The final regulations provide guidance under section 833(c)(5) for Blue Cross and Blue Shield organizations and certain other organizations to compute and apply the medical loss ratio and the consequences for not meeting the medical loss ratio threshold. The final regulations revise the 2014 final regulations to reflect the enactment of a technical correction to section 833(c)(5) by the Consolidated and Further Continuing Appropriations Act of 2015.

Section 409A(a) provides requirements on the deferral and payment of nonqualified deferred compensation. These proposed regulations amend various rules under the existing section 409A regulations (published May 2007) to address issues cited by commenters. These proposed regulations also withdraw the anti-abuse rule for nonvested deferred compensation at Prop. §1.409A-4(a)(1)(ii)(B) (published December 2008), replacing it with a rule limiting the circumstances under which changes may be made to the payment of nonvested deferred amounts. REG-123854–12.

Section 457 of the Internal Revenue Code applies to compensation deferred under plans established and maintained by State or local governments or other tax exempt organizations. The proposed regulations include rules for determining when amounts deferred under these plans are includible in income, the amounts that are includible in income, and the types of plans that are not subject to these rules. The proposed regulations would affect participants, beneficiaries, sponsors, and administrators of certain plans sponsored by State or local governments or tax-exempt organizations that provide for a deferral of compensation.