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Notice: The articles in this Archive
are no longer of immediate interest or relevance and are preserved only
for historic purposes for those who wish to peruse earlier writings.
The information in these articles may no longer be accurate as laws/regulations
may have changed. Because this section is not updated or kept current
for any changes in the law, readers should contact Mahoney&Associates
before relying on anything in the Archive.
December
28, 2009 – COBRA Subsidy Extension Requires Immediate Employer Action
The American Recovery and Reinvestment Act of 2009 (ARRA) provides for premium
reductions and additional election opportunities for health benefits under the
Consolidated Omnibus Budget Reconciliation Act of 1985, commonly called COBRA.
Eligible individuals pay only 35 percent of their COBRA premiums and the remaining
65 percent is reimbursed to the coverage provider through a tax credit. The premium
reduction applies to periods of health coverage beginning on or after February
17, 2009 and lasts for up to nine months for those eligible for COBRA during
the period beginning September 1, 2008 and ending December 31, 2009 due to an
involuntary termination of employment that occurred during that period. The TAA
Health Coverage Improvement Act of 2009, enacted as part of ARRA, also made changes
with regard to COBRA continuation coverage. To read
this entire article, click on the title above.
December
23, 2009 - Health Care Changes Near Enactment
With the imminent Christmas Eve vote and almost certain passage of the
Senate’s amendment to HR 3590, the Patient Protection and Affordable Care
Act of 2009, we thought it would be appropriate to provide you with a list
of the major provisions of this historic revised piece of legislation.
Unless you have already read the entire amended bill, a number of these
provisions will be new to you and more than a couple may startle or alarm
you, however, it is what it is! These new proposals are rolling down hill
like a huge snowball. There are some good parts and some bad, so sit down,
brace yourself and read on! To read the entire article, simply click
on the title.
October
26, 2009 - Why Healthcare Reform May Fail…Again
On September 16, 2009, Senate Finance Chairman Max Baucus (D-MT) found out what
happens when you give a party and nobody comes. On that date he took the podium
alone before a roomful of journalists and formally announced his health care
reform bill. Apparently, no colleagues from either party were willing to stand
with him. Small wonder, the legislation included $500 billion in Medicare cuts,
mandated universal coverage, member-owned purchasing “co-ops”, a potential price
tag only slightly below $1 trillion and no public option. In short, it had something
for everybody to dislike. Is it possible that the phrase in italics is the reason
why yet another attempt to reform America’s health care system may fail? If every
provision in a Health Care Reform bill is opposed by someone, the accumulative
affect of this opposition could potentially defeat the bill.
October
12, 2009 - Around the Health Care Reform Debate in Less Than Two Pages
The week ending October 9, 2009 was a quiet one compared with the
frenzied activity of previous weeks. Health Care Reform Fatigue Syndrome
(HCRFS) could be part of it; there may also be a growing sense of resignation
out there that the reform debate may be becoming more destructive than
most any reform itself could be. If true, this may be a dangerous mindset.
Nevertheless, the week was not without a few noteworthy developments. To
read the entire article, simply click on the title.
October
5, 2009 – Health Care Reform Update
The reform process is moving ahead, albeit, slowly. Our paper this
week examines two newsworthy items that emerged during the past several
days. On September 29th, the Senate Finance Committee rejected two public
option proposals. The second story involves the growing concern over the
potential penalty for failure to comply with the individual mandate to
buy health insurance. Is it possible that citizens who don’t buy individual
health insurance could be sent to prison? Click on the above title
to read more.
September
29, 2009 - Congress Considers Changes to Federal Estate Tax Law
Believe it or not, health care reform is not the only thing lawmakers are
working on this year. The search for additional revenue to fund proposed
health care changes has led Congress and its minions to peer into every
corner and under every rock for any loose change. The Federal Estate Tax
Law has not escaped this scrutiny. Not surprisingly though, some of our
lawmakers are looking to increase estate taxes while others look to reduce
them. This article contains a snapshot of the various proposals, their
sponsors and what affects they would have on various components of the
law. To read the entire article, simply click on the title.
September
28, 2009 - Health Care Reform – A Look at the Baucus Proposal
Health care reform proposals, particularly from the U.S. Senate, are coming so
quickly and are changing so fast that it is difficult to offer sound commentary
on their merits. Some of the most noteworthy proposals remain visible for such
a short time they are almost like subliminal messages. Nevertheless, we have
been able to glean a few common themes from the Baucus bill now before the Senate
Finance Committee. Even with their 564 amendments (yes, true!) we think these
provisions may remain in play for awhile. To read the entire article, simply
click on the title.
