Archive for: Benefits & Compensation

Tillie Hidalgo Lima

Can you imagine the stress of leaving work for an appointment and finding your car in the parking lot with a flat tire? Wouldn’t it be nice to have someone else deal with getting it repaired? That’s exactly what happened to a nurse at SkyRidge Medical Center in Lone Tree, Colorado whose on-site concierge came to the rescue and got the car tire fixed while she returned to work that afternoon.

Stressed out Workers

Several factors are combining to increase the stress level in the workplace:

1) Changing Work force

The composition of today’s work force is going through a radical change. For the first time in history, the current workers come from four different generations:

1. Generation Y (born 1978-89)
2. Generation X (born 1965-77)
3. Baby Boomers (born 1946-64)
4. Silents (born before 1946)

Each generation has its own characteristics. For example, in general the youngest generation prefers a fast-paced, multi-tasking lifestyle while the Silents are accustomed to a slightly more leisurely pace. As another example, Baby Boomers and Silents typically prefer face-to-face communication whereas the younger generations thrive on instant messaging and texting.

Dealing with these multiple generational differences adds an extra measure of stress, for both employees working with their colleagues and supervisors.

2) Shrinking Work force

Compounding the variety of ages in our work force is the fact that the older two generations are poised to retire in the next five years. As these older employees leave, the overall size of the work force will shrink since the younger generations replacing them are substantially smaller in number. Ajilon Finance reports that in 2006, two workers left the work force for each one entering it. As the trend continues into the foreseeable future, vacancies and company changes to deal with the work shortages may put more stress on those still working.

3) Work Intensification

The competitiveness of our business climate today, fueled by global competition, Wall Street pressures and a host of other factors, drives many firms to layoff portions of their work force. While employees who keep their jobs are grateful, they face a daunting task of balancing new job responsibilities with current duties.

Commonality

All of these factors take their toll on the remaining workers who are continually pressed for more productivity – to do more with less – and to work longer hours to make up for their departed colleagues. The resultant stress, then, is common to all employees, regardless of generation. So while there are many differences between the generations, all workers today are time-starved and stressed out.

There is plenty of evidence of this stress in our lives. The American Psychological Association reports that more than half of all working adults and 47 percent of all Americans say they are concerned about the amount of stress in their lives. Additionally, according to a recent Harris Interactive Study, one in three U.S. employees feel overworked as a chronic condition. The Anxiety Disorders Association of America reports that three in 10 Americans say they have experienced persistent stress or panic attacks.

At the same time, as a society we’re coming to understand the negative effects that this pressure has on our health, ranging from high blood pressure to more severe complications such as heart attack or stroke. The opportunity to ‘get away from it all’ and reduce this time burden can have an important role in keeping stress at bay.

In order to alleviate this pressure, companies are finding various methods for helping employees to cope including:

• Healthy eating/nutrition workshops
• Stress reduction workshops
• Health club memberships for regular exercise
• Promoting a better work/life balance

Help is on the Way

One innovative method of addressing the last bullet above, achieving a better balance between our work and our personal lives, is to offer concierge services to employees. Hotels have been utilizing this concept successfully with their guests for many years and it is now being leveraged into the corporate and health care setting.

Concierges can offload time consuming chores so that employees are able to use their free time to unwind and to do as they please. The top five most popular concierge services are:

1. Personal shopping
2. Automobile services
3. Mail/shipping/postage
4. Information referrals
5. Dry cleaning/laundry services

Other types of services are also offered by concierges such as errand running, transactional services (obtaining tickets), home-based help (waiting for a repair or service person), child/elder care research, corporate support (administering recognition programs), convenience services (gift wrapping), guest relations, travel planning, and event planning.

This last service is a good example of a popular and highly valued offering. Concierges have taken treats to school for holiday parties, and planned birthday parties for busy parents. One concierge organized a graduation party; offloading the details, even down to balloon delivery, from the parents. In short, this service is a huge time saver for the employee.

Services are not limited to the above examples. One employee had the concierge write a treasure hunt poem to lure her husband home early. Another request was to fill a hot tub with 1600 gallons of water before a tailgate party. One concierge located five, full- dress Scottish kilts for a wedding. As long as it is legal and moral, concierges are happy to help out with any request.

