1Willis North America | May 2015

HRFocus

HR CORNERSURVEY ON REMOTE WORKERS SHOWS GAINS FOR BOTH EMPLOYERS, EMPLOYEES WITH TELECOMMUTING ARTICLE PROVIDED BY BLR

The results of the latest ConnectSolutions “Remote Collaborative Worker Survey” suggest clear cost-savings and productivity gains for companies that employ remote workers, as well as a number of both personal and professional benefits for workers themselves.

EMPLOYER BENEFITS Whether remote workers are able to work with greater efficiency off-site or are more motivated to demonstrate off-site effectiveness, of the 39% who work remotely at least a few times per month, 77% report greater productivity while working off site, with 30% accomplishing more in less time, and 24% accomplishing more in the same amount of time.

Also, 23% are even willing to work longer hours than they normally would on site to accomplish more while 52% are less likely to take time off when working remotely—even when sick.

When it comes to camaraderie and collaboration, 42% of remote workers feel they’re just as connected with colleagues as if they were working on-premises, and 10% feel even more connected.

EMPLOYEE BENEFITS Respondents indicate a clear financial motive in working remotely, with the largest group of remote workers (30%) reporting savings of as much as $5,240 per year simply accounting for expenses.

Half of the remote workers surveyed also say being able to work remotely at least some of the time makes them much more likely to stay with the company.

Personal satisfaction and quality-of-life also seem to play a strong role in the allure of working remotely: 45% of remote workers are getting more sleep, 35% are getting more physical exercise, and 42% are eating healthier.

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HR CORNERSurvey on Remote Workers Shows Gains for Both Employers, Employees with Telecommuting ���������������������������������������������� 1The Learning Curve—Professional Development for HR Professionals ������������������������������������������������������������������������ 2

HEALTH OUTCOMESThe High Cost of Poor Sleep ���������������������������������������������������� 4

LEGAL AND COMPLIANCECourt Finds SPD Intranet Posting Insufficient ����������������������� 5DOL Announces Delay Affecting SBC Final Rules and Template ���������������������������������������������������������������������������������� 7

SINCE YOU ASKEDParticipation in Health FSAs and HSAs ����������������������������������� 8

WEBCASTS �������������������������������������������������������������������� 12

CONTACTS ��������������������������������������������������������������������� 13

HUMAN CAPITAL PRACTICE

May 2015 www�willis�com

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Overall, 44% have a more positive attitude and 53% report reduced stress. 51% spend more time with their significant others, adding to the greater job satisfaction.

TECHNOLOGICAL DRIVERS Of the digital communication and collaboration tools available, e-mail is the most used at 88%, with instant messaging (47%), video conferencing (36%), VoIP/Skype (32%), and presence functionality (30%) also commonly relied upon by remote workers. Also, 28% of those surveyed use an enterprise unified communication solution, such as Microsoft Lync.

Mobile devices with growing desktop-like functionality are also doing much to empower workers remotely—at home or in the field, including at cafes, parks, and other nontraditional locations—with 40% of those surveyed able to conduct at least half of their total workload on a smartphone, tablet, or other mobile device.

“Our Remote Collaborative Worker Survey suggests there are significant benefits to be gained by both remote workers and their employers with off-site employees motivated to work harder and more efficiently to protect both the personal and professional benefits of working remotely,” said Michael Fitzpatrick, CEO of ConnectSolutions.

“Even the personal benefits workers experience can be viewed as employer benefits since workers tend to be happier, less stressed out, and healthier, thereby bringing down the costs of turnover, absenteeism, lower productivity, and other issues.”

Note: 353 US Internet users 18 years old and over participated in the ConnectSolutions Remote Worker Survey, conducted online during the month of December, 2014.

THE LEARNING CURVE—PROFESSIONAL DEVELOPMENT FOR HR PROFESSIONALSARTICLE PROVIDED BY BLR

Great leaders never stop learning. Learning helps leaders anticipate, adapt, and innovate to move their organizations forward. Of course this makes sense in theory. However, it isn’t always easy for human resources professionals to focus on their own professional development when the report deadline is tomorrow, and three positions need to be filled yesterday.

In fact, for many HR executives, the biggest barrier to ongoing professional development is their competence. They are so adept at meeting the organization’s immediate needs, they allow these daily demands to distract them from the long-range focus.

