HEALTH CARE REFORM: 2015 SURVIVAL BOOT CAMP

Transcription

1 May 12, 2005 HEALTH CARE REFORM: 2015 SURVIVAL BOOT CAMP October 1, 2015 Presentation To The Dallas Estate Planning Concil by Cynthia Marcotte Stamer, Esq. Managing Shareholder Cynthia Marcotte Stamer, PC, A Member of STAMER CHADWICK SOEFJE PLLC Main Office: 5851 Legacy Circle, 6th Floor, Plano, Texas Mail Room: 3948 Legacy Drive, Site 106, Box 397, Plano, Texas Hor Direct Dial: (469) Main Switchboard: (469) cstamer@soltionslawyer.net Cynthia Marcotte Stamer. All Rights Reserved Cynthia Marcotte Stamer. All rights reserved. 1

2 Abot Cynthia Marcotte Stamer, Esq. A noted Texas-based management lawyer and consltant, athor, lectrer and policy advocate, Stamer Chadwick Soefje PLLC attorney Cynthia Marcotte Stamer is a management lawyer best known for her more than 27 years of pragmatic, leading edge, soltions oriented work and thoght leadership on health and other employee benefit concerns, A Fellow in the American College of Employee Benefit Consel, the American Bar Association and the Texas Bar Association, recognized by DMagazine as among the Best Lawyers In Dallas for her work in the field of Tax: ERISA & Employee Benefits, among the Top Rated Labor & Employment Lawyers in Texas in the 2014 LexisNexis Martindale-Hbbell list of Top Rated Lawyers, Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization,, Vice Chair of the American Bar Association (ABA) TIPS Employee Benefits Committee, Immediate Past Chair and the crrent Welfare Committee Co-Chair of the ABA RPTE Employee Benefit & Other Compensation Grop, a Concil Member of the ABA Joint Committee on Employee Benefits, Past Chair of the ABA Health Law Section Managed Care & Insrance Section and Board Certified in Labor and Employment Law, Ms. Stamer helps management manage. Her clients appreciate her ability to draw pon her expansive knowledge of the complex tapestry of federal and state jdicial precedent and stattory, reglatory, contracting, other laws and indstry operations to help clients defensibly prse their bsiness operations, corporate compliance, internal controls and risk management and other goals. While her work extends to a broad range of hman resorces and performance management, Ms. Stamer continosly advises and represents health and other employee benefit plans, their fidciaries, insrers, sponsors, administrators and other vendors abot the design, docmentation, administration and defense of employee benefit and insrance programs, ethics, compliance and management processes and tools for administering these and other processes, and ERISA and other employee benefit, insrance, tax, licensing, privacy and data secrity, hman resorces, contracting, technology, risk management and other legal compliance and operational concerns. She designs and writes insred and self-insred health, 24-hor and other occpational injry benefit and risk management, disability management, corporate health and wellness, disease management, tilization, adit, patient empowerment, deferred compensation and pension and other employee benefit, insrance and retirement programs. Her work incldes leading edge development and se of 24-hor coverage and other occpational injry, ex-pat and other medical torism prodcts, min-med and other limited benefit plans, fraternal benefit and association plans, hidedctible health plans and dedctible reimbrsement programs. Ms. Stamer also designs and advises clients abot fidciary process and risk management, claims and appeals administration. She consels and defends clients abot reglatory compliance; defends clients in ERISA, contract, and other disptes by private plaintiffs, as well as litigation, adits, licensing board and other enforcement actions by state insrance departments, the Department of Labor, the Internal Revene Service, the Office of Civil Rights, the Centers for Medicare & Medicaid Services, the Department of Jstice, State Attorneys General and other federal and state reglators. She also has extensive experience conseling third party administrators, insrers, self-insred employee benefit plans and their sponsors, medical bill adit, tilization management, cafeteria plan administrators and sponsors, reinsrers, fidciary liability and other E&0 carriers, conslting firms, brokers, and others abot prodct design and defense; licensre; contract review, drafting, interpretation and enforcement; corporate and broker ethics, reglatory compliance and risk management programs; managed care contracting and compliance; electronic and paper claims and appeals administration nder ERISA, clean claims and prompt pay, workers compensation, and other laws; coordination of benefits with Medicare, Medicaid, CHIP, TRICARE, and other third party liability sorces; sbrogation and assignment; federal and state health care, insrance, tax, labor, licensing and other matters. The athor of Claim s Processing Under the New World Order" "The Health Care Eligibility Toolkit, and A Plan Sponsor s HIPAA Privacy & Compliance Toolkit, and many other implementation processes and aids, she reglarly advises, develops processes and procedres, and condcts training for insrers, plan fidciaries and administrators, third party administrators and other service providers, employers, their professional associations and others. Her clients inclde employers, contractors and their employee benefit plans, their sponsors, management, administrators, insrers, fidciaries and advisors, technology and data service providers, health care, managed care and insrance, financial services, government contractors and government entities, governments and law makers, and others A poplar lectrer and widely pblished athor of thosands of pblications on health, disability, and other employee benefits, insrance, health care and hman resorces matters. Ms. Stamer pblishes the HR & Benefits Update. Her insights on health care, health insrance, hman resorces and related matters appear in the Atlantic Information Service, Brea of National Affairs, World At Work, The Wall Street Jornal, Bsiness Insrance, the Dallas Morning News, Managed Healthcare, Health Leaders, and a many other national and local pblications. To register to receive the HR & Benefit Update, arrange for training or for additional information abot Ms. Stamer, her experience, involvements, see or contact Ms. Stamer by telephone at (469) , by to cstamer@soltionslawyer.net or by mail to Cynthia Marcotte Stamer, P.C., 3948 Legacy Drive, Site 106, Box 397, Plano, Texas 75023, 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 2

