General News

1. Medicare Part D Notice Requirements

Medicare generally requires employers that offer prescription drug coverage to Medicare-eligible individuals to satisfy two notice requirements:

1. Prior to October 15 each year, the employer must provide Medicare-eligible individuals with a Medicare Part D Creditable or Non-Creditable Coverage Notice. These notices serve to notify the individuals whether the employer-offered prescription drug coverage is “creditable” under law. Coverage is generally “creditable” if it is expected to pay, on average, as much as the standard Medicare prescription drug coverage. Click here to download model notices pertaining to this requirement.  
2. Within 60 days of the beginning of each plan year (generally March 1 for calendar-year plans), the employer must complete an online disclosure to the Centers for Medicare and Medicaid Services (CMS) to report whether the coverage offered is “creditable.” Click here to complete an online disclosure.

Additional requirements may apply. Click here for more information on the Medicare Part D notice requirements.

2. Medicare Secondary Payer Requirement

When an individual is covered by both an employer-sponsored group health plan and Medicare, it can be confusing as to who should pay for the individual’s medical claims. In general, the employer-sponsored group health plan is the primary payer of these claims, while Medicare is the secondary payer. However, exceptions do apply, including for employers with less than 20 employees. For more information, please contact CMS at 1-800-MEDICARE or give us a call.  

3. Medicare Nondiscrimination Requirements

Medicare-eligible employees are generally protected against discrimination in group health insurance benefits in two ways:

1. Employers with 20 or more employees are required by law to offer workers and their spouses who are age 65 or older the same health benefits that are offered to younger employees.
2. Employers are generally prohibited from encouraging or offering incentives to individuals to enroll in Medicare instead of a group health plan. However, the Equal Employment Opportunity Commission (EEOC) has stated that offering Medicare-eligible employees a choice between either group health insurance coverage or the reimbursement of Medicare Part B premiums is generally lawful as long as the choice creates an advantageous option available only to the Medicare-eligible employees.

New Figure Marks Decrease from 2019

Under the employer shared responsibility (“pay or play”) provisions of the Affordable Care Act, applicable large employers—generally those who have 50 or more full-time employees (including full-time equivalent employees)—may be subject to a penalty if they do not offer affordable coverage that provides minimum value to their full-time employees and their dependents.
  
For plan years beginning in 2020, the Internal Revenue Service has announced that coverage will generally be considered affordable if the employee’s required contribution for the lowest-cost self-only health plan offered is 9.78% or less of his or her household income for the taxable year. For plan years beginning in 2019, the applicable percentage is 9.86%. 
 
Given that employers are unlikely to know an employee’s household income, they may use a number of safe harbors to determine affordability, including reliance on Form W-2 wages. 

U.S. Department of Labor (DOL) audits of welfare benefit plans are happening with greater frequency to every size company. Reasons for a DOL audit include:

• Complaints by welfare benefit plan participants to the Employee Benefits Security Administration (EBSA), the DOL agency responsible for administering and enforcing the provisions of Title I of the Employee Retirement Income Security Act of 1974 (ERISA).
• Inaccurate or late filings of the Form 5500 Annual Report
• National enforcement initiatives investigating compliance with ERISA and the Affordable Care Act (ACA)
• Transfer of cases from the IRS to the DOL
• Random selection

This section covers the following topics to help you prevent, and be prepared for, a DOL audit:

• How To Lower the Risk of a DOL Audit
• DOL Health Plan Audit Document Request Checklist
• Top Tips for Navigating Through a DOL Health Plan Audit

Wellness programs are generally health promotion and disease prevention programs and activities offered to employees as part of an employer-sponsored group health plan. There are three main types of wellness programs:   

• Participatory wellness programs, which are generally available without regard to an individual’s health status and do not offer any reward based on satisfying a health-related standard.
• Activity-only wellness programs, which require an individual to perform or complete a health-related activity to obtain a reward.
• Outcome-based wellness programs, which require an individual to attain or maintain a specific health outcome in order to obtain a reward.

Wellness programs are subject to certain federal requirements. General compliance information for these different types of wellness programs appears below.

Participatory Wellness Programs

Participatory wellness programs offered as part of a group health plan generally must:

1. Be made available to all “similarly situated individuals.” However, the following employees can be treated as different groups of similarly situated individuals: part-time and full-time employees, employees working in different geographic locations, and employees with different dates of hire or lengths of service.
2. Not bar individuals from participating based on a health factor, including disability.
3. In accordance with HIPAA, generally protect from disclosure any individually identifiable health information collected from or created about participants in the program. Click here for more information.
4. If sponsored by an employer with 15 or more employees, offer reasonable accommodations that allow employees with disabilities to participate.
5. If collecting employee health information and sponsored by an employer with 15 or more employees, distribute an ADA Notice Regarding Wellness Program to all individuals eligible to participate. Click here for a sample ADA Notice Regarding Wellness Program.
6. If sponsored by an employer with 15 or more employees, ensure that the employer does not receive any information about program participants except where necessary for plan administration.