This myopic view of HR can drastically limit your organization’s success and your own career goals. Traditional HR functions, such as benefits and payroll are becoming self-service, presenting an enormous opportunity for HR professionals to become talent leaders in their companies—making talent decisions not just implementing them.

This requires a broader view and often an expanded skill set. Making this jump from implementer to decision-maker can seem intimidating, but it is the key to providing organizational value—and what will make you indispensable. Where do you need to expand your expertise to benefit the organization and energize your work?

Professional development is not just a seminar—it’s a different approach to work. It requires identifying your learning gaps and taking the steps to fill them. Here are some questions to ask yourself that may prompt your learning.

HR Corner – continued from page 1

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AM I STRATEGIC ENOUGH? HR professionals don’t often use their time or capacity to address strategy. Becoming a leader means looking through a wider lens to anticipate and address the organization’s strategic needs and challenges this year, next year, and five years from now.

Ask, “How can I bring value to the organization? What is happening with our competitors? What longer-term initiative can we adopt to position the organization for growth?” Think beyond HR to determine how your decision-making will impact the entire business.

AM I ADDRESSING THE TALENT NEEDS OF THE NEXT GENERATION OF THIS ORGANIZATION? Talent management is not just about filling positions. Successful HR professionals are able to recruit and retain the most talented people to meet the needs of the organization now and later. This involves identifying talent gaps. Where are the needs in the company? Where will growth be? How can hiring support that growth? Where will you find the people to meet those needs? How will you keep them? Talent management strategies should be global initiatives that incorporate innovative programs for recruitment, hiring, and retention.

AM I FOLLOWING THE LEADERS? While HR professionals often implement mentor programs within the organization as part of professional development and succession plans, it can be difficult for HR professionals to find in-house mentors for themselves. Look outside the organization for a virtual mentor. Who are the thought leaders in your field? Be sure to follow these innovators by reading books, blogs, and interviews. Stay current with the trends affecting your industry by staying involved in your professional organizations.

Where do you find your HR inspiration? Does Google’s Laszlo Bock’s unconventional take on hiring spur your creativity? Maybe Felicia Field’s ingenuity in turning Ford Motor Company around is your motivation. Perhaps Hollie Delaney’s focus on hiring to fit Zappos’ culture of fun and service inspires your practices. Find your industry muse and let their innovation inspire yours.

AM I A GOOD COLLABORATOR? Becoming a master collaborator means more than just being a people person (which most HR professionals are by nature and practice). It involves becoming a highlevel business thinker and strategic partner with other business lines—IT, finance, product development—to have the pulse of the entire organization and an inside line on talent needs.

DO I IMPACT THE CULTURE? Determine to what extent human capital strategy impacts the culture at your organization. Is it inextricably linked? Incompatible? At the very least, HR professionals should be holding leadership accountable to remain true to their cultural mission. Human capital can also define, shape, and influence the culture.

CAN I MEASURE MY ROI? HR professionals are often so in-tune with making sure that everyone else has their performance appraisals done, they often forget their own! This may be due in part to the “Cobbler’s Syndrome,” but it often is something more. Most HR executives want their organization’s leadership team to tell them they are doing a good job. Yet, they don’t always know how to define what a “good job” looks like. They may feel even more intimidated about measuring their own performance.

Stop using the excuse that it is too difficult to measure a return on investment (ROI) for HR, because it’s not! Measure adaptability, access to talent, and innovation. Subject yourself to the same rigorous assessments that other employees undergo to prove your worth and demonstrate your value.

Learning, or professional development, is the key to moving HR professionals from transactional to transcendent. Expanding your skills and expertise by becoming a business partner, strategic thinker, and organizational leader will solidify your position in any company.

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GREAT LEADERS NEVER STOP LEARNING. LEARNING HELPS LEADERS ANTICIPATE, ADAPT, AND INNOVATE TO MOVE THEIR ORGANIZATIONS FORWARD.

