IRS announces 2015 COLA limits

The Internal Revenue Service has just announced the annual cost-of-living adjustments for 2015. Every year around this time, the financial industry, especially those in the retirement space, anxiously await these updates, particularly since they outline whether or not taxpayers will be able to contribute more to their retirement plans. Between 2013 and 2014, there was little change for elective contributions. Catch-up contributions, 401(k), SIMPLE, Roth and Traditional IRAs all stayed the same as well. However, things are definitely changing in 2015.

On October 23, 2014 the IRS announced the 2015 cost-of-living adjustments for the dollar limitations under qualified retirement plans, 403(b) plans and 457(b) governmental plans. The following reflects the 2015 limits and offers a comparison between 2014 limits where there is a difference.

Is your Landlord’s tenant information open to a data breach?

Fitch Ratings-recently reported that while the potential long-term effects of Essex Property Trust’s data breach are not yet known, the incident may serve as a harbinger of future problems for multifamily Real Estate Investment Trusts (REITs).

A REIT is a type of real estate company modeled after mutual funds. REITs were created by Congress in 1960 to give all Americans the opportunity to invest in income-producing real estate in a manner similar to how many Americans invest in stocks and bonds through mutual funds. Income-producing real estate refers to land and the improvements on it, such as apartments, offices or hotels.

Tracking variable hour employees – when should employers look to outsource?

As part of the Employer Shared Responsibility Provision going into effect on January 1, 2015, employers are required to extend coverage to employees working 30 or more hours per week. Sounds simple, right? Not necessarily. As it turns out, many employers with variable hour employees are struggling to determine which of their employees have averaged more than 30 hours per week.

Employers with large numbers of variable hour employees may want to consider partnering with a vendor to assist in this tracking. Payroll organizations may also have resources for tracking these employees.

Rise in healthcare regulatory scrutiny means providers must be extra cautious

Healthcare providers who submit claims to Medicare and Medicaid are exposed to greater financial risk than ever before. Enhanced anti-fraud legislation coupled with a massive increase in government resources aimed at recouping billing errors and fraud will ultimately take millions of dollars away from healthcare providers and cost substantial sums to refute or defend in legal expenses and forensic reviews. The Centers for Medicare and Medicaid Services(CMS) through its aggressive Recovery Audit Contractor(RAC) program initiated in 2006, whereby federally hired contractors are paid on a contingency basis retaining a percentage of recovery payments, had recouped almost a billion dollars as of 2008, that did not meet coding or necessity policies.

As Ebola threats continue, insurance options respond – or will they?

While the current Ebola pandemic still remains primarily isolated to West Africa, the death of Thomas Duncan earlier this month in Texas has raised many concerns relative to the potential spread of the disease globally. At this time, two nurses responsible for treating Duncan have both tested positive for the disease, raising questions about whether American hospitals and their staff are adequately prepared to contain the virus.

Are your benefits plans ready for Ebola?

As the nation braces for a potential outbreak of one of the worst infectious diseases in modern history, employers and employees should carefully review their benefits contracts to ensure financial protection in the face of significant exposure. It’s obvious from the recent high profile cases that travel and treatment costs for a patient infected with Ebola can run into the hundreds of thousands of dollars, but don’t assume that your standard copays and out of pockets will cover the costs. Why not?

WGA’s Employee Benefits Practice has compiled responses and alerts from carriers and their contractual wording for medical, life and disability, critical illness and travel products. Employers should review their contracts and seek written clarifications that specifically include Ebola, as well as a listing of other pandemic diseases. 

When pandemic strikes: does your company have an action plan?

Following reports of the first Ebola transmissions on U.S. soil, the threat of the disease continues to escalate across the world. The Ebola outbreak is only the latest version of potential worldwide pandemics with serious economic impacts affecting supply chain and business operations for companies of all types. Industries like mining, agriculture and energy face the greatest risks with Ebola, since these groups have a high number of operation bases and workers in the affected nations. However, companies that do not operate in Africa may also experience business interruptions when employee access to the workplace is compromised.

2015 Compliance To-Do’s: Is your checklist ready?

As 2014 winds down, employers are longing for a reprieve in benefits compliance after having to endure a year of new, often times complex, guidance related to the Affordable Care Act (ACA), HIPAA and same-sex spouses. Unfortunately, to-do lists are only going to get longer as employers review their plans and get ready for the approaching challenges and deadlines arising in the upcoming year. Below is a summary of three main compliance issues for employers to keep on their regulatory checklists in the coming year.

Cyber liability – the changing D&O risks

In a sluggish world economy, hacking has unfortunately been a robust business. Recent reports issued by the Ponemon Institute, Symantec and others have detailed the stunning growth in cybersecurity breaches (such as a greater than 60% increase in breaches in 2013) and given vivid support to the now-common warning about breaches: “It’s not if, it’s when.”

The avalanche of cyber breaches has alarmed companies — and insurers. Cyber liability exposures include the following, among others:

• First-party costs incurred in dealing with the breach (forensics, legal, notification, credit monitoring, call center, etc.)
• Third-party exposures to individuals and entities affected by the breach
• Regulatory enforcement (SEC, FTC)
• Intellectual property exposures (often via corporate espionage)
• Reputational exposures
• Extortion exposures
• Theft exposures (such as hacks of bank accounts or phishing-induced erroneous transfers of money)
• Business interruption costs
• Data restoration costs

Phishing Claims – watch out for wire fraud transfers

Be aware – issues of cyber crime are becoming more prevalent in today’s business landscape, with instances of hackers running various email scams that target a company’s CFO, controllers or directors and officers. Posing as the President or Founder of the organization, the fraudsters request an immediate transfer of large sums of money, (oftentimes upwards of $500 thousand to $5 million) indicating it is required to facilitate an offshore payment of a foreign tax obligation or for the acquisition of a foreign subsidiary. After sending the email, the hackers often make a follow-up phone call to the recipients to assure them that the request is high-level, legitimate and kept fully confidential. Using social media sites like Facebook and Twitter, as well as reviewing public company filings, the criminals gather as much data as they can to gain intimate knowledge of the company policies. As a result, the CFO or other targeted officers or employees come to trust these instructions and dutifully wire the money. Oftentimes, the wire fraud isn’t detected until the receiving bank questions the large transaction.