3 THE FINE PRINT This presentation and any materials and/or comments are training and edcational in natre only. They do not establish an attorney-client relationship, are not legal advice, and do not serve as a sbstitte for legal advice. No comment or statement in this presentation or the accompanying materials is to be constred as an admission. The presenter reserves the right to qalify or retract any of these statements at any time. Likewise, the content is not tailored to any particlar sitation and does not necessarily address all relevant isses. Becase the law is rapidly evolving and this presentation provides an overview, this program and its materials also may not be flly pdated to reflect the crrent state of law in any particlar jrisdiction or circmstance as of the time of the presentation. Frthermore, the rapidly evolving rles also makes it highly likely that sbseqent developments may impact the crrency and completeness of this discssion. The presenter and the program sponsor disclaim, and have no responsibility to provide any pdate or otherwise notify any participant of any sch change, limitation, or other condition that might affect the sitability of reliance pon these materials or information otherwise conveyed in connection with this program. Parties participating in the presentation or accessing of these materials are solely responsible for and are rged to engage competent legal consel for consltation and representation in light of the specific facts and circmstances presented in their niqe circmstance Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 3

4 THE FINE PRINT Circlar 230 Compliance. The following disclaimer is inclded to ensre that we comply with U.S. Treasry Department Reglations. Any statements contained herein are not intended or written by the writer to be sed, and nothing contained herein can be sed by yo or any other person, for the prpose of (1) avoiding penalties that may be imposed nder federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.* 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 4

5 Continosly Evolving Federal Health Plan Rles - ERISA - Internal Revene Code Years of Sbseqently Enacted Federal Eligibility, Benefit & Other Mandates COBRA, FMLA, USERRA, HIPAA, GINA Mental Health Parity, OBRA 93, Newborn & Mothers Medicare Prescription Drg Bill ARRA Many Others - Affordable Care Act Reqirements - More 2015 Cynthia Marcotte Stamer. All rights reserved. 5

6 Offering Health Plan Coverage = Costly, Risky Bsiness Health Plan Coverage Is Expensive 2015 Average Employer-Sponsored Health Plan Premims* Single Coverage = $6,251, of which workers on average pay $1,071 Family Premim = $17,545, with workers on average contribting $4, Costs Projected To Rise Premims Don t Show Hidden Compliance & Liability Costs * Kaiser Family Fondation/Health Research & Edcational Trst (HRET) 2015 Employer Health Benefits Srvey 2015 Cynthia Marcotte Stamer. All rights reserved. 6

7 Obama Reads SCOTUS King v. Brwell As ACA Enforcement Go Ahead Obama Administration Moving To Fll ACA Implementation IRS, DOL, HHS Adits & Enforcement Private Litigation Little Realistic Prospect For Legislative Relief In Near Ftre 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 7

8 Mst Employer Offer Coverage? No, Bt ACA & Other Federal Laws Generally Not Mandate Employers Offer Any Grop Health Coverage Unless Contractal Obligation, E.G.: - Collective Bargaining Agreement - Certain Government Contractors - M&A Or Other Contractal Promises Certain Recordkeeping, Tax Reporting & Notice Reqirements Apply Whether Or Not Employer Sponsors Grop Health Plan Employer Payment Arrangements (Pay/Reimbrse Individal Policies) In Lie of Traditional Plan Sponsorship Generally Prohibited Applicable Large Employer Not Offering Qalifying Grop Health Plan Coverage To Some Or All FTEs & Dependents Generally Incrs Pay or Play Penalty Under IRC 4980H(a) If Cover Some, Not All: - Applicable Large Employer Not Offering Qalifying Grop Health Plan Coverage To Some Or All FTEs & Dependents Generally Incrs Pay or Play Penalty Under IRC 4980H(a) - Prohibited Discrimination Traps For Eligibility Under Code 125, 105(h) & HCE nondiscrimination, ERISA, HIPAA, GINA, Social Secrity Act & Other Laws *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2013 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 8

9 What Health Insrance Coverage, If Any Mst/Shold Employer Offer? Rle Small Employer < 25 FTEs Medim Employer FTEs Large Employer FTEs Large Employer > 100 FTEs IRC 162 Employer Premim Dedction Yes Yes Yes Yes IRC 46R Tax Credit Yes No No No IRC 4980H Pay or Play (Transition Relief Delays Enforcement to 2015 For Employer of >100 FTEs and 2016 If FTEs) No No Yes beginning 1/1/2016 Yes beginning 1/1/2015 IRC 105(h) Self-Insred Health Plan HCE Nondiscrimination Yes if selfinsred Yes if selfinsred Yes if selfinsred Yes if self insred PHS 2716 Insred Non-Grandfathered HCE Nondiscrimination Excise Tax $100 per day per non-highly compensated individal discriminated against (delayed by Notice ntil frther notice, pls a possible civil action to enjoin the discriminatory practice Code 125 Taxability of Contribtions Discriminating In Favor of HCE or Key Employees Contractal Obligations When Union, Government Contractor, M&A or Other Obligation Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 9

10 Mst Employer Offer Coverage? No, Bt If Does If Employer Offers Grop Health Coverage, Employer, Fidciaries, & Others Mst Comply With All Applicable Mandates* *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2013 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 10

