Benefits Selling magazine, published by Summit Business Media, announced on May 10^th  that Brandon Scarborough has been named the 2012 Broker of the Year at the 8th Annual Benefits Selling Expo in San Antonio, Texas. Benefits Selling’s Broker of the Year is one of the industry’s most prestigious awards and identifies brokers and consultants who have influenced the benefits industry in a positive way.

Brandon Scarborough, co-founder of Power Group worksite division and PowerEnroll at Power Group in Overland Park, Kansas, originally founded Benefit Design Group, because it allowed him to focus strictly on providing voluntary benefits to low-wage workers employed by nursing homes. Scarborough merged with Power Group in 2007 when the company wanted him to run a new worksite division. For Scarborough, the appeal of the benefits industry centers on the opportunity to help a wide range of clients. Whether your group is small or large, Scarborough can help you find a plan that fits best for your company’s unique needs.

Please join us in congratulating Brandon Scarborough for being Benefits Selling’s 2012 Broker of the Year.

SAN ANTONIO, Texas, May 10, 2012 /PRNewswire/ – Benefits Selling magazine, published by Summit Business Media, announced today that Brandon Scarborough has been named the 2012 Broker of the Year at the 8th Annual Benefits Selling Expo in San Antonio, Texas. Benefits Selling’s Broker of the Year is one of the industry’s most prestigious awards and identifies brokers and consultants who have influenced the benefits industry in a positive way.

Brandon Scarborough, co-founder of Power Group worksite division and PowerEnroll at Power Group Cos. in Overland Park, Kansas, founded Benefit Design Group, because it allowed him to focus strictly on providing voluntary benefits to low-wage workers employed by nursing homes. Scarborough continued his business until he merged with Power Group Cos. in 2007 when the company wanted him to run a new worksite division. For Scarborough, the appeal of the benefits industry centers on the opportunity to help a wide range of clients. Whether a group is small or large, Scarborough can help that client find a plan that fits best for its unique needs.Read more.  See the VIDEO!

Compliance Exceptions Allowed for Health Benefit Summaries
Issued May 11
Three federal agencies said in guidance issued May 11 that they will not take enforcement action against group health plans and insurance issuers in a number of circumstances for failure to fully comply with requirements for providing a standardized summary of benefits and coverage during the first year of applicability of new rules under the Patient Protection and Affordable Care Act. For example, instead of requiring combined benefit information with respect to a plan that uses two or more issuers to provide various types of coverage, the agencies will allow “multiple partial SBCs that, together, provide all of the relevant information.” The agencies also posted updated versions of an SBC template and a sample completed SBC.

Obesity Increases Worker’s Compensation Costs
Gaining too much weight can be as bad for an employer’s bottom line as it is for a person’s waistline
 
A Duke University Medical Center analysis found that obese workers filed twice the number of workers’ compensation claims, had seven times higher medical costs from those claims and lost 13 times more days of work from work injury or work illness than did non-obese workers.

Workers with higher risk jobs were found to be more likely to file workers’ compensation claims, and obese workers in high-risk jobs incurred the highest costs, both economically and medically.

Although workers’ compensation plans vary from state to state, they all require that employers carry insurance policies to cover their employees should they be injured on the job. The plans can pay for employee medical costs, compensation for loss of current or future wages, or compensation for pain and suffering.

“We all know obesity is bad for the individual, but it isn’t solely a personal medical problem — it spills over into the workplace and has concrete economic costs,” said Truls Ostbye, MD, PhD., professor of community and family medicine. Read More. Read More.
Fees to Fund Patient-Centered Outcomes Research Institute
Insurance Standards Bulletin
Effective for group health plan years ending after Sept. 30, 2012, and before Oct. 1, 2019 (the seven calendar plan years from 2012 through 2018), employers that have self-insured plans and health insurance issuers that offer insured plans and policies must pay annual fees to fund the Patient-Centered Outcomes Research Institute, a nonprofit corporation established by PPACA. The Institute compares and evaluates the clinical effectiveness of medical procedures, services, and treatments to help individuals and health care providers make informed health care decisions.

