|
|
|
|
Employers Save Money By Giving It Away
As health care costs continue to climb, some employers are taking a
novel approach to saving money: They're spending more.
 These companies
are offering cash incentives and adjustments to health premiums in the
hopes of boosting preventive care, which they hope will translate into
big health care savings.
One approach involves eliminating copayments on some prescription
drugs for chronic conditions, such as asthma, diabetes, high
cholesterol and high blood pressure.
Many companies that have tried this tactic swear by it. Now, more
employers are starting to experiment with their prescription
copayments. A recent industry study notes that the number of employers
waiving drug copayments for maintenance drugs for chronic conditions
increased to 18 percent in 2009, compared with 11 percent in 2007. Dr.
Kevin Volpp, director of the University of Pennsylvania's Center for
Health Incentives, told CFO.com that this "explosion of
interest" is clearly fueled by concerns about rising health care
costs.
Midwest Business Group on Health (MBGH), a consortium that purchases
health care benefits for 100 large employers, offers a program that
eliminates copayments for diabetes drugs. Larry S. Boress, the
consortium's CEO, said participant companies can save up to $3,000 per
patient annually because the no-copay arrangement encourages better
drug compliance, which reduces the risk of expensive hospital stays.
Despite those savings, Boress said tweaking the copayments still
doesn't go far enough in boosting drug adherence. So MBGH gives
patients access to a diabetes "coach" to help them manage the
disease. Employees who don't keep in touch with their coach must go
back to making copayments for their drugs.
Other employers are taking an even more direct route and are doling
out cash to employees who change their lifestyle. These companies offer
cash rebates or reduced medical premiums to convince workers to stop
smoking, lose weight and live healthier, according to a report in The
Washington Post. For instance, Safeway offers a medical premium
discount to nonsmoking employees who meet certain targets for weight,
blood pressure and cholesterol levels. After instituting the plan, the
rates of obesity and smoking among Safeway employees have dropped below
national averages, the company said.
Considering that bad health behaviors account for as much as 40 percent
of all disease and premature death in the U.S., employers are wise to
do all they can to improve their workers' health, the University of
Pennsylvania's Volpp noted.
Monetary and premium incentives "can not only help you reduce
future health care costs, but also improve the health and productivity
of your employees," he said.
Employers, however, expect results for their cash. A recent Towers
Watson survey found that 65 percent of polled midsize employers expect
to offer wellness incentives in 2011. But 62 percent said that in 2012
they'll only pay up if they see positive results from participants,
according to a report in the Los Angeles Times.
|
|
|
|
|
In 2011, Resolve To Keep Top Talent
The New Year is a perfect time to shake off old habits, refocus and
make a fresh start. For employers who want to remain successful in 2011,
that means making a resolution to revisit their workforce retention
strategies, experts say.
 While
the country still struggles with a weak economic recovery, several
signs point to improvements in the labor market. The Society for Human
Resource Management expects December 2010 hiring by manufacturing and
service industries to increase for the 14th straight month. While it is
doubtful that this increase will make a big impact on the national
unemployment rate (9.3 percent as of November 2010), the Leading
Indicators of National Employment (LINE) report suggests that the
hiring environment is continuing to improve.
A stronger wave of seasonal hires likely will contribute to that
trend. Chicago-based Challenger Gray & Christmas reports that the
holiday hiring trend for 2010 was the strongest since 2006, according
to Human Resource Executive Online.
Even more telling, the LINE report finds that salaries for new hires
are higher compared with November 2009 figures.
All this positive economic news bodes well for employers and
employees alike. However, experts say many employees are eager to make
their own fresh start in the New Year -- by finding a new job.
"Disengagement is higher than ever, historically," Joy
Kosta of the Human Capital Institute told Employee Benefit News.
"Some people, if they can, spend up to 50 percent of their time
looking for another job."
