Happy Friday

Hayes Carll is what I am kistening to these days.

Happy Mardi Gras

Everyone should see Mardi Gras once when they are young. Get your Mardi Gras on New Orleans.

PPACA:Clear As Mud

Ok the best discussion I have seen yet of the nondiscrimination provisions of PPACA are detailed below compliments of BenefitMall.com. You can read the source materials below or just take my simplified and nevertheless accurate summary that on a party line vote using reconciliation Democrats passed a stupid law that made many employer provided health plans subject to fines of up to $100 per employee per day until shortly before Christmas 2010 when no one was paying attention the IRS suspended enforcement to avoid the embarrasment of scorn by millions of American who would have lost coverage when their employers dropped it to avoid onerous IRS fines January 1 , 2011. It just goes On & On kind of like this video happy Friday Peeps and by the way does REK look like he could use an EAP? Look at those shades.



Section 2716 of the Patient Protection and Affordable Care Act (PPACA) contains a provision that applies the “non-discriminatory” requirements of Section 2716 of the Public Health Services Act (PHSA) [Section 105(h) of the Internal Revenue Code] to all non-grandfathered health plans issued on or after September 23, 2010. This provision prohibits health plans from discriminating in the way benefits or costs are allocated and shared among classes of employees.

The implementation of the nondiscrimination requirements continues to be delayed. On January 10, the Internal Revenue Service (IRS) issued Notice 2011-2, which states that compliance with PPACA is once again delayed for insured group health benefit plans until at least March 11.1

There is significant confusion surrounding the nondiscrimination requirements. The following information details the timeline of the attempts on the part of the federal regulators to clarify these issues.
Provision and Scope

SEC. 2716. PROHIBITION OF DISCRIMINATION BASED ON SALARY.
"(a) IN GENERAL – The plan sponsor of a group health plan (other than a self-insured plan) may not establish rules relating to the health insurance coverage eligibility (including continued eligibility) of any full-time employee under the terms of the plan that are based on the total hourly or annual salary of the employee or otherwise establish eligibility rules that have the effect of discriminating in favor of higher wage employees.2”

Generally, the regulations issued pursuant to Section 105(h) apply to employer-sponsored health benefit plans that cover premiums and expenses for qualified medical and other specialty plans.3 The recent amendments expand the nondiscrimination provisions to health benefit plans irrespective of whether they are fully-insured, self funded or medical reimbursement plans. Some types of plans are excluded from the new requirements, including “grandfathered” plans, government-sponsored health plans and limited benefit plans.
The “benefits” provided under the health plan must not discriminate in favor of highly compensated individuals. The health plan should incorporate several design features in order to be non-discriminatory. For example, plans should:
Establish parity in employee contributions for each benefit level

Preclude offering lower co-pays for highly compensated employees

Not impose different waiting periods

The employer sponsoring the health plan also must not discriminate in favor of highly compensated individuals in actual operation. For example, discrimination in operation could arise if a plan administrator approves certain claims for medical expenses under the utilization management process for highly compensated employees while denying them to lower compensated employees.
As the regulation is developed, the definition of terms such as “benefit” and “highly compensated” will continue to be addressed in the provision development.
Comments and Timelines

Currently, implementation of the anti-discrimination provision continues to be delayed due to several outstanding issues that need to be addressed. The Department of Treasury, along with the Departments of Labor (DOL) and Health and Human Services (HHS), has released a series of public notices to gain guidance on how to best implement this provision.
Notice one: IRS Bulletin 2010-634

The first notice to address Section 2716 was issued on May 17, 2010. “This notice invites public comments concerning the application of rules prohibiting insured group health plans from discriminating in favor of highly compensated individuals. The United States Department of Labor and the United States Department of Health and Human Services have reviewed this notice and have advised the Department of the Treasury and the Internal Revenue Service (IRS) that they agree with it.”
Previous Request for Comments
“The final regulations under section 105(h) of the Code, prohibiting discrimination in favor of highly compensated individuals under self-insured medical expense reimbursement plans, were issued in 1981. The Department of the Treasury and the IRS are considering issuing guidance on the extension, through section 2716 of the PHSA and new section 9815 of the Code, of the requirements of section 105(h)(2) to insured group health plans. The Department of the Treasury and the IRS request comments on what additional guidance relating to the application of section 105(h) (2) would be helpful with respect to insured group health plans.
Comment due: November 4, 2010
Notice two: IRS Bulletin 2011-15

