Congress Considers Medicare Legislation
Medicare and Medicaid legislation has seen considerable debate this legislative session. The Medicare, Medicaid and SCHIP Extension Act of 2007 (S. 2499) delayed scheduled cuts in physician reimbursements for six months, reauthorized the State Children’s Health Insurance Program (SCHIP) for 18 months and required employer-provided health plans to provide enrollment data to the secretary of Health and Human Services. [March 2008]EEOC Issues Final Rule Permitting Coordination of Retiree Medical and Medicare
The Equal Employment Opportunity Commission (EEOC) released final regulations that allow employers to coordinate retiree health benefits with Medicare benefits. Although the EEOC decided to approve this long-standing employer practice some time ago, the agency had been blocked from issuing these final rules by litigation brought by AARP. Under the final rules, employers can eliminate or reduce retiree health benefits when retirees become eligible for Medicare without violating the Age Discrimination in Employment Act (ADEA). [February 2008] Partially Prefunding the Canadian Public Pension Plans: Lessons for the United States?
During the 1990s, both Canada and the United States were facing many of the same challenges to their Social Security programs. But while the United States has continued on the same course, with no changes made – despite continued projections of severe shortfalls ahead – Canada began partially prefunding its public pension plans with real assets in 1998. Would a similar approach be possible or appropriate for the financially challenged Social Security program in the United States? [February 2008] SSA to Suspend Disability Service Improvement Initiative
The Social Security Administration (SSA) has proposed to suspend the Disability Service Improvement (DSI) initiative, while soliciting public input on other possible reforms. [October 2007] Developments in Retirement Programs in Spain
The retirement system in Spain includes three pillars: a generous, almost universal Social Security program; employer pension and insurance plans, which are mainly sponsored by large companies and cover fewer people; and a moderate but significant penetration of individual retirement savings products. Spain’s population is aging rapidly, and, like many developed countries, Spain must act soon to avert significant deficits later in its public retirement income programs. [September 2007] Improvement in Social Security Disability Claims Process May Affect Cash Flow in Employers’ Disability Plans
For the first time in 50 years, the Social Security Administration (SSA) is revamping its disability determination process. The final rule, which is intended to shorten decision times and pay out benefits faster, took effect August 1, 2006, in the New England region. [May 2007] Senate Blocks Medicare Part D Drug Negotiation
The Senate’s attempt to allow the secretary of Health and Human Services (HHS) to negotiate the price of prescription drugs under the Medicare Part D program was blocked on April 18 when the legislation failed to gain the 60 votes it needed for final debate and passage. [May 2007] Social Security — The Fate of the 1983 Long-Term Solution and the Lessons for Future Reform
The federal government last tried to restore long-term financial solvency to Social Security 24 years ago. The Social Security Amendments of 1983 were supposed to make Social Security fiscally sound for the next 75 years. This article discusses why the 1983 amendments did not deliver the long-term solution policymakers were hoping for and how future reforms can avoid the same fate. [April 2007] House Approves Legislation to Require Negotiation of Part D Drug Prices
On January 12, the House approved the Medicare Prescription Drug Price Negotiation Act of 2007 (H.R.4) by a vote of 255-170. The legislation would require the secretary of Health and Human Services (HHS) to try to negotiate lower drug prices – including discounts, rebates and other price concessions – for sponsors of Part D prescription drug or Medicare Advantage plans. The secretary would have to report the results of these negotiations to Congress twice a year. [February 2007] Governmental “Pick-Up” Plans Require Formal Adoption
In Revenue Ruling 2006-43, the IRS clarifies the designation required by an employing
governmental unit in order to “pick up” employee contributions. In a pick-up plan, the
Code allows governmental employers to “pick up” mandatory employee contributions,
which are then treated as nontaxable employer contributions instead of taxable employee
contributions. [October 2006] President Bush Addresses the Projected Social Security Shortfall
On April 28, 2005, President Bush unveiled another piece of his plan for Social Security, addressing the criticism that his proposal for individual accounts ignores the projected long-term insolvency. [June 2005] AARP Blocks EEOC From Ruling on Retiree Medical Benefits and Medicare
On February 4, a federal court in Pennsylvania blocked the Equal Employment Opportunity
Commission from issuing its final rule on coordinating retiree medical benefits with Medicare. [March 2005] IRS Issues Additional Guidance on HSAs
The IRS recently issued its second round of guidance regarding health savings accounts (HSAs), which answers employers’ most pressing questions and concerns about these new accounts. [May 2004] Behind the Headlines on COLI
Those who have been following the recent press coverage of corporate-owned life insurance, most notably in the Wall Street Journal, may be asking: “What’s the problem with COLI?” [July 2002] Lessons from Abroad for U.S. Social Security Reform
President Bush's Commission to Strengthen Social Security presented its set of three reform proposals at the end of last year and has not been heard from since. Though few expect Social Security reform to see the legislative light of day this year, it cannot be put off forever. [May 2002] Social Security Retirement Earnings Test Repealed: Should Workers Take Benefits Now or Later?
