An update on legal aspects of plan communications

Plan communications can be a real challenge for trustees, unions and management, but effective communications are essential because they provide the link between plan sponsors' efforts to provide benefits and the actual receipt of those benefits by participants. Communication-related issues that must be considered by those responsible for keeping plan participants informed include ERISA provisions, the need for accurate information, disclosures concerning possible benefit plan changes, COBRA rights and HIPAA provisions.     

The economic impact of implementing an ergonomic plan

It is of paramount importance for executives to be well aware of registered nurse (RN) hidden replacement costs related to musculoskeletal injuries. Developing and implementing an ergonomic plan that includes procurement of appropriate lifting equipment at the point of care makes sense. Armed with an ergonomic plan, proactive case management, and a return to work program, the organization is positioned for fiscal success. The ANA's Handle With Care campaign addressed the fact that 12% of RN turnover and 38% of RN workers' compensation pay are related to back strains. Using the benchmarks reported in the Handle With Care campaign, the average cost of replacing an RN who leaves nursing due to a back injury ranged from $25,450 to $38,280 per nurse. Health care worker injury prevention should be valued as a retention strategy, as well as a fiscal responsibility where all stakeholders benefit.     

Reading and understanding employee benefit plan financial statements

If your employee benefit plan has more than 100 participants, chances are you've had to work your way through the audited financial statements you're required to include with your Form 5500 filing. These statements contain a wealth of information about the financial health of your plan, and understanding them is an important fiduciary responsibility. To strengthen your grasp of financial statements, this article gives an overview that will make a plan's financial statements more informative, explains their basic structure and provides information on some of the more arcane aspects (such as actuarial tables). While this article focuses on Taft-Hartley (multiemployer) plans, much of it applies to other types of employee benefit plans.     

Access profit-sharing regulation with information acquisition and transmission

This paper analyses how information acquisition and transmission on the upstream cost affect the optimal access profit-sharing plan and the regulator’s choice of an information transmission regime in network industries characterized by a regulated upstream monopoly with cost uncertainty and an unregulated downstream duopoly. When the regulator obliges the upstream monopolist to transmit information to a downstream rival, the adoption of an access profit-sharing plan may boost his/her incentives to acquire information. It will be shown that the optimal access profit-sharing plan under information transmission depends on the variance and shape of cost distribution. Moreover, an information transmission regime proves to be welfare preferable to a regime with no information transmission only if it induces information acquisition and if the regulator is significantly concerned about firms’ profits.     

Estimated cost savings associated with the use of valsartan in heart failure in a large US health plan

Summary

Results from a large, randomised clinical trial demonstrated reduced rates of hospitalisation and mortality, and reduced length of stay associated with valsartan added to the usual care of heart failure patients not currently receiving angiotensin-converting enzyme inhibitors (ACEIs). These results were used in a budget impact model for a large US health plan. Administrative claims data were used to estimate cost savings over 1 year. In the study health plan, 63,218 patients were identified with heart failure, with 55% not currently receiving ACEI or valsartan. Using health plan-specific cost data, care for the untreated heart failure patients with valsartan would reduce hospitalisation costs from $135 million to $43 million owing to averted heart failure-related hospitalisations and shortened length of stay for the remaining hospitalisations. Economic effects of other aspects of treatment with valsartan (e.g. outpatient or physician visits or adverse events) were not considered. Taking into account only hospitalisations and the costs of valsartan therapy, net savings in the study health plan would be expected to be $64 million.     

Multiple HMO/indemnity plan supplement design: a managed care strategy for employers with high HMO enrollment

This article outlines a health care benefits strategy that combines features of the multiple HMO choice approach and the point-of-service approach. Although this plan design may not be appropriate for all employers, it may provide the greatest long-term cost savings for employers with high HMO enrollment, according to the author.     

The funding for a Defined Benefit (DB) pension plan based on the fair valuation of the plan's insolvency risk

This study provides a contingent claims valuation approach model to value a sponsor's claim on a salary-related, defined benefit (DB) pension plan. The model is further developed to numerically estimate a suggested optimal contribution cost that allows the sponsor to fairly bear the risk of the plan's insolvency. The results demonstrate that the traditional actuarial valuation underestimates the cost of pension benefits, and that the normal contribution cost is not enough for the sponsor to fairly charge the value of bearing the plan's insolvency.     

The portable guarantee to exchange back an old defined benefit for a new defined contribution (DC) pension plan

As a defined contribution (DC) pension plan is introduced to replace a defined benefit (DB) pension plan, the portability benefit from a DC pension plan costs the employees to bear the investment risk from managing the pension fund. To protect the retirement income and maintain the portability benefit, a guarantee to exchange back the old defined benefit is supposed to be demanded for the new DC plan's participants in the guarantee market. In light of such a demand, this article applies a claim-terminating insurance pricing model to offer a contingent claims pricing model for a portable pension guarantee. Using the new labor pension plan of Taiwan as an illustration, a guaranteed DC pension will carry an extra cost of almost 50% up to over 100% of the plan's contributions over the participant's work life, given the current mandatory minimum requirement of a contribution rate of 6%.     