The second notice to address Section 2716 was issued on December 22, 2010. Notice 2011-1 which states compliance with the nondiscrimination provisions of the PPACA are suspended for insured group health benefit plans until an undefined date.
Request for Comments
“Comments submitted in response to Notice 2010-63 maintained that, without regulations or other administrative guidance under Section 2716, plan sponsors are uncertain how to apply the nondiscrimination provisions. In addition to what is meant by rules 'similar to,' comments raised a number of other issues regarding the application of Section 2716. Comments suggested that guidance address the application of Section 2716 before plan years beginning in 2014 (when the State Exchanges, employer responsibility and penalty provisions, and related provisions take effect) and also in and after 2014. The Departments recognize that the guidance under Section 2716 must take into consideration the Exchange operations and individual and plan sponsor requirements that go into effect after 2013.”
Notice three: IRS Bulletin 2011-26

The IRS continued to delay the implementation of Section 2716. The agency reissued Notice 2011-1 on January 10, 2011 to gain additional guidance.
Additional Request for Comments
Notice 2011-1 asks 13 key questions that need to be address to successfully implement Section 2716:
The basis on which the determination of what constitutes non-discriminatory benefits under Section 105(h)(4) should be made and what is included in the term “benefits.” For example, is the rate of employer contributions toward the cost of coverage (or the required percentage or amount of employee contributions) or is the duration of an eligibility waiting period treated as a “benefit” that must be provided on a non-discriminatory basis?

The suggestion made in previous comments that the Departments have the authority to provide for an alternative method of compliance with Section 2716 that would involve only an availability of coverage test.

The application of Section 2716 to insured group health plans beginning in 2014 when the health insurance exchanges become operational and the employer responsibility provisions (Section 4980H of the Code), the premium tax credit (Section 36B of the Code), and the individual responsibility provisions (Section 5000A of the Code) and related Affordable Care Act provisions are effective.

The suggestion in previous comments that the non-discriminatory classification provision in Section 105(h)(3)(A)(iii) could be used as a basis to permit an insured health care plan to use a highly compensated employee definition in Section 414(q) of the Code for purposes of determining the plan’s non-discriminatory classification.

The suggestion in previous comments that the nondiscrimination standards should be applied separately to employers sponsoring insured group health plans in distinct geographic locations and on whether application of the standards on a geographic basis should be permissive or mandatory.

The suggestion in previous comments that the guidance should provide for “safe harbor” plan designs. Specifically, comments are requested on potential safe and unsafe harbor designs that are consistent with the substantive requirements of Section 105(h).

Whether employers should be permitted to aggregate different, but substantially similar, coverage options for purposes of Section 2716 and, if so, the basis upon which a “substantially similar” determination could be made.

The application of the nondiscrimination rules to “expatriate” and “inpatriate” coverage.

The application of the nondiscrimination rules to multiple employer plans.

The suggestion in previous comments that coverage provided to a “highly compensated individual” (as defined in Section 105(h)(5)) on an after-tax basis should be disregarded in applying Section 2716.

The treatment of employees who voluntarily waive employer coverage in favor of other coverage.

Potential transition rules following a merger, acquisition or other corporate transaction.

The application of the sanctions for noncompliance with Section 2716.

Comments due: March 11, 2011

Next Steps

To ensure the smooth implementation of Section 2716, the federal agencies reviewing comments have stated that the request for public comment and guidance is critical. Unfortunately, the anti-discrimination provisions, along with many other PPACA requirements, are difficult to implement due to limited or poor statutory language construction.
Comments are due on March 11, 2011 for Notice 2011-17, and analysis by HHS, DOL and the IRS will take place over the next few months. Karen Levin out of the Office of Division Counsel/Associate Chief Counsel (Tax Exempt and Government Entities) will be the main drafter of the next notice.

Got Surveillance?

Class Warfare

At a time when the long term solvency of Social Security is very much in question it is revealing to shed a little light on one provision of PPACA which is publicized far to Little and that is The CLASS Act (Community Living Assistance Services and Support Act). Yes, it seems Obamacare included a voluntary taxpayer optional long term care program that owes its origins to Ted Kennedy.

Whats wrong with that you might ask? Well for starters the design more or less mirrors the group guaranteed issue approach to LTC which has failed miserably for over 20 years in the private sector to the point where John Hancock has exited the group market along with MetLife and anyone else with a board or stockholders because its simply not profitable. Not only is it not profitable it is financially unsustainable. Imagine a wave of baby boomers faced with financial ruin from outliving their bodies ability to perform acitivities of daily living like bathing, dressing, eating, and transferring. All they have to do is enroll and pay premiums for 5 years and be actively at work for 3 years and they can receive a cash LTC benefit. And hey, the premiums are only expected to be $123 per month! What a deal!  You see the exact benefits costs and program details are all being designed by the Secretary of Health and Human Services at this juncture. think we will see an LTC trust fund established like the SS Trust fund to keep Congress from spending the proceeds sorta like the SS Trust Fund?

