Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
September 30th, 2014
Benefit Briefs
Employers Report Strategies to Mitigate ACA Cost Increases
More than 87% of employers surveyed indicated they have taken at least one action to mitigate rising health care costs. According to the 2014 HR@Moore Survey of Chief HR Officers by the Darla Moore School of Business at the University of South Carolina, 78% of respondents indicated their health insurance costs have risen (by an average of 7.73%), and 37% reported their labor costs have increased (by an average of 5.6%) as a direct consequence of the Patient Protection and Affordable Care Act (ACA).Read more >
Employers See Health Exchanges as Viable Health Benefit
Twenty-eight percent of employers surveyed by Towers Watson said they had already extensively evaluated the viability of private exchanges for health care benefits. Nearly one in four (24%) employers said private exchanges could provide a viable alternative for their active full-time employees as soon as 2016, according to the 2014 Towers Watson Health Care Changes Ahead Survey. The survey also revealed the top three factors that would cause employers to adopt a private exchange for full-time active employees.Read more >
Industry Voices
Objectively, how good is your retirement plan? Without some comparative analysis, how would you know? Doing a comparative analysis can be a daunting task, and if there is no clear need, it’s human nature to put it off. In Part 1 of this two-part article we hope to show you that over-using  the “snooze button” is risky, and in Part 2 we will provide a roadmap for performing a comparative analysis on your plan. The “if it ain’t broke…” approach is unacceptable, for two main reasons.Read more >
Market Mirror
Yesterday, the Dow was down 41.93 points (0.25%) at 17,071.22, the NASDAQ slipped 6.34 points (0.14%) to 4,505.85, and the S&P 500 lost 5.05 points (0.25%) to finish at 1,977.80. The Russell 2000 decreased by 1.43 (0.13%) to 1,117.90, and the Wilshire 5000 closed 43.66 points (0.21%) lower at 20,842.01. On the NYSE, 3.2 billion shares changed hands, with 1.4 declining issues for every advancing issue. On the NASDAQ, 2.8 billion shares traded, with a 1.3 to 1 ratio of decliners to advancers. The price of the 10-year Treasury note was up 14/32, decreasing its yield to 2.481%. The price of the 30-year Treasury bond increased 29/32, bringing its yield down to 3.170%.
Rules & Regulators
PBGC Wants Notice of Pension Risk Transfer Moves
The Pension Benefit Guaranty Corporation (PBGC) is requesting that the Office of Management and Budget (OMB) approve a revised collection of information under its Payment of Premium regulations. PBGC intends to revise the 2015 filing procedures and instructions to, among other things, require reporting of certain undertakings to cash out or annuitize benefits for a specified group of former employees.Read more >
The U.S. Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) proposed a regulation that would require electronic filing of “top hat” plan statements, as well as apprenticeship and training plan notices. Generally, top hat plans are pension plans for select groups of management or highly compensated employees. Under the current law, these plans, as well as apprenticeship and training plans, file paper statements and notices with EBSA. The proposed regulation would revise current filing procedures to require electronic submission of these notices and statements, but would not change current requirements for their content.Read more >
IRS Adds ACA Guidance for Measuring Full-Time Employees
The Internal Revenue Service (IRS) has issued a notice regarding measurement methods for purposes of the employer shared responsibility rule under the Patient Protection and Affordable Care Act (ACA). Specifically, Notice 2014-49 describes a proposed approach to the application of the look-back measurement method, which may be used to determine if an employee is a full-time employee for purposes of Section 4980H of the Internal Revenue Code, in situations in which the measurement period applicable to an employee changes.Read more >
Financial Sense
Why Rebalancing Retirement Plan Investments Is Important
Retirement savers are often presented with a simple message on portfolio allocations: Rebalance regularly. But one investment provider wants you to think deeply about rebalancing. Richard Yasenchak, a senior vice president and client portfolio manager for INTECH, says his firm has long worked to provide smarter portfolios to a variety of institutional client types, including both defined contribution (DC) retirement plans and traditional defined benefit (DB) pensions. He explains that INTECH utilizes computer algorithms throughout the portfolio-building and maintenance effort to ensure decisions are made in a “scientific and disciplined way.” The point of the approach is to optimize the processes that may seem less important than choosing a manager or setting the asset allocation—things like, exactly how often should one trade back to the target weight? And how does one watch for rising correlations in the portfolio when rebalancing?Read more >
Small Talk
ON THIS DATE: In 1777, the Congress of the United States moved to York, Pennsylvania, due to advancing British forces. In 1846, Dr. William Morton performed a painless tooth extraction after administering ether to a patient. In 1868, the first volume of Louisa May Alcott’s book “Little Women” was published. In 1947, the World Series was televised for the first time. The sponsors only paid $65,000 for the entire series between the Brooklyn Dodgers and the New York Yankees. In 1954, the USS Nautilus, the world’s first nuclear submarine, was commissioned by the U.S. Navy. In 1955, 24-year-old actor James Dean was killed in Cholame, California, when the Porsche he was driving hit a Ford Tudor sedan at an intersection.   TUESDAY TRIVIA: In 1842, Georgia physician Crawford Williamson Long became the first doctor to use ether as a general anesthetic during surgery, when he used it to remove a tumor from the neck of his patient James M. Venable.
TRIVIAL PURSUITS: Before the 19th amendment to the U.S. Constitution was passed, which state first granted women the right to vote?Read more >
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Editorial: Alison Cooke Mintzer alison.mintzer@strategic-i.com

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