That disengagement stems from several years of layoffs, salary
freezes and benefit cuts. With the job market improving, some experts
see a mass exodus by top performers who are fed up and burned out.
"Even though boomers have postponed retirement and everyone
across generations is holding on to their jobs for economic security,
those retained have been asked to do four or five jobs," Kosta
said. "The expression we've heard repeatedly is 'working like a
water bug' because all they can do at best is skim the surface of what
they've been asked to do. When the economy improves and people can make
a change, they will."
So what can employers do? For starters, they can provide strong
leadership and make an extra effort to let their employees know they
are appreciated.
"The top retention driver isn't necessarily salary," said
Lauren Herring, president and CEO of IMPACT Group, who cites a recent
survey by her organization that found that an inspirational manager,
advancement opportunities and a company's good reputation can go a long
way in keeping top talent.
Positive retention starts with good management, and employers need
to give managers the right support, training - and especially, time -
to boost retention efforts, Herring told EBN.
"Now you have managers with expanded duties, additional
reports, and now we're saying to them, 'Don't forget - we have to
retain our talent as well,' " Herring said. "Some people are
naturally good at developing talent and coaching, but most are not when
they are incented on business results and margins and things like
that."
|
|
|
|
|
Flu Season: Nothing to Sneeze At
For employers, flu season can create a flurry of scheduling
headaches, higher health costs and lost productivity as workers stay
home to take care of themselves or loved ones.
 This
year's assault has already begun, with Georgia health officials
recently reporting the first regional outbreak of the season, according
to a HealthDay report.
While the season likely will bring lots of aches and pains,
companies can boost their immunity to the impact of influenza and
protect their workforce with a couple of simple solutions.
One of the best ways to stave off a workplace outbreak is a flu
clinic. A recent study by the American Public Health Association (APHA)
finds that companies can save between $63 and $95 per employee by
offering vaccines to its workforce, according to a Los Angeles
Times report. The secret to maximize savings, the APHA says, is to
hold the flu clinic early. Any efforts after the end of December won't
add up, according to the APHA.
"Employers are likely unaware of the potential savings" of
flu clinics, said Rachel Bailey, the APHA study's lead author.
"They may view employee vaccination as a short-term expense but
may not be fully aware of the savings that result later into the
influenza season."
Other HR tips for battling the flu, from Entrepreneur
magazine:
Tell sick workers to stay home: In a rough economy,
some workers might feel they can't afford to miss work. But a sick
worker who infects others can do a lot more harm than a few lost days
of productivity. Keep a close eye on your workforce and let employees
know they should stay home if they feel sick.
That goes for you, too: HR and management shouldn't
contradict the sick policy, either. Workers who see the boss refusing
to take sick leave may think that they must do the same.
Keep it clean: Offer sanitizer at work and impress
upon employees the importance of washing their hands. Emphasize the
importance of cleaning office equipment, such as computer keyboards and
phones.
Plan for absences: Inevitably, some workers will
fall ill. Arrange for telecommuting possibilities in advance and
prepare schedules with some wiggle room in case someone calls in sick.
|
|
|
|
|
|
|
|
PPACA NOTES
Federal agencies recently released a series of regulations and decisions
related to the Patient Protection and Affordable Care Act. They include:
Tax
credit for small businesses: The IRS recently clarified that the
small-business tax credit applies to a broad range of employers,
including those who pay for a portion of their workers' health coverage through
a wide range of contribution arrangements, religious groups that provide
coverage through denominational organizations, and certain employers who
provide coverage through multiemployer plans.
Medical
loss ratio: The Department of Health and Human Services has
approved a new rule that states that insurers of individual and small
group plans must spend at least 80 percent of their revenue on direct
medical care. Larger plans (50 or more participants) must spend 85
percent on medical care. The rule might make millions of Americans
eligible for rebates starting in 2012.