Customers Love It

From an executive standpoint, Don Morris, vice president of human resources at Wesley MedicalCenter in Wichita , Kansas , said, “Our employees spend their energy every day caring for others and the concierge service returns the favor by making them the customer and meeting their needs. It is a true win-win situation with purely positive results.”

Customers of concierge services volunteered the following comments, among others:

• “I can focus more on my work responsibilities because I am not distracted by my personal to-do list.”
• “It’s an every day reminder that Bronson [my employer] cares about its employees.”
• “I think this is our best benefit.”

Welcome Results

Results are proving the value of these services, for the employee and for their employers alike:

1) Decreased Stress

A national provider of concierge services, Best Upon Request, reports that based on their surveys, over ninety percent of those who used the service say it decreases their stress and helps them balance their work and personal lives. Another customer said, “Personally, I have become much more efficient in my time off. I now have time to do other things.”

• 93% Strongly Agree/Agree that the concierge service helps reduce their stress level and 0% disagree.

• 92% Strongly Agree/Agree that the concierge service helps them balance work and personal responsibilities and 0% disagree.

2) Improved Productivity

These same survey results tell us that employees save an average of two hours for each concierge request. More than half of those surveyed say they put that time back into work.

3) Improved Retention

HealthONE of Denver, Colorado, reported an overall decrease in their turnover ranging from 11 to 26 percent across several facilities. The concierge service was definitely a factor in these improvements says HealthONE.

Bronson Healthcare Group, a Malcolm Baldrige award winner based in Michigan , also documented an overall turnover drop from almost 21 percent to just over 9 percent. Other organizations are posting similar results.

4) Decreased Costs

Real dollars associated with reduced turnover can be significant as well. In Bronson’s case, they report that their recruiting costs fell by at least a quarter of a million dollars ($250,000) annually.

Other Results

Although the direct tie between concierge services and improved overall employee well-being has not been specifically documented yet, it is a logical conclusion from the above outcomes. Additional results, though less quantified, are:

• Improved employee satisfaction
• Enhanced customer/patient satisfaction, and
• Decreased absenteeism.

Anecdotal evidence reasons to support employee well-being abounds from utilization of the concierge service. Another customer recently wrote a letter saying, “The sinking feeling of ‘I’ll never get caught up in life’ has changed to a feeling of being pulled out of the quicksand … You have given me back my free time and that is invaluable to me … Never in my 20 years has the hospital provided a service that makes as much of a difference in my life as this service does.”

If you have questions or comments on this article, you can contact Tillie Hidalgo Lima, Best Upon Request Corporate, Inc. President/CEO, at thl@bestuponrequest.com Also, feel free to visit her website at http://www.bestuponrequest.com for more resources and information.

By David Chrestensen, Vice President, New Business Development, First Financial Wealth Management

Sgt Joe Friday (Jack Webb in real life) became iconic for his comment “Just the facts, Ma’am” as he was trying to find the truth. In trying to understand retirement plan fees and the regulations for business owners, the same holds true; so here are some facts.

Frontline aired “The Retirement Gamble” on April 23, 2013, which studied the impact of excessive fees on retirement plan accumulation. The documentary asserted losses of up to 64% of future value due to excess fees. An EBSA (Employee Benefits Security Administration – responsible for ensuring the integrity of private employee benefit plans in the US) video on their website asserts a 1% overcharge in fees can reduce future values by up to 28%. Other studies also illustrate the heavy toll taken by high fees on participant account balances. So what is being done to remedy this accumulation sickness, and how effective is the cure?

Effective July 1, 2012, ERISA requires 401(k) plan sponsors to increase transparency and improve education to participants relative to fees and investment performance. To assist plan sponsors to meet their obligation, service providers must fully disclose all services provided and fees charged to plan sponsors. In turn, plan sponsors must add performance data to better educate participants. The assumption is that the combination of lower fees due to competition and improved education will result in better participant decisions, and lead to improved accumulation. That is the cure, but it does not appear to be working, for two main reasons..

First, many of the disclosures provided by service providers are complex and hard to navigate. Balking at the time needed to distill the information regarding their plan from these disclosures, many plan sponsors do not take the time, nor have the expertise, to adequately review the disclosure.