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Willis North America | May 20154

HEALTH OUTCOMESTHE HIGH COST OF POOR SLEEP

Many American workers are not getting enough sleep and employers are footing the bill. The Centers for Disease Control and Prevention (CDC) reports that “30 percent, or 40.6 million, of American adults are sleeping six or fewer hours a day, and night shift workers, particularly those in transportation, warehouse and health care industries are at the most risk of not getting enough sleep.”1 According to a 2011 Harvard study, sleep deprivation costs businesses in the U.S. an estimated $63.2 billion annually in lost productivity.2 A study in the Journal of Occupational and Environmental Medicine3 outlined the impact of sleep disturbances on work performance and productivity. Employees at four corporations were surveyed about their sleep patterns and completed the Work Limitations Questionnaire. Participants were classified into four groups: insomnia, insufficient sleep syndrome, at risk and good sleep. Results showed that the insomnia and sleep syndrome groups had significantly worse productivity, performance and safety outcomes. The group with the highest use of sleep medication was the insomnia group. Fatigue-related productivity losses in this study were estimated to cost nearly $2,000 per employee annually.

Poor quality sleep reveals itself in the workplace as irritability and decreased productivity, including lessened attention to detail and poor communication. In 2014, Ceridian conducted the Workplace Wake-Up Call: Pulling Back the Covers on Sleep Deficiency survey. Six hundred ninety-six human resource professionals from the U.S. and Canada, representing a wide variety of organizations, responded, citing sleep deficiency as contributing to:4

� Errors � Workplace stress � Illness � Absenteeism � Interpersonal conflicts � Employee self-medication � Presenteeism

To help protect productivity and mitigate risks, employers should support employees’ sleep health and wellbeing. Successful strategies include:

� Promoting better sleep through an employee communication campaign or wellness program focused on healthy sleep habits

� Promoting Better Sleep Month in May (www.bettersleep.org)

� Implementing workplace policies and practices that support sleep health

� Allowing for “power naps” or offering dedicated space for a quiet room

� Evaluating technology and email policies to encourage employees to take time away from their devices

� Including treatment for sleep apnea in health plan benefits

Sources:

1 Medical Daily: Nearly a Third of Americans are Sleep Deprived 2 The Wall Street Journal: Go Head, Hit the Snooze Button 3 Rosekind, MR, Gregory, KB, Mallis, MM, Brandt, SL, Seal, B, Lerner, D (2010) The cost of poor sleep: workplace productivity loss and associated costs. Journal of Occupational and Environmental Medicine #52 4 Workplace Wake-Up Call: Pulling Back the Covers on Sleep Deficiency

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LEGAL AND COMPLIANCECOURT FINDS SPD INTRANET POSTING INSUFFICIENT A recent court case highlights the importance of adhering to the Department of Labor’s (DOL) safe harbor for electronic disclosure of materials required under the Employee Retirement Income Security Act (ERISA). The case centered on whether the plan administrator had furnished a summary plan description (SPD) in accordance with ERISA’s rules and whether it provided participants notice of the plan’s waiver of premium provisions. The case, Thomas v. CIGNA Group Ins., involved a life insurance beneficiary seeking to recover benefits following the death of his sister, a participant in the Countrywide Financial Corporation Group Insurance Plan. The participant had ceased working due to disability and stopped paying premiums. Although she was no longer in active service, per the plan’s waiver of premium provisions, such an individual could retain eligibility if certain conditions were met. After the participant’s death, the insurer denied her beneficiary’s claim for benefits. While the plan allowed for premium waivers due to disability, the participant failed to make a timely request for the waiver. As such, she was not covered under the plan when she died. The beneficiary argued that the premium waiver requirements had not been appropriately communicated to the participant due to inadequate SPD distribution.

ERISA’S ELECTRONIC DISCLOSURE SAFE HARBOR ERISA welfare benefit plans must prepare and distribute SPDs to plan participants. The purpose of an SPD is to inform participants of their rights and obligations under an employee benefit plan. Equally important, an SPD informs participants of any limitations on the benefits provided under the plan. ERISA provides that an SPD must be “written in a manner calculated to be understood by the average plan participant, and shall be sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.” See DOL Reg. §2520.102-2(a). Further, SPDs must be furnished in a manner “reasonably calculated to ensure actual receipt of the material.” See DOL Reg. §2520.104b-1(b)(1).

DOL regulations provide a safe harbor that describes specific circumstances in which ERISA plans may use electronic delivery methods (i.e., by email, an intranet or the internet) to furnish to participants (both employees and non-employees) documents and other information required under ERISA. See DOL Reg. §2520.104b-1(c). As a safe harbor, plans are not required to comply with its conditions; however, compliance ensures that the DOL will find a plan’s electronic delivery method acceptable. This option is not without limit, however.