Fees must be paid by employers that sponsor self-insured plans and issuers of insured group health plans, such as commercial insurance companies. Fees do not apply to excepted benefit plans, such as vision-only, dental-only, disability income, long-term care, nursing home care, and other limited scope benefit plans.

Employers and issues calculate PCORI fees by multiplying the average number of lives covered under plans by the applicable dollar amount which is:

• $1 for plan years ending on or after Oct. 1, 2012, and before Oct. 1, 2013; and
• $2 for plan years ending on or after Oct. 1, 2013, and before Oct. 1, 2014.  Read More.

It’s a mod, mod, mod, mod world:
Split plan creates chance to reduce premiums
Assessing experience ratings is about to change in most states. Contrary to what many employers believe, they can control their premiums by controlling their experience modifications, according to a veteran experience rating analyst. The experience modification factor, or ex-mod, represents a company’s payroll and losses and is used in most states to determine workers’ comp premiums. A higher mod results in higher premiums. Companies that understand how their ex-mods are calculated stand a better chance of lowering their workers’ comp premiums, especially with the upcoming changes to the so-called split plan.Read More.

IRS Issues Proposed Regulations on Research Fees
The Affordable Care Act
The Affordable Care Act (ACA) created the Patient-Centered Outcomes Research Institute (Institute) to help patients, clinicians, payers and the public make informed health decisions by advancing comparative effectiveness research. The Institute’s research is to be funded, in part, by fees paid by health insurance issuers and sponsors of self-insured health plans.

On April 17, 2012, the Internal Revenue Service (IRS) issued proposed regulations on the research fees. The proposed regulations address many important details regarding which health insurance issuers and plan sponsors are subject to the fees and how the fees are calculated and paid. Comments on the proposed regulations are due by July 16, 2012.

Although the proposed regulations are not final, issuers and plan sponsors may rely on the guidance provided in the proposed regulations pending the IRS’s issuance of final regulations. If future IRS guidance on the research fees is more restrictive than the proposed regulations, the future guidance will not be applied retroactively.

This Power Group Companies Legislative Brief provides an overview of the research fees to be paid by health insurance issuers and sponsors of self-insured plans under ACA, including the guidance provided in the proposed regulations.Read More.

The Workers Compensation Audit:
How Employers Should Prepare
The annual premium audit determines your company’s actual Workers’ Compensation insurance premium for the policy period, as opposed to the estimated premium originally used on the policy. Sometimes there can be dramatic changes in premium based on audit results, and not at all of these changes are welcomed by insured employers. Often these unwelcome changes are not truly correct and legitimate, per the rules that govern Workers’ Compensation insurance. (AKA Workman’s Comp.) Read More.