September
11, 2009 - M&A Assessment of President Obama's Health Care Speech
to Congress
President Obama's Health Care Reform speech of September 9th generated
a huge volume of commentary. One can only imagine the outpouring of "boos" and "yeas" from
every talking head and every television and radio show in the land. Our
hope is that the speech rekindles some forward movement on the much-needed
reform. In the meantime, we want to offer our comments on some of the key
points in the president's speech. To read the entire article, simply
click on the title.
September
4, 2009 - M&A On Point Position Paper - Health Care Reform - Is the
Public Option Doomed?
In the beginning, a Public Option was assumed to
be an integral part of Health Care Reform. However, in the past few weeks,
the strength of that assumption has weakened considerably. The question
now seems to be, will it even survive? For insight into that question,
just click the title above.
August
31, 2009 - M&A On Point Position Paper - The "Lion" Casts
a Huge Shadow Over Healthcare Reform Debate
Throughout his career, Senator Edward M. Kennedy
fought to ensure that all Americans would have access to high quality,
affordable health care. His death came at a time when the debate over
Health Care Reform was at its peak. Only time will tell what affect the
passing of “The Lion of the Senate” will have on the final legislation. To
read the full article, just click on the title.
August
19, 2009 - M&A On Point Position Paper - Health Care Reform
From the beginning, we have been monitoring developments
in the Health Care Reform debate, and what a debate it has been! Thankfully,
Congress took its summer recess and the pace of Reform has slowed. We
took advantage of this lull in the action to document some of our thoughts
on the major points of the pending reform. Our challenge was to comment
on these issues before they changed, which they seemed to do every hour. To
read the full article, just click on the title.
July
15, 2009 - Medical Tourism
According to one estimate, 1.5 million Americans underwent medical treatment
abroad in 2008, the majority in Asia and Latin America. The number of these
“Medical Tourists” is increasing rapidly. This trend raises a number of
important questions for employers to consider. To read the entire article,
click on the title.
June
30, 2009 - Tax Deductibility of Unpaid Employee Welfare Benefit Claims
The rules governing the deductibility of Incurred But Not Reported claims (IBNR)
in an employee welfare benefit program are complex. This complexity has led benefits
and accounting professionals of every stripe to offer incorrect interpretations
to clients and employers. The purpose of this Position Paper is to clarify those
rules and the circumstances under which employers may claim a deduction. To
read the full article, just click on the title.
May
15, 2009 - Pension Benefit Guaranty Corporation (PBGC) Prospects amid
Recession
The domino effect of the current recession seems to have no bounds. Juan
Kelly, our on-staff Actuary, wrote this piece as a way of drawing our attention
to the declining fortunes of the Pension Benefit Guarantee Corporation.
It’s just one more thing to think about. To read the entire article,
click on the title.
May
15, 2009 - 401(k) Plan Investment Choices for Participants Closer to Retirement
Age
The dramatic reduction in 401(k) and other retirement plan balances
has left many would-be retirees in a state of shock. Unfortunately, many
of them will not have enough time to recover their losses before they leave
the work force. Plan sponsors may want to consider offering seminars on
what kinds of investments are best suited for their more mature employees. To
read the entire article, click on the title.
May
15, 2009 - Financial Education Seminars Boost Employee Productivity
Many employers are beginning to wonder - how many of our employees are
spending excessive on-the-job time worrying about their financial problems
than their jobs? We can’t answer that question but we do have a suggestion
as to what can be done about it. To read the entire article, click
on the title.
March
15, 2009 - 401(k) Guarantee Products: Current and Future
The transformation from Defined Benefit to Defined Contribution plans as
the main retirement savings vehicle has hit an inflection point. Recent
studies have revealed the greatest concern among participants is one of
longevity risk. Responding to their concerns, asset managers and insurance
companies have recently developed the first generation of 401(k) Guarantee
plans that will provide the “safety net” lacked in current programs. The
purpose of this article is to draw the reader’s attention to this relatively
new product in the marketplace and to briefly discuss its general characteristics. To
read entire article, click on the title.
