Benefits

1. Benefits MANA 5322 Dr. Jeanne Michalski michalski@uta.edu

2. Strategic Benefit Planning • Top- Down Approach • Proactive process • Regular review of benefits programs (all or part) • Backing-in approach • Reactive process • Reevaluate benefits when unexpected problems arise

3. Benefits Strategy Top Down Approach S T R A T E G I C T A C T I C A L

4. Benefits Strategy Backing-in Approach Tactical Question “ How should our health plan be changed to control employee health care costs? • What health care costs are increasing most rapidly?

5. Benefits Basics • Income Protection – Mandatory • Social Security • Worker’s Compensation • Unemployment Insurance • Health Care (?) • Income Protections - Non-Mandatory • Health Care (medical, dental, prescription, etc) • Welfare (Life insurance, STD, LTD, etc.) • Retirement and Investment (DB,DC) • Pay for Time not Worked • Vacations • Holidays

6. Discussion Topics • Actions companies can take to reduce costs associated with legally required benefits. • Social security • Unemployment insurance • Workers compensation • FLMA Issues • Health Care Costs

7. Discussion Topics • Creating successful Wellness Programs • Vendor Relationships • Benefits Administration considerations

8. Dealing with Intermittent FMLA • Have a doctor certify all FMLA leave for medical reasons. You’re entitled to ask for a second or even a third opinion. • Use a form that asks the certifying doctor for complete information on the claimed condition, including schedule of dates and times for treatments, and minimum amount of time leave will be needed. • Have the employee recertify the condition especially if patterns of abuse are apparent. This is at the worker’s expense and has proved to be a strong deterrent to bogus leave claims.

9. Dealing with Intermittent FMLA • Ask for a new certification for the claimed condition for each 12-month period. • Insist that the employee work with you in setting up a schedule that includes as many treatments as possible in off-work hours. • Transfer the employee to a position where absences are less disruptive. Keep pay and benefits equivalent to the previous job. • Look for obvious abuse patterns, such as the “Monday/Friday syndrome.” You are entitled to ask for recertification of a claimed medical problem if “the employer receives information that casts doubt on the stated reason for the leave”.

10. The Costs of Benefits • What are some of the factors that impact costs of benefit programs?

11. Consumer-Driven Health Plan • A type of health benefits plan that requires member responsibility for certain up-front medical costs; an employer-funded account that may be used to pay these up-front costs; and catastrophic coverage with a high deductible. Full coverage is provided for in-network preventive care.

12. Disease Management • People with chronic conditions — 44 percent of non-institutionalized Americans — account for a disproportionate share — 78 percent — of health care expenditures in the United States

13. Common Chronic Health Problems • Lost economic output associate with 7 common health problems total more than $1 trillion (includes lost time) world at work, 2009 • Cancer • Diabetes • Heart disease • Hypertension • Mental disorders • Pulmonary conditions • Stroke

14. Wellness Programs- What They Can Do

15. Wellness Programs • Use assessment activities to identify health risks • Provide Health Screening • Make self help materials available • Include “self-care” programs • Nurse advice lines, software, educational materials • Involve the employee’s family

16. Some Easy Examples of Wellness Changes • Healthy foods in the cafeteria and/or vending machines • America Heart Association, American Cancer Society, etc to conduct educational workshops • Bike racks • Free health screenings

17. HIPPA and Wellness Programs • The HIPAA nondiscrimination provisions generally prohibit group health plans from charging similarly situated individuals different premiums or contributions or imposing different deductible, copayment or other cost sharing requirements based on a health factor. However, there is an exception that allows plans to offer wellness programs.

18. HIPPA and Wellness Programs If none of the conditions for obtaining a reward under a wellness program are based on an individual satisfying a standard related to health factor, or if no reward is offered, the program complies with the nondiscrimination requirements. For example: • A program that reimburses all or part of the cost for memberships in a fitness center. • A diagnostic testing program that provides a reward for participation rather than outcomes. • A program that encourages preventive care by waiving the copayment or deductible requirement for the costs of, for example, prenatal care or well-baby visits. • A program that reimburses employees for the costs of smoking cessation programs without regard to whether the employee quits smoking. • A program that provides a reward to employees for attending a monthly health education seminar.

19. HIPPA and Wellness Programs • Wellness programs that condition a reward on an individual satisfying a standard related to a health factor must meet five requirements described in the final rules in order to comply with the nondiscrimination rules.

20. Five HIPPA Requirements for Rewards Based Wellness Programs • The total reward for all the plan’s wellness programs that require satisfaction of a standard related to a health factor is limited – generally, it must not exceed 20 percent of the cost of coverage under the plan. • The program must be reasonably designed to promote health and prevent disease. • The program must give individuals eligible to participate the opportunity to qualify for the reward at least once per year. • The reward must be available to all similarly situated individuals. • The plan must disclose in all materials describing the terms of the program the availability of a reasonable alternative standard.

21. Outsourcing Metrics