Posts from — June 2010

Indeed, it varies.  In some cases, an HSA-eligible plan may cost the same as a non-HSA high-deductible plan. In others, the premiums can actually be more expensive, a recent NHPI report locates.

As a matter of fact, a non-HSA plan offering similar coverage can carry a monthly per-employee premium that’s about $15 to $25 lower and a deductible that’s $500 to $1,000 lower than the HSA option.

Sometimes the difference is due to price-jacking -  the HSA plans are the ones that’ve been hyped in radio commercials and mentioned in newspapers in recent years.

Nowadays, fewer people  exploring high-deductible plans ask first about the non-HSA, so insurance companies sometimes slash prices to drum up interest in those options, too. Another factor -  Not all deductibles work the same.

Deductible cuts both ways

Two deductibles can look similar but work differently, and the cost scales can tilt in favor of either an HSA or a non-HSA plan. Example -  HSAs by law can no longer allow first-dollar coverage of prescription drugs. But a non-HSA plan can.

On the flip side, HSAs often feature better preventive-care coverage. In some non-HSA plans, a person who has yet to meet the deductible must pay out of pocket for standard tests (example -  cholesterol testing) that’re part of the routine physical. Only the office visit itself is covered.

Also, HSA-eligible plans have to follow rules that limit total out-of-pocket costs. But this can push up the premiums paid on the front end.

Best bet -  Double-check with your broker to make certain you’re comparing apples to apples when investigating  the costs of HSA and non-HSA plans.

When your company has this common - and increasingly popular - fringe benefit you may be at legal risk without even knowing it.

Some companies have an on-site employee fitness room as part of a formal wellness program. Others simply do it as a way for folks to get their juices flowing before work or blow off steam afterwards.

No matter the reason, businesses with fitness rooms need to be aware that the benefit isn’t risk-free.

Over the last few years, a few privately owned fitness clubs have been sued - and agreed to expensive settlements - after exercisers suffered sudden cardiac arrest (SCA) and died before help arrived. In each case, the facility either did not have lifesaving equipment on the premises or didn’t have personnel properly trained to use it.

Some legal professionals have expressed concern that companys could also be at risk when the unthinkable happened on business premises while an worker worked out.

SCA is of particular concern. Reason -  Even seemingly healthy, active adults are at risk of sudden cardiac arrest. It can’t be prevented. There’s no vaccine.

And few victims survive by the time an ambulance arrives. But there is a way to save the employee’s life and potentially save your firm from a lawsuit.

Learning about SCA

Sudden cardiac arrest (SCA) is a frequently misunderstood killer. It’s different thing as a heart attack. SCA can affect anybody, anywhere, anytime. It occurs more than 600 times every day in the U.S., killing at least 250,000 individuals  each year.

The only hope -  using a device called an automated external defibrillator (AED) within 10 minutes.

The good news is any person at your company may be quickly trained to use an AED - you don’t need any medical knowledge to use it. the training may be obtained for free through a local Red Cross or civic group. the devices themselves cost under $2,000.

Compare that to the financial risk of being sued for not having an AED near a workplace fitness room, and it’s a no-brainer that any company with onsite workout equipment should at least investigate an AED purchase and training.

Staff Members, supervisors and upper-level managers alike will probably need education about SCA and AED use. A excellent teaching resource is available here.

Key talking points -  Without an AED, 90 percent of victims die. But when you’ve access to one, there’s a good chance to save an employee’s life. and it’s easy to teach supervisors and workers how to use the device when it’s ever needed.

The vast majority of facilities with AEDs never need to use them - and that includes medical facilities. But it only takes one tragic event, and subsequent lawsuit, to cause pain for both the business and an employee’s family.

Remember -  Prevention and education are always your company’s best tools for avoiding liability. In this case, where human life is involved, the choice seems rather obvious.

For most firms, voluntary benefits are a win-win arrangement. But there could be hidden risks.

On the positive side, voluntary benefits cost corporations next to nothing, yet improve employees’ morale and benefits satisfaction. an Aon survey found 77 percent of organizations offer at least one voluntary benefit.

But what happens when there’s a legal dispute between one or more of your employees and the vendor?

In many cases, corporations unwittingly get dragged into court. the provider may argue that the plan is covered by ERISA, and the employee’s lawsuit should instead be filed against his or her corporation.

