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Dodd Frank – Do You Know What You Need to Know?

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Expert Perspective from Grahall’s Garry Rogers
 
The Dodd-Frank Wall Street Reform and Consumer Protection Act is aimed dead center at the heart of the financial services industry and contains substantial changes regarding the determination and reporting of executive pay and corporate governance.   These changes will impact all public filers.
 
Over the next few weeks we will highlight some of the more interesting, unusual and controversial issues in the legislation.  For example, “Say-on-Pay” is now mandatory for all public filers.  Changes are effective on January 21, 2011 (6 months from the date the Act was signed).  Did you know that Dodd-Frank will require that institutional investment managers be required to report no less than annually how they voted on the Say On Pay proposal, even though, starting in 2011, shareholders at most public companies will determine whether the advisory vote is to occur annually, biennially, or triennially. 
 
For a fuller discussion of Dodd-Frank’s new rules with respect to pay and governance read Grahall’s Regulatory Client Advisory DODD-FRANK FINANCIAL REFORM LAW CONTAINS SIGNIFICANT COMPENSATION CHANGES POTENTIALLY AFFECTING ALL PUBLIC FILERS.
 
For more information on Dodd Frank and how you may be impacted contact Garry Rogers at garry.rogers@grahall.com

Click here to access other important information for CEO’s.

Click here to access other important information for executives.

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Your Questions About Health Care Reform Answered NOW

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Ask the Experts about Health Care Reform Legislation

Our clients have many questions about the implication of the recent Health Care Reform Legislation. 

Just a few of the questions posed by clients and answered at our recent seminar on Health Care Reform Legislation were:

1 If I already offer coverage, can we keep the same plan under reform?
2 Are there new reporting requirements, such as on the W-2?
3 How are preexisting conditions handled under healthcare reform?
4 How does the change in preexisting condition exclusions affect the coverage I offer my employees?
5 Will waiting periods still be allowed?
6 How will the new high-risk pool work and when will it be available?
7 What if my State already has pools?
8 Will insurance through the new high-risk pools be more affordable than that through existing pools?
9 Does the law affect coverage for early retirees?
10 Does the law offer incentives to create or participate in wellness programs?
11 Will there be limits on what insurance companies can charge me or my employees?
12 What does the new law do to control costs?
13 Will there be malpractice reform under this new law?
14 Are there changes to Health Spending Accounts (HSAs), Flexible Spending Accounts (FSAs) and Archer Medical Spending Accounts (MSAs)?
15 How will simple cafeteria plans work for small business owners?

For the answers to these and many more questions on the new legislation (including answers to questions about Health Care Exchanges and the Small Business Tax Credit) go to http://www.grahall.com/knowledge/event-transcripts/ and download information from the June 2nd seminar including an audio recording of the discussions, all presentation materials, and other information.

Or you can contact the presenters to discuss your specific questions and concerns:

Contact Robert Cirkiel at rcirkiel@uhy-us.com   or 201 337 0009
Contact  Todd C. McDonald at tmcdonald@aisling-partners.com or 508 799 9100
Contact Pate Steele at pate.steele@grahall.com or 508 269 4065 Contact Grahall’s OmniMedia Editorial Board at edie.kingston@grahall.com

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Grahall’s 2nd Webinar on Health Care Reform Reveals Key Provisions that You Must Address NOW

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Ask the Expert about Health Care Reform Legislation

There are no fewer than 20 key provisions of the health care reform legislation that take effect between now and January 1, 2011.  These provisions were thoroughly discussed during the second in a series of webinars sponsored by Grahall, LLC held June 2, 2010.   Presenters  Robert Cirkiel, Chief Actuary, UHY Advisors, Todd C. McDonald, President, Aisling Partners Insurance Brokerage and  Pate Steele, Consultant, Grahall Consulting Partners advised webinar participants that that these changes are significant and extensive. Developing a full understanding of these provisions is critical for employers to ensure the optimal approach is taken to addressing the new requirements including:


Continue reading “Grahall’s 2nd Webinar on Health Care Reform Reveals Key Provisions that You Must Address NOW” »

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Heath Care Reform: What You Need to Know NOW #2

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Ask the Experts: Pate Steele, Robert Cirkiel and Todd McDonald Discuss Health Care Reform and What it Means For Your Business

On May 4, 2010, Grahall hosted a webinar on the new heath care reform bills signed into law in March 2010.   Presenters Pate Steele of Grahall, Robert Cirkiel of UHY Advisors  and Todd McDonald of Aisling Partners  reviewed the main provisions of the reform, discussed the timeline of events and actions required, and shared information and tools needed to respond to health care reform.

As Robert Cirkiel said pertaining to the Health Care Reform bill, “What you like about the Massachusetts plan you will like about the Federal plan, what you don’t like about the Massachusetts plan you won’t like about the Federal plan”.  Essentially, Massachusetts provides a barometer to gauge the Federal plan’s impact on challenges and opportunities that will face every state in the coming years.