All ERISA Title I plan documents and notices, including SPDs, summary of material modifications (SMMs) and summary annual reports (SARs), may be furnished electronically if the plan administrator ensures that the system for furnishing documents results in actual receipt of the information (for example, using return receipt electronic mail features or conducting surveys periodically to confirm proper transmission and receipt).

The disclosure must meet such general requirements as preparing and furnishing the electronic materials in accordance with otherwise applicable requirements (e.g., timing, format and content requirements); providing each recipient with a notice at the time the electronic document is furnished of its significance and of their right to request and obtain a paper version; making a paper version of the electronic document available (free of charge) upon request to participants, beneficiaries or other individuals.

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The notice requirement applies to all recipients (employees and non-employees alike) and must be complied with each time an electronic disclosure is made. Furnishing a general notice on a periodic basis is not acceptable. However, the safe harbor permits a plan administrator to include this notice with other disclosures being furnished at the same time, provided that the notice is conspicuous.

By meeting these requirements, electronic disclosure can be made to any plan participant who is able to access the electronic documents where the participant is expected to perform his/her duties, provided that the employee’s access to the employer’s electronic information system is an integral part of the employee’s duties (public kiosks are not acceptable).

The DOL safe harbor also permits a plan to provide documents electronically to other individuals entitled to ERISA disclosures, even if those individuals are not employees with access to the employer’s computer system, but additional requirements must be met.

First, prior to receiving electronic information, the person must receive a statement that:

� Identifies the documents or categories of documents to which the person’s consent applies

� Explains that consent may be withdrawn at any time without charge

� Describes procedures for withdrawing consent and updating information

� Explains the person’s right to request a paper version and states whether or not there will be a charge for the material

� Summarizes any computer software and hardware requirements to access and retain the electronic materials

Then, after the person receives the foregoing statement, the person must provide an address for delivery of the documents and consent to receive documents electronically. If the electronic disclosure will be made “through the Internet or other electronic communication system,” the individual must consent “in a manner that reasonably demonstrates the individual’s ability to access information in the electronic form that will be used.” See DOL Reg. §2520.104b-1(c)(2)(ii)(B). Note that if system hardware or software requirements change, the plan administrator must provide a revised statement and obtain a renewed consent from the individual.

CONCLUSIONIn Thomas, the court held that the insurer’s denial of benefits was arbitrary and capricious, because there was no evidence that the plan administrator had provided the participant with an SPD. While the participant was provided, when she was first hired, with an employment confirmation letter that referenced the company intranet and provided notice of the SPD, the electronic disclosure rules require notice each time a new electronic document is furnished. There was a different SPD in effect when the participant stopped working and there is no evidence that notice of the new SPD was ever provided or that SPDs were provided in a manner other than posting on the intranet.

For employers, the lesson learned from this case is that simply placing SPDs on a company website, without notifying participants that they are available and of their significance, does not satisfy ERISA’s requirements that SPDs be furnished in a manner “reasonably calculated to ensure actual receipt of the material.” It also serves as a reminder to those employers who make SPDs and other plan materials available electronically to review the DOL’s safe harbor rules against their current practices. It is only by complying with the DOL’s safe harbor rules in their entirety that an employer can ensure a result different from the outcome in the Thomas case.

SIMPLY PLACING SPDS ON A COMPANY WEBSITE, WITHOUT NOTIFYING PARTICIPANTS THAT THEY ARE AVAILABLE AND OF THEIR SIGNIFICANCE, DOES NOT SATISFY ERISA’S REQUIREMENTS...

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DOL ANNOUNCES DELAY AFFECTING SBC FINAL RULES AND TEMPLATEOn March 30, 2015, the U.S. Department of Labor (DOL) Employee Benefits Security Administration (EBSA) issued another FAQ (Part XXIV) on the implementation of the health care reform law. This FAQ provides an update on when the agencies (the Departments of Labor, Treasury and Health and Human Services) expect to finalize proposed rules on the summary of benefits and coverage (SBC) and uniform glossary that they issued on December 22, 2014. The proposed changes were to be effective for plan years beginning on or after September 1, 2015.