高等学校教学经费评估方案探讨

为了更好地体现分类指导,在现有的评估方案基础上,针对特殊类型的高校,分别制定相对应的评估方案,是我国高等教育改革和发展的需要。根据高校不同教育性质对教学评估方案加以完善,一方面,可以加强教学经费投入的评估力度,增强不同性质高校之间的可比性;另一方面,在为教育评估提供信息支持的同时,可以为高校其他决策提供强有力的支撑。     

Capital accumulation during the transition from plan to market1

This paper focuses on the process of capital accumulation and the forces that drive it in the countries undergoing the transition from plan to market. The methodological framework for analyzing the determinants of aggregate business investment draws on the neoclassical accelerator model, extending it to reflect some of the specificities of the transition environment. The model is estimated on data for the economies in Central and Eastern Europe (CEE) and the Commonwealth of Independent States (CIS). The results highlight the role of some key drivers of capital accumulation in an economy in transition, in particular, the relatively significant accelerator response to output, the importance of adjustment effects and financing constraints and the relatively minor role of the cost of capital.     

会计信息披露的冲突与对策研究

随着现代企业制度和证券市场的不断发展与完善,使得会计信息披露成为企业经营机制的重要组成部分,同时也为企业和投资者决策有用性提供了巨大的参考作用。但是,外部信息披露机制要求与企业内部实际成本效益之间会发生一定的冲突。要化解会计信息披露的冲突,应从横向上,采用强制披露与资源披露相结合;从纵向上,采用多层次信息披露制度:从技术上,加大网络会计的推广。     

Occupation pension for public employees in the People's Republic of China: A new approach with defined benefit underpin pension plan

The State Council of the People's Republic of China announced a reformed pension plan for public employees with the occupation pension plan in January 2015, officially disclosing that the social pension systems for private and public employees will be unified. Our proposed occupation pension plan for public employees is one of the important components in transiting from a dual‐track pension system to a sustainable and unified system. We aim at providing a pension design, that is, the defined benefit (DB ) underpin pension with estimates of the costs and benefits. We have used a financial engineering approach to calculate the hedge contribution for a DB underpin hybrid pension plan benefit. We also treat pension benefit and salaries in aggregate. Therefore, we propose a stochastic and exogenous salary model. Employees’ total benefits can be determined by multiple factors, such as inflation, economic environment, and employer's preference. However, the expectation of employees’ total benefits should not be affected by the change of salary and pension benefits. Our results could facilitate the ongoing pension reform in the People's Republic of China, providing a rigorous benchmark with public policy implications as to plan design, cost estimation, as well as risk management approach.     

Designing your health benefit plan

A health care benefit plan should meet the needs and expectations of your organization and its insureds. Each organization is unique, so a health care benefit plan shouldn't be "off the shelf" but be uniquely tailored for your organization. Analyze current demographic, utilization and other data to determine which services members and their families are using and what type of services may be needed in the future.     

Determinants of pension plan fees in Spain

Pension plans and funds represent a substantial part of the welfare systems in both Europe and Spain. One of the most important factors in the choice of a plan or fund is the performance it obtains. In view of the influence that fees have on performance, the objective of this study is to analyse the variables that determine the management and custodial fees of individual pension plans. The Spanish market for pension plans and funds sets legal caps on these fees, and at the same time the majority of them are commercialized and managed by financial institutions, which can in turn generate a conflict of interests. In this article, we estimate models with censured variables and our findings show how the average investment per plan, the legal status and the size of the management company to which the plan belongs, and the style of the plan are all relevant determinants of the management fee. In turn, the custodial fee is determined by the legal status of the custodial company, the size, the return and the type of plan.     

Understanding multiemployer health and welfare plan financial statements

The trustees of a health and welfare plan may choose to delegate monitoring of the plan's financial operations. Still, it is important that they have a basic understanding of welfare plan financial statements.     

Do people plan?

We report the results of an experimental investigation of a key axiom of economic theories of dynamic decision making—namely, that agents plan. Inferences from previous investigations have been confounded with issues concerning the preference functionals of the agents. Here, we present an innovative experimental design which is driven purely by dominance: if preferences satisfy dominance, we can infer whether subjects are planning or not. We implement three sets of experiments: the first two (the Individual Treatments) in which the same player takes decisions both in the present and the future; and the third (the Pairs Treatment) in which different players take decisions at different times. The two Individual treatments differed in that, in one, the subjects played sequentially, while, in the other, the subjects had to pre-commit to their future move. In all contexts, according to economic theory, the players in the present should anticipate the decision of the player in the future. We find that over half the participants in all three experimental treatments do not appear to be planning ahead; moreover, their ability to plan ahead does not improve with experience, except possibly when we force subjects to pre-commit to their future decision. These findings identify an important lacuna in economic theories, both for individual behaviour and for behaviour in games.

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Electronic Supplementary Material  The online version of this article () contains supplementary material, which is available to authorized users.      

Retirement plan technology delivers big benefits to small business

Retirement plan technology has made it possible for small businesses to be "competitive" in the benefits they offer employees. Small firms that have upgraded their plans have found they are able to offer programs that are less expensive for them and richer for their employees. Integration and Web-based technology have also facilitated employees' retirement planning.     

报酬方案、棘轮效应和激励成本关系研究

在委托代理关系中,委托人为了抑制代理人的机会主义行为,在设计激励机制时采用报酬方案和棘轮效应。本文采用实验方法,研究报酬方案和棘轮效应各自及它们联合起来对委托人激励成本的影响。根据实验数据分析发现:如果单独考虑报酬方案,则松驰诱导报酬方案会增加激励成本;如果单独考虑棘轮效应,则棘轮效应也可能增加激励成本;但是,当二者联合起来时,在真实诱导报酬方案下,棘轮效应并不会增加激励成本。所以,将报酬方案与棘轮效应正确地配合起来,委托人才能真正实现自己利益最大化,否则,则可能是代理人的业绩增加了,但是,委托人为换取这种业绩增加却付出了更大的激励成本,委托人得不偿失。