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4 Steps for Compliance with the New Disability Claims Procedures

Did you read our post “Work Now, Party Later,” advising you to do just that in response to the new Department of Labor rule governing disability claims procedures? If so—party on! If not, we hope you enjoyed your holiday celebrations, because it is now time to work.

On January 5, the Department of Labor announced its decision that the new disability claims procedure rules will take effect on April 1 of this year. Here is our suggested plan of attack for employers:

Step 1: Review our previous blog post to familiarize yourself with the new rules.

Step 2: Identify which of your plans offer disability benefits.

Remember to check both your ERISA qualified and nonqualified plans.

Step 3. Determine whether you need to amend your plan and/or SPD.

Under the new rules, participants who file a disability claim must receive an expanded explanation of their adverse

Work Now, Party Later: The Case for Tackling the New Disability Claims Procedures Before Year-End

Update: On November 24, 2017, the Department of Labor filed a final rule to delay the applicability date of new disability claims procedures regulation by 90 days, through April 1, 2018.

Plan sponsors are typically forced to wait for last minute guidance to satisfy year-end compliance obligations. As a result, those of us who work with these plans spend the last days of the year frantically ensuring plans are in compliance mode while friends and family ring in the new year with frivolity and festivities. While we can’t guarantee that won’t happen again this year, if it happens to you because you are evaluating the impact of the new disability claim procedures on plans, then shame on you. As discussed below, the information necessary to comply with the new rules is already available. So address these obligations now – then dig out your little-black-dress or tux, and join the year-end

Fiduciary Rule Under Review – Update

On Friday, President Trump issued an order directing the Department of Labor to review the new regulation to determine whether it is inconsistent with the current administration’s policies and, as it deems appropriate, to take steps to revise or rescind it.

The long awaited Fiduciary Rule expanded protection for retirement investors and included a requirement that brokers offering investment advice in the retirement space put clients’ interests first.  Financial institutions that either implemented, or were rapidly completing, their compliance efforts to comply with the Fiduciary Rule will need to assess the impact of this order on these efforts.  Notwithstanding many earlier reports that the rule would be delayed 180 days, the date on which the rule was to take effect (April 10, 2017) has not been delayed.  However, it is anticipated that a delay will be forthcoming, making the decision whether or not to proceed with further

The First ACA Shoe Drops

The First ACA Shoe Drops

January 23, 2017

Authored by: Lisa Van Fleet and Chris Rylands

ACA Blue HighlightOnly hours into the new administration, steps were taken to eliminate, or at the very least minimize the impact of, the Patient Protections and Affordable Care Act (“ACA”).  In his first Executive Order, President Trump affirmed his intent to repeal the ACA and further sought to minimize the economic burden of the ACA.  The order instructs the Secretary of Health and Human Services and the heads of all other executive departments and agencies to,  “take all actions consistent with the law to minimize the unwarranted economic and regulatory burden of the act, and prepare to afford the states more flexibility and control to create a more free and open healthcare market.”

This is not a repeal of the ACA (the President cannot unilaterally do that).  However, what

Top 10 Employee Benefits New Year’s Resolutions for 2017

new-years-resolutionsIf statistics are any guide, by now a significant number of you have already broken your New Year’s resolutions.  However, there’s still plenty of time to make new ones that you can break, er, keep.  If you sponsor or work with an employee benefit plan (and odds are, if you’re reading this, that you do), then here are some ideas to keep in mind in the upcoming year:

  • Fiduciary, Know Thyself. It important to know your fiduciaries (or know if you are one). Reviewing plan documents, charters, and delegations, among other possible documents, are key to determining who is an ERISA fiduciary. You should make sure that any individuals who have been designated are still willing and able to serve and, if not, they should be removed. While not as much of an
  • Cautionary Observations from the Proposed 457 Regulations

    Governmental Buildings and MoneyAfter more than nine years of deliberations, the IRS has finally released proposed regulations governing all types of deferred compensation plans maintained by non-profit organizations and governmental entities.

    In issuing these regulations, the IRS reiterates its long-standing theme that these regulations are intended to work in harmony with, and be supplemental to, the 409A regulations. However, the IRS provides little guidance on how these regulations interact with each other.  The following discussion focuses on 3 key aspects of the new guidance: the severance exemption, the substantial risk of forfeiture requirement, and leave programs.

    As with the 409A regulations, the 457 regulations exempt severance pay plans from the rules and taxes applicable to deferred compensation. The 457

    EEOC Weighs in on the Impact of the ADA and GINA On Employer-Sponsored Wellness Programs

    Regulations Compliance Puzzle PiecesOn Monday, May 16 the Equal Employment Opportunity Commission (“EEOC”) issued two final regulations providing guidance on how employer-sponsored wellness programs work with the general antidiscrimination requirements of Title I of the Americans with Disabilities Act (“ADA”) and Title II of the Genetic Information Nondiscrimination Act of 2008 (“GINA”). These rules were published in the May 17th Federal Register.

    This blog post is designed to provide background information on wellness programs and the antidiscrimination protections of the ADA and GINA, to highlight the final regulations and note two action items relating to smoking cessation programs and tiered health plan benefit or cost-sharing structures.

    What is a Wellness Program?

    The term “wellness program” generally refers to programs intended to promote health and disease prevention and

    New IRS Memo Confirms Tax Treatment of Wellness Programs & Incentives

    Wellness Word CloudIn a recently released IRS Chief Counsel Memo, the IRS confirmed that wellness incentives are generally taxable. The memo also, indirectly, confirmed the tax treatment of wellness programs more generally.

    As to the incentives, the IRS held that a cash payment to employees for participating in a wellness program is taxable to the employees. The memo did not deal with incentives paid to dependents, but we presume those would be taxable to the applicable employee as well.  The IRS did say that certain in-kind fringe benefits (like a tee shirt) might be so de minimis as to be exempt as fringe benefits.  Confirming the IRS’s long-standing position, however, cash does not qualify for this exception and is taxable.

    This tax treatment also applies to premium reimbursements if

    Finally: DOL Releases the Final Fiduciary Rule

    April 6, 2016

    Categories

    Earlier today, the Department of Labor (DOL) released the Conflict of Interest Final Rule.   Click here to explore all 200+ pages.  Among other things, this rule expands the definition of fiduciary, and requires that persons who give investment advice to retirement investors act in the best interests of those investors.

    The DOL released significant additional guidance in connection with the Final Rule, including the best interest and principal transaction exemptions, a chart illustrating changes from the proposed rule, and FAQs.  To access that additional guidance click here.  We will examine the Rule in further detail, as well as the industry’s reaction to it, in future posts.

    Scratch & Sniff the New Health Plan FAQs

    ACA Blue HighlightLast month the U.S. Departments of Labor, Health and Human Services and Treasury published FAQs offering a veritable potpourri of guidance addressing preventive services, wellness programs and mental health parity.  Some potpourris offer a pleasing aroma – other not so much.  Decide for yourself whether this potpourri of guidance is pleasing based on the following summary.

    PREVENTIVE SERVICES – New guidance expands coverage obligations.

    Non-grandfathered health plan must cover certain preventive services without the imposition of any cost sharing.

    Lactation Counseling/Equipment. Among the preventive services that a non-grandfathered health plan must cover in-network without cost-sharing is comprehensive prenatal and postnatal lactation support, counseling, and equipment rental. The Departments provided the following clarifications with respect to such preventive service:

    • If participants do not have access to lactation counseling in-network, the plan
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