According to the FAQ, however, the agencies intend the final regulations to be effective on the first day of the first plan year (or, in the individual market, policy year) that begins on or after January 1, 2016. This includes 2015 open enrollment periods that relate to coverage beginning on or after January 1, 2016. While the agencies anticipate that the new SBC template will be finalized by January 2016, it does not appear that they will be available for 2015 open enrollment periods. The FAQ states that the revised SBCs applies to coverage with a plan year (or, in the individual market, policy year) beginning on or after January 1, 2017. This includes 2016 open enrollment periods that relate to coverage beginning on or after January 1, 2017.

BACKGROUND The health care reform law expanded health plans’ disclosure obligations, requiring distribution of a uniform four-page “summary of benefits and coverage” – an SBC. Any employer-sponsored plan – whether insured or self-insured – that provides, pays for or reimburses the cost of health care is a “group health plan” that may be subject to the SBC requirement. Any type of employer (e.g., religious, governmental, for-profit and not-for-profit) may maintain a group health plan that is potentially subject to the SBC requirement. To the extent that a plan consists of “excepted benefits,” such as stand-alone dental and vision benefits, the plan is exempt from the SBC requirement.

PROPOSED REGULATIONS The proposed regulations amend the final regulations published on February 14, 2012 and include revisions to the SBC templates, instruction guides, uniform glossary and other supporting materials.

Highlights of the proposed changes (intended to make the SBC more user-friendly):

� A shortened SBC template (from 4 to 2½ double-sided pages)

� The addition of a third cost-of-coverage example involving a simple foot fracture with emergency room visit (current examples are having a baby and managing type 2 diabetes)

� Revision of some existing definitions in the uniform glossary and the addition of new definitions of important insurance or medical concepts (e.g., claim, screening, referral, and specialty drug), as well as key terms relevant in the context of the health care reform law (e.g., individual responsibility requirement, minimum value, and cost-sharing reductions)

The proposed amended SBC template, uniform glossary and other related materials are available for review at http://cciio.cms.gov and www.dol.gov/ebsa/healthreform.

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SINCE YOU ASKEDPARTICIPATION IN HEALTH FSAS AND HSAS The National Legal & Research Group (NLRG) has recently received questions about the impact of adding a health savings account (HSA) when an employer is already offering a health flexible spending account (FSA) as a part of its health and welfare benefit plan.

BACKGROUND HSAs are tax-favored IRA-type trust accounts that eligible individuals covered by certain high-deductible health plans (HDHPs) can establish to pay for certain medical expenses of HSA account holders, their spouses and their tax dependents.

An eligible individual is one who, with respect to any month, is:

� Covered by a plan that qualifies as an HDHP � Not covered at the same time by any other plan

which is not an HDHP but which covers the same benefits as the HDHP

� Not claimed as a dependent on another person’s tax return (a spouse is not considered a tax dependent under either Internal Revenue Code (IRC) §§ 151 or 152, even though a taxpayer may claim an exemption for the spouse)

� Not enrolled (not just eligible, but actually enrolled) in Medicare Part A or B (eligible employees age 65 or

older may contribute to an HSA, including the catch-up contribution, as long as they are not enrolled in Medicare)

A health FSA offered under a cafeteria plan can only reimburse qualified medical expenses incurred during a plan year from the same years’ contributions or benefits. Accordingly, unused amounts remaining in a participant’s health FSA cannot be carried over to pay or reimburse expenses incurred in a subsequent year and must be forfeited unless an exception applies (the “use-or-lose rule”). There are two exceptions to the rule: (1) carryovers of $500 or less and (2) grace periods. Note: a health FSA cannot have both a carryover provision and a grace period.

Health FSA arrangements can be general-purpose, which means they reimburse all qualifying medical expenses of the employee, the employee’s spouse and certain other eligible individuals. Being covered by a non-HDHP, which would include a general-purpose health FSA, makes an individual ineligible to contribute to an HSA. However, certain limited-purpose health FSAs (that cover vision, dental and preventive care expenses on a first-dollar basis) or post-deductible health FSAs (that only pay or reimburse for qualified medical expenses incurred after the minimum annual HDHP deductible is satisfied) or combinations of limited-purpose and post-deductible are considered HSA-compatible and would not affect eligibility.

Similarly, if an employee is covered by a health reimbursement arrangement (HRA), then he/she will not be eligible for HSA contributions, unless it is limited-purpose, post-deductible or a retirement HRA.