Second, many business owners/plan sponsors misunderstand their role as it relates to fees and performance. In plans where participants direct investments, someone is liable for choosing the investments, monitoring fees and their impact on investment performance, and replacing those investments as needed. Many plan sponsors incorrectly believe this liability belongs to those offering the investments. In fact it is not their duty, and often there may be a conflict of interest as they are product manufacturer. This can mean that participants continue to be faced with high fee and/or low performance investment choices due to hidden fees, mediocre investment products or a combination of both.

However, ERISA is very clear on theses topics. On item one, the plan sponsor must do the analysis, fully understand the data, and thereafter make decisions regarding the plan, fees and service providers in fulfillment of the plan sponsor’s fiduciary responsibilities under ERISA. On item two, without a contract from a bank, insurance company or registered investment advisory firm, in writing, to accept this liability under ERISA Section 3(38), the business owner/plan sponsor has this personal fiduciary liability.

A word to the wise at this juncture. Estimates are that an EBSA inquiry (cannot be paid by the plan) can cost upwards to $100,000 if no legal action is taken. Defense costs (again cannot be paid by the plan) of over $300,000 are not uncommon if EBSA pursues legal recourse personally against the plan sponsor. Now that the rules are laid out, along with the potential costs of ignoring them, plan sponsors should consider learning exactly where they stand in relation to these rules, and if uncomfortable with that position, how to mitigate the risk.

To assist in the review and analysis of service provider disclosure, plan sponsors can seek out third-party firms that can analyze the fees, performance and services offered by their current service provider(s). Some firms charge fees for this service, but others offer at no cost due to their role in the financial services industry. This information is critical, and it is not a case where you get what you paid for, so shop around.

Finally, it should go without saying; an ounce of prevention is worth more than a pound of cure. In this case, action now is much preferred to action later, especially if in response to a DOL audit. And as Sgt Friday might also say, “Those are the facts”.

About the Author:

David Chrestensen joined First Financial Wealth Management, a division of First Financial Bank, in 2011 and currently serves as a Vice President of New Business Development. He serves clients within the Greater Cincinnati region.

Mr. Chrestensen has more than 25 years of experience in the financial services industry and currently focuses on providing clients wealth management solutions including financial planning, trust services, investment management and retirement planning. As a former business owner, Chrestensen also understands the importance of helping clients select the right retirement plans to help their company and employees achieve greater success.

Chrestensen, a resident of West Chester, holds the certificate of Chartered Financial Consultant (ChFC®) and is the founder and former president and CEO of Sol Ventus Partners, LLC. He is also a member of the Society of Financial Services Professionals, Green Energy Ohio and the West Chester Chamber Alliance.

About the First Financial Wealth Management:

First Financial Wealth Management, a division of First Financial Bank, N.A., provides investment advisory and wealth management services, as well as services as a qualified Discretionary Trustee under ERISA Section 3(38). As such, and because it does not offer any proprietary investment products, First Financial Wealth Management is qualified to provide the services remarked above to interested business owners.

If you have questions or wish to share your comments, please feel free to contact strategic HR inc.(www.strategicHRinc.com) at Info@strategicHRinc.com.

by Denise Flickner, President of HealthWorks

Rising healthcare costs, an emphasis on productivity, and a desire for healthier workforces have made “employee wellness” one of the hottest topics in the workplace. If you’re a Human Resources professional or a part of your company’s Benefits Department, chances are the task of rolling out a successful wellness program has been placed on your shoulders and it can be overwhelming.

How do you create an environment for meaningful, lasting, change? Does the ‘Carrot and the Stick’ approach (expectations and incentives) work? After nearly 20 years in the wellness industry, my answer to you would be a qualified “yes.” There is internal homework that every organization must do first in order for this approach to work.

No Quick Fix

I got into the wellness industry in 1993 as a sales representative for a local company and then started my own corporate wellness company, HealthWorks, in 1999. After having studied Dietetics at The University of Cincinnati and teaching fitness classes since 1988, I quickly determined I wanted to be on the preventative side of wellness. Even in 1993, we understood the connection between healthy lifestyle choices and preventing and/or controlling certain disease states, but there wasn’t enough research yet to push many companies toward implementing strategic wellness programs. Wellness was a tough sell. There was no quick fix and a lot of trial and error before we started to really understand what works and the importance of developing a 3-5 year strategy for implementation.