When the court agrees, the legal burden shifts.  Some courts have ruled that a voluntary benefits could  be covered under ERISA, even when it wasn’t an corporation’s intention to formally “sponsor” the plan.

When push comes to shove, the providers will protect themselves. In fact, some attorneys warn that a voluntary plan insurer’s first move when sued by one of your workers will be to attempt to get the legal burden shifted from itself to you.

Two seemingly innocent things that could be turned against you in court -

• the written announcement to tell employees about the new voluntary benefit, and

• getting involved when there’s a dispute between an worker and the plan vendor.

Be cautious with announcements When you offer a new voluntary benefit, the natural tendency is to try to get staff members pumped up to participate. But you are able to get in trouble if people  get the impression the firm endorses the plan. Helpful practices -

• Don’t put the announcement on organizational letterhead

• Put a disclaimer on the description

•  either exclude your voluntary offerings from employees’ benefits manuals or list them separately, and

• hold open enrollment at a different time than for ERISA plans (401(k), main health plan, etc.).

Additionally, if the provider offering the voluntary plan has competitors, you might want to remind employees the provider of the voluntary plan isn’t the only game in town. Some firms pass along lists of competing providers.

Avoid involvement in disputes as with your ERISA plans, chances are employees will come to you when they have a problem with a voluntary plan. Your first inclination is to help.

But many professionals warn it’s better to stay out. Reason -  Courts see this as the action of a plan sponsor. But you are able to steer someone in the right direction (e.g., giving a contact name to call) while remaining neutral in the dispute.

Good intentions gone bad

From an ERISA standpoint, the most perilous voluntary plan design is one that is partially compensated by the corporation, even when staff members pay the bulk of the cost.

In a major ruling several years ago (Burgess v. Cigna Life Insurance), a U.S.  district court ruled against an business with a voluntary supplemental disability plan in which the firm compensated a portion of premiums for its lower-compensated workers.

While most workers paid the entire premium - and firm made clear to  people  the plan was a voluntary benefit -the court said it didn’t matter. the act of contributing to some employees’ premiums made it an ERISA plan.

In the last few years, “presenteeism” has become an even larger concern for a lot of businesss than absenteeism. Although many HR/benefits managers hate the admittedly overused term, presenteeism is nonetheless a real issue in nearly every workplace.

Most widely,  presenteeism takes the form of staff members coming to work sick. They’re  unproductive and endanger peers. Meanwhile, the worker is not forced to use a sick day. A bad deal for corporations all the way around.

A recent survey by LifeCare revealed that 93 percent of staff members (polled from 1,500 organizations) admit that they at least ocassionally come to work when they’re sick enough to stay home. More important, the research study  looked at the reasons why folks do it.

Troubling rationales

The No. 1 reason staff members cited for coming to work sick was a belief that they’d be “letting other individuals  down” when they call out. Nearly 30% of respondents cited this as their main reason. Beyond that, the top responses were -

• It’s too risky, due to office politics or culture, to take time off (26%)

• the employee is too busy at work to be able to stay home a day (15%)

• the staff member saves up sick days for childcare/eldercare emergencies (12%), and

• the worker saves up sick days to use as extra vacation time (8%).

A lot of of these rationales are troubling to HR/benefits managers.

In the first place, supervisors who hassle staff members about taking legitimate sick time are, at best, being pennywise and poundfoolish.  Presenteeism costs more than absenteeism, once you figure in the uncharged sick days, lack of productivity and risk of other staff members getting sick.

You have more power than you think to change your business culture if the “tough it out” mentality still applies to individuals  who come in sick. When  senior management is confronted with the real dollars and cents of presenteeism, decling the problem normally becomes a priority. at the very least, firms shouldn’t invite it.

In terms of supervisor- and employee-education, repetition of the “stay home if you’re sick” message is the key. Eventually, it’ll sink in.

Of course, there’s still the problem - as evidenced by the survey - of employees who misuse their sick days by trying to hoard them for other purposes.  

Adopting PTO, no-fault absence policies or use-it-lose-it sick leave are the three most common ways of reducing the risk, but be aware that each of these policies have risks of their own.

At the end of the day, the more open the lines of communication are between management and workers, the less prevalent the presenteeism problem becomes.

In many segments of society, we  hear about racial and ethnic profiling in negative ways. But what about when it comes to wellness programs?  

When used for the specific purpose of  beginning - or evaluating  - a wellness or disease management (DM) program, profiling isn’t just legal. It’s also encouraged.

