Welfare Benefit Plan ERISA News
August 2016

Department of Labor Substantially Increases Penalties for ERISA Violations

Department of Labor"The Department of Labor (the "Department") issued an interim final rule on July 1, 2016 (the "Interim Final Rule") that substantially increases the civil penalty amounts for various violations of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). The Interim Final Rule is effective August 1, 2016, and the increased civil penalty amounts apply to penalties assessed after that date even if the associated violations occurred prior to August 1, 2016. As noted below, some penalties have sharply increased, such as the daily penalty for Form 5500 failures, which has increased from a maximum of $1,100 to $2,063." (Groom Law Group)

Marketplace Subsidy Notices:
What Employers Need to Know
HealthCare.gov"As promised by the Centers for Medicare & Medicaid Services (CMS) in late-2015, the Federally-Facilitated Marketplaces (FFMs) have started sending notices informing employers that employees have enrolled in a FFM and were determined eligible for premium subsidies. Because the employer shared responsibility penalties set forth in Sectioni 4980H of the Internal Revenue Code (the "Code") could be triggered when at least one full-time employee obtains a premium subsidy in the Marketplace, an employer receiving one of these notices should understandably be concerned about the possibility of penalties. Nevertheless, these notices do not guarantee that a penalty will be assessed. Here's what employers should know:" (Proskauer's ERISA Practice Center)

Justice Department and State Attorneys General Sue to Block Anthem's Acquisition of Cigna, Aetna's Acquisition of Humana

"The U.S. Department of Justice and attorneys general from multiple states and the District of Columbia sued on July 21st to block Anthem's proposed acquisition of Cigna and Aetna's proposed acquisition of Humana, alleging that the transactions would increase concentration and harm competition across the country, reducing from five to three the number of large, national health insurers in the nation.... The complaints allege that the two mergers -- valued at $54 billion and $37 billion -- would harm seniors, working families and individuals, employers and doctors and other healthcare providers by limiting price competition, reducing benefits, decreasing incentives to provide innovative wellness programs and lowering the quality of care." (Office of the Solicitor, U.S. Department of Labor)

Health Savings Accounts:
How and When a Participant Should Make a Contribution

  • Learn before the beginning of the plan year the amount and timing of your employer contribution so that you can plan your personal contributions accordingly.
  • Plan to make pre-tax payroll contributions if your employer offers a Cafeteria Plan. You should begin the discipline of regular HSA deposits. Check to see whether your employer has set up a negative election. Most do not, but some do.
  • Review your contributions before the end of the calendar year to make sure that you have not made an excess contribution (and correct the excess contribution if you have made one. (Xerox HR Insights)
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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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