Act) (07/08)

On June 6, 2008, President Bush signed into law the Heroes Earnings Assistance and Relief Tax Act of 2008 (HEART Act). This new legislation provides additional benefits for individuals on active duty in the Armed Forces and amends the Uniformed Services Employment and Reemployment Rights Act (USERRA). The Act provides for liberalization of pension as well as welfare plan rules including the ability to cash out unused contributions from a health FSA (at the employer's option). The purpose of this memorandum is to highlight the pension rules and to discuss the welfare plan changes in more depth.

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Gay Marriage Licenses Now Being Issued: An Early FAQ (06/08)

On May 15, 2008, the California Supreme Court ruled that California's ban on same gender marriage was unconstitutional. Thus, couples of the same gender must be allowed to marry. The new ruling requires that county clerks issue and record marriage licenses to same gender couples in exactly the same manner as issued to opposite gender couples.

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IRS Approves One Time IRA-to-HSA Funding (06/08)

Owners of individual retirement accounts (IRA) who are enrolled in a high-deductible health plan can shift IRA funds into a HSA without facing a tax penalty. The transfer amount, however, cannot exceed the individual's maximum HSA contribution limit. Simple IRAs and SEP IRAs are not eligible.

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The Family and Medical Leave Act and National Defense Authorization Act for FY 2008 (01/08)

Section 585 of the NDAA amends the Family and Medical Leave Act of 1993 (FMLA) to permit a "spouse, son, daughter, parent, or next of kin" to take up to 26 workweeks of leave to care for a "member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness."

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San Francisco Health Care Security Ordinance Legislative Brief (01/08)

The Employer Spending Requirement (ESR) of the new San Francisco Health Care Security Ordinance (HCSO) was challenged in federal courts which delayed the initial January 1, 2008 effective date. Pending the appeal, the Ninth Circuit Court of Appeals has granted the City's Emergency Motion for a Stay of the court's decision. Until the courts reach a decision on the appeal, the City's program for health benefits for thousands of the City's residents and workers is going forward effective January 9, 2008.

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New California Laws Effecting Group Health Plans and Plan Sponsors (01/08)

The Unpaid Leave Law requires a qualified employer to allow a qualified employee to take up to 10 days of unpaid leave during a qualified leave period. The healthy care treatment law will prevent health care service plans and health insurers from rescinding or modifying preautorized treatment or services provided by health care providers for any reason. The protected health information law expands the provisions of the confidentiality of Medical Information Act as well as other California personal information privacy laws to apply to electronic health information held by any organization regarding any California resident.

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New California Law Gives Unpaid Leave to Military Spouses (11/07)

The bill requires employers with 25 or more employees ("qualified employers") to provide any employee whose spouse is a member of the Armed Forces of the United States, National Guard or Reserves, who has been deployed during a time of military conflict, up to 10 days of unpaid leave when his or her military spouse is on leave from deployment.

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Department of Labor Releases Final Regulations on 401(k) Plan Default Investment Vehicles (10/07)

The Department of Labor has issued final regulations that provide a safe harbor to qualified plan fiduciaries to guide their selection of default investment alternatives for plan participants. Default investment alternatives are investments that are automatically provided by plan sponsor fiduciaries when participants who are given the opportunity to direct the investment of their defined contribution plan accounts (401k) do not make an investment election. This regulation will be applicable to 401k plans that use automatic enrollment for newly-eligible employees as well as plans that do no receive an election from participations. The final regulations are effective December 24, 2007.

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New Cafeteria Plan Rules (10/07)

The purpose of this legislative update is to highlight the key provisions of these new proposed regulations (the new proposed rules) that will directly affect plan sponsors in the administration of their cafeteria plans. It is not intended as a comprehensive restatement of the new proposed rules.

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California Benefits: 2006 Legislation (07/07)

As you may know, each year, we summarize the new laws enacted in California effecting health and welfare plans. The purpose of this memorandum is to provide you with an overview of the more significant legislation for 2007. We have also included health care legislation not directly effecting health and welfare plans to give you an idea of the direction of California's legislative intent.

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Are You Ready to Incorporate a Wellness Program in your Employee Benefits Plan? (06/07)

Survey after survey in 2007, shows nearly 70% of large companies plan to offer tools and programs to help employees improve their health, including health risk questionnaires and nurse hot lines. Companies' efforts at improving employee health range from simple things, such as flipping the food in company vending machines so the nutritional information faces out, to an increasing number of in-house clinics and pharmacists to help employees with primary care.

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An Update to San Francisco's Sick Leave Ordinance (05/07)

All employers with at least one person employed within the boundaries of the City and County of San Francisco (City) must provide sick pay benefits to employees who work in the City for more than 90 calendar days. Sick leave benefits accrue at the rate of one hour for every thirty hours worked, with a maximum accrual of 40 hours for employers with less than 10 employees and 72 hours for employers with 10 or more employees.

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New HSA Provisions (12/06)

This bill will allow consumers with FSAs, individual retirement plans and health reimbursement arrangements to transfer funds into their HSAs. The passing of this bill greatly enhances the rules governing HSAs. It also expands funding sources for HSAs. The HSA provisions will go into effect on January 1, 2007. If you are presently offering an HSA plan to your employees, you need to communicate to your employees these new regulations which may benefit them.

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Pension Protection Act of 2006 (10/06)

The Pension Protection Act of 2006 is one of the most significant pieces of retirement plan legislation since the enactment of the Employee Retirement Income Security Act of 1974 ("ERISA") more than 30 years ago. The Act makes many changes to the rules governing retirement plans that will affect nearly every plan sponsor and participant. It is a clear message that Americans need to save more for their retirement and Employers now have more tools to help them.

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New Guidance For 2006 Health Savings Accounts (HSA) (11/05)

The Treasury Department has issued new guidance for 2006 on the maximum contribution levels for Health Savings Accounts (HSAs) as well as minimum deductibles and out-of-pocket spending limits for HSA Compatible High Deductible Health Plans. We would like to call your attention to the "New Minimum Deductible Amounts for 2006". For the first two years (2004 - 2005) of the Health Savings Account/HSA program, minimum deductible for High Deductible Health Plans/HDHPs was $1,000 for self-only coverage and $2,000 for family coverage. For 2006 the Treasury has now raised the HDHP deductible amounts for 2006: the minimum deductible for HDHPs increases to $1,050 for self-only coverage and $2,100 for family coverage.

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HIPAA: Final and Proposed Regulations and Special Enrollment Rights Expanded (10/05)

Employers and carriers will need to make changes to their health insurance plan materials and participant communications as of the start of their next plan year (January 1, 2006 for employers with calendar plan years), in order to comply with final regulations under HIPAA. These regulations pertain to rules about pre-existing condition exclusions, certificates of creditable coverage and special enrollment rights.

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125 Plans: A Second Look at Use It or Lose It Grace Period (10/05)

When the IRS announced a 2½ month grace period for participants to incur claims in a health care or dependent care FSA, the general assumption was that Plan Sponsors would implement it as a safeguard against forfeitures by Plan Participants who could not accumulate enough covered health care or dependent care expenses during the twelve month Plan Year to use all of their pre-tax contributions.

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