11 For Health Plan Compliance & Conseqences Size Matters For Some (Bt Not All) Things, e.g. IRC 4980H Pay or Play Only Applies To Large Employers Not Offering Minimm Essential Coverage (MEC) Providing Minimm Vale (MV) That Is Affordable Small Bsiness Health Care Tax Credit Applicable Only To Small Employers Some Notice, Reporting & Disclosre, Plan Design & Other Mandates Vary By Size Different Rles Cont Employees Differently Some Violations Riskier Than Others 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 11

12 For Health Plan Compliance & Conseqences Mst Accrately Know Who Are Employees Accrate Understanding & Records Of Who Conts As Employee When M&A, Joint Ventres, Management Services Organizations, Alternative Workforce, Leased Employees & Other Special Workforce Rles Create Special Challenges & Risks - Necessary To Manage Risks & Compliance - Dty To Provide Benefits - Plan & Insrance Coverage - Discrimination - Benefit & Fidciary Liability - MEWA - Other 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 12

13 Grop Health Plan Compliance & Risks Employers, Fidciaries, Administrators, Insrers, Brokers & Consltants If Yo Can t Take The Heat, Stay Ot Of The Health Plan Kitchen 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 13

14 Big Pictre Employer/Plan Sponsor Risks Any Offered Grop Health Plan Mst Comply With Applicable Federal Mandates & Other Laws* ERISA Fidciary Responsibility Risks For The Employer, Management Involved In Plan Administration or Selection or Oversight Of Plan Fidciaries & Service Providers Employer/Plan Sponsor Vs. Fidciary Privacy Matters: HIPAA, IRC, ADA & Other Privacy Mandates Wide Range of Federal Rles, Inclding ERISA, ACA & Many Other Federal Laws* Wide Range Of New & Growing Plan Docment, Notice, Reporting, Recordkeeping, Disclosre & Other Mandates If Large Employer, Mst Pay Applicable Pay Or Play Penalty Under IRC 4980H Unless Offer Affordable Grop Health Plan That Provides Minimm Essential Coverage (MEC) Providing Minimm Vale (MV) In addition to otherwise applicable legal sanctions, Form 8928 Sox For Health Plan Reporting & Excise Tax Apply If Violate Any Of Listed Provisions *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 14

15 Employer/Plan Sponsor IRC 6039D/Form 8928 Sox Self- Reporting & Excise Tax Penalties Discrimination As Employer Plan Fnding Of Unanticipated Benefits Potential Fidciary Liability For Matters Over Discretion Indemnification of Defense Costs & Liabilities Of Vendor/Service Providers, Exectives Per Contractal Obligations Reporting/Disclosre Penalties Tax Liabilities - Withholding - Dedctions - Form 8928 Sox Style Self Reporting Other Risks Inclde 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page 15 Fidciary/Plan Administrator Personal Liability For Own, Co- Fidciary Breach 502(l) Fidciary Breach Penalties Administrative Penalties Other Broker/Advisor/Service Provider Risks If Fidciary Discretion, Personal Liability For Own, Co-Fidciary Breach & 502(l) Fidciary Breach Penalties If Plan Administrator, Payroll Agent, Administrative Penalties Circlar 230 or Other Professional Ethics Breach Risks Malpractice/E&C Contractal Breach of Fidciary Dty DPTA or Other Bad Faith Other 2015 Cynthia Marcotte Stamer. All rights reserved. 15

16 Big Pictre Employer/Plan Sponsor Risks Heightened Enforcement Of Fidciary & Other Reqirements Pls Expanding Rles, Reporting, Penalties & Enforcement Make Health Plan Compliance & Risk Management Particlarly Critical Now Certain Rles/Risks Apply To All Grop Health Plans Other Rles, Risks Vary Based On: Grandfathered Vs. Non-Grandfathered Plan Under ACA Size of Employer Benefits Offered Insred Vs. Self-Insred - If Insred, State Mandates, ACA Essential Benefits & Other Market Reforms Benefits Offered Plan Design Other Compliance & Risk Management Make Docmented Plan Design, Docmentation, Vendor Selection, Credentialing & Contracting; & Oversight Critical 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 16

17 IRC 6039D/IRS Form 8928 Health Plan's "SOX Ups The Ante For Employers Beginning with 2014 Tax Year Employers and plan sponsors mst report on Form 8928 to report excise taxes de for certain health plan violations for post-2013 Tax Years Employer Srprise, Discontent When Learn Of Potential 2014 Liability Creates Liability For Insrers, Administrators, Consltants, Brokers & Other Advisors Recognize & Plan To Deal With Potential Exposres, Fallot For Yor Clients & Yor Plan Related Services 2015 Cynthia Marcotte Stamer. All rights reserved. Page # 2015 Cynthia Marcotte Stamer. All rights reserved. 17

18 ERISA Fidciary Responsibility Which Hat Do Yo/Yor Firm Wear? Plan Sponsor, Fidciary, Consltant, Service Provider, Other? Named or Fnctional Discretion Triggers Fidciary Stats. Often Incldes: - Bsinesses Sponsoring Plans - Officers, Directors & Management Employees Engaged In Discretionary Acts or With Power or Responsibility Over Fnding, Select/Retain Fidciaries & Service Providers/Commnicating, Other Activities - Insrers & Administrators Disclaimers/Exclpatory Provisions Void Otsorcing & Delegation May Not Shift Risk/Responsibility Unless Proper Selection & Oversight, Written Appointment & Acceptance Of Fidciary Stats, No Fnctional Exercise Of Discretion, Other Safegards 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 18

19 Fidciary Responsibility The Qacking Dck Principle If It Walks Like A Fidciary, & Talks Like A Fidciary. If Fnctions Don t Match Up In Operational Reality, Liability Spreads 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 19

