Welfare Benefit Plan ERISA News
June 2016

 
Life Insurance Pricing Structure Upheld
in ERISA Class Action

"An employee benefit plan that includes an alleged subsidization component for its basic and supplemental options is neither prohibited by ERISA nor a violation of the plan sponsor or service provider's fiduciary duties. ... Plaintiffs had alleged that the Insurer and the Company engaged in a 'cross-subsidization scheme' to overcharge plaintiffs for supplemental life insurance that was higher than called for by the underwriting and actuarial pricing experience for the purpose of lowering the price that the Company incurred for 'non-contributory' basic group life insurance coverage." (Sutherland Asbill & Brennan LLP)

CFOs and HR Execs Face Millions in Personal Liability
Due to Unmanaged Health Plans
"Employers typically have extremely rigorous oversight of retirement benefits with independent investment committees, regular audits and more. Though the same fiduciary responsibility exists for health benefits, evidence suggests that the vast majority of employers have fallen short." (Forbes)

EEOC Issues Final Rules Under ADA and GINA
on Wellness Plans

"The U.S. Equal Employment Opportunity Commission issued two final rules May 16, 2016 that guide employers on the manner with which their wellness programs that ask health-related questions and/or require participants to undergo medical examinations can incentivize employee participation, while remaining in compliance with Title I of the Americans with Disabilities Act (ADA) and Title II of the Genetic Information Nondiscrimination Act (GINA). ... Both rules allow employers to continue providing wellness programs that offer financial incentives so long as the wellness plans are 'reasonably designed to promote health or prevent disease' and are not 'a subterfuge for violating' the ADA, GINA or other employment discrimination laws." (Stinson Leonard Street LLP)

DOL Fiduciary Rule: Employers Should Not Overlook Impact on HSAs

"Employers having group health plans supplemented by health savings accounts should be aware that health savings accounts are specifically covered by the new fiduciary rule.... Employers should examine their role with any health savings account arrangements to assess how the health savings accounts are being made available to employees, how the providers offering those services are being compensated, whether the compensatory arrangement needs to comport with the new fiduciary rule, and if so, how the provider intends to satisfy the requirements of the rule." (Benefits Bryan Cave)
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© 2017 ERISAPros, LLC, All rights reserved. Information on ERISAPros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISAPros. Transmission of this information does not create an attorney-client relationship. ERISAPros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.

 

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