HEALTH FSAS AND HSAS

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DISCUSSION When exploring various health plan design options, more and more employers are considering implementing an HSA coupled with an HDHP. However, it is important to understand that if the employer already has a health FSA in place, there are certain limitations that will affect a participant’s ability to establish and contribute to the HSA. Similarly, if an employee is covered by a health reimbursement arrangement (HRA), then he/she will not be eligible for HSA contributions, unless it is limited-purpose, post-deductible or a retirement HRA.

A general-purpose health FSA is typically considered family coverage (i.e., it is not usually designed to reimburse only the employee’s qualified medical expenses.) As such, if an employee is covered under a general-purpose FSA, neither the employee nor his or her spouse may contribute to an HSA. This is true, even if the general-purpose health FSA consists of only unused amounts from a prior year pursuant to a grace period or carryover provision.

More specifically, the addition of a grace period for a health FSA is treated as a continuation of coverage making the employee and spouse ineligible for HSA coverage until the first calendar month after the end of the grace period (i.e., April 2015, in the case of a January 1, 2015 – March 15, 2015 grace period). However, the employee will be eligible to contribute to the HSA if the health FSA with grace period has a zero balance at the end of the plan year (determined on a cash basis and considering pending and/or summited claims).

For example: Employer ABC has adopted a calendar year general-purpose health FSA with a grace period in 2014. As of December 31, 2014, Douglas has $500 remaining in his health FSA account, and Katy has zero in her health FSA. As a result of the addition of a grace period to the health FSA, Douglas can use the $500 for medical expenses incurred between January 1, 2015 and March 15, 2015. He will not be HSA-eligible until April 1, 2015 (assuming HDHP coverage). However, Katy is eligible for the HSA as of January 1, 2015 (assuming HDHP coverage) because she has a zero balance in the health FSA as of the last day of the 2014 plan year.

This is a problematic situation for employers desiring to implement the HSA with HDHP coverage on the first day of the plan year (i.e., January 1). Note that the “full-contribution” rule for HSAs does provide some relief in this circumstance. That is, such rule permits the employee to make a full year’s contributions to the

HSA even though he/she is only eligible for a portion of the year, if certain conditions are met. Additional information about the full-contribution rule is available on Willis Essentials.

Another way that Employer ABC above can help employees avoid the loss of access to an HSA on the first day of the plan year is to amend the cafeteria plan to convert its general-purpose health FSA to one of the following HSA-compatible health FSAs during the grace period:

� A limited-purpose health FSA (i.e., one that reimburses only dental, vision and preventative care expenses)

� A post-deductible health FSA (or one that reimburses medical expenses only if incurred after the Code Sec. 223(c)(2)(A)(i) minimum annual deductible has been satisfied)

� A combination of limited-purpose and post-deductible health FSA

For example: If Employer ABC amended the health FSA in order to convert it to a limited-purpose health FSA during the grace period, then Douglas is eligible for HSA coverage as of January 1, 2015 (assuming HDHP coverage). Note: the amendment must apply to all health FSA participants who are entitled to the grace period for the entire duration of the grace period.

A general-purpose health FSA with a carryover raises similar HSA eligibility issues as one with the grace period. One difference, however, is that the carryover to the general-purpose health FSA will make the employee

WHEN EXPLORING VARIOUS HEALTH PLAN DESIGN OPTIONS, MORE AND MORE EMPLOYERS ARE CONSIDERING IMPLEMENTING AN HSA COUPLED WITH AN HDHP.

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ineligible to contribute to his or her HSA for the entire subsequent plan year (regardless of whether the employee has elected to make health FSA contributions for that plan year or has exhausted the carryover).

An employer could avoid this possibility by amending the cafeteria plan to convert its general-purpose health FSA to allow or require the unused amounts to be carried over to an HSA-compatible health FSA. For example, if Employer ABC offers both an HSA-compatible health FSA and a general-purpose health FSA to employees under the terms of the cafeteria plan, then Employer ABC can allow individuals with year-end balances in the general-purpose health FSA who elect to participate in the HSA-compatible health FSA to also elect to have any unused general-purpose amounts carried over to the HSA-compatible health FSA.

Alternatively, Employer ABC can provide in the cafeteria plan that individuals who elect HDHP coverage for the next year are treated as automatically enrolled in the HSA-compatible health FSA, and any unused general-purpose amounts will be automatically carried over to that HSA-compatible health FSA.

