On March 11, 2021, President Biden signed into law the American Rescue Plan Act (“ARPA”). The ARPA mandated several important changes for both employers and employees. One of these is potentially significant for both: full subsidies for employer-paid COBRA premiums. The ARPA requires employers to provide temporary, fully subsidized COBRA continuation coverage premiums for certain individuals for up to six months. Employers will be able to recover the subsidized premiums by claiming a tax credit.
The benefits provided to employers and employees are available to COBRA ...
Most blog entries focus on new developments or recent legislation. This one’s a bit different. Its subject matter, fiduciary responsibility, is as old as ERISA itself. In today’s environment of increased litigation risks for plans, it’s critically important to dust off these rules and review these fundamental obligations applicable to all ERISA plan fiduciaries.
ERISA imposes a few specific duties on fiduciaries:
- Loyalty (also called the “exclusive benefit” rule) – the duty to act solely for plan participants and beneficiaries
- Prudence – the obligation to act ...
In the summer of 2019, I wrote a short blog on the death of the PCORI fee -- Ding, Dong, the PCORI Fee is Dead!. When enacted as part of the Affordable Care Act, the fee was set to expire with plan/policy years ending after September 30, 2019.
The Further Consolidated Appropriations Act, 2020, signed by President Trump on December 20, 2019, extended the PCORI fee for another ten years. The fee is now set to expire with plan/policy years ending after September 30, 2029.
So, Ding, Dong, the PCORI Fee is NOT Dead!
The Treasury Department and the Internal Revenue Service (collectively referred to hereafter as “IRS”) on September 23, 2019 published the final regulations on hardship distributions, finalizing the regulations proposed in November 2018. The plans primarily affected are 401(k) and 403(b) plans. The final regulations reflect changes in the Internal Revenue Code dating back to the Pension Protection Act of 2006 through the Bipartisan Budget Act of 2018. The preamble states that the regulations are substantially similar to the proposed regulations and, notably ...
On June 13, the Departments of Labor, Treasury and Health and Human Services jointly released final regulations dealing with health reimbursement accounts (“HRAs”). These regulations fulfill the Trump administration’s directive to “increase the usability of HRAs, to expand employers’ ability to offer HRAs to their employees, and to allow HRAs to be used in conjunction with nongroup coverage.”
Background.
HRAs are employer-funded account-based plans from which employees may be reimbursed for qualifying medical expenses. HRAs, like other account-based plans ...