Affects health risks

Different ethnic and racial groups tend to be more at risk - for genetic and/or cultural reasons - of certain medical problems. Examples -

• African-American, Latino, Native American and Pacific Islanders are  at higher risk of diabetes than Caucasian employees

• Chinese women are statistically twice as likely to get cervical cancer

• Caucasians have disproportionately high rates of obesity and high blood pressure, and

• Latinos have higher rates of asthma and chronic obstructive pulmonary illness than other groups. the HIV/AIDS population is also disproportionately Hispanic.

Bottom line -  By analyzing  the ethnic breakdown of your worker population, you are able to set disease management (DM) program priorities with greater confidence and accuracy.

Healthcare quality an issue

Several studies also show there’s an unfortunate relationship between ethnicity and quality of healthcare. Many times, minority workers receive inferior treatment and health education at the same facilities where others receive top-notch care.

This generally happens for innocent reasons. A common scenario -  a lack  of Spanish-speaking doctors in the network for your Latino staff members. But the result is generally higher medical costs for you and, often,  greater reluctance among minority staff members to seek needed treatments.

By profiling workers against the physicians in the network, you ultimately help workers get the care they need and the business to better control long-term costs.

Almost two-thirds of organizations with wellness programs offer staff members incentives - financial or otherwise - to participate.

But only one firm in five has seen major betterment in employees’ health status (and lower costs) within two years of launching the incentive. Here are three keys to getting good results - and a red flag for failure.

Cancer screenings pay off big

Most wellness programs feature health-risk assessments for things like high cholesterol and diabetes. But many overlook the need for early detection of cancer, which can affect any employee, regardless of his or her age or general health.

In many cases, you can line up certain screenings, like skin cancer detection (the most common type of cancer and, in its early stages, the most easily treated) for free or at a nominal cost.

These resources are often available through community agencies or the American Cancer Society. More involved and costly screenings - like mammograms - are well worth the cost.

A single case of cancer identified early usually saves thousands of dollars in medical claims and disability costs - not to mention trauma for the worker.

Smart employee wellness incentives

Medical Insurance Portability and Accountability Act (HIPAA) has tricky non-discrimination rules for offering workers a break on premiums or copays. You needn’t worry about HIPAA when you -

1. Structure the program as a cost-break for employees who embrace wellness. on the flip side, imposing surcharges for uncooperative employees can force you to jump through HIPAA hoops.

2. Make the incentive available to all staff members. for  instance, if you offer a discount to non-smokers, an staff member who recently quit use of tobacco must also be eligible.

3. Allow staff members who fail to earn the incentive to have another shot at it next plan year.

Bottom line -  Make the financial incentive a reward, not a punishment. Do the incentives work? When they’re done right, yes.

Firms offering monetary rewards for wellness typically save about $20 to $50 a month, as reported by some estimates.

Making wellness programs simple

A lot of firms require employees to work with a personal “health coach” in order to earn premium discounts or other incentives. Usually, the worker sets up appointments and reports to the health coach on a regular basis, either by phone or in person.

The good news -  the early results are often encouraging.

The bad news -  Once employees realize there’s ongoing effort involved, many lose interest. But many firms have found a simple alternative. Rather than having participants contact the health coach, the health coach calls them.

In many cases, this minor program tweak keep folks on the right track and cuts dropout rates.

Wellness starts upstairs

No matter how much money your company spends on wellness, the odds of success depend largely on the example set by top management.

Example -  When your CEO is a smoker, chances are few employees will purchase into a tobacco use cessation program.

In like manner, it’s hard to sell employees on subsidized fitness center memberships when your organization culture is sedentary. for wellness to work, the top brass must practice what the firm preaches.

Are your health care programs delivering on your vendors’ promises?

Just as importantly, how can you hold providers accountable if you’re not getting what you paid for?

Here’s one proven way -  Create a provider scorecard. Scorecards alone won’t bring down your health care costs. But they’ll at least help make certain your company - and staff members - get everything you’re compensating for.

The tool can help you measure plan performance with greater precision - and identify specific areas that need improvement. Best of all, any business can adopt the technique to fit their needs. Here’s how it works.

1. Pick specific rating areas

Benefit pros who’ve successfully adopted the scorecard system recommend grading vendors on five to 10 measurable areas, like -

• Claims processing. Are employees’ medical claims turned around in a timely fashion? Are you hearing complaints that the explanations of benefits (EOBs) are slow to arrive or hard to understand?