Workers who defer receipt of Social Security benefits after their SSNRA will receive a delayed retirement credit, up to age 70, thus increasing their benefit when they do retire. [June 2000] Congress Restores BBA Cuts
The Balanced Budget Act (BBA) of 1997 "saved" Medicare until 2008 - largely by significantly reducing payments to providers and implementing new methodologies for determining reimbursement. But health care providers complained that payment cuts have been steeper than expected, and thus are imposing hardships on both providers and patients. [December 1999] Social Security Benefit Statements
Last month the Social Security Administration began mailing out individual earnings and benefit estimate statements. [November 1999] The Real Deal: A Solution to Social Insecurity
When President Clinton used his State of the Union message to propose vast changes in the way Social Security is financed, he escalated what may become the hottest public policy debate of the next several years. [October 1999] Tax Bill Includes Many Benefits Provisions
It’s tax season on Capitol Hill — not the tax season when everyone files their tax returns with the IRS — the one where members of Congress argue about changing the tax code. This year’s debate has been particularly divisive, thanks to the strong economy and large budget surplus. Some lawmakers have been pushing big tax cuts, while others want to hold the entire surplus in reserve for Social Security and Medicare. Before the August recess, Congress passed a $792 billion tax cut bill, the Taxpayer Refund and Relief Act of 1999 (H.R.2488). [September 1999] The Changing Economics of Social Security and Retirement Plan Sponsorship
Over the last several months, Watson Wyatt Insider has run a series of articles describing Social Security reform proposals currently under consideration. This article takes a slightly different tack, by explaining an underlying aspect of Social Security policy that many employers may not have fully grasped as they have dealt with financing their own retirement benefit plans. The basic premise is that the way Social Security has been implemented in the United States has served to spur the creation of employer-sponsored pensions. [September 1999] President Releases Medicare Reform Plan
President Clinton has released a Medicare reform proposal aimed at safeguarding the program’s financial solvency until 2025. The proposal would devote 15 percent of budget surpluses over the next 15 years — almost $800 billion — to Medicare. [August 1999] When East Is West
The Social Security policy deliberations in Washington have taken another interesting twist. Ways and Means Committee chairman Bill Archer (R-Texas) and the Social Security Subcommittee chairman Clay Shaw (R-Florida) have proposed their own version of Social Security reform. [August 1999] A Bipartisan, Bicameral Proposal for Reforming Social Security
During May 1998, the National Commission on Retirement Policy (NCRP) released a proposal for Social Security reform. [July 1999] Social Security Reform for the Brave of Heart
In the last two issues of the Insider, we looked at reform proposals that would tap into the projected federal budget surpluses to help resolve Social Security's underfunding. [June 1999] Patients' Bill of Rights Gets First Vote
On March 18, the Senate Committee on Health, Education, Labor and Pensions (formerly the Committee on Labor and Human Resources) approved a version of the Patients' Bill of Rights Act (S.326) sponsored by committee chair James Jeffords (R-Vermont). [May 1999] And He Stuck in His Thumb...
Most policymakers and policy analysts looking at Social Security today advocate more funding. Last month we looked at President Clinton's proposal to use 60 percent of projected federal budget surpluses to fund currently promised benefits through the first half of the next century [May 1999] Social Security: The Talk of the Town
It's springtime in the nation's capitol and, along with the cherry blossoms, dormant issues are coming back to life. One such overdue discussion concerns Social Security policy. [April 1999] Aging Baby Boom Driving New Congress' Benefits Agenda
As the 21st century approaches and the baby boomers near retirement age, benefits issues such as retirement security, Social Security and Medicare reform, and retiree health care have been attracting more attention on Capitol Hill. [January 1999] Medicare HMOs Hold the Line in 1999—Despite 2 Percent Rate Increases
Medicare's rate increases were limited to 2 percent for most HMOs in 1999, prompting some HMOs to drop out of the program or reduce service areas [January 1999] HCFA Gears Up for Medicare+Choice Publicity Campaign
November's introduction of a Medicare+Choice education program will usher in a new era in Medicare. [September 1998]
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