But it gets better. Check out this "wisdom" from CBO emphasis mine;

Q: Are there any estimates now of what those premiums might be?


A: During the long course of the CLASS Act plan’s development, a number of estimates were made of the premiums that could be required for a financially sound plan. These estimates vary widely depending on the version of the law (which changed as it went through the legislative process) analyzed, the data and the assumptions used. Many commonly cited estimates reflect studies of much older versions of the CLASS Act. No analysis to date exactly matches the complete details of the CLASS plan that will be implemented, as these details have yet to be determined. As Congress debated the version of the CLASS Act that is now the law, the non-partisan Congressional Budget Office (the official “score-keeper”) provided estimates of average premiums. The Congressional Budget Office (CBO) estimated that average premiums would be $123/month (lower for younger people, higher for older people). Naturally, the CBO estimate included assumptions about some detailed elements of the program that might be different when the final plan is ultimately determined. In addition, the CBO assumed, among other things, that the CLASS Act plan would have relatively low enrollment, such as that found with private long-term care insurance.

To again use a parable from popular culture examine the picture above closely. This time its not a Baby Ruth. It is an actual turd. No amount of chlorine can sanitize a pool contaminated with feces. It must be drained and sanitized every time. Now notice what the CBO said about the CLASS risk pool in the 2nd to last sentence;the CLASS Act plan would have relatively low enrollment, such as that found with private long-term care insurance. I am certain CBO meant relatively low enrollment like group LTC on a guaranteed issue basis of the type that is not even marketed anymore due to adverse selection. Which means the pool will ultimately be a septic tank unfit to dip a toe into much less to swim in and every time the septic is collected the taxpayers get to replenish the pool with tax dollars in order to allow allow Americans to have access to LTC. There is not a reinsurer who would ever insure such a risk but there is on the other hand a Democratic Party in America who did on a party line reconciliation vote sign taxpayers up to insure the risk which is not voluntarily insurable on a guaranteed issue basis. And its means tested, so low income Americans get subsidized until every taxpayer is low income and then what?

I think CLASS is actually an acronym meaning Clueless Liberals Accessorizing Social Security. It is a mind numbing subsection of PPACA stupidity to be implemented by bureaucrats at HHS. This is not even what Pelosi meant when she said we would have to read the bill to know whats in it because the final regulations are not due until October 1. 2012. At a time when we have the President & DNC carefully orchestrating union protests over collective bargaining rights and historic Federal, State & Local deficits we now have a  law created by politicians with a cognitive deficit that will insure all Americans go broke. Tell me this is not the same logic that brought us to a broken Social Security system? Why would we expect a different result this time? Remember that one difinition of insanity is repeating the same behavior and expecting a different result. Yet every time feces goes into the pool its contaminated so just keep Bill Murray in mind and remember this time its not a Baby Ruth.

Federalist View Of Wisconsin & National Politics Instructive

The Federalist No. 10


The Utility of the Union as a Safeguard Against Domestic Faction and Insurrection (continued)

Daily Advertiser

Thursday, November 22, 1787

[James Madison]

To the People of the State of New York:

AMONG the numerous advantages promised by a well constructed Union, none deserves to be more accurately developed than its tendency to break and control the violence of faction. The friend of popular governments never finds himself so much alarmed for their character and fate, as when he contemplates their propensity to this dangerous vice. He will not fail, therefore, to set a due value on any plan which, without violating the principles to which he is attached, provides a proper cure for it. The instability, injustice, and confusion introduced into the public councils, have, in truth, been the mortal diseases under which popular governments have everywhere perished; as they continue to be the favorite and fruitful topics from which the adversaries to liberty derive their most specious declamations. The valuable improvements made by the American constitutions on the popular models, both ancient and modern, cannot certainly be too much admired; but it would be an unwarrantable partiality, to contend that they have as effectually obviated the danger on this side, as was wished and expected. Complaints are everywhere heard from our most considerate and virtuous citizens, equally the friends of public and private faith, and of public and personal liberty, that our governments are too unstable, that the public good is disregarded in the conflicts of rival parties, and that measures are too often decided, not according to the rules of justice and the rights of the minor party, but by the superior force of an interested and overbearing majority. However anxiously we may wish that these complaints had no foundation, the evidence, of known facts will not permit us to deny that they are in some degree true. It will be found, indeed, on a candid review of our situation, that some of the distresses under which we labor have been erroneously charged on the operation of our governments; but it will be found, at the same time, that other causes will not alone account for many of our heaviest misfortunes; and, particularly, for that prevailing and increasing distrust of public engagements, and alarm for private rights, which are echoed from one end of the continent to the other. These must be chiefly, if not wholly, effects of the unsteadiness and injustice with which a factious spirit has tainted our public administrations.



