Blog

Employee benefits professionals often focus on the details of a specific event -- such as a new regulation or a new court case. Such focus is important; these details are critical to plan design and administration. But, it is also important to be cognizant of broader trends. This blog is about one of those trends. There is currently an ongoing...

In December the IRS issued Notice 2018-95. The Notice provides very specific and targeted relief for retirement plans under Code Section 403(b). Specifically, the Notice provides relief to 403(b) sponsors who failed to properly administer certain 403(b) eligibility rules. However, equally valuable to 403(b) sponsors, is the clarification contained in the Notice on how these eligibility rules are supposed to...

Several recent items in InvestmentNews describe market trends that should be noted -- and followed by -- plan fiduciaries. These items (Unintended fiduciary consequences of 401(k) fee compression and 401(k) record keepers seek new revenue streams to 'save themselves') address different aspects of the same issue: a number of long-term market trends are creating significant pressure on bundled recordkeepers’ revenues....

Disclosure is currently all in rage in the U.S. healthcare system. In recent weeks the federal government has taken a number of steps to increase the information available to consumers. Most notably: •      The Centers for Medicare & Medicaid Services (“CMS”) has recently proposed regulations that require direct-to-consumer (DTC) television advertisements of prescription drugs and biological products to include the Wholesale...

It is estimated that there is currently $1.5 trillion in student debt owed by 44 million borrowers in the U.S. A recent IRS private letter ruling (PLR 201833012) approved an innovative approach that allows employees to balance student loan repayments with saving for retirement. By combining a 401(k) plan with student loan repayments, this approach may provide employers an opportunity...

A recent paper, The Market for Financial Adviser Misconduct (Journal of Political Economy, Publication Forthcoming), raises some important - and troubling - issues about how the financial industry treats advisers who engage in serious misconduct. The paper shows a number of different ways that adviser misconduct is concentrated - among repeat offenders, certain financial firms and geographically. In effect, the...

The efforts to dismantle the Affordable Care Act, piece by piece, continue. Over the past few months the Trump Administration: •      Finalized regulations expanding Association Health Plans (“AHPs”) for unrelated employers; •      Signed the Tax Cuts and Jobs Act of 2017, eliminating the individual mandate; •      Finalized regulations expanding short-term limited duration (“STLD”) coverage; •      Stopped payments to insurance carriers for cost sharing subsidies...

The battle over the appropriate standard of conduct for investment advisors and brokers is being waged on a number of fronts - the courts, the Department of Labor, the Securities and Exchange Commission, Congress and various state legislatures. And the arguments and counterarguments used in this battle can be pretty confusing. Adviser or Broker? Guess Which One of the most...

A recent article in the Wall Street Journal reported that Wells Fargo bank was under investigation for practices in the bank’s retirement division. According to the article the investigation focuses on practices intended to move clients into more expensive individual retirement accounts when they retire or leave their jobs. The article also noted that the bank’s retirement plan practices are...

Our last blog (Nature Abhors a Vacuum – and So Should Fiduciaries) discussed the decision by the U.S. Court of Appeals for the Fifth Circuit to invalidate rules, issued by the U.S. Department of Labor, for financial professionals who sell financial services and products to retirement plan participants. One part of the Court’s rationale was that the conduct of these...