March
15, 2009 - Why Every Employer Should Implement an ERISA Severance Pay
Plan
The majority of medium to large companies have formalized their severance
pay practices, usually in the form of a section in the Human Resources
Policies & Procedures Manual. This article offers several reasons why
these practices should take the form of an ERISA Plan. If nothing else,
ERISA offers certain protections for these plans, for example, avoidance
of state law liability theories. We think this article may prompt many
of our readers to re-consider their approach to severance pay. To read
the entire article, click on the title.
February
15, 2009 - New Law Makes Low-cost Individual Health Coverage Available
to Florida Residents
“Cover Florida”, a new law effective January 5, 2009, makes certain Florida
residents between the ages of 19 and 64 eligible to apply for preventive
or catastrophic individual health insurance. Carriers offering the coverage
in all 67 counties include Blue Cross Blue Shield of Florida and UnitedHealthCare.
To be eligible, residents must have been without coverage for at least
6 months or have lost coverage in the interim, by virtue of unemployment,
death or divorce. To read the entire article, click on the title
November
3, 2008 - DOL Proposes Additional Disclosure Rules
Marc Zimmerman, AIF®, Vice President Qualified
Plans Consulting
The Department of Labor (DOL) requires plan fiduciaries to provide participants
with information sufficient to enable them to make informed decisions
about the investment management of their accounts. Last year, DOL proposed
regulations that would impose new and expanded disclosure requirements
on plan sponsors. To read this entire article,
click on the title above.
November
3, 2008 - The Mental Health Parity and Addiction Equity Act of 2008
Juan Kelly, ASA, EA, MAAA, Senior Actuarial Advisor
In the past, strict limitations were placed
on mental health and substance abuse benefits because of concerns over
the potential for abuse and fraud. The Mental Health Parity and Addiction
Equity Act changes that by requiring group health insurance plans to
cover mental illness and substance abuse disorders on the same terms
and conditions as other illnesses. To read
this entire article, click on the title above.
August
15, 2008 - Cashed-out DC Plan Participants can Sue for Investment Losses
Caused by Breach of Fiduciary Duty
M&A Vice President, Compliance
In two federal cases, the courts held that former, cashed-out participants
have standing to sue under Section 502(a)(2) of the Employee Retirement
Income Security Act of 1974, for Investment Losses Caused by Breach of
Fiduciary Duty. This decision was affirmed on July 18th, in the 1st Circuit
Court of Appeals, which includes Massachusetts. The fact that a participant
has left their employ does not protect plan sponsors from liability for
breaches of fiduciary duty. To read this entire
article, click on the title above.
August
15, 2008 - DOL Proposes New Service Agreement Rules
M&A Vice President, Compliance
The Department of Labor (DOL) has issued
proposed regulations which, when they become final, will require that
contracts between service provider(s) and a plan disclose enough information
to assist the fiduciaries in ascertaining and understanding (1) exactly
what the plan actually pays for specific services (2) whether all the
compensation received by the vendor is reasonable for those services
and (3) the potential for conflicts of interest that may affect a vendor’s
performance of those services. To read this
entire article, click on the title above.
July
16, 2008 - Top Ten Mistakes Participants Make on their 401(k) Plans
Marc Zimmerman, AIF®, Vice President Qualified Plans Consulting
For many employees, the money they save in their 401(k) Plan will
be the primary source of retirement income. For this reason, it is critical
that they have a complete understanding of how their Plan works and the
implications of their participation, investment and withdrawal decisions.
This is primarily the responsibility of the employer. The list of “don’ts”
in this article will help employers help participants avoid these common
mistakes. To read this entire article, click
on the title above.
November
13, 2007 - Funding of Employee Health & Welfare Benefits by Internal
Revenue Code (IRC) Section 125 Cafeteria Plans
M&A Vice President, Compliance & Juan
Kelly, ASA, EA, MAAA, Senior Actuarial Advisor
The Internal Revenue Service (IRS) recently issued new
proposed Regulations under Section 125 of the Internal Revenue Code of
1986 (the Code). They consolidate into one set of rules the numerous IRS
interpretations issued over the past couple of decades in response to the
continuingly changing federal tax laws. The old proposed and temporary
Regulations have been withdrawn; therefore, employers must rely on the
new proposed rules pending issuance of final Regulations, which were effective
January 1, 2009.