STATE COMPLIANCE ALERTS:
ARIZONA
New-Hire Procedures—Effective on the 91st day after adjournment of the Arizona State Fiftieth Legislature’s second regular session, the new-hire reporting requirements are revised to comply with new federal requirements that add a new data element for new-hire reports for the date on which new hires first perform paid services.
CALIFORNIA
Meal and Rest Breaks—On April 12, the California Supreme Court ruled that employers must relieve nonexempt employees of all duties during legally required meal breaks, but employers are not required to ensure that such employees do not perform any work during that time (Brinker Rest. Corp. v. Superior Court, Calif., No. S166350, 4/12/12).
DISTRICT OF COLUMBIA
Equal Employment Opportunity—Under provisions that are expected to be effective May 23, 2012, employers cannot fail or refuse to consider for employment or fail or refuse to hire applicants who are unemployed. Employers also cannot publish job vacancy advertisements or announcements that include provisions that disqualify unemployed persons from consideration for such jobs.
EEO Enforcement—Under provisions that are expected to be effective May 23, 2012, the retaliation prohibition, administration/enforcement, and penalties/remedies provisions are revised regarding the employment status discrimination prohibitions.
DELAWARE
Health Benefit Mandates—Effective for insured group health plans issued, renewed, or amended on or after Jan. 1, 2013, plans that provide coverage for prescription drugs and anti-cancer medications must provide coverage for orally administered prescription anti-cancer medications and comply with certain cost-sharing requirements.
GEORGIA
Unemployment Insurance—Effective Jan. 1, 2013, the taxable wage base is $9,500.
MAINE
Unemployment Insurance—Effective July 17, 2012, former employees who are disqualified for a third falsification or misrepresentation to obtain benefits can be penalized 100 percent of the benefits wrongfully obtained.
MARYLAND
Deductions From Wages—Effective June 1, 2012, employers that have a wage deduction program for collecting employees’ voluntary contributions to campaign finance entities must include employees’ addresses when transmitting contributions.
Personal Information Protection—Effective Oct. 1, 2012, employers cannot ask or require employees and applicants to disclose usernames, passwords, or other means for accessing personal accounts or services through electronic communications devices. Employers also cannot retaliate against employees and applicants for refusing to comply with such requests or requirements.
Unemployment Insurance—Effective Oct. 1, 2012, former employees who leave employment to prevent themselves, their spouses, minor children, or parents from becoming domestic violence victims are not disqualified from receiving benefits.
Workers’ Compensation—Effective July 1, 2012, certain amounts payable under settlement agreements are exempt from second-injury assessments.
MINNESOTA
Unemployment Insurance—Effective July 1, 2013, employers’ accounts are charged for overpaid benefits and such benefits can apply to future tax rates if employers or their agents do not timely or adequately respond to requests for benefit claim information from the Minnesota Department of Employment and Economic Development.
MISSISSIPPI
Unemployment Insurance—Effective July 1, 2012, certain direct sellers are exempt from coverage under Mississippi’s unemployment insurance law.
NEW YORK
Health Benefit Exchange—Effective April 12, 2012, eligible individuals can enroll in health insurance coverage and certain small employers can claim tax credits through the New York Health Benefit Exchange when the exchange becomes operational.
Income Tax Withholding—Effective July 1, 2012, to Sept. 30, 2012, the late payment interest rate is 7.5 percent.
OKLAHOMA
Health Care Continuation Coverage—Effective Nov. 1, 2012, employers that are covered by Oklahoma’s health care continuation coverage law must permit employees, their spouses, and employees’ dependents to elect to continue group policy coverage when coverage terminates for any reason except employees’ employment termination for gross misconduct or termination of group policies. In addition, continuation coverage notification and election requirements are revised.
RHODE ISLAND
New-Hire Procedures—Effective April 13, 2012, the new-hire reporting requirements are revised to comply with new federal requirements that define “newly hired employees.”
TENNESSEE
Military Leave—Effective April 23, 2012, the military leave provisions are revised.
UTAH
New-Hire Procedures—Effective July 1, 2012, the new-hire reporting requirements are revised to comply with new federal requirements that define new hires, including rehires, and add a new data element for new-hire reports for the date on which new hires first perform paid services. In addition, the filing deadline requirements are revised.
WEST VIRGINIA
Wireless Communications Devices Use—Effective June 8, 2012, drivers, including employees of private-sector employers who drive as part of their job duties, cannot use hand-held wireless communications devices while driving on public streets or highways in West Virginia.
WISCONSIN
Unemployment Insurance—Effective April 22, 2012, certain provisions relating to claimant disqualification for unemployment insurance benefits are revised.

IN CASE YOU MISSED IT:
State Compliance Alerts from April: Read more about the Department of Labor Model CHIP Notice. EEOC Issues Final Regulation Under Federal Age Discrimination Law  Read more.

Abortion is defined as “the use or prescription of any instrument, medicine, drug or any other substance or device to terminate the pregnancy of a woman known to be pregnant with an intention other than to increase the probability of a live birth, to preserve the life or health of the child after live birth, or to remove a dead unborn child who died as the result of natural causes in utero, accidental trauma or a criminal assault on the pregnant woman or her unborn child and which causes the premature termination of the pregnancy.” Elective abortion is defined as “an abortion for any reason other than to prevent the death of the mother upon whom the abortion is performed; provided, that an abortion may not be deemed one to prevent the death of the mother based on a claim or diagnosis that she will engage in conduct which will result in her death.”

