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February 2014

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 Tulay.Turan@wolterskluwer.com.

Hot Topics in Employee Benefits Management:

Proposed regulations amend the definition of limited excepted benefits for Affordable Care Act compliance purposes, Employee Benefits Management Directions, Issue No. 555, January 14, 2014 — The Departments of Labor, Health and Human Services (HHS) and the Treasury (Departments) have jointly issued proposed regulations that would amend the definition of limited excepted benefits, which are generally exempt from the Patient Protection and Affordable Care Act’s (ACA) (P.L. 111-148) market reform requirements. The rules would be effective for plan years starting in 2015.

IRS issues guidance on post-Windsor benefits issues, Employee Benefits Management Directions, Issue No. 555, January 14, 2014 — The IRS has updated its online frequently asked questions (FAQs) on the impact on employee benefits of the Supreme Court’s decision in Windsor. In that case, the Supreme Court struck down Section 3 of the Defense of Marriage Act of 1993 (DOMA).The IRS also has issued Notice 2014-1, which addresses the participation by same-sex spouses in certain employee benefit plans.

IRS, HHS, DOL issue guidance on risk-reducing medications, cost-sharing, MHPAEA, and reward programs, Employee Benefits Management Directions, Issue No. 556, January 28, 2014 — The Health and Human Services Department (HHS), Labor Department (DOL), and the IRS have issued a new set of Frequently Asked Questions (FAQs) on the implementation of an assortment of provisions of the Patient Protection and Affordable Care Act (ACA), including the ACA’s effect on provisions of the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA).

IRS regulations allowing premium tax credit for federal exchanges purchases did not violate ACA, court rules, Employee Benefits Management Directions, Issue No. 556, January 28, 2014 —The Patient Protection and Affordable Care Act (ACA) clearly supports an IRS regulation allowing the agency to issue premium tax credits to individuals enrolled through both federal and state Exchanges, the District Court for the District of Columbia has ruled.

What's New in Employee Benefits Management:

Post-Windsor guidance — The IRS has issued guidance on the application of the rules under Code Sec. 125 relating to cafeteria plans, including health and dependent care flexible spending arrangements (FSAs), and Code Sec. 223 relating to health savings accounts (HSAs), to the participation by same-sex spouses in certain employee benefit plans. For details, see ¶38,030, ¶38,035, and ¶39,067.

Supreme Court decision on ERISA lawsuits — The Supreme Court’s decision in Heimeshoff v Hartford Life & Accident Insurance Co. is discussed at ¶73,330.

Excepted benefits — The Departments of Labor, Health and Human Services (HHS) and the Treasury (Departments) have jointly issued proposed regulations that would amend the definition of limited excepted benefits, which are generally exempt from the Patient Protection and Affordable Care Act’s market reform requirements. For more information, see ¶10,320 and ¶10,550.

Same-sex marriage — The discussion on health care coverage of domestic partners and same-sex spouses has been updated at ¶10,110.

ACA’s reinsurance fee — Proposed regulations would exempt certain self-insured plans from the Affordable Care Act’s reinsurance fee in 2015 and 2016. For more information, see ¶10,505.

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

Proposed regulations amend the definition of limited excepted benefits for Affordable Care Act compliance purposes. The Departments of Labor, Health and Human Services (HHS) and the Treasury (Departments) have jointly issued proposed regulations that would amend the definition of limited excepted benefits, which are generally exempt from the Patient Protection and Affordable Care Act’s (ACA) market reform requirements. The rules would be effective for plan years starting in 2015. See the discussions at ¶20,061 and ¶21,970 for more information about excepted benefits.

IRS issues guidance on post-Windsor benefits issues. The IRS has issued Notice 2014-1, on the application of the rules under Sec. 125 relating to cafeteria plans, including health and dependent care flexible spending arrangements (FSAs), and Code Sec. 223 relating to health savings accounts (HSAs), to address the participation by same-sex spouses in certain employee benefit plans. This is in response to the Supreme Court’s decision in Windsor, which struck down Section 3 of the Defense of Marriage Act (DOMA). More information about the impact of Windsor on Sec. 125 cafeteria plans can be found at ¶70,490.

IRS clarifies rules applicable to in-plan rollovers to designated Roth accounts. The IRS has issued guidance clarifying the rules governing in-plan rollovers to designated Roth accounts in 401(k), 403(b), and governmental 457(b) plans (i.e., in-plan rollovers). To find out more about in-plan rollovers, see ¶10,690.

Budget deal includes PBGC premium increase. President Obama on December 26, 2013 signed into law H.J. Res. 59, a two-year budget agreement that contains a provision to increase the PBGC flat-rate and variable-rate premiums. Under the budget bill, the PBGC flat-rate premium would increase to $57 for plan year 2015 and to $64 for plan year 2016. The flat-rate premiums would then be indexed to the growth in wages thereafter. Find out more about the PBGC premium increase at ¶14,370 and ¶14,560.

HSA enrollments grow, health reimbursement arrangements shrink. The growth in consumer-driven health plans (CDHPs) continues, and now cover 28 percent of those with health insurance, according to recent research from the Employee Benefit Research Institute (EBRI). However, one kind of consumer-driven health plan—employer-funded health reimbursement arrangements (HRAs)—declined while enrollment grew in health savings accounts (HSAs) and high-deductible health plans (HDHPs), which can include both employer and employee contributions, EBRI found. An overview of the CDHPs, HSAs, and HRAs can be found at ¶21,100, ¶23,600, and ¶23,700.

What's New in Spencer’s Benefits Reports:

Mental Health Parity Act. Recent laws specify that all employer-sponsored group health plans that provide mental health benefits are required to provide benefits that are equivalent to medical benefits. This report outlines the provisions of the mental health parity laws (Reports 325.32.-1 and 325.32.-7).

Adoption Assistance. The IRC provides for two adoption-related tax benefits under Sec. 137 and Sec. 23. This report summarizes the provisions of those two sections and provides the updated amounts allowable for 2014 (Report 327.2.-5).

401(k) Plans. The final 401(k) regulations contain general rules that define elective contributions and participation election rules, among others. This report examines the final regulations (Report 221.-1).

Social Security Benefits. This report describes how the basic Social Security benefit is calculated at normal retirement age as well as earlier retirement ages, and provides the COLA adjustments for 2014 (Report 410.1.-1).

Retiree Health Plans. This report discusses design elements of retiree health plans, the rules regarding funding, and the effects of the ACA on retiree health plans (Report 328.-1).

New Pension/Benefits Titles Added:

December
401(k) Advisor, December 2013 issue
Employee Benefit Plan Review, December 2013 issue
Executive Compensation Answer Book, 2014 Cumulative Supp to the 8th Edition
Flexible Benefits Answer Book, 2014 Cumulative Supplement to the 6th Edition
Mandated Benefits 2014 Compliance Guide
Nonqualified Deferred Compensation Answer Book, 8th Edition
The 2014 Pension Answer Book
Pension Benefits, December 2013 issue
State by State Guide to Human Resources Law, 2014 Edition
Value of Pensions in Divorce, 5th Edition

January
401(k) Advisor, January 2014 issue
Employee Benefit Plan Review, January 2014 issue
Pension Benefits, January 2014 issue