Last week the U.S. Court of Appeals for the Seventh Circuit ruled that the deadline imposed under ERISA for plan administrators to decide on benefit claims is a “bright line” rule. The court held that when a plan administrator misses this deadline, the “substantial compliance” exception to statutory compliance does not apply and the plan
ERISA Plan Administration
EIGHTH CIRCUIT RULES AGAINST THIRD PARTY ADMINISTRATOR IN CROSS-PLAN OFFSETTING IN GROUP HEALTH PLANS
On January 15, 2019, the federal Eighth Circuit Court of Appeals issued its decision in Peterson v. UnitedHealth Group, Inc., 913 F.3d, 769 (8th Cir. 2019), in which the Court upheld the federal district court’s holding that UnitedHealth Group, Inc. (“United”) was not authorized to reduce (or “offset”) payments to medical providers under ERISA…
You’ve Discovered A Mistake in Your Plan Administration – Now What?
Occasionally qualified plan administrators discover that their plans have incurred an operational error. The Internal Revenue Service (“IRS”) recognizes that it needs the help of plan administrators to police the administration of qualified plans and has correspondingly published guidance to help plan administrators take appropriate corrective action where necessary.
IRS Correction Alternatives
Financial Conflict of Interest in the Eighth Circuit: Trigger of a Less Deferential Standard of Review or Mere Factor in Determining Plan Administrator Abuse of Discretion?
It is well-established under the Employee Retirement Income Security Act of 1974 (“ERISA”) that when an employee benefit plan grants the plan administrator discretion to decide questions of eligibility for benefits or to construe plan terms, judicial review of the plan administrator’s denial of benefits is generally limited to the deferential abuse of discretion standard…
IRS Reduces HSA Contribution Amount for Current Year
In 2017, the IRS released the 2018 inflation-adjusted figures for contributions to Health Savings Accounts (HSAs). The contribution limits for HSAs associated with High Deductible Health Plans was increased to $3,450 for individuals with self-only coverage and to $6,900 for individuals with family coverage. In December, the President signed the tax reform bill commonly known…
DOL Continues Investigating Defined Benefit Plans Regarding Procedures for Locating Participants and Paying Benefits at Mandatory Retirement Age
The U.S. Department of Labor (DOL) publicized last year its stepped up enforcement efforts inquiring about procedures used by larger defined benefit plans for locating, and then beginning payment of benefits to, terminated vested participants who have reached the age when the plan mandates benefits must begin. Those audit activities are continuing. For years, the…
DEATH OF THE SUBSTANTIAL COMPLIANCE DOCTRINE?
In Halo v. Yale Health Plan, decided in April of 2016, the Second Circuit expressly rejected the “substantial compliance” doctrine with respect to alleged violations of the ERISA Claims Procedure regulation. Instead, the Court held that, in order to preserve otherwise properly reserved discretionary authority, the decisionmaker must demonstrate that any deviation from the…
“Off the Rails:” A Plan Administrator’s Burden
When an ERISA plan provides the plan administrator with discretion to interpret the terms of the plan, the administrator’s claims and appeals decisions are generally reviewed by courts under a lenient standard of review such as “abuse of discretion.” In such cases, courts generally will not upset the plan administrator’s decision absent a clear error.…
IRS GUIDANCE: EMPLOYEE INCOME TAX CORRECTION FOR SAME-SEX SPOUSAL HEALTH COVERAGE AFTER UNITED STATES V. WINDSOR
On June 27, 2014, the IRS released Information Letter 2014-0012, which contains guidance for employees who have had the value of same-sex spousal coverage under employer health plans — which until recently was required to be included in gross income — reported on their Forms W-2.
BACKGROUND
Historically, the employer cost of opposite-sex …
Department Of Labor Issues “Me Too” Technical Release: ERISA Definition of Marriage Includes Same-Sex Spouses
DOMA Windsor “same-sex spouse”…
Continue Reading Department Of Labor Issues “Me Too” Technical Release: ERISA Definition of Marriage Includes Same-Sex Spouses