UHC Changes for Fully Insured 100+ and Public Sector Customers

To comply with the Kansas law (HB 2075) and to uniformly administer UnitedHealthcare’s fully insured medical employee benefit plans in Kansas, UnitedHealthcare will be removing coverage for elective abortions according to state law for all customers effective Feb. 1, 2012. Please note that this change applies to large 100+ employee groups (commercial as well as public sector).

To inform customers, a letter will be mailed to affected groups on Jan. 31, 2012.

UHC Changes in Legal Standard for Kansas Small Business Customers

To comply with the Kansas law (HB 2075) and to uniformly administer UnitedHealthcare’s fully insured medical employee benefit plans in Kansas, we will be removing coverage for elective abortions according to state law for all customers effective Feb. 1, 2012.

To inform customers, a letter will be mailed to affected small business groups on
Jan. 31, 2012.

For more information, please contact your UnitedHealthcare representative.

Churches, other houses of worship and similar organizations are exempt from covering contraception on the basis of their religious objections. However, this exemption does not cover other church-affiliated institutions, such as schools, charities, hospitals and universities.

On Feb. 10, 2012, President Obama announced a proposal to address objections of non-exempt religious organizations. Under this proposal, the organization may choose whether or not to cover contraceptives. The insurance company providing coverage would be required to cover contraception if the religious organization chooses not to.

Background

The health care reform law requires non-grandfathered health plans to cover preventive health services without imposing cost-sharing requirements, effective for plan years beginning on or after Sept. 23, 2010. In August 2011, the Department of Health and Human Services (HHS) issued additional preventive care guidelines for women, including contraceptives, effective for plan years beginning on or after Aug. 1, 2012.

On Aug. 3, 2011, HHS issued an amendment to the women’s preventive care guidelines to allow certain non-profit religious employers offering health coverage to decide whether or not to cover contraceptive services, consistent with their beliefs. A non-profit religious employer, for this purpose, is an employer that has the inculcation of religious values as its purpose, primarily employs persons who share its religious beliefs and primarily serves persons who share its religious beliefs. This exemption covers churches and similar organizations.

On Jan. 20, 2012, HHS announced a one-year delay to the contraceptive coverage requirement for non-profit employers that do not qualify for the exemption and do not provide contraceptive coverage to employees based on religious beliefs. Church and religious leaders objected, arguing that the coverage requirement violates their organizations’ religious freedoms and that the delay is not an adequate solution. According to the White House, the President’s proposal is an attempt to balance religious liberty with the health of women.

WHITE HOUSE PROPOSAL

There will continue to be a one-year transition period for non-exempt religious organizations. During the transition period, a new regulation will be drafted. Under the new regulation, religious organizations, such as schools, charities, hospitals and universities, will not have to provide contraceptive coverage, refer their employees to organizations that provide contraception or subsidize the cost of contraception.

However, under the new regulation, female employees of these entities will receive free preventive care that includes contraceptive services. Specifically, contraception coverage will be offered to women by their employers’ insurance companies directly, free of charge, with no role for religious employers that oppose contraception.

Additional details of the policy will need to be finalized, such as how it applies to self-funded health plans. Also, the new policy does not affect existing state insurance requirements concerning contraception coverage.

Employers who sponsor group health plans that cover any prescription drugs generally must disclose whether the plan provides creditable or noncreditable prescription drug coverage to CMS within 60 days of the start of a new plan year. Because 2012 is a leap year, the deadline for calendar year plans is February 29.

Filing is done electronically using the CMS web site. Instructions also are available there.

This filing requirement applies to health plans that cover anyone who is eligible for the Medicare Part D prescription drug program, whether as an active employee, spouse, dependent or retiree. There are limited exemptions for plans that contract with a Medicare Part D plan or directly with Medicare to become a Part D plan. No disclosures are required for health flexible spending accounts (FSAs) or health savings accounts (HSAs); but disclosures are required for Health Reimbursement Arrangements (HRAs) if the HRA reimburses prescription drug expenses.

Note that this disclosure is in addition to the Notice of Creditable (or Noncreditable) Coverage that you provide annually to Medicare-eligible participants. Remember also that if, after filing this disclosure, you terminate prescription drug coverage or change from creditable to noncreditable coverage (or vice versa), you must file a new electronic disclosure within 30 days (and also provide an updated notice to participants in your plan).