The ‘Ready, Fire, Aim’ Approach Backfires

There has been a tremendous amount of research supporting the benefits of a healthy work environment for both the employee and the organization. The biggest mistake employers can make is trying to get there too fast. The “Ready, Fire, Aim” approach, where employers throw a number of wellness initiatives at the wall hoping something will stick often backfires. Employees feel threatened and unsure about how these programs will impact them or their jobs, and employers are frustrated because they don’t see results at all or fast enough.

Changing an organization’s ingrained values, priorities and work structures is much more difficult than simply offering fitness challenge or encouraging a healthy lifestyle. The goal for employers needs to be an ongoing program that is sustainable over time. It’s important to provide an environment where employees feel a strong level of trust and consistency in what the organization is trying to achieve and that everyone is in it together.

First Things First

As employers embark on changing healthy behaviors they have to first consider a few key things:

• Do the employees feel valued and trust that the employer really cares about their health?
• Does the wellness program have upper management support?
• How can the program be rolled out so employees to feel they are part of the solution as opposed to strictly the problem?

We ask our clients to take a good, hard look at these questions and to try to answer them honestly. No two organizations are alike and our clients are everything from legal offices, school districts, and manufacturing plants, to colleges and universities. How they come at wellness is going to be different. But one thing is for certain – those that generate the best results have shifted their mindsets to view the money being spent on wellness initiatives as an investment rather than a cost. Everything will flow from that perspective – how you brand your initiative, how you communicate the programming supports and how you design your incentive structures. Your employees will feel and believe the programs are put in place to benefit them. They will be more receptive and they will engage. Just ask anyone in the wellness industry – the key to achieving those desired outcomes is putting in place the conditions for high levels of engagement and trust. “If you don’t engage the hearts, you won’t engage the feet” (Wellness Councils of America).

Time for the ‘Carrot and the Stick’

Rewarding healthy behaviors (incentives) and education, which gives individuals the tools to be more personally accountable for their own health, can absolutely work. A recent study released by Towers Watson, called, “Pathway to Health and Productivity,” suggests that motivating action requires an understanding of how individuals respond to different types of incentives. The figure below from Towers Watson shows the use of wellness incentives are still being used but with tougher requirements.

Intrinsic incentives create interest, desire or readiness to make changes, and the reward for change is therefore internal rather than external. Extrinsic incentives create a motivation to act in order to receive an external reward (such as money, gifts, etc.). Relatively simple change can occur through extrinsic rewards, which were fairly common in early generations of incentive design. However, employers today are seeking a more complicated change and actual adoption of healthy behaviors that are sustainable over time.

There are three key steps that serve as the basic building blocks of healthy organizations.

• Careful examination of the risk factors, or the underlying job characteristics and organizational conditions that enhance or impair health.
• Zero in on desired outcomes, in terms of employee health, organizational results, and broader societal impacts.
• Identify what actions are required to address these underlying factors and achieve the desired outcomes.

Whether your organization is just beginning to implement wellness efforts, has been offering some level of programming, or has been actively engaged in a comprehensive wellness strategy for a number of years, constant evaluation of goals and desired outcome is imperative. Take the necessary time to build your foundation at every level of the organization and make sure to keep your programming interactive and on a human level. Building from that human perspective, with a watchful eye on data and desired outcomes, will establish integrity and trust and ultimately ensure that your programming engagement levels start to self propel, rather than requiring bigger carrots and larger sticks.