Activity-Only Wellness Programs

Activity-only wellness programs offered as part of a group health plan generally must:

1. Not bar individuals from participating based on a health factor, including disability.
2. Allow participants to obtain a reward at least once per year, and generally limit such rewards to 30% of the cost of coverage under the health plan for the employee and his or her dependents.
3. Offer a reasonable alternative standard to individuals who, due to a medical condition, are unable to satisfy the standard necessary to obtain the reward.
4. In accordance with HIPAA, generally protect from disclosure any individually identifiable health information collected from or created about participants in the wellness program. Click here for more information.
5. If sponsored by an employer with 15 or more employees, offer reasonable accommodations that allow employees with disabilities to participate.
6. If collecting employee health information and sponsored by an employer with 15 or more employees, distribute an ADA Notice Regarding Wellness Program to all individuals eligible to participate. Click here for a sample ADA Notice Regarding Wellness Program.
7. If sponsored by an employer with 15 or more employees, ensure that the employer does not receive any information about program participants except where necessary for plan administration.

Outcome-Based Wellness Programs

Outcome-based wellness programs offered as part of a group health plan generally must:

1. Not bar individuals from participating based on a health factor, including disability.
2. Allow participants to obtain a reward at least once per year, and generally limit such rewards to 30% of the cost of coverage under the health plan for the employee and his or her dependents.
3. Offer a reasonable alternative standard to individuals who do not meet the program’s initial standard based on a measurement, test, or screening.
4. Distribute a Wellness Program Disclosure in all plan materials that describe the program. This notice must also be furnished to any individual that fails to satisfy an outcome-based standard necessary to obtain a reward. Click here to download a model Wellness Program Disclosure.
5. In accordance with HIPAA, generally protect from disclosure any individually identifiable health information collected from or created about participants in the wellness program. Click here for more information.
6. If collecting employee health information and sponsored by an employer with 15 or more employees, distribute an ADA Notice Regarding Wellness Program to all individuals eligible to participate. Click here for a sample ADA Notice Regarding Wellness Program.
7. If sponsored by an employer with 15 or more employees, offer reasonable accommodations that allow employees with disabilities to participate.
8. If sponsored by an employer with 15 or more employees, ensure that the employer does not receive any information about program participants except where necessary for plan administration.

Additional requirements and exceptions may apply to your wellness program. For more information, click here.

By RICARDO ALONSO-ZALDIVAR

WASHINGTON (AP) — America’s much-maligned health care system is covering 9 out of 10 people, a fact that hasn’t stopped the 2020 presidential candidates from refighting battles about how to provide coverage, from Bernie Sanders’ call for replacing private insurance with a government plan to President Donald Trump’s pledge to erase the Affordable Care Act and start over.

The politicians are depicting a system in meltdown. The numbers point to a different story, not as dire and more nuanced.

Government surveys show that about 90% of the population has coverage , largely preserving gains from President Barack Obama’s years. Independent experts estimate that more than one-half of the roughly 30 million uninsured people in the country are eligible for health insurance through existing programs.

Lack of coverage was a growing problem in 2010 when Democrats under Obama passed his health law. Now the bigger issue seems to be that many people with insurance are struggling to pay their deductibles and copays.

“We need to have a debate about coverage and cost, and we have seen less focus on cost than we have on coverage,” said Colorado Sen. Michael Bennet. He is among the Democratic presidential candidates who favor building on the current system, not replacing it entirely, as does Sanders. “The cost issue is a huge issue for the country and for families,” Bennet said.

A report this year by the Commonwealth Fund think tank in New York found fewer uninsured Americans than in 2010 but more who are “underinsured,” a term that describes policyholders exposed to high out-of-pocket costs, when compared with their individual incomes. The report estimated 44 million Americans were underinsured in 2018, compared with 29 million in 2010 when the law was passed. That’s about a 50% increase, with the greatest jump among people with employer coverage.

“When you have 90 percent of the American people covered and they are drowning in their health care bills, what they want to hear from politicians are plans that will address their health care costs, more than plans that will cover the remaining 10 percent,” said Drew Altman, president of the Kaiser Family Foundation, a nonpartisan research organization that tracks the health care system. “When Democrats talk about universal coverage more than health care costs, they are playing to the dreams of activists and progressives … much less to the actual concerns of the 90 percent who have coverage today.”

Sanders’ office responds that the Vermont senator’s “Medicare for All” plan would solve both the coverage and cost problems for individual Americans. Medical care would be provided with no deductibles or copays. No one would be uninsured or underinsured.

“The simple answer is that our health care system becomes more unmanageable for more and more Americans every year,” Sanders spokesman Keane Bhatt said in a statement. “This is not a system that needs a few tweaks. This is a system that needs a complete overhaul.”

But other countries that provide coverage for all and are held up by Sanders as models for the U.S. don’t offer benefits as generous as he’s proposing. If he is elected president, there’s no way of telling how his plan would emerge from Congress, or even whether something like it could pass.

Four other 2020 Democrats are co-sponsors of Sanders’ bill: Sens. Cory Booker of New Jersey, Kirsten Gillibrand of New York, Kamala Harris of California, and Elizabeth Warren of Massachusetts.

