Understanding Employee Benefits and key developments in the employee benefits field and items of interest to our clients. MORE

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It is not uncommon for employers to have executive severance plans that pay substantial severance if an executive loses employment in connection with a change in control. In a recent federal district court decision, a former chief executive officer sued an employer for $700,000 claimed to be owed as severance as a result of …

Over the years we have seen some employers, particularly small employers, choose to provide health coverage to their employees by paying all or part of the premium for individual insurance policies that the employees have obtained. Under an old IRS revenue ruling, Rev. Rul. 61-146, that type of premium subsidy could be provided on a …

I blogged recently about a decision from a federal district court in Virginia (Eastern Distrct) involving a widow who sought to recover life insurance benefits from her late husband’s employer-sponsored group term life insurance plan. The employer had improperly allowed the late husband to enroll in the plan.  The court had found on summary judgment …

HIPAA nondiscrimination provisions prohibit group health plans and health insurance issuers from discriminating against individual participants and beneficiaries in eligibility, benefits, or premiums based on a health factor.  Wellness programs offered in conjunction with group health plans must also be nondiscriminatory.

Final regulations issued on June 3, 2013, describe nondiscriminatory wellness programs.  The regulations amend…

ERISA requires that plans contain a reasonable claims procedure. Courts have generally required claimants to exhaust that claims procedure before filing a lawsuit. In addition, if the plan gives the plan administrator discretion to interpret the plan and decide claims, a court will often give deference to the plan administrator’s decision. These rules should encourage …

Many employers know that one benefit to an ERISA plan is the standard of review available when the participant brings a lawsuit for benefits under the plan. If the plan documents give the plan administrator discretion to decide claims, then the court will review the exercise of the plan administrator’s discretion under an arbitrary and …

Pactiv Corporation sponsored a severance plan subject to ERISA. The plan required an employee to sign a separation agreement and release in a “form acceptable to the company” in order for the employee to be entitled to a payment under the plan. The severance plan itself did not contain a no compete provision. When an …

I recently blogged about an employer who continued health insurance coverage for an employee on short term disability in contravention of the health plan document. The employer lost its stop-loss coverage for health claims incurred by the disabled employee because the health plan document did not specifically allow for continued coverage during disability. Today’s blog …