Grandfathered
plans:
Federal agencies in November announced that employers who switch
insurance carriers won't necessarily lose grandfathered status for their
group health care plans. Forcing an employer to stick with a carrier to
maintain grandfathered status for a health care plan would give the
insurer an unfair advantage, the agencies said. Self-insured
employers also can change administrators without automatically losing
grandfathered status.
2011 MILEAGE RATES
The IRS has issued the optional standard mileage rates for motor vehicles
in 2011. These rates are used to calculate the deductible cost for
operating a car or truck. The rates will be 51 cents per mile for
business purposes, 19 cents per mile for medical or moving purposes, and
14 cents per mile driven in service of charitable organizations.
STILL NEED TO SAVE
Despite some savings from recent health care reform, employees still need
to save a significant amount of money to ensure they can cover health
care expenses in retirement, a new Employee Benefit Research Institute
(EBRI) study finds. The research notes that a 65-year-old man retiring in
2010 will need from $65,000 to $109,000 to give him a 50 percent chance
of covering all health premiums and out-of-pocket expenses in retirement.
To increase his chances to 90 percent, he would need between $124,000 and
$211,000, the EBRI study finds. Because women have a longer lifespan,
they must have even more stashed away - between $88,000 and $146,000 for
a 50-50 chance of covering all health expenses in retirement (between
$143,000 and $242,000 for a 90 percent chance).
A LITTLE WEIGHT, A LOT OF TROUBLE
Even a few extra pounds can translate into health troubles, according to
new research by the American Cancer Society. The study of 1.5 million
people found that healthy white adults who were overweight (but not
obese) were 13 percent more likely to die during the time they were
followed in the study than those whose weight was in the ideal range.
Two-thirds of U.S. adults are either overweight or obese, according to a
report by The
Associated Press.
SOCIAL MEDIA SWAMP
The flurry of social media outlets can leave employees "scattered
and disoriented," according to a new report by People-OnTheGo, which
provides training on social media. While people are spending more than an
average of 4.5 hours daily on social media sites and email, social media
"is misused and contributing little to productivity,"
researchers said. Thirty-nine percent of respondents said they use social
media at work for personal reasons more than for work-related tasks.
EEOC CHARGES
The Equal Employment Opportunity Commission (EEOC) received a record
number of charges by workers in fiscal year 2010. The commission took in
100,000 new private-sector discrimination charges, an increase of 7
percent from 2009, the EEOC reported. The jump follows a slight decline
in 2009, when totals fell 2.2 percent from fiscal year 2008. In a report,
the EEOC attributed this year's increase to the expanded authorities of
the EEOC under several new labor-related laws, including the ADA
Amendments Act of 2008.
409A RELIEF
The IRS has issued a new notice (Notice 2010-80) that provides more
relief for nonqualified deferred compensation plans covered under Section
409A. This guidance provides another method of correction and transition
relief under Notice 2010-6. The latest notice clarifies that a
nonqualified plan linked to a qualified or another nonqualified plan is
eligible for the previous relief in Notice 2010-6, provided that the link
doesn't affect the time and form of payments under the plan.
401(k) TAX BREAK
The IRS has announced that the 20 percent withholding tax does not apply
to in-plan Roth conversions of 401(k) plans. This rollover feature was
included in a small-business jobs bill that was signed into law in
September. If employers add the option this year, employees who roll over
funds into a Roth (401)k will get a tax break.
DON'T SKIMP ON SPDs
The Department of Labor recently reaffirmed its policy regarding the
distribution of summary plan descriptions (SPDs) to plan participants.
According to the Nov. 15 issue of Deloitte's Washington Bulletin, the DOL
said "ERISA plan administrators cannot satisfy their obligations to
'furnish' summary plan descriptions simply by making them available to
participants." The DOL was responding to a question of whether SPDs
could be furnished by mailing a letter or postcard to participants
informing them that a new SPD is available and that they call a telephone
number and make a request. Such an action "is not a method likely to
result in actual and full distribution of the SPD," the DOL said.
|
|
|
