Yesterday, the President signed H.R. 4691 titled “Temporary Extension Act” for the purpose of extending certain benefits and programs which expired on February 28, including the COBRA premium subsidy.  There are 4 things for plan administrators to first consider in light of the new 30-day COBRA subsidy extension:

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Mike Kinard practiced law in Magnolia for decades and served in the General Assembly before his election to the Court of Appeals, so he is well-versed in the common law and statutory law and the confluence of the two, as well as human nature.

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Important new accounting rules for community banks selling loan participations went into effect on January 1, 2010. The Financial Accounting Standards Board (“FASB”) in June of 2009 adopted new guideline, Statement 166, amending Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities. The new rules apply to loan securitizations as well as loan participations. Unfortunately, some of the participation agreements we have seen over the last several weeks do not satisfy the new requirements. Lenders should spend time reviewing the bank’s “standard” participation agreement to insure that they are incompliance with the new rules.

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For further questions please contact Alan Lewis at 479.464.5656 or jalewis@mwlaw.com.

Being that the delegation of the discretionary function of claims processing is a fiduciary act, plan fiduciaries are responsible to routinely monitor their third party claims administrator’s processes and performances and make the affirmative determination that the delegated duties are performed in accordance with the controlling law under ERISA and its written administrative policies.

A recent lower-court case in California raises an interesting question: Is it appropriate for the delegating fiduciary to require a representation from the claims administrator that its processors’ compensation or performance evaluations are not conditioned upon a purely quantitative measure of the processed claims (i.e. the number of claims dismissed) but upon a qualitative measure (i.e. the number of claims processed under the controlling requirements of Title I of ERISA).

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For further questions, please contact Tod Yeslow at 479.464.5667 or tyeslow@mwlaw.com.

FNMA no longer requires creditors’ rights endorsements for loans it purchases and, if rumors can be trusted, the American Land Title Association will soon eliminate the ALTA 21 Creditors Rights Endorsement available for the 2006 and 1992 ALTA Loan Policies.  Since the ability to transfer risk to a third party indemnitor (the title insurance company) may be gone, lenders must carefully review each commercial loan transaction and the parties behind it.

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For further questions please contact Alan Lewis at 479.464.5656 or jalewis@mwlaw.com.

Lawyer Coon Dog Twichell was in a contemplative mood, gazing out the window of his office. His view focused on a row of Bradford pear trees whose leaves autumn had turned to shades ranging from burgundy to a brilliant orange.

His reverie was shortened by a commotion in the reception room, caused by his sometime client Crittenden Roberts, who was loudly demanding to see Twichell.

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The IRS has provided guidance on taking an employment tax credit equal to the 65% COBRA subsidy paid on behalf of a former employee who is receiving a COBRA subsidy. Under the American Recovery and Reinvestment Act of 2009, certain individuals who are eligible for COBRA continuation health coverage, or similar coverage under state law, may receive a subsidy for 65 percent of the premium.

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The federal subsidy for COBRA continuation coverage is now extended to employees who lose group health plan coverage because of an involuntary separation of employment between December 31, 2009, and February 28, 2010. The maximum period of subsidized coverage for any eligible individual is increased from nine to fifteen months. As a result of this legislation, it is advisable to immediately contact your COBRA administrator to confirm that the proper procedures, notifications, and participant communications to satisfy the legislative changes are in place for your plan.

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For further questions please contact Jeff Dixon in Little Rock at 501.688.8823 | jdixon@mwlaw.com or Tod Yeslow in Rogers at 479.464.5667 | tyeslow@mwlaw.com.

Effective January 1, 2010, the Internal Revenue Service establishes the manner and method for the payment of excise taxes for certain uncorrected operational failures under Group Health Plans, HSAs, and Archer MSAs. In a recently issued Treasury Regulation, the Internal Revenue Service issued rules effective January 1, 2010, for the reporting and paying of excise taxes imposed for certain violations under group health plans, Health Savings Accounts, and Archer Medical Savings Accounts.

Download this Mitchell Williams E-Brief for detailed information about the issued rules and who is subject to the reporting requirements.

Under the Medicare Secondary Payer Act (MSP), Medicare is entitled to reimbursement of amounts paid to personal injury victims where another entity is primarily responsible for the payment. Such entities typically include civil defendants and their insurers. The Medicare, Medicaid and SCHIP Extension Act of 2007 (MMSEA or the “Act”) amended the MSP by requiring all primary payers to report to the government any payment or expectation of payment to a Medicare beneficiary. To that extent, the MMSEA creates a roadblock to settlement in personal injury cases. Medicare may recover payments from civil defendants and their insurers regardless of whether the payer is at fault or has already paid the Medicare beneficiary. Thus, entities that ignore the MMSEA may literally pay double for it.

Parties on all sides are confused by the MMSEA’s complicated requirements, resulting in several extensions of the various compliance deadlines. However, entities required to register under the Act should have done so by now. This reminder reviews the major post-registration requirements of the MMSEA and their corresponding deadlines.

Download the Mitchell Williams E-Brief providing detailed information about the requirements.