If you have any questions about the creditable coverage disclosure to CMS or about Medicare Part D generally, please contact your Power Group representative.

The Internal Revenue Service has released updated guidance for employers on W-2 reporting of aggregate coverage costs under group health plans, which will soon be required by the Patient Protection and Affordable Care Act. Issued in Q&A format, Notice 2012-9 makes changes to earlier guidance and provides additional information on issues such as the cost of coverage under employee assistance programs and health reimbursement arrangements. The guidance generally is applicable beginning with Forms W-2 for calendar year 2012—that is, the forms that employers must give employees by the end of January 2013, IRS noted. (More.)

New 2013 FSA Limit Requires Plan Amendments in 2012

Health care reform legislation imposed a new, $2,500 limit on annual contributions to health care flexible spending accounts (FSAs). This limit applies to all FSA plans in taxable years beginning after Dec. 31, 2012 — even plans grandfathered under other provisions of health care reform. (More.)

FMLA Forms: Expiration Date Saga

The US Department of Labor (DOL) has submitted the Family and Medical Leave Act (FMLA) forms for renewal by the Office of Management and Budget (OMB). The most recent versions originally expired on December 31, 2011. On Saturday January 14, the DOL quietly changed the expiration date on the FMLA forms to January 31, 2012; however, this appears to be the only change at this time. As always, employers should use the most recent versions of the forms; however, be reminded that the DOL forms that expire on January 31 do not address the Genetic Information Nondiscrimination Act (GINA) safe harbor notice employers can provide when seeking medical information from employees or employees’ medical providers.

According to law [5 CFR 1320.10(e)(2)], employers may continue to use the form while its renewal is pending at OMB.

Affordable Care Act holding insurers accountable for premium hikes

Health insurance premium increases in five states have been deemed “unreasonable” by the U.S. Department of Health and Human Services, HHS Secretary Kathleen Sebelius announced today. After independent expert review, HHS determined that Trustmark Life Insurance Company has proposed unreasonable health insurance premium increases in Alabama, Arizona, Pennsylvania, Virginia, and Wyoming. The excessive rate hikes would affect nearly 10,000 residents across these states. (More.)

New Report: States Moving Forward to Implement Health Reform’s Affordable Insurance Exchanges

Twenty-eight states are on their way toward establishing a key component of health care reform — Affordable Insurance Exchanges — according to a report issued today by the White House. Affordable Insurance Exchanges are state-based, one-stop marketplaces where consumers can choose a private qualified health insurance plan that fits their health needs. The report outlines some of the steps the Administration has taken to ensure all Americans have access to an Exchange beginning in 2014. (More.)

1/13/12

The Patient Protection and Affordable Care Act (PPACA) imposed a new $2,500 limit on the contribution or election amount for health care Flexible Spending Accounts (FSA). The new requirement applies to all FSA plans whose taxable years begin after Dec. 31, 2012 — even plans grandfathered under other provisions of health care reform.

The “taxable year” refers to the employee’s taxable year –and in most cases this stipulation means a calendar year. Thus, a calendar year limitation of $2,500 in salary reductions for the health care FSA will become effective Jan. 1, 2013.

Changes to Plan Documents
Plans that currently allow a health care FSA election of more than $2,500, must amend plan documents before Jan. 1, 2013, and change employee communications. Non-calendar plans that amend their plans as of Jan. 1, 2013, mid-plan year, may face some unique challenges or situations due to the changes required.

Be Proactive
To simplify administration of this change, sponsors of non-calendar year plans may want to adopt the new limit as of the first day of the plan year rather than waiting until Jan. 1, 2013. For example, if the current plan year begins May 1 and ends April 30, the plan sponsor may:

Communicate the change to employees.

• Amend their plan documents to implement the new $2,500 maximum election
• Initiate the changes to the contribution effective May 1, 2012, rather than wait until the mid-plan year in Jan. 1, 2013

The Internal Revenue Service Jan. 3 issued Notice 2012-9, which amends interim guidance for employers on reporting the cost of their group health insurance to employees on Forms W-2 beginning with the 2012 tax year.