On the other side of the political spectrum, Trump is talking about big changes. His administration is seeking to have federal courts declare the entire Obama-era health care law unconstitutional, jeopardizing coverage for 20 million people, jettisoning protections for patients with preexisting conditions, and upending the rest of the 970-page statute, now nearly 10 years old.

The president says there’s nothing to worry about. Earlier this summer Trump told ABC News that he was working on a plan that would provide “phenomenal health care,” protect people with preexisting conditions, and would be “less expensive than ‘Obamacare’ by a lot.”

White House spokesman Judd Deere said in a statement that the Obama law was “sold and passed on a litany of broken promises” and now “Democrats are proposing even more radical government takeovers of our health care system.”

As president-elect, Trump promised a health plan but never offered one upon taking office. Instead he backed bills from congressional Republicans, including one he called “mean” during a private meeting.

Trump says he might come out with his new plan within months, but that passing it would hinge on his getting reelected and Republicans winning back the House in 2020 while keeping control of the Senate.

That’s a bit of political deja vu.

Republicans controlled Washington back in 2017 when Trump, then-Speaker Paul Ryan, R-Wis., and Senate Majority Leader Mitch McConnell, R-Ky., tried for months to repeal and replace the Obama law, only to fail. The repeal effort was widely seen as contributing to Republicans losing the House in 2018.

Since then, many GOP lawmakers have tried to avoid the issue altogether.

Economist Sara Collins of the Commonwealth Fund, who led the study about under insured Americans, says cost and coverage problems are intertwined. Citing the Democrats’ debate over Medicare for All, she says what’s missing from that discussion is that “one doesn’t have to go that far in order to improve the financial situation for millions of people — you can do that with much more targeted, incremental policies.”

Senate vote on retirement-savings measure not likely this month, so supporters ready push for fall

from: www.investmentnews.com

Jul 23, 2019 @ 2:18 pm

By Mark Schoeff Jr.

When congressional leaders and President Donald J. Trump reached a budget agreement Monday, they closed it off to additional measures, including a landmark retirement-savings bill that is stalled in the Senate.

Backers of the Setting Every Community Up for Retirement Enhancement Act were hoping to get it folded into the $2.7 trillion spending pact, which suspends the debt limit until July 2021, but came up short.

“It was not for lack of trying on our behalf,” said Chris Spence, senior director of federal government relations at TIAA.

The SECURE Act, which would bring about the biggest changes in retirement policy in a decade, would provide legal protections for employers to include annuities in retirement plans, make it easier for small businesses to band together to offer plans, and increase the age for required minimum distributions from 70½ to 72, among other provisions. It was approved 417-3 by the House.

Several senators, including Ted Cruz, R-Texas, and Patrick Toomey, R-Pa., are objecting to the bill for policy reasons unrelated to its retirement provisions. That’s preventing the bill from being passed quickly by unanimous consent. Spokespeople for Mr. Cruz and Mr. Toomey weren’t immediately available for comment.

Getting time for a full debate on the Senate floor looks unlikely before the chamber departs next week for its summer recess.

“We’re not going to see floor time before August,” Mr. Spence said. “We need to come together and regroup to figure out what can be done in September to move this forward.”

Paul Richman, chief government and political affairs officer at the Insured Retirement Institute, hopes that the SECURE Act will be included in appropriations legislation that must be approved this fall to avoid a government shutdown.

One of the points of the budget agreement says no policy changes can be included in government-agency spending bills unless they’re approved by House Speaker Nancy Pelosi, D-Calif., Senate Majority Leader Mitch McConnell, R-Ky., the minority-party leaders in each chamber and Mr. Trump.

“All have said they have no issues with the SECURE Act,” Mr. Richman said. “We continue to remain optimistic that the leadership of Congress and the president see the value of enacting this into law sooner rather than later.”

When the insurance lobby kicked off its campaign to get SECURE approved, they said doing so before August was critical. As the presidential election year gets closer, legislative activity on Capitol Hill is likely to slow.

But SECURE proponents are taking setbacks in stride.

“The bill is a very positive force,” Mr. Spence said. “It’s not a policy issue. We’re getting caught up in the politics of it. It’s got to be a matter of time before it breaks loose and gets over the finish line.”

In the meantime, the lobbying continues. On Tuesday, the American Retirement Association released research showing the retirement-savings gap on a state-by-state basis and asserted the SECURE Act would address the 28.3 million Americans who do not have access to a workplace retirement plan.

Pretty heavy reading but these multiple white papers from various record-keepers like Fidelity, Schwab and Vanguard on the value of Retirement Plan Consultant services are still really interesting. I appreciate the fact that these firms, which were traditionally known to try and work direct without advisors, have come around to the conclusion that the plan level input and participant engagement we add is a win-win for everyone. This specific Vanguard white paper tries to quantify the hypothetical future wealth creation plan participants in plans with advisors would receive vs. those without a retirement plan consultant like Arcwood. The Alpha is staggering at over 3.5% annualized. Which is hard to believe until you drill down into the article and look into the areas this increased retirement success come from. Which includes an advisors work on crucial areas like asset allocation policy, risk management frameworks, manager oversight, and most importantly plan design advocacy and implementation.

Click here to read the white paper in its entirety.