Compliance December 5, 2018

PBGC Wants to Collect Information About DB Plans’ ERISA Coverage

The PBGC insures DB plans covered under title IV of ERISA, and if a question arises about whether a plan is covered under title IV, the PBGC may make a coverage determination.

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The Pension Benefit Guaranty Corporation (PBGC) intends to request that the Office of Management and Budget (OMB) approve a collection of information necessary for the PBGC to determine whether a defined benefit (DB) plan is covered under title IV of the Employee Retirement Income Security Act (ERISA).

The PBGC insures DB plans covered under title IV of ERISA. Covered plans are those described in Section 4021(a) of ERISA but not those described in Section 4021(b)(1)–(13). If a question arises about whether a plan is covered under title IV, the PBGC may make a coverage determination.

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A proposed form and instructions would be used by a plan sponsor or plan administrator to request a coverage determination and would be suitable for all types of requests. The proposed form would highlight the four plan types for which coverage determinations are most frequently requested:

  • Church plans as listed in Section 4021(b)(3) of ERISA;
  • Plans that are established and maintained exclusively for the benefit of plan sponsors’ substantial owners as listed in Section 4021(b)(9);
  • plans covering, since September 2, 1974, no more than 25 active participants that are established and maintained by professional services employers as listed in Section 4021(b)(13); and
  • Puerto Rico-based plans within the meaning of Section 1022(i)(1) of ERISA.

Notably, a number of DB plans that have been determined to qualify for church-plan status by the IRS have had that status challenged in lawsuits. Plaintiffs in the lawsuits are concerned that the plans are not following ERISA funding requirements and are not insured by the PBGC.

The PBGC is requesting public comment on its proposal. More information is here.
Products December 5, 2018

Optum Offers HSA Growth with Upgraded Data Analytics

The tool groups consumers into microsegments based on characteristics and behaviors, allowing employers to then create targeted communications for HSAs. 

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In order to raise health savings account (HSA) accumulation and raise awareness behind HSAs and heath care costs, Optum bank has updated its data and analytics tool, Health Finance Journey.

The model, which implements “behavioral science and advanced analytics” to gauge why consumers behave the way they do, groups clients into microsegments based on mutual characteristics and incentives. These clustered, shared interests between consumers allows employers who sponsor HSA-qualifying insurance plans to develop targeted communications for their employees, which can then grow health care savings, says Optum.

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“Employers want access to the latest data-driven analytics and tools that help their employees save for their current and future health care needs,” says Deb Culhane, president and CEO of Optum Bank. “The Health Finance Journey’s enhanced capabilities offer employers better strategies to help them communicate the right messages, to the right employees, at the right time. We are very encouraged by the initial results of applying this updated model.”

The company recently analyzed almost 200,000 de-identified accountholders and identified natural segments and cluster, says Optum. Over 2,000 attributes based on HSA contributions and distributions, account tenure and consumer behaviors were then created, leading to an end result of 20 microsegments that can be targeted with specific communications relevant to them.

Optum says the enhancement has already shown results. Overall, accountholders who were targeted with new messages based on the enhanced Health Finance Journey increased their balances, became eligible to invest, and chose to open investment accounts. Specifically, the enhanced tool resulted in a 26% increase in one-time contributions, an increase of average balances of 12%, and a 23% increase in investment account openings.

More information about Health Finance Journey can be found here.

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