The Internal Revenue Service (IRS) has announced cost-of-living adjustments (COLAs) applicable to dollar limitations for pension plans and other items for the 2009 tax year.

There are several web sites you can visit for specific information on the new COLAs.

IRS.gov offers
• a full summary of COLAs
• a comprehensive list of COLA increases dating back to 1989

401khelpcenter.com provides
• a full summary of the new adjustments

For further information, please contact Jere Cowden, President/CEO of Cowden Associates, or Jim Bartoszewicz, President/CEO of Cowden Advisers. They can be reached at 412-394-9330 or toll-free at 888-889-9432.

The Medicare Modernization Act (MMA) mandates that plan sponsors offering prescription drug coverage disclose to all Medicare eligible individuals covered under the plan whether such coverage is “creditable.” This is valuable information to the individual, since it impacts their decision to enroll.

The MMA mandates that this communication of creditable or non-creditable status of your plan be made once a year, and no later than November 15, 2008.

Cowden Associates is prepared to assist you with both the determination of creditable or non-creditable coverage, as well as the development of the communication itself. Contact your Cowden Associates consultant at 412.394.9330, to be prepared for the November 15th deadline.

...in the Pittsburgh Business Times (full article requires a subscription):

Senior executives are taking a much more active role in administering 401(k) plans than in the past, according to a survey of more than 125 employers in the tri-state area around Pittsburgh.

Of the respondents in this year’s survey by Downtown Pittsburgh-based consultant Cowden Associates Inc., 94 percent said senior executives are involved in making decisions about investments, up from 30 percent in 2007.

...in the Pittsburgh Post-Gazette (full article):

The survey of 128 area employers also found that 25 percent of companies were automatically enrolling employees in 401(k) plans, up from 16 percent in 2007.

Cowden said the survey also identified a major deficiency among plan sponsors: One-quarter said they did not have an investment policy statement, which outlines the general investment goals and objectives of a retirement plan.

...in the Pittsburgh Tribune-Review (full article):

Employers in the Pittsburgh region are taking action to retain and attract top employee talent by increasing contributions to their workers' 401(k) and related retirement plans well above the standard 3 percent mark, a consultant's survey found.

Cowden Associates Inc.'s second annual survey of employers who sponsor defined-contribution plans released Thursday found a substantial year-over-year percentage increase in employer matching contributions.

Cowden Associates survey finds significant changes in investment decision-making process

Significantly more senior executives are taking a direct role in decisions regarding their organization’s 401(k) plans than in the past, according to Cowden Associates, Inc.’s Second Annual Tri-State Defined Contribution Plan Sponsor Survey.

Of the respondents to this year’s survey, 94 percent indicated that their senior executives are involved in the investment decision-making process, compared with 30 percent in 2007.

More than 125 employers throughout the tri-state region participated in this year’s survey, which was conducted during March and April, and provided information on their location, size, total plan assets, type of organization, and eligibility for and participation in the plan.

CONTINUE READING

Vince Wolf was featured in a Pittsburgh Business Times article from the August 1 - 7, 2008 issue:

To cope with the rising cost of specialty drugs, some companies are creating a new prescription tier for employees that requires a bigger co-payment and directing patients on these drugs to a specialty pharmacy, according to Vice Wolf, executive vice president of Downtown-based Cowden Associates, Inc. But care has to be taken to set co-pays that are not prohibitively high.

"It's understandable that you'd want them to pay more, but you don't want to create a huge financial burden," Wolf said. "Where the savings are is in the management of the prescriptions, making sure that people stay compliant, which has a longer term savings."

The full article requires a subscription.

A recent study by EBRI (Employee Benefit Research Institute) reports that many experienced employees might delay retirement if offered the right incentives. In partnership with the HR Policy Association, EBRI interviewed employees and retirees from 11 aerospace and defense industry companies. Nearly half of those polled said that feeling needed would be enough to get them to stay as much as 2 years longer. Half also said that receiving a full pension while adopting a part-time schedule would delay their retirement. Nearly as many would be enticed by a partial pension while working part-time. An overwhelming majority say that they would look positively on an employer asking them to stay longer. Employers have a narrow window to offer incentives for working longer, though. Many employees start thinking and planning for retirement as much as 2 years before they retire.

The New York Times on Pittsburgh:

PITTSBURGH has undergone a striking renaissance from a down-and-out smokestack to a gleaming cultural oasis. But old stereotypes die hard, and Pittsburgh probably doesn’t make many people’s short list for a cosmopolitan getaway. Too bad, because this city of 89 distinct neighborhoods is a cool and — dare I say, hip—city. There are great restaurants, excellent shopping, breakthrough galleries and prestigious museums. The convergence of three rivers and surrounding green hills also make it a surprisingly pretty urban setting. And if the Pirates are in town, head over to PNC Park. Besides the game, the ballpark offers a great excuse to explore downtown Pittsburgh and the river views.

On June 19, the Supreme Court decided MetLife v. Glenn, ruling that a company that both administers and funds a benefits plan operates under a conflict of interest that must be considered as a factor in a court’s review of claim denials.

From the analysis on SCOTUSBLOG:

In its decision below, the Sixth Circuit explicitly considered that conflict of interest when reviewing MetLife’s denial of benefits to respondent Glenn, a Sears employee who filed for disability benefits after a heart condition impaired her ability to work. After MetLife rejected Glenn’s claim, asserting that she was still physically capable of performing full-time sedentary work, Glenn brought suit against the insurance company under ERISA, which authorizes federal courts to review the decisions of benefit plan administrators. Glenn lost her case in district court but prevailed before the Sixth Circuit... The Sixth Circuit [ruled] that the claim denial was unreasonable and should be reversed.

As always, plan sponsors should carefully evaluate how their claims are decided and paid. Any employer who both administers and pays benefits should take the ruling into account and put safeguards into place to separate benefit decisions from financial concerns.

A thorough discussion of MetLife v. Glenn can be found on SCOTUSWIKI.

In June, President Bush signed into law H.R. 6081: Heroes Earnings Assistance and Relief Tax Act of 2008 (HEART Act), providing tax benefits and incentives to employees in qualified military service as defined by the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA). The provisions have varied impact on many benefits, including 403(b) plans, governmental 457(b) plans, IRAs, and health flexible spending accounts. A full summary can be found at GovTrack.us.

Vince Wolf, Cowden Associates' Executive Vice President, is featured in a Pittsburgh Business Times interview focusing on wellness programs:

How does a small employer implement an effective work site wellness plan?

I think the thing that is not necessarily understood is there are a lot of programs people can do that are not really expensive or time consuming.

The full article requires a subscription.