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Monthly Benefits Alert - February 2015

On January 29, 2015, Anthem Inc., one of the largest managed health care companies in the country, disclosed that the sensitive personal data of almost 80 million current and former participants in its network was breached in a cyber attack. This breach also impacted health plan participant data of plans that use the Blue Cross Blue Shield network of health providers. In some states, Anthem administers certain aspects of Blue Cross’s network. Those states include California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, New York, Ohio, Virginia, and Wisconsin. Accordingly, health plans that have participants who received care in those states through the Blue Cross network are likely to be impacted.

King v. Burwell: What to Expect From the Supreme Court Argument

On Wednesday, March 4, 2015, the Supreme Court of the United States will hear argument in King v. Burwell, a case involving premium tax credits under the Affordable Care Act (ACA). Among its many provisions, the ACA includes one that authorizes a refundable federal income tax credit to assist low-income taxpayers to pay for health coverage obtained through a health insurance marketplace (referred to as an “Exchange”) established by a state under ACA § 1311. The only issue before the Court in King is the validity of a Treasury regulation implementing the premium tax credit provision of the ACA.

What’s Next for the Affordable Care Act...Information Reporting

Employers with a calendar year health plan who have completed open enrollment and tackled many of the significant compliance hurdles toward Affordable Care Act (ACA) compliance may feel they are entitled to a breather. But there is no rest for the weary. Many more challenges lie ahead. In 2016, “applicable large employers” (ALE) (determined without regard to any special transition rules) will need to satisfy the ACA’s information reporting requirements for 2015 (using IRS Forms 1094 and 1095), which must be filed and furnished early in 2016. Employers must take steps now in order to be prepared.

White House and DOL Begin Revised Fiduciary Rule Marketing Campaign

On Monday, the White House and the Department of Labor publicized efforts to target conflicts of interest in managing employee retirement funds. In essence, the Administration is promoting the DOL's much–beleaguered proposal to more broadly define who constitutes a “fiduciary” for the purposes of rendering investment advice under the Employee Retirement Income Security Act (ERISA). According to a White House fact sheet, the DOL will issue its proposed fiduciary rule in the coming months. Notably, the agency withdrew its initial fiduciary rule in 2011 after the proposal faced significant opposition from the employer community.

White House and DOL Begin Revised Fiduciary Rule Marketing Campaign

On Monday, the White House and the Department of Labor publicized efforts to target conflicts of interest in managing employee retirement funds. In essence, the Administration is promoting the DOL's much–beleaguered proposal to more broadly define who constitutes a “fiduciary” for the purposes of rendering investment advice under the Employee Retirement Income Security Act (ERISA). According to a White House fact sheet, the DOL will issue its proposed fiduciary rule in the coming months. Notably, the agency withdrew its initial fiduciary rule in 2011 after the proposal faced significant opposition from the employer community.

Monthly Benefits Update - January 2015

The U.S. Supreme Court ruled in M&G Polymers USA, LLC v. Tackett, 574 U.S. ____ (2015) that ordinary principles of contract law should govern the interpretation of provisions for retiree healthcare benefits under collective bargaining agreements. In so holding, the Supreme Court rejected the “Yard-Man presumption,” pursuant to which the U.S. Court of Appeals for the Sixth Circuit has long presumed that retiree healthcare benefits provided under a collective bargaining agreement vest for life absent specific language to the contrary in the collective bargaining agreement. The Supreme Court remanded the case at hand to the Sixth Circuit to (1) in the first instance, review the agreement and determine whether the parties intended the retiree healthcare benefits to vest and (2) if a determination is made that the agreement itself is ambiguous, review extrinsic evidence to determine the intent of the parties. Our prior alert, which discusses the significant implications of the case for employers, is available here.

Not All Health Savings Plans Are Created Equal

Health Savings Accounts (HSAs) have gained in popularity since the implementation of the Affordable Care Act, but many employers are unclear about how they differ from more traditional Flexible Spending Accounts (FSAs). An employee can’t have both. Here’s why an HSA may make sense for your employees.

House Votes to Repeal the Affordable Care Act

In a message vote, the Republican-led House of Representatives elected to repeal the Affordable Care Act in its entirety. The move is considered symbolic, as the Senate lacks the 60 votes needed to avoid an almost certain filibuster, and the President has vowed to veto any repeal measure. The final vote on H.R. 596 was 239 to 186 along party lines.

Eligibility Rules Need To Be In Writing

Healthcare reform continues to roll on. 2014 saw the implementation of the health insurance exchanges, the Individual Mandate, and a host of new rules relating to employer-provided health coverage. 2015 marks the start of yet another major component of the Affordable Care Act (ACA): the Employer Mandate.

Congress Clarifies the Expatriate Health Coverage Exemption

For expatriate health plans issued or renewed on or after July 1, 2015, the Expatriate Health Coverage Clarification Act of 2014 (EHCCA) provides an exemption from various Affordable Care Act (ACA) provisions. Last December, Congress enacted the EHCCA as Division M of the Consolidated and Further Continuing Appropriations Act, 2015. Section 3(a) of the EHCCA clarifies that the ACA and certain titles of the Health Care and Education Reconciliation Act of 2010 do not apply to (1) expatriate health plans, (2) employers that sponsor those plans, and (3) expatriate health insurance issuers (with respect to the expatriate coverage). Notably, the EHCCA does not provide an exemption from the coverage reporting requirements in Internal Revenue Code (IRC) sections 6055 and 6056, and does not exempt sponsors from the excise tax on high cost employer-sponsored coverage in IRC section 4980I.