20 Persons Qalified To Serve As Fidciaries Disqalified Persons Can t Serve - Get & Retain FCRA Reporting Act Consent - Condct Backgrond Check & Retain Proof ERISA Bonding Reqired For Fidciaries, Certain Others Delegation Not Transfer Fidciary Stats Unless Written Appointment & Acceptance, Prdently Selected & Overseen Select, Monitor & Contract With Care 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 20

21 Core Fidciary Dties Mst Discharge Dties With Respect To The Plan & Its Administration, Assets: Solely In The Interest Of Participants And Beneficiaries For Exclsive Prpose Of Providing Benefits With Care, Skill, Prdence, And Diligence That A Prdent Person Wold Use Under Like Capacity And Circmstances In Accordance With Written Plan Docments; And In Accordance With ERISA And Any Other Applicable Federal Or State Law No Prohibited Transactions Assets Held In Trst Unless Exception Applies 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 21

22 Selection, Retention & Oversight Of Fidciaries & Service Providers Selection & Oversight Of Plan Fidciaries * Service Providers Commonly Considered Fidciary Act Prdent Selection & Oversight Prohibited Transaction Prohibited Qalification & Bonding Reasonable Fees & Fee Disclosres DOL New Reglations Will Reqire Greater Care In Selection, Contracting, Adit & Compensation 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 22

23 Fidciary Liability For: Personal Civil Liability For - Own Breach Of ERISA Fidciary Responsibilities - Co-fidciary s Breach Of ERISA Fidciary Responsibility If: Participated By Own Breach Knew Or Shold Have Known Imprdent Selection Oversight ERISA 502(l) Penalty 20% Amont Recovered From Fidciary Breach Settlement Or Cort Order (Redced by ERISA 502(i) & IRC 4975 Penalties Paid ERISA 502(i) Prohibited Transaction Administrative Penalty If Not Corrected Within 90 Days After Notice From DOL Up To 100 % Amont Involved 5% Amont Involved In Each Sch Transaction Each Year/ Partial Year Prohibited Transaction Contines 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 23

24 ERISA Civil Liability Stattory Awards For Noncompliance Fail To Provide Plan, SPD, SBC, COBRA, HIPAA Certificate, Claims or Appeals Notice, Certain Other Docments Reqired Time - ERISA 502(c) Discretionary Award To Participants/Beneficiaries $125 Per Day + Attorneys Fees And Eqitable Relief - $1000 Per Day To DOL For Failre To Timely Or Appropriately File Form 5500 Annal Report, Provide Information In Response To Reqest For Information, SBC, File Form M-1, Failing To Provide Certain Reqired Notices Of Underfnding, Defined Contribtion Plan Blackot Notice And Other Violations Under ERISA - Varios New Affordable Care Act Penalties - Internal Revene Code Penalties 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 24

25 ERISA Criminal Exposres Inclde: Theft or Embezzlement from Employee Benefit Plan False Statements or Concealment of Facts in Relation to Docments Reqired by the Employee Retirement Income Secrity Act of 1974 Offer, Acceptance, or Solicitation to Inflence Operations of Employee Benefit Plan Prohibition Against Certain Persons Holding Certain Positions ERISA 411 Willfl Violation of Title I, Part 1 ERISA 501 Coercive Interference. Persons convicted of violations enmerated in section 411 are sbject to a bar from holding plan positions or providing services to plans for p to 13 years nder ERISA 511 HIPAA Criminal Liability For Making Fradlent Claims Under Federal Health Plan HIPAA Health Plan Violation of HIPAA Privacy Reqirements Federal Tax Shelter & Other Tax Frad Liability Under Internal Revene Code Other (Inclde In Federal Sentencing Gideline Organizational Gideline Compliance Plan) 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 25

26 Plan Docment Reqirement Dty To Have & Administer in Accordance With Plan Docment Plan Docment Reqired Plan Docments Defined; SPD or Insrance Contract Alone Rarely Sfficient Content & Langage Precision Matters Name Fidciaries, Scope of Athority & Discretion Other Mandatory Content Exploding Advisable Langage Failre To Update Terms For Law Enhances Risks For Plan Violations, Forces Fidciary Discretion Sloppy Drafting Expands Fidciary Risk, Undermines Enforceability - Proper Adoption & Amendment - Availability for Inspection & Copying Upon Reqest 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 26

27 Written Plan Terms Matter At Least One Named Fidciary Updated To Clearly Comply With Law - Enron: Fidciary Mst Investigate Legality Of Terms And Constre And Administer In Accord With Law. Administration In Accordance With Illegal Plan Terms May = Fidciary Breach All Mandated Terms All Material Terms Other Advisable Terms Minimize Ambigities To Protect Fidciaries, Enhance Enforceability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 27

28 Plan Langage Impacts Potential Degree of Deference To Fidciary Decision-Making Loose Drafting Is A Fidciary s Enemy If plan written to give the plan administrator discretion in constring the terms of the plan and the plan administrator complies with fidciary dties in constring and administering the plan, administrator s decision may be entitled to some measre of deference if claimant ses. See Firestone v. Brch (1990) Degree of deference varies depending on reviewer s financial interest or other conflict of interest in otcome and possible conflicts. See MetLife Ins. Co. v. Glenn, 128 S. Ct (2009) 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 28

