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Council to issue new report: health care tax on retiree health subsidy loses money, will affect prescription drug coverage American businesses urge Congress to remove provision from final legislation March 17, 2010:Today, March 17 at 1:30 p.m. Eastern Time, the American Benefits Council will unveil a report, prepared by a former White House Office of Management and Budget (OMB) official, that illustrates how a proposed revenue provision within the health care reform legislation will threaten existing retiree health programs. The Council will describe the provision and the very serious consequences of its enactment for employers, retirees and the federal budget. The provision, contained in both the House of Representatives and Senate health care bills, would reverse a carefully negotiated element of the Medicare Modernization Act by reducing allowable deductions for the 28 percent subsidy that employers receive for providing drug coverage for retirees. Congress enacted the policy in 2003 to allow employers to maintain such coverage and to save the government money on Medicare expenditures. The report, Assessing the Coverage and Budgetary Implications of Legislation Modifying the Deductibility of Retiree Drug Spending Eligible for Subsidies, affirms what the Council has been arguing for months: as more retirees are moved from employer plans to Medicare Part D, government outlays will increase, and the shift from employer retiree drug subsidy programs to Medicare Part D is likely to be significant. The report was commissioned by the Council and prepared by Donald W. Moran, president of the Moran Company and former Executive Associate Director for Budget and Legislation at OMB. To RSVP for the briefing and obtain call-in information, click here. For more information, or to arrange a separate interview with Council staff, please contact Jason Hammersla, Council director, communications, at 202-289-6700 (office) or (202) 253-5458 (cell). Senate pension funding relief measure saves jobs, but more work remains March 9, 2010: “Today, the Senate adopted a funding relief amendment, which, along with the underlying funding provisions included in jobs legislation, would save jobs across the country by allowing companies more time to repay the huge losses incurred by pension plans in 2008,” said American Benefits Council President James A. Klein. “This legislation, as amended, would enable companies to invest in business recovery and job retention instead of contributing enormous amounts on behalf of pension liabilities that will not come due for many years.” A Council summary of the provisions is now available. The American Benefits Council has long advocated for pension funding relief as a way to preserve jobs. In late 2009, the Council commissioned the report Jobs in Peril: Assessing the Impact of Increases in Defined Benefit Plan Funding Obligations on Employment During an Economic Recession, which clearly demonstrated an inverse relationship between pension funding obligations and revenue available for labor and capital expenditures. Click here to read the rest of the media release. New video calls on Congress to act on pension funding legislation, links temporary relief to jobs and economic security View the video here. http://snipurl.com/dbfunding February 19, 2010: A new video released today and disseminated widely online makes an urgent case for pension funding relief and is the latest demonstration of urgency for congressional action. Saying “We need pension funding relief and we need it now,” the video provides information for viewers to contact Congress to make their voices heard about this urgent, yet often overlooked issue. Due to unprecedented economic turmoil and market volatility, pension plans are facing massive losses in their asset values. As a result, billions of dollars that could be used to save or create jobs are scheduled to be diverted into pension plans unless Congress acts quickly. Today’s video release comes on the heels of a telephonic conference call held earlier this month on which retirement experts, employers, and Members of Congress joined voices to raise awareness about the need for temporary pension relief. The call featured Representative Earl Pomeroy (D-ND), who has introduced pension relief legislation in Congress with Rep. Pat Tiberi (R-OH), along with James Klein, President of the American Benefits Council; Katy Beh Neas, Vice President for Government Relations at Easter Seals; Kathy Cloninger, CEO, Girl Scouts of America; and Barbara Crane, RN, President of the National Federation of Nurses. “Temporary pension funding relief legislation will preserve jobs, promote economic recovery and alleviate the deficit without spending any taxpayer money,” said James A. Klein, President of the American Benefits Council. “As the video says, the clock is ticking. Congress must enact pension funding relief immediately.” For more information, or to arrange an interview with Council staff, please contact Jason Hammersla, Council director of communications, at 202-289-6700 (office) or (202) 253-5458 (cell). Dropping pension funding relief provisions from jobs bill a serious mistake, will cost jobs and slow economic recovery February 13, 2010: "By eliminating defined benefit pension funding relief from jobs legislation, Congressional leadership is wasting a golden opportunity to save jobs and promote economic recovery at no cost to the federal government," American Benefits Council President James A. Klein said today. "Immediate relief is essential to the preservation of thousands of American jobs. Every day that goes by without a solution means more facilities will close, more layoffs will be planned and economic growth slips farther away." Klein said. "After the encouraging news that pension funding relief had been included in the bipartisan jobs bill drafted by Senators Max Baucus and Charles Grassley, the elimination of this relief by Majority Leader Harry Reid from the latest version of jobs legislation is particularly troubling. We urge lawmakers to include pension funding relief as part of jobs legislation as soon as possible. To ensure long-term retirement security, we must create long-term job security," Klein said. The Council's full statement is available here. For more information, or to arrange an interview with Council staff, please contact Jason Hammersla, Council director of communications, at 202-289-6700 (office) or (202) 253-5458 (cell). Employers, organized labor tell Reid: taxation of Medicare drug subsidy will threaten retiree health programs Council, AFL-CIO urge elimination of provision from Senate bill, host media briefing with former CMS administrator Tom Scully December 10, 2009: On Thursday, December 10, the American Benefits Council and the AFL-CIO sent a letter to Senate Majority Leader Harry Reid (D-NV) urging the elimination of a little-discussed but potentially harmful provision in the Senate health care reform bill. As currently crafted, the Patient Protection and Affordable Care Act (H.R. 3590) would impose a new tax on prescription drug subsidies for Medicare-eligible seniors. In a conference call briefing for the media on December 10, Council President James A. Klein and AFL-CIO Assistant to the President Gerald Shea explained the catastrophic effect this provision could have on employers, workers, the Medicare program and American financial markets. Tom Scully, former administrator of the Centers for Medicare and Medicaid Services, who wrote an op-ed in the December 7 Wall Street Journal criticizing the provision, also spoke at the media briefing. Additional illustrative materials were also provided at the briefing:
Click here for a link to a recording of the media briefing. Council research report: pension funding relief critically necessary to preserve jobs, promote economic recovery Enactment of relief legislation, such as Pomeroy-Tiberi bill, urgently needed October 30, 2009: “The research report Assessing the Impact of Increases in Defined Benefit Plan Funding Obligations on Employment During an Economic Recession, prepared by Optimal Benefit Strategies, LLC and commissioned by the American Benefits Council, clearly confirms what employers have been saying for months,” said Council President James A. Klein today. “The current defined benefit funding crisis is more than a pension issue. It is a fundamental jobs issue and a critical economic recovery issue.” Drawing on academic research, congressional testimony and economic analysis, the report clearly demonstrates an inverse relationship between pension funding obligations and revenue available for labor and capital expenditures. “Requiring employers to increase their funding to defined benefit plans during a recession leads to layoffs, bankruptcies, and the freezing of defined benefit plans, suggesting that the pension funding obligations could fundamentally alter the distribution of jobs in the economy,” the report reads. Among the paper’s revelations citing previously conducted research and surveys:
The following materials are also available for additional background:
Click here to download the recording. Council President James Klein speaks on Marketplace Radio Discusses need for defined benefit pension reform New Survey: Three Out of Five Employers Maintain 401(k) Plans Despite Economic Crisis Seven in ten eligible employees participated in 401(k) plans in 2008 March 17, 2009: A new survey of employers released by WorldatWork and the American Benefits Council, "Trends in 401(k) Plans," presented today at a National Press Club Newsmakers press conference in Washington, DC, finds that the financial crisis has not significantly discouraged 401(k) contributions or participation. A full 74 percent of employers reported no change in the employer matching contribution; 15 percent have either increased or are considering increasing the employer match; eight percent have either decreased or are considering decreasing the 401(k) match, and three percent reported eliminating the match. According to the survey, more than nine out of ten U.S. companies offer an employee 401(k) plan. In addition, despite the widely