• Disputed and resolved claims. Do staff member questions and complaints about denied or still-pending claims get answered rapidly and thoroughly? How often are you forced to go to bat for employees?

• Accessibility. Are plan reps quick to answer phone calls? Do they attend regularly scheduled meetings?

• Reports. Do you receive timely compensated claim and utilization reports?

• Open enrollment. Did you receive effective support preparing for and conducting open enrollment events?

• Employee education. Do your employees find the written and/or one-on-one services provided through the plan helpful in answering questions about managing specific chronic diseases (such as diabetes or depression)? Do you receive support in educating your employees to make healthy lifestyle options, such as tobacco use cessation?

2. Pick a workable rating scale

There are two schools of thought when it comes to picking  a rating method -  subjective or objective. Many benefit pros - namely those from smaller firms - use a simple pass/fail or 1 to 5 score to rate their satisfaction.

Others create more elaborate, statistic-based ratings. One method -  take the vendor’s guarantees (e.g., addressing disputed claims within 3-5 company days) and then measure by percentage how often these goals are met.

These rating data can be obtained through quarterly performance reports, worker surveys, issue and complaint files and, for larger plans, external audits.

3. Feedback causes improvement

It’s good practice to share your scorecard system with the provider before meeting to review the results. Reason -  This lets you iron out any provider questions about the review categories and scoring system.

Once that’s settled, you can meet to go over the numbers and prioritize the areas that need improvement. Many firms then add a new scorecard category - providers’ followup.

At the end of the day, is it worthwhile to ban use of tobacco on the premises at your company?

It depends on the steps you take to support workers trying to kick the habit, finds a recent research study .  The Journal of Tobacco Policy and Research found that smokers do, in truth  take more sick days than their non-use of tobacco colleagues.

And even if the smoker is in relatively good overall health (i.e., isn’t obese, doesn’t have chronic medical conditions), he or she’s still likely to have higher healthcare costs than a comparable non-smoker over the last three years.

How does a use of tobacco ban fit into the cost equation? If the smoker quits, medical costs even out.

But if the individuals only refrains from tobacco use on the job - but continues puffing away at home - the corporation sees little to no health cost decrease. the published study  found similar patterns for absenteeism.

Bottom line -  A workplace use of tobacco ban in combo with a use of tobacco cessation program gets results. A use of tobacco ban alone normally doesn’t.

In the last few years, there’s been a rising trend for public employers - not just private corporations - to ban tobacco use. Here’s what your colleagues are doing.

What’s New in Benefits and Compensation lately surveyed 374 of our readers from both the private and public sectors to find out their organization’s policy on allowing staff members to smoke on-site and hiring smokers in the first place. Here’s what we found -

• 11% have created a policy of hiring only non-smokers

• 17% allow workers to smoke offsite, but ban it on all company property

• 39% restrict smoking to designated areas outside the building

• 30 percent allow tobacco use anywhere outside the building, and

•  3% allow tobacco use in break rooms or other indoor areas.

Public businesss get aggressive

While much of the publicity about no-hire policies for smokers centers on private corporations, it’s actually public businesss in certain states who have been the most aggressive of late.

For example, Florida is one of the states at the forefront of the movement. Sarasota County lately became  the third Florida county to take a no-hire stance in order to control health care costs.  

New hires must take a drug test that detects nicotine and sign a pledge certifying that they haven’t smoked in the past 12 months.

The ban won’t affect current workers, but the county has undertaken smoking cessation programs aimed at employees’ wallets.

Non-smokers pay less for coverage through various incentives and the county covers the cost of participating in smoking cessation programs.

The reason why Florida public businesss are able to take these steps -  the state supreme Supreme Court has ruled that refusing to hire smokers doesn’t break discrimination laws.

But your state laws may vary, so proceed with caution before considering similar policies.

Quitting smoking at any age can improve a person’s health. and believe it or not, older workers often fair better with smoking cessation than younger workers.  

According to the Journal of American Medicine, Duke University reseearchers tracked 573 older patients over 10 years. They found that just 16 percent of those who joined the smoking cessation program later returned to smoking.  

Previous research has found young smokers who try to quit have a 35% to 45% relapse rate within two years.

Given that workers nationwide are retiring later and the cost of retiree health care is sky high, you might want to keep trying with tobacco use cessation programs, even for the oldest workers on your health plan.