Benefits Update – March 2011

From the editors of CCH’s BENE and BAN products, here are hot topics from recent Employee Benefits Management Directions newsletters as well as recent explanatory updates in Employee Benefits Management. Also included are recent explanatory updates to the Benefits Answers Now product.

If you have any comments/suggestions concerning the information provided or the format used, we’d like to hear from you. Please contact me at Tulay.Turan@wolterskluwer.com.

 

Hot Topics in Employee Benefits Management:

Expert reviews health care reform law implementation, previews 2011 developments, Employee Benefits Management Directions newsletter, Issue No. 486, February 22, 2011 — In one more month – on March 23, 2011 – the Affordable Care Act will turn one year old. During that year, health reform kept many people busy. To review health reform’s journey over the past year and also to preview what’s ahead, CCH, a Wolters Kluwer business, spoke to Joanne Hustead, Senior Health Compliance Specialist at The Segal Company.

Health care reform law is unconstitutional, Florida district court rules, Employee Benefits Management Directions newsletter, Issue No. 486, February 22, 2011 – In issuing a declaratory judgment on January 31 that the entire Patient Protection and Affordable Care Act is unconstitutional, Judge Roger Vinson of the U.S. District Court for the Northern District of Florida may have, in effect, voided the implementation of the law in the 26 states that joined in the Florida case.

Mississippi throws out health reform challenge on jurisdictional grounds, Employee Benefits Management Directions newsletter, Issue No. 486, February 22, 2011 – A federal court in Mississippi has joined more than a dozen other districts in ruling that those seeking to overturn the Patient Protection and Affordable Care Act (ACA) do not have standing to file suit. In four other cases, judges have ruled on the merits of the challenges to the ACA.

States enacted numerous mandated health benefits in 2010, Employee Benefits Management Directions newsletter, Issue No. 485, February 8, 2011 – Notwithstanding states’ ambivalence or even hostility towards the federal health care reform mandates overall, states have long histories of mandating what kind of health insurance coverage must be provided if any coverage is offered within their state. This article contains brief summaries of the major statutory enactments during 2010.

 

What’s New in Employee Benefits Management:

2011 values for employer-provided vehicles – The IRS has released the maximum allowable value of certain employer-provided automobiles, including trucks and vans, that are first made available to employees for personal use during calendar year 2011. For the values, see ¶150,590 and ¶150,595.

2011 reporting calendar – The Plan Reporting Calendar has been updated to reflect 2011 due dates. For details, see ¶2710.

FMLA leave – An employee who accompanied her husband on a spiritual healing trip to the Philippines was not wrongfully terminated in violation of the FMLA, because her husband was not relying solely on religious methods for healing, according to the U.S. Court of Appeals for the Third Circuit (CA-3). The case, Tayag v. Lahey Clinic Hospital, Inc., is discussed at ¶68,056.

Long-term disability – The termination of an airline pilot’s long-term disability benefits was arbitrary and capricious, the U.S. Appellate Court for the Third Circuit (CA-3) has held, after weighing multiple factors that included inconsistent determinations by the plan administrator. The case, Miller v. American Airlines, Inc., is discussed at ¶30,060.

State laws on disability – State laws on disability benefits have been updated at ¶30,100.

 

What’s New in Benefits Answers Now (BAN):

DOL, HHS, Treasury release more FAQs on health reform. The Department of Labor’s Employee Benefit Security Administration (EBSA), the Department of Health and Human Services (HHS), and the Treasury Department (the Departments) have released the fifth set of frequently asked questions about the Patient Protection and Affordable Care Act (ACA). The FAQs also addressed issues related to the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act (MHPAEA).  To learn more about the requirements of the ACA and the MHPAEA as discussed in the FAQs, see the information at ¶20,051, ¶20,175, and ¶21,800.

SHRM finds organizations moving ahead to implement health care reform. While most organizations are not waiting for a repeal of health care reform, many are looking for further guidance on specific provisions of the law before making decisions on their benefits plans, a new poll by the Society for Human Resource Management (SHRM) found.  “A majority of organizations are not counting on repeal. They are seeking guidance and moving forward to make sure they comply with the law,” said Mark Schmit, SHRM’s director of research. “This is the smart approach because a health care plan design affects the entire organization.” Find out more about implementing the provisions of health care reform at ¶20,010.

Spiritual healing trip was not protected FMLA leave. An employee who accompanied her husband on a spiritual healing trip to the Philippines was not wrongfully terminated in violation of the FMLA, because her husband was not relying solely on religious methods for healing, according to the U.S. Court of Appeals for the First Circuit (CA-1). The court also held that she had submitted inadequate certification for intermittent FMLA leave.  Specifically, the appellate court found that granting FMLA leave to the employee would be duplicative, since she had already received leave for her husband’s conventional medical care.  More information about what obligations employees have under the FMLA can be found at ¶31,070.

Exemption in health reform may encourage some to self-insure. The Patient Protection and Affordable Care Act (ACA) adds new requirements that apply to all insurance plans, including self-insured plans and group or individual health plans offered by insurance companies. However, self-insured employer plans are explicitly exempted from some requirements of the ACA. According to the National Health Policy Forum (NHPF), in the paper, Self-Insurance and the Potential Effects of Health Reform on the Small-Group Market, while these self-insured exemptions provide the opportunity to preserve health insurance coverage for millions of workers, self-insuring may become a better value than fully insured plans for small firms with an adequate size and risk profile. The NHPF noted that because of the potential for adverse selection in the small-group market if small employers with healthier populations opt to self-insure, some have advocated that the Departments of Labor and Treasury define “self-insured status to clarify that only employers who are capable of bearing, and do in fact, bear, the substantial risk of the cost of health care for their group may qualify as self-insured.” To learn more about what it means to be self-insured, see ¶20,220.

Study reveals growth in use of HRAs and HRAs. The number of health savings accounts (HSAs) and health reimbursement arrangements (HRAs) increased to 5.7 million in 2010, according to a new report by the nonpartisan Employee Benefit Research Institute (EBRI). Assets in these account-based health plans increased to $7.7 billion in 2010. HSAs and HRAs can be used to reimburse participants for qualified medical expenses. They are offered by some employers in order to give their workers more control over funds allocated for health care services. The number of HSAs and HRAs grew to 5.7 million in 2010, up from 1.2 million in 2006. Assets in these accounts increased from $835.4 million in 2006.  Find out more about these types of arrangements at ¶23,600 and ¶23,700.