Spencer and Benefits NetNews – May 9, 2014

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Featured This Week

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  • Analysis: Interest Rates For Funding Calculations, 4/14 (101.2.-7)


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  • Survey: Monthly Retirement Plan Interest Rates, 4/14 (101.2.-1)


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May 9, 2014

Higher Health Care Costs For Employees And More Private Exchanges Are Expected Trends For Near Future

Employees can expect to continue to pay more for their health plans, and to face higher deductibles and copayments, according to a recent survey by Wells Fargo Insurance of more than 70 insurance companies. Employers also can expect to pay higher rates for their employees’ health care based on a finding in the survey that overall claim costs will continue to increase in the upper single digits in 2015….

(Read Intelliconnect) »

More Employers Adding Roth Features To Expand Savings Options: Aon Hewitt

More U.S. employers are adding Roth 401(k) features than ever before and participation is also on the rise, according to recent research from Aon Hewitt. The research finds that half of all companies now offer a Roth account, nearly five times the percentage that did so in 2007 (11 percent). In a separate report, Aon Hewitt analyzed more than 3.5 million eligible participants in over 125 defined contribution plans and found that employee participation in these Roth accounts is also steadily increasing. In 2013, 11 percent of workers saved to a Roth account when it was available in the plan, up from 8 percent in 2011….

(Read Intelliconnect) »

ERISA Suit Challenging Failure To Remove Proprietary Investment Funds Time-Barred

A breach of fiduciary duty suit brought later than six years after the initial selection of allegedly improper proprietary investment funds was time-barred, according to the Eleventh Circuit U.S. Court of Appeals, because no intervening events occurred that would qualify the fiduciaries’ failure to remedy the breach as a separate cognizable ERISA violation. The case is Fuller, et al. v. SunTrust Banks, Inc., et al

(Read Intelliconnect) »

May 8, 2014

Text: IRS, Final Regulations, Information Reporting for Affordable Insurance Exchanges

(Read Intelliconnect) »

Final Information Reporting Rules Issued For Insurance Purchased On Health Insurance Exchanges

The Internal Revenue Service has released final information reporting rules for insurance purchased on affordable insurance exchanges. The final regulations apply to health insurance exchanges that make qualified health plans available to individuals. The regulations are effective on May 7, 2014, and apply to tax years ending after Dec. 31, 2013. The final regulations adopt the proposed regulations with some modifications. The final rules were published in the May 7
Federal Register

(Read Intelliconnect) »

Most Traditional IRAs Created Through Rollover Contributions

Traditional individual retirement accounts (IRAs) continue to be opened predominantly with rollovers from employer-sponsored retirement plans, according to a study released by the Investment Company Institute. The study,
The IRA Investor Profile: Traditional IRA Investors’ Activity, 2007–2012, found that few Americans used the opportunity to contribute and save directly in IRAs in 2012…

(Read Intelliconnect) »

May 7, 2014

Text: EBSA, Proposed Rules, Health Care Continuation Coverage

(Read Intelliconnect) »

Clarification Of Coverage Options For COBRA-Eligible Workers Released By DOL

Proposed regulations containing amendments to COBRA’s notice requirements have been issued by the Department of Labor (DOL), along with updates to COBRA model notices, clarifying to workers that, if they are eligible for COBRA continuation upon leaving a job, they may, instead, purchase coverage via the health insurance marketplace. The proposed regulations better align COBRA’s notice requirements with requirements of the Patient Protection and Affordable Care Act’s (ACA) provisions already in effect. The proposed regulations were published in the May 7
Federal Register

(Read Intelliconnect) »

ACA-Related FAQs Address Limitations On Cost-Sharing, Summary Of Benefits And Coverage

The Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury (the Departments) have jointly issued another set of frequently asked questions (FAQs) about the implementation of the Patient Protection and Affordable Care Act (ACA). The FAQs address an array of topics, including limitations on cost-sharing, coverage of preventive services, health flexible spending account (FSA) carryover, the summary of benefits and coverage (SBC), and the continuing application of previously issued enforcement and transition relief guidance. The FAQs also address proposed amendments to COBRA’s notice requirements…

(Read Intelliconnect) »

May 6, 2014

Most Customers Will Not Flee If Businesses Add Fee To Pay For Employees’ Insurance

Although nearly two-thirds (68 percent) of Americans find it acceptable for a business to add a nominal surcharge to each bill in order to help pay for employees’ health insurance, overall, few Americans feel their health insurance situation has gotten better with the implementation of the Patient Protection and Affordable Care Act (ACA). That’s according to a recent Bankrate.com poll…

(Read Intelliconnect) »

Employer’s Proposed Changes In Funding Retiree Health Care Benefits Not What Parties Bargained For In CBA

An employer’s unilateral implementation of individual health reimbursement accounts (HRAs) in place of group health care plans breached the parties’ collective bargaining agreements, not because they were “unreasonable,” but because they were not what the parties bargained for, ruled the Sixth Circuit U.S. Court of Appeals in
United Steel, Paper, Forestry, Rubber, Manufacturing Energy, Allied Industrial and Service Workers International Union v. Kelsey Hayes Co. (No. 13-1717). As a result, the Sixth Circuit affirmed the district court’s judgment granting injunctive relief in favor of the retirees. Judge Merritt filed a separate concurring opinion. While agreeing with the majority opinion that the employer had promised vested lifetime health care benefits for its retirees, Judge Sutton dissented from what he regarded as an advisory opinion, finding that under other circumstances the HRAs would satisfy the employer’s health care funding obligations…

(Read Intelliconnect) »

May 5, 2014

Enrollment Achievement Does Little To Change ACA Opinion

Signing up 8 million people for health care coverage in a never before used process has done little to impress the American public, according to a new opinion tracking poll released by Kaiser Health. Overall favorability of the Patient Protection and Affordable Care Act (ACA) has basically remained the same and “exactly where it was in last month’s tracking poll, with 46 percent of the public saying they have an unfavorable view and 38 percent a favorable view.” Although this is a very slight improvement over polls taken from the earlier months of November through January, the numbers represent a more negative tilt to opinion than before the problematic launch of the health insurance exchanges last October…

(Read Intelliconnect) »

Exemption From ACA For Expatriate Health Plans Passed By House

The House of Representatives passed legislation on April 29 making expatriate health care plans exempt from the provisions of the Patient Protection and Affordable Care Act (ACA). Lawmakers approved the Expatriate Health Care Coverage Clarification Act of 2014 (H.R. 4414) by a vote of 268 to 150. The bill provides that employers, insurers, and expatriate health care plans would all be exempt from requirements of the ACA…

(Read Intelliconnect) »

More Women Are Saving For Retirement Than Men

Sixty percent of workers saved for retirement, at an average salary deferral rate of 7 percent, according to a recent study from ADP. Across most wage categories, women saved at a higher rate than men, and workers save more as they approach retirement. “The Retirement Savings Paradigm: Factors Influencing Saving study found that more women are saving for retirement than men,” said Ahu Yildirmaz, vice president and head of the ADP Research Institute. “Factors such as lower incomes and time spent out of the workforce still put women at greater risk of not achieving a secure retirement. But efforts by financial advisors and agencies to raise awareness among women of the importance of saving for retirement appear to have made an impact…”

(Read Intelliconnect) »