Like the initial guidance (Notice 2011-28), these latest modifications are in question-and-answer format (62 BTM 108, 4/5/11). The changes come in response to solicited comments on the reporting requirement under Internal Revenue Code Section 6051(a)(14) as imposed by the Patient Protection and Affordable Care Act, the agency said.

The new Q& As address issues such as cost of coverage under an employee assistance program and under a health reimbursement arrangement, and the application of the exception for fixed indemnity insurance offered by an employer on an after-tax basis.

The guidance is “generally applicable” beginning with 2012 Forms W-2, Wage and Tax Statement—that is for forms that employers generally must file by the end of January 2013—IRS said. Employers required to file fewer than 250 Forms W-2 for the 2011 tax year will not be subject to the reporting requirement for 2012 Forms W-2, the agency said.

Notice 2012-9 is scheduled to appear in Internal Revenue Bulletin 2012-4, to be published Jan. 23.

The Patient Protection and Affordable Care Act (PPACA) established the Early Retiree Reinsurance Program (ERRP). The ERRP is a temporary program that provides reimbursement to eligible employers (and employment-based plans) for part of the cost of providing health care coverage to early retirees and their families. Early retirees are those who are age 55 and older, but not yet eligible for Medicare.

The ERRP was created to encourage health plan sponsors to make coverage available for early retirees and their families, who often face difficulties finding affordable health coverage in the individual market. Under the program, plan sponsors can receive reimbursements of 80 percent of high cost claims between $15,000 and $90,000.

The ERRP became effective in June 2010. It received $5 billion in funding. The ERRP was designed to expire on Jan. 1, 2014, or earlier if the program’s funds were depleted. On Dec. 9, 2011, the Department of Health and Human Services (HHS) announced that the ERRP will end early because its funding is almost exhausted.

This Power Group Companies Legislative Brief summarizes the end of the ERRP for claims incurred after Dec. 31, 2011.

Winter Wellness

Is getting more active your New Year’s resolution or are you trying to shed those pesky holiday pounds? Winter is ripe with outdoor activities that offer a good workout. Plus, you can burn more calories exercising in winter because your body has to work hard to keep itself warm.

Flex your muscles. Snow creates plenty of opportunity for burning calories. When the fluffy stuff falls, ditch the snow blower, and shovel your driveway and sidewalk by hand. Offer to help a neighbor or family member to maximize the workout. Download Live Well, Work Well — January 2012.

In Case You Missed It

8 ways employees can use their Flexible Spending Accounts before 2012. Read the 12/7/2011 PowerMail.

Holiday Schedule

Power Group’s Overland Park office will be closing at 3pm on Friday, 12/23. Our office will be closed on Friday, 12/30, and Monday, 1/2. We will have a reduced staff on 12/23 and 12/26.

Holiday Misc.

We all have our holiday favorites, but what about the other end of the spectrum? The movie ticket website Fandango polled customers to come up with the ultimate holiday flop, and now has a list of the top 10 worst Christmas movies ever made.

1. SANTA CLAUS CONQUERS THE MARTIANS 23%
2. SILENT NIGHT, DEADLY NIGHT  16%
3. JINGLE ALL THE WAY 10%
4. JACK FROST  9%
5. SANTA WITH MUSCLES  5%
6. ERNEST SAVES CHRISTMAS  5%
7. HOME ALONE 3  4%
8. DECK THE HALLS  4%
9. SURVIVING CHRISTMAS  3%
10. CHRISTMAS WITH THE KRANKS  3%

Have a safe and healthy holiday season!

The ERRP was created to encourage health plan sponsors to make coverage available for early retirees and their families, who often face difficulties finding affordable health coverage in the individual market. Under the program, plan sponsors can receive reimbursements of 80 percent of high cost claims between $15,000 and $90,000.

The ERRP became effective in June 2010. It received $5 billion in funding. The ERRP was designed to expire on Jan. 1, 2014, or earlier if the program’s funds were depleted. On Dec. 9, 2011, the Department of Health and Human Services (HHS) announced that the ERRP will end early because its funding is almost exhausted.

This Power Group Companies Legislative Brief summarizes the end of the ERRP for claims incurred after Dec. 31, 2011.