29 Plan Term Risk Management Tips Avoid Naming The Plan Sponsor, Corporate Officers Or Board Members As A Fidciary; Consider, When Possible Naming Service Provider Responsible For Activities Or Committee Careflly Craft Written Delegation Athority Then Prdently Credential, Oversee, Compensate And Review Appointed Parties Define The Roles Of Plan Sponsor And Fidciaries Then Stick To Allocations Inclde Reasonable Time Limits Within Which Claims Mst Be Filed Or They Will Be Denied As Untimely Plans Shold Be Created Or Amended To Give The Claims Fidciary Discretion To Constre The Terms Of The Plan, Make Benefit Eligibility Determinations, And Make Factal Findings Plans Shold Warn Participants That Their Failre To Exhast The Internal Claims Procedres Will Reslt In A Motion To Dismiss For Failre To Exhast Those Procedres In The Event A Participant Or Beneficiary Files A Lawsit When Allowed By Law Draft Plan To Provide Plan Has The Right To Correct And Recop Any Overpayments. Draft Plan To Reqire Participants And Beneficiaries To Attest To Eligibility Facts, Other Matters That Cold Be Basis Of Frad 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 29

30 Plan Assets, Plan Expenditres & Plan Investments Big Responsibilities Growing Bigger Plan Assets Held In Trst By Trstee Unless Meet Reqirements For Exception Cafeteria Plan Interface Insolvency, Other Failres to Fnd Who Holds The Money and How? Dedctibility Taxability of Income Earned Prdent Investment & Expenditre Emerging Reqirements Regarding Prdent Vendor Selection & Services Pricing Adit Prdence of Aditor Selection & Oversight New Welfare Plan Fee Disclosre Reqirements Likely To Prompt New Scrtiny Of Client Services Other 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 30

31 ERISA Claims & Appeals ERISA Reasonable Claims & Appeals Procedre Reqirements Apply To All Plans ACA Adds Independent Review & Other Reqirements For Non- Grandfathered Grop Health Plans Plan Docment/SPD/EOB Content, Compliance With DOL Reglations, Fidciary Discretion & Condct Matter Prompt Pay, Other State Law Liability To Providers For Non- Derivative Claims Coordination of Benefits Risks False Claims Act, Social Secrity Act 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 31

32 ACA Grandfathered Plans Coverage Provided By A Grop Health Plan Or A Health Insrance Isser Only If: Plan/Policy Continosly Existed On 3/23/10 Plan/Policy Continosly Exist For As Long As Grandfathered Stats Is Claimed At Least 1 Individal Was Enrolled On 3/23/10 For As Long As It Maintains Grandfathered Plan Stats Plan/Policy Not Experienced Disqalifying Material Change Reqired Grandfathered Stats Disclosres Provided Reqired Docmentation Maintained Cationary Note: Review & Reconfirmation Of Stats Of Plans Presmed To Qalify As Grandfathered As Market Forces & Reqirements To Collect & Maintain All Plan Docmentation Since 3/23/10 Inclding Plan Docment, SPD, Vendor Contracts, Etc. & Other Restrictions Raise Challenges In Maintaining Grandfathered Plan Qalifications 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 32

33 Key Federal Plan Design Rles* Federally Reqired Plan Terms Inclde Federal Employment Discrimination Laws Inclding ADEA, ADA, Title VII & Pregnancy Act, GINA, Religion Obergefell v. Hodges Same-Sex Marriage Rling Implications Medicare, Medicaid, SCHIP, TRICARE & Other DOD, ACA PIP Plan Federal Nondiscrimination, Eligibility, COB & Reporting Reqirements Children Affected By Divorce/Medicaid-QMCSOs Child Adopted or Placed For Adoption Mst Be Child IRC 105(h)/ACA Insred Plan Nondiscrimination In Favor Of HCE & Associated IRC 125 Cafeteria Plan Rles FMLA, USERRA Military Leave, COBRA, Michelle s Law Coverage Contination *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 33

34 Key Federal Plan Design Rles* Federally Reqired Plan Terms Inclde HIPAA Creditable Coverage & Special Enrollment Mandates HIPAA Pre-Existing Condition Limits Restricted To 12 Months (18 Late Enrollment) Less Creditable Coverage On All Plan Benefits HIPAA/GINA Nondiscrimination On Health Stats & Genetic Information GINA Prohibition Of Genetic Information Collection Inclding Family History Note: HIPAA Nondiscrimination & GINA Present Special Reqirements & Risks For Wellness & Disease Management Programs. See New Final HIPAA Wellness Reglations *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 34

35 Key Federal Plan Design Rles* Benefit Design Mandates Insred Grop Health Plans Provide Essential Health Benefits Becase ACA Generally Reqires Policies Offered By Insrers In Large or Small Grop or Individal Market To Meet Essential Health Benefit, Market Reform & Other Reqirements Unless Grandfathered Plan, Or Otherwise Exempt Grandfathered Plan & Excepted Benefit Plan Reglations & Rles Limit Availability Of These Reqirements. Applicability Often Oversold 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 35

36 Key Federal Plan Design Rles* Bona Fide Wellness Programs New Rles Wellness & Disease Management Violate HIPAA/GINA Nondiscrimination Unless Meet Final ACA/HIPAA Wellness Reglations Allowable Reward Limited To 30% Of Cost Of Medical Coverage (50% With Respect To Smoking) New Final Reglations Set Forth Detailed Rles Based On If Program: - Participatory - Health Stats Based All Programs Mst Be Available To All Similarly Sitated Participants Health Stats Based Reqirements Inclde Many Conditions, Inclding: - Opportnity To Qalify At Least Annally - Reasonably Likely To Improve Wellness - Generally Mst Provide Reasonable Alternative Method Of Obtaining Reward To Participants If Unable Or Health Makes Unadvisable To Participate - Specific Notifications & Other Safegards Other laws impact wellness programs (GINA, ADA, HIPAA Privacy, ERISA, IRC) *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 36