reported drop in account balances, two-thirds (66 percent) of organizations indicated that at least 70 percent of eligible employees participated in those 401(k) plans in 2008. This survey was conducted in December 2008 by WorldatWork, in collaboration with the American Benefits Council. Surveys were sent electronically to a random representative sample of 4,938 U.S. WorldatWork members. A total of 505 members participated in this survey during a two-week period, generating a 10-percent response rate. For more details about the survey and contact information, see the official news release. Council to unveil health care proposal, featuring key players from previous reform efforts to answer questions ‘Condition Critical’ report offers 44 specific recommendations for consideration in stimulus bill, comprehensive reform legislation Monday, January 12: At noon Eastern Time, the American Benefits Council will hold a special media briefing to unveil "Condition Critical: Ten Prescriptions for Reforming Health Care Quality, Cost and Coverage." This report was developed by the Council’s board of directors with the goal of reforming health care through the employer-sponsored benefits system. The Council will be joined by a number of independent experts and advisors, who will discuss the report in the context of the greater health care reform debate. The following items were unveiled at the briefing: Condition Critical: Ten Prescriptions for Reforming Health Care Quality, Cost and Coverage PowerPoint Slides on the release of Condition Critical Fast Facts on Health Care Reform/2008 Survey Results "This report covers a wide range of controversial topics, including individual mandates, tax policy and health care quality initiatives, some of which may be considered as part of the economic stimulus package," said Council president James A. Klein. "The Council’s ‘ten prescriptions’ provides 44 specific policy recommendations that can be implemented quickly." The briefing will be held in person at the conference center at 1455 Pennsylvania Avenue NW, 4th floor, Washington DC. (Entrance on F St.) Lunch will be served for those attending in person. Reporters may also attend the briefing via conference call. For RSVP information or an embargoed copy of the report, please contact Jason Hammersla, Council director of communications, at 202-289-6700 (office) or (202) 253-5458 (cell). ‘Safe and Sound’ retirement goals include raising financial literacy, expanding coverage November 8:"The current voluntary employer-sponsored retirement system has been an enormous success," said Lynn Dudley, American Benefits Council vice president, retirement policy, at a hearing before the House of Representatives Health, Employment, Labor and Pensions (HELP) Subcommittee of the Education and Labor Committee. "The magnitude of America’s demographic challenges now dictates that individuals, employers and the government all need to do more to continue this success and ensure widespread retirement security." Dudley’s testimony was drawn from the Council’s 2004 report Safe and Sound: A Ten-Year Plan for Promoting Personal Financial Security, which contains specific goals for improving retirement coverage and savings and discusses the responsibilities of the key stakeholders. "The fact that individuals will be called upon to play a greater role in achieving personal financial security does not mean that employers or the government will be doing less," Dudley said. "As individuals play a more prominent role in achieving their own personal financial security, employers and the government will be expected to help provide the tools to more simply and successfully play this larger role." The full text of the Council's media release is available in the Newsroom. |
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Benefits Byte (03/17/10)
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Health Care Reform: Opportunity to Revise and Improve Elements of Legislation The Council's Health Care Reform Issue Page The health care reform debate may be entering a final phase, with Democratic leadership developing various strategies for passing the Senate-passed measure along with the president's "sidecar" package of revisions. Congress has set and missed several deadlines over the past year, so there is no guarantee that the latest date set forth by the President will be met. But the White House and Congressional leaders are pressing for final action. It is now critically important that Council members express their overall views on the bill and advocate targeted modifications that may still be possible prior to final congressional consideration. Council Materials: The Council has updateda list of priority issues for employers, citing necessary improvements to the House of Representatives- and Senate-passed measures and President Obama's "sidecar" proposal. In addition, Council staff has prepared a detailed side-by-side chart comparing the House and Senate bills and the Obama proposal. For more information, contact Paul Dennett, senior vice president, health care reform, at (202) 289-6700. |