Key issues to look for 2010 and 2011 include:

• Changes in dependent status
• Small employer tax credits
• Reinsurance program
• Grandfathered plans affected by some provisions and not others
• Fall 2010 communications for 2011 open enrollment
• Proceeding with caution to avoid losing your grandfathered status

Todd McDonald shared that, yes, Massachusetts did insure the uninsured and now boasts the highest coverage rate in the country up from 83% to over 97%, but the goal of reducing heath care costs was not achieved.   Healthcare costs for Massachusetts have increased 68% from $1 billion in 2006 to an estimated $1.7 billion in 2010.

There were important lessons learned from the Massachusetts reform including:
• Merger of non-group and group – Increases cost
• Employer mandate – Socially responsible, not necessary
• Minimum creditable coverage – Full disclosure is the issue
• Administrative responsibilities – Keep it simple

Complete recording of the conference call, all presentation materials, and other information are available for download on the Grahall website.  To listen to the session and access the presentation materials, go to http://www.grahall.com/knowledge/event-transcripts/.  The conference content begins about 6 ½ minutes into the recording.

Or contact our presenters:

Pate Steele at pate.steele@grahall.com
Robert Cirkiel at rcirkiel@uhy-us.com
Todd McDonald at tmcdonald@aisling-partners.com

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Heath Care Reform: What You Need to Know NOW

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Ask the Experts: Pate Steele, Robert Cirkiel and Todd McDonald discuss ealth Care Reform and what it means for your business

On May 4, 2010 Grahall hosted a webinar on the new heath care reform bills signed into law in March 2010.   Presenters Pate Steele  of Grahall, Robert Cirkiel of UHY Advisors  and Todd McDonald of Aisling Partners  reviewed the main provisions of the reform, discussed the timeline of events and actions required, and shared information and tool needed to respond to health care reform.

Complete recording of the conference call, all presentation materials and other information are available on the Grahall website.  Listen to the conference call (the conference content begins about 6 ½ minutes into the recording) and access the presentation materials.

On March 23, 2010 President Obama signed into Law the Patient Protection and Affordable Care Act, the following week Obama signed The Health Care and Education Reconciliation Act signed into law.  These 2 laws complete the current efforts to enact comprehensive health care reform in the United States.  The scope and impact of the changes are significant making it imperative for  employers to understand the changes in order to meet new requirements, take advantage of new opportunities and optimize plan designs.

The health care reform bills are essentially just frameworks and the requirements will be defined by as yet to be written regulations.  There are important things to know even before the regulations are released. 

1) Determine if you qualify for the small employer health premium subsidy, this tax credit is “free money” to those who qualify.
2) On June 23, 2010 a reinsurance program will be introduced for employers with retiree medical plans that cover early retirees.  The reinsurance program, funded with $5 billion, is intended to cover 80% of “large claims”.  Employers will need to apply. No doubt there will be an enormous rush to apply for these funds. 
3) Determine if you have “grandfathered” plans not subject to some of the otherwise required changes, and if it makes sense to maintain these plans, and what you do and do not need to be concerned with regarding the new requirements.
4) Begin preparing the communications for 2011 enrollment period.  Employers will need to conform with yet to be written regulations and 2011 mandates. AND any material plan changes must be communicated to employees at least 60 days before the effective date (or 10/31/2010 for plan years beginning 1/1/2011) 

There is more insight, material and tools available on our website.  Complete recording of the conference call, all presentation materials and other information are available on the Grahall website.  To listen to the conference call go http://www.grahall.com/knowledge/event-transcripts/.  The conference content begins about 6 ½ minutes into the recording.  To access the presentation materials go to http://www.grahall.com/knowledge/event-transcripts/

Or contact our presenters:

Pate Steele at pate.steele@grahall.com
Robert Cirkiel at rcirkiel@uhy-us.com
Todd McDonald at tmcdonald@aisling-partners.com

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Now that Health Care Reform has Passed, What’s Next for Employers”

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10:47 PM Sunday March 21st, 2010 Health Care Reform Passed the House with a Vote of 219 to 212.  About 10 minutes later the “fixes” to the Senate bill pass by one vote more. As Yahoo News Blog “House Passes Second Historic Healthcare Vote”  says:

“While the senate still has to weigh in on an amended bill, most observers think that shouldn’t be much more than a formality especially at this late stage of the process. At the very least, the House vote ensure that there will be a health care bill on President Obama’s desk, perhaps as early as the end of this week.  And the president’s signature will set I motion the most dramatic change to American health care since Lyndon Johnson signed Medicare into law in 1965.