37 Key Federal Plan Design Rles* Bona Fide Wellness Programs New Rles Other laws impact wellness programs (GINA, ADA, HIPAA Privacy, ERISA, IRC) EEOC Interpretation of Americans With Disabilities Act Reqires That Employers & Plans Consider & Manage Disability Discrimination Risks *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 37

38 Key Federal Plan Design Rles* Federally Reqired Plan Terms Inclde Contined Coverage For Pediatric Vaccines Covered On 5/1/93 Maternity Stay Mental Health Parity Post-Mastectomy Reconstrctive Srgery nder Women s Health & Cancer Rights Act *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 38

39 Key Federal Plan Design Rles* ACA Federally Reqired Plan Terms Inclde Child Dependent To Age 26 Preexisting Conditions Exclsions Banned On Essential Health Benefits Coverage Rescissions Prohibited Except Frad or Misrepresentation Waiting Periods Over 90 Days Prohibited Mandatory Defalt Enrollment In Lowest Cost Option For Employers With > 200 Fll-Time Employees No Annal/Lifetime Caps On Essential Health Benefits Cation Abot HRAs/Defined Contribtion Health Plans 100% Preventive Care Coverage Mandate With No Cost-Sharing Except Vale Based Design Ot-Of-Pocket Match 2014 Transitional Relief Allows To Apply Separately to Prescription Drg Benefits From Other Benefits *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 39

40 Affordable Care Act Lifetime & Annal Maximms Post 9/22/10 Plan Years Implications On HRAs & Other Defined Contribtion Strategies Integrated Non-Integrated Other Challenges 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 40

41 Key Federal Plan Design Rles* ACA Federally Reqired Plan Terms Inclde Coverage for Rotine Costs For Participation In Clinical Trials Plan Reqiring PCP Designation Mst Allow Designation of Any Available Primary Care Provider OBGYN Treated As PCP For Women s OBGYN Services Plan Reqiring PCP Designation mst Allow Designate Pediatrician In Network As PCP Provider No Pre-Athorization Reqirement For Emergency Services & Mst Coverage Emergency Care Of Ot-Of Network Provides Like In-Network Care Claims & Appeals Procedres Inclding Extensive Additional ACA Reqirements For Internal & External Claims Review Cltrally & Lingistically Appropriate Commnications *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 41

42 Essential Health Benefits Insred Individal & Grop Coverage, Association Plans, Government Plans Market Reform Mandate For Insred Individal & Grop Health Coverage Other Than Excepted Plans Very Rich Benefit Package Set By States Within HHS Parameters For Insred Plans Minimm Essential Coverage Distingished - Relevant To: Self-Insred Plan Compliance With ACA Annal & Lifetime Limit Rle Small Employer Plan Tax Credit Eligibility Large Employer Pay or Play Penalty 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 42

43 Key Federal Plan Design Rles* ACA Grop & Individal Insrers Mst Provide ACA- Compliant Essential Health Benefits Design ACA Federally Reqired Plan Terms Inclde Mst Cover Essential Health Benefits As Defined By HHS Reglations Within Following Reqired Categories - Amblatory Patient Services - Emergency Services - Hospitalization - Maternity And Newborn Care - Mental Health And Sbstance Use Disorder Services, Inclding Behavioral Health Treatment - Prescription Drgs - Rehabilitative And Habilitative Services And Devices - Laboratory Services - Preventive And Wellness Services And Chronic Disease Management - Pediatric Services, Inclding Oral And Vision Care. - Other Services Typically Covered By Employers *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 43

44 Key Federal Plan Design Rles* ACA Grop & Individal Insrers Mst Provide ACA- Compliant Essential Health Benefits Design ACA Federally Reqired Plan Terms Inclde Mst Cover Provide Benefits Actarially Eqivalent To Applicable % Fll Actarial Benefits Provided By Plan - Bronze Level: 60% - Silver Level: 70% - Gold Level: 80% - Platinm Level: 90% - Catastrophic Plan Cost Sharing Restrictions For Self-Only Or Other Coverage Can t Exceed High Dedctible Limits Under IRC 223(c)(2)(a)(ii) For Self-Only And Family Coverage Respectively *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 44

45 IRC 6039D/IRS Form 8928 Health Plan's "SOX Employers and plan sponsors mst report on Form 8928 to report excise taxes de for certain health plan violations for post-2013 Tax Years Prepare For Employer Srprise, Discontent When Learn Of Potential 2014 Liability Recognize & Plan To Deal With Potential Exposres, Fallot For Yor Firm 2015 Cynthia Marcotte Stamer. All rights reserved. Page # 2015 Cynthia Marcotte Stamer. All rights reserved. 45

46 Form D ACA Grop Health Plan Violation Excise Tax Amont Plan sponsor generally mst self-assess and pay $100 per day, per individal, per violation, excise tax for specified health plan violations, sbject to the following minimms and maximms: If IRS discovers on adit, minimm excise tax is: - $2,500 or - If not de minims, p to $15,000. For single employer plans, maximm excise tax for nintentional failres = lesser of: - 10 percent of the aggregate amont paid by the employer dring the preceding tax year for grop health plan coverage, or - $500,000 Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 46

47 Form D ACA Grop Health Plan Violation Excise Tax Amont For mltiple employer health plan, maximm tax limited to lesser of: 10% amont paid or incrred by sch trst dring sch taxable year to provide medical care w/in meaning of IRC 9832 (d)(3) directly or throgh insrance, reimbrsement, or otherwise, or $500,000 All plans of part of same trst forms treated as one plan. Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 47