November
8, 2007 - IRS
Extends 409A Operational Relief Through 2008
M&A Vice President, Compliance and Juan Kelly,
ASA, EA, MAAA, Senior Actuarial Advisor
In our eActionAlert dated October 18th, we notified you
that the deadline for sponsors of Nonqualified Deferred Compensation Plans
(NQDCPs) to comply with the documentation requirements under Internal Revenue
Service (IRS) guidance for Section 409A of the Internal Revenue Code of
1986 (the Code) had been extended through December 31, 2008. We also noted,
however, that beginning January 1, 2008 NQDCPs were still required to comply
with the operational rules under IRS final Regulations, issued on April
17, 2007. We are pleased to inform you that the IRS has just published
Notice 2007-86 (the Notice), which indicates that NQDCPs now have until
December 31, 2008 to comply with the operational requirements of the final
409A Regulations. This is welcome news as it gives employers additional
time to analyze their plans and make informed decisions regarding any changes
that may be needed to bring the operation of their plans into compliance
with the final Regulations.
October
18, 2007 - IRS
Gives Limited Extension to Fully Amend Nonqualified Deferred Compensation
Plans
M&A Vice President, Compliance and Juan Kelly,
ASA, EA, MAAA | Senior Actuarial Advisor
In April 2007, the Internal Revenue Service (IRS) published
final Regulations under Section 409A of the Internal Revenue Code of 1986
(the Code). IRS guidance under Section 409A imposes several requirements
on Nonqualified Deferred Compensation Plans (NQDCPs), including proper
plan documentation by December 31, 2007. If a NQDCP does not meet those
requirements, the amounts deferred under the plan, unless subject to a
substantial risk of forfeiture, are included in participants’ current income
– and subject to an additional 20% federal income tax, interest and penalties.
In response to requests from the largest law firms in the country for an
extension of the documentation requirements, the IRS has just issued Notice
2007-78, which extends the deadline for amending NQDCPs to December 31,
2008. This eActionAlert discusses what you must do in order to take advantage
of that extension as well as other aspects of the Notice.
August
9, 2007 - New State Mandates Prohibiting Discrimination in the Workplace
(FL and VT)
Juan Kelly, ASA, EA, MAAA, Senior Actuarial Advisor
In the absence of comprehensive, uniform federal legislation,
we continue to see piecemeal legislation on a state by state basis. This
Alert discusses steps taken by Florida and Vermont to prohibit discrimination
against employees subject to domestic violence and transgender identity
respectively. The new laws were effective July 1, 2007.
August
7, 2007 - Paid Sick Leave Mandate for Employees Working in San Francisco
Juan Kelly, ASA, EA, MAAA, Senior Actuarial
Advisor
For a long time California has been known for its worker-friendly
laws. This eActionAlert discusses another in a series of pieces of legislation
applicable to employers and employees in the City and County of San Francisco.
The law and accompanying regulations are posing both administrative and
financial challenges for employers.
August 3, 2007
- Hurricane
Preparations
M&A Editorial Staff
As we are all aware, hurricane season begins June 1st.
Fear and a feeling of helplessness come from being unprepared, therefore,
I would like to suggest that we all take charge of what to do in response
to hurricane season by having a plan and being prepared. The attached document
is from the CDC entitled “Key Facts About Hurricane Readiness”. Read this
carefully. Also, I have listed below some additional ideas to help you
prepare.
June
13, 2007 - Employers
with Employees in Massachusetts – New Healthcare Reform Law, effective
July 1, 2007
M&A Vice President, Compliance
If your company has employees within Massachusetts, a
new state law, “An Act Providing Access to Affordable, Quality, Accountable
Health Care” (the Act) may affect your company, its cafeteria and/or group
health plans effective July 1, 2007. This law applies whether your group
health plan is insured or self-funded. Therefore, there is heated discussion
as to whether this health care reform law is preempted by the Employee
Retirement Income Security Act of 1974 (ERISA). This Alert briefly discusses
that issue and a few major provisions of the law.
February
23, 2007 - IRS Issues Guidance on PPA ’06 Changes
M&A Vice President, Compliance
The Internal Revenue Service (IRS) recently released Notice
2007-7, which provides guidance on some provisions of the Pension Reform
Act of 2006 (the PPA) that are effective in 2007, or earlier, and apply
to tax-qualified plans and Individual Retirement Accounts (IRAs). This
Alert discusses the issues that are most likely to affect your company’s
plans and their participants. |
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