Feds Publish "Things to Do" List

May 27, 2003 (PLANSPONSOR.com) - Plan sponsors looking for signals regarding the direction of upcoming regulatory actions can glean some insight from today's Federal Register.

>According to its    semiannual regulatory agenda , the Labor Department’s Employee Benefits Security Administration (EBSA) is next month considering issuing guidance concerning the notification requirements on continuation of health care coverage under the Employee Retirement Income Security Act (ERISA), as provided under the Consolidated Omnibus Budget Reconciliation Act (COBRA).  

EBSA Agenda

>By year-end EBSA is planning to propose regulations providing safe harbors under which the designation of an institution providing an individual retirement account (IRA) such that it can receive the automatic rollover of funds and the initial investment choice for the rollover funds.   The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) requires that, absent an affirmative selection by the participant, certain mandatory distributions from a qualified retirement plan must be directly transferred to an individual retirement plan of a designated trustee or issuer.

>In September, EBSA plans to finalize guidance necessary to implement provisions of the Health Insurance Portability and Accountability Act (HIPAA), intended to improve health care access, portability, and renewability. Next March EBSA says it plans to finalize regulations on the Mental Health Parity Act to conform with the extension of the act’s sunset date under the Mental Health Parity Reauthorization Act (see    EBSA Adjusts Mental Health Parity Act Dates ).

>In December, EBSA plans to finalize rules on the prohibition of discrimination against participants and beneficiaries based on health status enacted under HIPAA, which established that group health plans and health insurers cannot establish rules for eligibility based on health status.

PBGC Proposals

>For its part, in October, the Pension Benefit Guaranty Corporation (PBGC) plans to propose rules that will fill in gaps in existing rules on benefit payments and address issues related to the determination of benefit guarantee limits and the time, form, and manner of payment.    The PBGC, which insures the nation's private pension system, also says it is considering amending benefit valuation and asset allocation regulations by adopting more current mortality tables and simplifying valuation assumptions and methods.   According to its  semiannual regulatory agenda , the PBGC says it expects to issue the proposed rulemaking in July.

>By September, the PBGC is planning to finalize rules to clarify and simplify its filing rules and provide greater flexibility in methods of filing.    Last February, the agency proposed rules to remove requirements that would limit electronic filings and electronic issuances to others (see  PBGC Looking for Input on Electronic Communications Proposal ).

Commission Calendar

>As early as next month, the Equal Employment Opportunity Commission (EEOC) says it plans to propose an exemption to the Age Discrimination in Employment Act (ADEA) to allow employers to reduce or end benefits when a retiree becomes eligible for Medicare or state retiree health benefits without potentially violating the law.    The proposed rule was first mentioned in EEOC's regulatory agenda published last December (see  EEOC Does 180 on Retiree Benefits Levels ).  

>The EEOC has previously noted with concern a decline in the number of employers who provide retiree health plans over the past decade.    The proposed regulation will implement an August 2001 policy change, in which the EEOC revoked its previously held position that a reduction or elimination of health care benefits for those who reached Medicare eligibility was illegal under the ADEA (see  EEOC Reviewing Policy on Retiree Health Benefits ).

According to its  agenda , the EEOC also plans to take final action this summer on a proposed rule that would update and clarify the agency's regulations under the ADEA dealing with when complainants can file a private civil action after filing EEOC charges.