48 Form 8928 Used To Report Health Plan Violation Excise Taxes For: 4980B: COBRA Violations (ER* Pays $100 Per QB Per Day Noncompliance Period, Sbject To Min. & Max Fine Rles) 4980D Code Chapter 100 Grop Health Plan Violations (ER**Pays $100 Per Day Per Victim) 4980E/ Employer W/HDC Contribting To Any Employee s Archer MSA Failre To Make Comparable MSA Contribtions For All Participating Employees (35% aggregate ER s Contribtions) 4980G - Failre Of Employer To Make Comparable Health Savings Accont Contribtions For All Participating Employees (35% aggregate ER s Contribtions) *Plan If Mltiemployer Plan ** N/A To Certain Violations Of Certain Flly Insred Small Employer Plans Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 48

49 Form 8928 Excise Taxes: Health Plan Violations Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 49

50 Form 8928 Excise Taxes 4980D ACA Health Plan Violations Dty To Report & Pay Noncompliance Period Means The Period Beginning on the date sch failre first occrs, and Ending on the date sch failre is corrected. Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 50

51 Form 8928 Excise Taxes Deadlines To Report & Pay Generally mst file Form 8928 & pay the excise tax by the de date of the employer s federal income tax retrn, withot taking into accont any extensions Atomatic six-month extension of time for filing Form 8928 available Extension does not extend the time to pay the excise taxes de Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 51

52 Form D ACA Grop Health Plan Violation Excise Tax Exception No Excise Tax If: Failre de to reasonable case and not to willfl neglect For plan other than a chrch plan, failre corrected dring the 30-day period beginning on the first date the person otherwise liable for sch tax knew, or exercising reasonable diligence wold have known, that sch failre existed; and For chrch plan, failre corrected before the close of the correction period nder the IRC 414(c)(4)(C) Brden of Proof Considerations Important Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 52

53 Form D ACA Grop Health Plan Violation Excise Tax Exception Failre Corrected If Retroactively Undone To The Extent Possible, And Person To Whom The Failre Relates Is Placed In A Financial Position Which Is As Good As Sch Person Wold Have Been If Failre Not Occrred. Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 53

54 Form 8928 Excise Taxes 4980D ACA Health Plan Violations Dty To Report & Pay N/A To Small Employer Plans If: Provide Health Insrance Coverage Solely Throgh A Contract With A Health Insrance Isser FailreSolelyBecaseHealthInsranceCoverageOffered By The Insrer Small Employer = (On Controlled Grop Basis) Secretary can waive all or part of tax for failre de to reasonable case and not to willfl neglect to the extent Secretary finds payment of tax wold be excessive relative to the failre involved. Page Cynthia Marcotte Stamer. All rights reserved 2015 Cynthia Marcotte Stamer. All rights reserved. 54

55 NOTICE Code 4980D & Form 8928 penalty relief for small employers and certain S-Corporations who have illegal employer payment plans (e.g., premim reimbrsement programs) throgh 6/30/15 Clarifies mere increase in an employee s compensation, withot conditioning the payment of the additional compensation on the prchase of health coverage (or otherwise endorsing a particlar policy, form, or isser of health insrance) is not a violation of the ACA Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 55

56 Health Plan Privacy & Data Secrity HIPAA Applies To Grop Health Plans & Their Bsiness Associates Prohibits Use, Access, Disclosre Of Protected Health Information (PHI) Except As Expressly Allowed By Rle General Dty To Protect PHI Pls Detailed Mandates For Secrity Of Electronic PHI Bsiness Associate Agreement, Employer Certification, & Workforce Designation Reqirements Breach Notification Mandates Recordkeeping & Acconting For Disclosres Personal Rights Compliance Plan Other 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 56

57 HIPAA Privacy & Secrity Heath Plan HIPAA Breaches May Create Fidciary Obligations For Health Plan Fidciaries the fidciary obligations of ERISA also may reqire a prdent investigation and other action Brokers, insrers, third party administrators, preferred provider organizations or other managed care providers and others doing bsiness with the health plan also may have specific responsibilities nder state insrance, health care, data breach and identity theft or other laws Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 57

58 INTERNAL REVENUE CODE Confidentiality of Tax Retrn Information 26 U.S.C nlawfl for any person to willflly disclose to any other person, except as athorized in this title, any retrn or retrn information acqired by he or she on another person. Any violation of this paragraph shall be a felony pnishable by a fine in any amont not exceeding $5,000, or imprisonment of not more than 5 years or both, together with the costs of prosection. Retrn information incldes taxpayer s identity; natre, sorce or amont of his income; payments and receipts; dedctions and exemptions; credits, assets, and net worth; tax or other liabilities, tax liability, tax withheld, and tax payments, sbject to an investigation or adit 9/22/2015 Copyright Cynthia Marcotte Stamer. All rights reserved Cynthia Marcotte Stamer. All rights reserved. 58

59 Brokers, CPAs Other Advisors Also May Owe Other Specific Confidentiality Obligations Texas Insrance Code Mandates For Brokers & Insrers Texas Identity Theft Statte AICPA Confidentiality Or Other Ethical Rles Internal Revene Code Privacy, Confidentiality FACTA Cybercrime Other 9/22/2015 Copyright Cynthia Marcotte Stamer. All rights reserved Cynthia Marcotte Stamer. All rights reserved. 59