So Let me translate that for those among you who have a problem understanding 18th century English uncorrupted by slang or Ebonics.

• Lets start with the title The Utility of the Union as a Safeguard Against Domestic Faction and Insurrection .  In other words it is the Union, the Federal Government Madison is offering as a structural protection against the danger of Faction.  Today we could call either party  a faction, especially the unique coalition of Unions, Progressives and various assorted left wing nut jobs that control the modern Democratic party.
• Political Parties are a "dangerous vice" causing mortal disease to governments historically. Keep in mind The Federalist Papers were written anonymously under the pseudonym "Publius" so the reference here is Rome where today the food may be great but the government, not so much, but I digress.
• It would be an unforgivable oversight to pretend the Constitution would be expected to stand up in the face of  a partisan majority  imposing their their will on the Nation to the detriment of the common good. Things like passing health care reform by Reconciliation by a party line vote for example. Fairly sure Mr Madison would have considered the Obama care vote to be a modern example of political parties run amuck. The emergence of the tea party and the landslide midterms sweeping Republicans into power are an indication the people have grown weary of party politics.
• The Wisconsin minority Democratic party left the building to allow time for the unions and the democratic party and even the Presidents campaign organization to marshall protesters and bus them in from neighboring states to march for the camera's.Bereft of the intellectual underpinnings to to have an intelligent debate on financial matters other state democratic minorities soon followed. The progressive logic is akin to your Dad saying "do as I say not as I do" when he cannot or will not explain something. Think of Michelle Obama preaching diet while her husband steals a smoke. By the way progressives are in the cannot group which is why they resort to emotion instead of reason and logic or principle.Expedience is the currency of faction.
• The unsteadiness and injustice by which a factious spirit has invaded our government is clear each day in the electronic or print media. In 2009 the 912 Rallies had no coverage except on Fox and among bloggers like me.
• In 2011 Governor Walker in Wisconsin is vilified and the protesters are all over the television,every night. In 2011 Twitter and Facebook play key roles for organizers in Tunisia and Egypt because they do not trust their state run media either.
• Yesterday we were all treated to an announcement that the Obama administration would not enforce the Defense of Marriage Act as it was unconstitutional. Contrast that with the reaction to PPACA being declared unconstitutional when the adminsitration immediately declared implementation would be ongoing. 
• Yesterday President Obama finally commented on the situation in Libya where Qaddafi has been killing thousands of Libyans for over a week to condemn the violence. Qaddafi who ordered PanAm 103 to be destroyed killing 270 people. Qaddafi who financed http://en.wikipedia.org/wiki/Black_September_(group)at the 1972 Olympics and the 1986 Berlin disco bombing that targeted American servicemen. So much for the bully pulpit. Recall that Reagan bombed Tripoli after the linkage to Qadafi but I digress we do not have a war on terror anymore. How could we have a war on terror when the President mobilizes his own campaign organization to protest in battleground 2012 states where Republican Governors and legislatures are trying to solve serious fiscal budget shortfalls that he completely ignored with his 2012 budget. I wonder what James Madison would think of such behavior?

Got EAP?

I was just a normal guy.

Life was just a nine to five.

With bills and pressure,

piled up to the sky.



She never asked,

'cause she knew I'd been,

hangin' with my wilder friends.

Lookin' for some other way to fly.



Three days straight was no big feat,

to get by on no food or sleep.

And crazy,

was becoming my new norm.



I'd pass out on the bedroom floor,

and sleep right through the calm before the storm.



[chorus]

My life was just an old routine.

Every day the same damn thing.

I couldn't even tell I was alive.

I tell you,

the high cost of livin',

ain't nothin' like the cost of livin' high.



That Southern Baptist parkin' lot,

was where I'd go to smoke my pot.

And sit there in my pick-up truck and pray.



Starin' at that giant cross,

just reminded me that I was lost.

And it just never seemed to point the way.



As soon as Jesus turned his back,

I'd find my way across the tracks.

Lookin' just to score another deal.



With my back up against that damn eight-ball,

I didn't have to think, or talk... or feel.



[chorus]



My whole life went through my head.

Layin' in that motel bed.

Watchin' as the cops kicked in the door.



I had a job and a piece of land.

My sweet wife was my best friend,

but I traded that for cocaine and a whore.



With my newfound sobriety,

I've got the time to sit and think...

Of all the things I had,

and threw away.



This prison is much colder than,

the one that I was locked up in...

Just yesterday.



[chorus]



I tell you,

the high cost of livin',

ain't nothin' like the cost of livin' high.



...just leave that stuff alone... (quietly during closing instrumental)