The bill, which the Congressional Budget Office says will cost $940 billion over the 10 years, is expected to cover 32 million Americans who are presently uninsured”

Now what?  We asked Grahall’s Robert Cirkiel what’s next for employers.  Here are Robert’s recommendations.
Continue reading “Now that Health Care Reform has Passed, What’s Next for Employers”” »

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Progress in our world will be progress toward more pain. George Orwell “1984”

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Ask the Expert: Robert Cirkiel

Pulitzer Prize-winning journalist Paul Ingrassia and Staff Writer Imogen Rose-Smith wrote a disturbing account of the potential  risk to the country’s pension system in a lengthy article for institutional investor titled  “Trillion-Dollar Pension Crisis Looms Large Over America“ . The authors say: “As the U.S. slowly pulls itself out of recession following the worst financial debacle in more than 70 years, another potential crisis is looming on the horizon. The country’s pension system — both public and private plans — faces trillions of dollars in unfunded liabilities and has little hope of ever being able to meet them.”

We asked Grahall’s Robert Cirkiel for his take on this. 

This is generally acknowledged to be an issue, but more so for the public sector.  In fact, the unfunded liability for Social Security alone is $17.5 Trillion.  Together with Medicare, the unfunded liability is anywhere between $53 Trillion and $107 Trillion depending who you ask.  This is all off-balance otherwise US debt would be rated as junk.  It is junk but it’s just not rated this way. 

Private sector pensions have been underfunded for a while too but not as severely and besides, private sector pensions are not all that prevalent anymore.  Back in 2006, the Pension Protection Act was enacted requiring all private pension plans to be adequately funded within seven years.  That was when the market was GOOD!  A crash wasn’t even anticipated in the Act’s language.  If you follow the news, private pension plans one-by-one are going the way of the dodo bird.  They either terminate, freeze, or are taken over by the Pension Benefit Guarantee Corporation, the pension version of the FDIC.   This movement away from defined benefit pension plans is logical.  Companies cannot allow their pension plan liability to bankrupt them.  (Consider this another example of the “efficient economy”.) But at least these private pension plans are insured. 

The public sector has always relied on “the unbridled taxing authority” of the sponsor.  In fact, the taxing authority has always been the counter argument to the existing of a funding crisis in that it implies that there is no need to prepay the unfunded liability and that like Social Security, the funding need not be more rapid than “pay-as-you-go.” 

For more on Grahall’s and Robert Cirkiel’s perspective on the pension landscape the relationship between retirement savings and workforce strategies and how to fix the problems read:

• The Haves vs. The Have Not 
• What It Really Means to Have Only a 401(k) Plan for Your Retirement
• 401k Plans are Easy to Fix: Use A Hammer 
• From Here to Eternity 
• It’s Complicated 

Contact Robert Cirkiel at robert.cirkiel@grahall.com

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How to Handle Conflicts of Interest? Don’t Create Them in the First Place!

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Ask the Expert: Grahall’s Michael Graham

business-strategy-chess-41There has been much written about the challenges and problems associated with conflicted executive compensation consultants.  The SEC has proposed wide disclosure of most services provided to fees paid by publicly traded companies for consulting services in the hopes that this transparency will limit both real and apparent conflicts of interest and provide shareholders a with better understanding of how executive compensation is determined for these companies.  Grahall is an organization whose core services are executive compensation but who, like most other consulting firms provides additional services, sometimes to these same executive compensation clients.  We applaud and encourage more transparency in terms of services and fees and agree with the SEC that this can benefit regulators, shareholders and companies alike. 
Continue reading “How to Handle Conflicts of Interest? Don’t Create Them in the First Place!” »

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Grahall Comments on SEC’s Proposed Proxy Disclosure Rules

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business-strategy-chess-41In July 2009 the SEC released proposed changes to Proxy Disclosure rules “to enhance the compensation and corporate governance disclosures registrants are required to make about: their overall compensation policies and their impact on risk taking; stock and option awards of executives and directors; director and nominee qualifications and legal proceedings; company leadership structure; the board’s role in the risk management process; and potential conflicts of interest of compensation consultants that advise companies.” 

The SEC invited public comment with a deadline for submission of mid-September, 2009. Not surprisingly, many commented. Well over 100 comments have been surfaced on the SEC’s web site to date.  (To read them click here.)

Grahall, too, commented on these proposed rule changes, with comments broken down into four general subject areas:
I. enhanced risk disclosure (as it directly relates to compensation),
II. proposed changes to the summary compensation table,
III. enhanced disclosure of director qualifications to serve on the Board,
IV. concerns regarding potential conflicts of interest with respect to executive compensation consultants who provide both compensation advice and other services to the same clients.
Continue reading “Grahall Comments on SEC’s Proposed Proxy Disclosure Rules” »

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Sameness is the mother of disgust (and loss of talent)

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business-strategy-chess-41Ask the Expert:  Grahall’s Michael Dennis Graham discusses ways that companies can structure packages to attract and retain top talent.

In better economic times, “throwing money at the problem” was the most prevalent approach – and a highly effective one at that. Today, for most companies large or small, TARP or not, public or private, that option can’t be broadly used. So today in these tougher economic times what can companies do?
Continue reading “Sameness is the mother of disgust (and loss of talent)” »

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