60 HIPAA & Other Privacy & Secrity Risk Management & Compliance Plan Amendments Bsiness Associate Agreements Employer Policies & Representations Docmented Operationalization & Enforcement Of Processes & Procedres Compliance Plans Breach Monitoring Proper Encryption, Training & Disposal Up The Ladder Reporting Yo/Yor Plan Can Be Liable For What Yor Bsiness Associate Does Breach Preparedness & Response Plan Indemnification & Liability Coverage Other 2012 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 60

61 EVOLVING NOTICE, REPORTING & DISCLOSURE REQUIREMENTS Note: That New ACA Grop Health Notice Reqirements Ct Short Deadlines For Finalizing Health Plan Terms & Contracts 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 61

62 Smmary Plan Descriptions (SPDs), Other Reqired Commnications Separate SPD & Plan Docment Reqirements Content Mandates Defined By Reglations All Material Terms Pls Others New Laws, Reglations Implementing New Mandates Increasingly Impose Specific Reqirements To Add Langage To SPD, e.g.: SPD Reglations Claims Reglations - Medicare Part D Notice - Electronic SPDs - Investment Gidance - Pension Protection Act - Affordable Care Act - Other Conflicts Between Plan Docments, Cigna v. Amara Certificates of Coverage/Other Vendor Docments Commonly Inadeqate DOL, IRS Model/Sample Forms Often Reqire Spplementation/Tailoring To Meet Other Reg. Reqirements, Fit Plan, Other 2012 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 62

63 Plan Notice & Commnications What Yo Say Can & Will Be Used Against Yo - Dty Of Prdence Applies - ERISA, Code, Social Secrity Act, HIPAA Notice, Affordable Care Act, COBRA, ARRA, Claims & Appeals & Other Commnication & Reporting Reqirements - List of Reqired Notices Expanding - Employer That Speaks As Fidciary FMC v. Halliday, In Re Enron - Conflicts Between Plan Docment, SPD Or Other Commnications Fidciary Concern, Cigna v. Amara - Content Concerns - Procedral Concerns - Affordable Care Act Cltrally & Lingistically Appropriate & EEOC Comments - Affordable Care Act SBC & Other Reqired Notifications - Electronic Commnications - Employer Speaking Abot Plan Acts As Fidciary Varity v. Howe 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 63

64 ACA Imposes New Notice Mandates Inclding: FLSA 18B Exchange Notice Smmary of Benefits & Commnications (SBC) 60-Day Advance Notice of Material Changes Reqirement Notifications In ACA Internal Claims & Appeals Mandates For Non- Grandfathered Plans Cltrally & Lingistically Appropriate Mandate For SPDs & Other Plan Written & Oral Commnications 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 64

65 Key Federal Plan Design Rles* Federal Law Mandates Many Other Grop Health Plan Notifications & Disclosres Inclding 5500 Annal Retrn, $1000 per day DOL penalty for failre to file; DOL & IRS Late Filer Amnesty Program W-2 & Other Affordable Care Act Reporting Reqirements Wage Reporting & Withholding Form 8928 Dty To Self Report, Pay 5% Excise Tax For Health Plan Not Compliance With Long List of Grop Health Plan Mandates Form 1094B, F0rm 1095B and C Employer Minimm Essential Coverage Reporting Information Retrns Annal Form M-1 For MEWAS and Mltiemployer Plans Medicare Data Bank Report For Terminated Providers Many Others *Grandfathered Plan Stats, Plan Size & Benefit Design May Impact Applicability 2015 Cynthia Marcotte Stamer. All Rights Reserved. Page Cynthia Marcotte Stamer. All rights reserved. 65

66 Miranda Warning Health Plan Notices & Other Commnications Spreme Cort In Varity: What Yo Say Can & Will Be Used Against Yo Plan Commnications Generally Are Fidciary Actions Unless Ministerial ERISA Fidciary Dty of Prdence ERISA Option To Allocate Fidciary Responsibility, Have Distinction Between Employer & Plan Fidciaries Named Fidciary Shold Commnicate On Matters Within Its Responsibility/Athority Under Plan Sloppy Commnication Can Blr Fidciary Allocations Ensre Plan Terms All Accrately Written Into Plan Docment & Notice & Other Commnications Flly Match Plan ACA Mandates & Model Notices Often Blr Fidciary & Employer Roles 2015 Cynthia Marcotte Stamer, PC Cynthia Marcotte Stamer. All rights reserved. 66

67 Optional Langage May Help Manage Risk, Promote Enforceability Plan Sponsor Reserves The Right To Amend Or Terminate The Plan At Anytime Limited By ACA 60 Day Notice Mandate Rights Under The Plan Are Determined By The Written Terms Of The Plan As In Effect At The Time As Interpreted By The Named Fidciary Under The Plan In Its Exclsive Discretion. Read The Plan Docments For A Complete Understanding Of Yor Rights And Write To The Named Fidciary For An Answer To Any Qestions The Applicable Named Fidciary Has The Exclsive Right To Interpret The Plan And Make Determinations Clear Identity Of Who The Named Fidciaries Are Inclding Disclosre Of Separate Roles When Applicable 2015 Cynthia Marcotte Stamer, PC Cynthia Marcotte Stamer. All rights reserved. 67

68 FLSA 18B Exchange Notice Reqirement All Fair Labor Standards Act (FLSA)-covered employers generally mst deliver a notice (Exchange Notice) to employees abot the new option beginning Janary 1, 2014 to get health care coverage throgh a health care exchange (now rebranded by the Obama Administration as a Marketplace )(Marketplace) created by ACA that meets the reqirements of new FLSA Section 18B, enacted by Section 1512 of ACA 2015 Cynthia Marcotte Stamer, PC Cynthia Marcotte Stamer. All rights reserved. 68