Therefore, the unused amounts from a general-purpose health FSA that could be carried over to an HSA-compatible health FSA may be used during the general-purpose health FSA’s run-out period to reimburse expenses covered by the general-purpose health FSA that were incurred in the previous plan year. During that period, expenses covered by the HSA-compatible health FSA must also be timely reimbursed, but reimbursement can be limited to the participant’s elected coverage amount for the new plan year (i.e., without counting the carryover). Reimbursement of any HSA-compatible claims in excess of the elected amount can be delayed until the end of the run-out period, when the amount of any carryover can be determined.

For example: Employer ABC offers both a calendar year general-purpose and a limited-purpose health FSA with a 60-day run-out period and carryover provision of $500. Robert has an unused general-purpose health FSA amount of $600 on December 31, 2014. Prior to that date, he elected HDHP coverage and salary reductions of $2,500 under the limited-purpose health FSA, as well as any general-purpose carryover go to the limited-purpose health FSA. In January 2015, Robert submits $1,000 of dental expenses incurred during 2015 and is reimbursed for those expenses from the limited purpose health FSA. In February 2015, Robert submits $300 of medical expenses incurred in 2014 and is reimbursed for those expenses from the general-purpose

health FSA. At the end of the run-out period, $300 remains in the general-purpose health FSA and is carried over to the limited-purpose health FSA. Robert now has $1,800 available in the limited-purpose health FSA to be used for eligible expenses incurred in 2015 or carried over to 2016 (up to $500). Robert may contribute to any HSA as of January 1, 2015.

Individuals may also decline carryover in order to participate in an HSA in the following plan year. If one participates in a general-purpose health FSA (and the balance will be automatically carried over by the plan sponsor), one may make an election prior to the next plan year, to either decline or waive the carryover. This will allow the individual to contribute to an HSA the following year, assuming that the individual is otherwise eligible to participate in an HSA. This is an option when the plan sponsor does not offer an HSA-compatible FSA that could receive the prior year’s health FSA carryover balance. For additional information about the carryover and HSA eligibility, see Willis Human Capital Practice HR Focus, May 2014, “IRS Issues Additional Guidance on Health FSA Carryover, HSA Eligibility.”

CONCLUSION When considering implementing an HSA with HDHP option, employers should understand their current benefit structure, including health FSAs. Employers currently offering a health FSA should consider providing employees with more than one type of health FSA option in order to avoid the loss of access to the HSA on the first day of the plan year. Of course, the benefit of additional health FSA options must be weighed against the increase in administrative tasks. Finally, the employer will want to be sure it describes for employees the implications of the general-purpose FSA on HSA eligibility as well as any changes the employer decides to make to its health FSA in order to accommodate HSA eligibility.

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Each of the above programs has been approved for 1 recertification hour toward PHR, SPHR and GPHR recertification through the Human Resource Certification Institute (HRCI). For more information about certification or recertification, please visit the HRCI homepage at www.hrci.org.

WEBCASTS

HOW TO ENGAGE EMPLOYEES ON A BUDGETTUESDAY, MAY 19, 2015 2 PM EASTERN

Presented by: Lisa Beyer Senior Communications Consultant Human Capital Practice

Organizations know that having a communication budget to support benefits education for employees is important. And considering how much you spend on employee benefits, it makes economic sense to let employees know their value. But knowing that you should be taking this step and actually having the funds to make it happen are often two different things.

How can you accomplish the seemingly impossible?

With Willis. The Willis Human Capital Group offers numerous tools and resources that allow you to build an effective communication campaign—on a budget. During this presentation, we’ll review the resources available to you as a client and show you how to develop a year-long communication campaign that will increase your workforce’s engagement with, and understanding of, their benefits.

During this session participants will: � Learn about the importance of communicating

about benefits, regardless of budget parameters � Review creative strategies for creating

communication materials � View communication samples � Leave with five ideas for developing

communication for their organization

To RSVP, click here.

NOTE: Advance RSVP is required to participate in this call. Registration ends 1 hour prior to the call start time.

HOW TO USE DATA ANALYTICS TO GUIDE HEALTH CARE REFORM COMPLIANCETUESDAY, JUNE 16, 2015 2 PM EASTERN

Presented by: Jill Spiker Senior Consultant Reporting & Analytics Consulting Human Capital Practice

Tara Silver-Malyska, JD, MBA, FLMI Senior Principal – Employee Benefits Attorney National Legal & Research Group Willis Human Capital Practice

It’s time. After countless regulatory specifications, clarifications and delays, the PPACA (The Affordable Care Act), with all its compliance mandates, must be addressed.

Are you ready to evaluate and document the eligibility of your part-time and seasonal workers? Do you know which measurement method would benefit your organization the most? What tools will you use to ensure good faith compliance as well as operational efficiency?

If that all seems too overwhelming to contemplate, never fear—because data analytics can show you the way!

During this session participants will learn: � Which tools are available to help you comply with

PPACA — and how to make the most of them. � How data analytics can help guide you toward the

best methods for defining eligibility. � How to best meet the continuing impact of Health

Reform on your Human Capital strategy—and the business results it could bring.

To RSVP, click here.

NOTE: Advance RSVP is required to participate in this call. Registration ends 1 hour prior to the call start time.

12Willis North America | May 2015

NEW ENGLAND

Auburn, ME207 783 2211

Bangor, ME207 942 4671

Boston, MA617 437 6900

Burlington, VT802 264 9536

Hartford, CT860 756 7365

Manchester, NH603 627 9583

Portland, ME207 553 2131

Shelton, CT203 924 2994

NORTHEAST

Buffalo, NY716 856 1100

Morristown, NJ973 539 1923

Mt. Laurel, NJ856 914 4600

New York, NY212 915 8802

Stamford, CT203 653 2430

Radnor, PA610 254 7289

Wilmington, DE302 397 0171

ATLANTIC

Baltimore, MD410 584 7528

Knoxville, TN865 588 8101

Memphis, TN901 248 3103

Metro, DC301 581 4262

Nashville, TN615 872 3716

Norfolk, VA757 628 2303

Reston, VA703 435 7078

Richmond, VA804 527 2343

Rockville, MD301 692 3025

SOUTHEAST

Atlanta, GA404 224 5000

Birmingham, AL205 871 3300

Charlotte, NC704 344 4856

Gainesville, FL352 378 2511

Greenville, SC864 232 9999

Jacksonville, FL904 562 5552

Marietta, GA770 425 6700

Miami, FL305 421 6208

Mobile, AL251 544 0212

Orlando, FL407 562 2493

Raleigh, NC704 344 4856

Savannah, GA912 239 9047

Tallahassee, FL850 385 3636

Tampa, FL813 281 2095

Vero Beach, FL772 469 2843

MIDWEST

Appleton, WI800 236 3311

Chicago, IL312 288 7700

Cleveland, OH216 861 9100

Columbus, OH614 326 4722

Detroit, MI248 539 6600

Grand Rapids, MI616 957 2020

U.S. HUMAN CAPITAL PRACTICE OFFICE LOCATIONS

KEY CONTACTS

Willis North America | May 201513

Milwaukee, WI262 780 3476

Minneapolis, MN763 302 7131763 302 7209

Moline, IL309 764 9666

Overland Park, KS 913 339 0800

Pittsburgh, PA412 645 8506

Schaumburg, IL847 517 3469

SOUTH CENTRAL

Amarillo, TX806 376 4761

Austin, TX512 651 1660

Dallas, TX972 715 2194972 715 6272

Denver, CO303 765 1564303 773 1373

Houston, TX713 625 1017713 625 1082

McAllen, TX956 682 9423

Mills, WY307 266 6568

New Orleans, LA504 581 6151

Oklahoma City, OK 405 232 0651

San Antonio, TX210 979 7470

Wichita, KS316 263 3211

WESTERN

Fresno, CA559 256 6212

Irvine, CA949 885 1200

Las Vegas, NV602 787 6235602 787 6078

Los Angeles, CA213 607 6300

Phoenix, AZ602 787 6235602 787 6078

Portland, OR503 274 6224

Irvine, CA949 885 1200

San Diego, CA858 678 2000858 678 2132

San Francisco, CA415 291 1567

San Jose, CA408 436 7000

Seattle, WA800 456 1415

50919/5/15

The information contained in this publication is not intended to represent legal or tax advice and has been prepared solely for educational purposes. You may wish to consult your attorney or tax adviser regarding issues raised in this publication.