HealthWorks, a full-service corporate wellness company, specializes in a wide range of on-site programs. A leader in worksite wellness, HealthWorks identifies employee health risk factors through comprehensive and confidential health screens and health risk assessment. This baseline information helps employers identify how specific health risks impact Productivity, Presenteeism, and Absenteeism, all things that drive a company’s success. HealthWorks has an extensive menu of services including flu shots, health coaching, activity tracking, in-depth corporate reporting and more. For more information, contact Denise directly, at denise@cincyhealthworks.com, or check out the company website at www.cincyhealthworks.com.

by Patti Dunham, MA, MBA, SPHR

We see the headlines and read the stories day after day. Health care costs are rising, claims are increasing, and the overall health of our nation decreasing. So what are we doing about it? Many companies have taken the initiative to actively manage their health care programs, even those who may not have done so in the past. Organizations are adding a bit of consumerism to their plans, implementing wellness initiatives, and creating cost-shifting alternatives to the plan design. But is it enough? Are we using data to analyze our groups and make appropriate plan and program decisions? Are we shying away from the sea of data monsters because we don’t know what we are diving into and what the data means? As we do with other human resources activities we need to analyze not just the cost of our benefit programs but the source of the costs and use the data to tame the monster and improve the health and welfare of not only our programs but of our group.

For anyone who has tried to dive into this sea, I agree, health care claim data is a complicated animal. For those of you fortunate enough to have access to your claim data, you know that the monthly barrage of data is seemingly endless. Sorting through all of the data and making sense of it is a daunting task. However, claim data is an excellent tool to use to refine your programs and work to improve the overall health of your organization. Effective analysis of appropriate data will help you and your organization implement programs for overall organizational improvement. In order to have a complete analysis, there are a few things to keep in mind.

Understand what the numbers are reporting

Most claim data is provided as a result of ICD-9, CPT-4, NCD, and HCPCS codes. Okay, I just said that to scare you, let’s see if we can make sense of what these types of codes mean. A provider will code a visit as “hypertension” or “sinusitis”, it is reported to the insurance company and out comes our data. Providers typically use these “codes” to determine what the illness, injury, or visit was for. You would then need to work with your third party administrator (TPA) or data provider to clarify where your data is coming from and how it is reported. The TPA can also help to refine the types of reports you are getting and review the information. Work with them and allow them to become your interpreter. Remember, more data may not necessarily be better data but do pick and chose those that will fairly represent the claims and give you a comprehensive picture. Again, your TPA may help to narrow this information down to what you need for a complete picture rather than allowing the data to manifest into one of those sea monsters.

Analysis of data

Data is just that, data. Analyze each piece of the data and then look at the entire picture. There are a lot of factors that impact what you are seeing so try and break it down into pieces and then review it in it’s entirety.

• Identify the trends but be careful not to make assumptions. An increase in OBGYN visits does not necessarily mean someone is pregnant. Identify and watch trends.
• Secondly, look around and observe data in its totality – include a review of workers’ compensation claims, absence rates, and short and long term disability claims to get a true picture of what is happening in your organization.

Again, data received from ICD-9 codes are great but use that data in conjunction with your prescription data to make sure you have the whole picture. If you see a high percentage of hypertension as a diagnosis, are you also seeing a lot of prescriptions treating the same diagnosis? Are you seeing an increase in the number of back strains? Did that “jump” occur two months after the start up of the new assembly line? Could it be an ergonomic issue? Look at the numbers and then look beyond.

Reviewing statistical time frames

Review your data by month, quarter, and year to look for trends. Have your claims increased or decreased over the same time period in the previous month, quarter, year, or years? Again analysis is crucial. Consider all of the logical explanations for a jump in the number of office visits. Look at the time frame in which you are analyzing and make sure there aren’t obvious (or not so obvious) explanations for jumps in trends due to the season. Did you just get out of flu season? Are you in an organization with a lot of families who just completed back to school physicals? Using time frames will allow you to make better interpretations of the data you are receiving.

Bench-Marking

It is very important to benchmark your data to determine where you are as compared with other companies. Although you can compare your data with your data in previous time frames, it is also important to benchmark your data to determine where you are as compared with other companies. What are your trends and are they similar to the trends nationally or regionally? How about with similar-type organizations?

National and Regional data will allow you to compare your data with that of organizations (typically of similar size) nationally or regionally. Mercer Human Resource Consulting offers a National Survey of Employer Sponsored Health Plans that will allow you the opportunity to benchmark data. Other organizations such as Kaiser Family Foundation (www.kff.org) and the Milliman Medical Index offer sources of data to benchmark from.

Industry data will allow you to make good comparisons with like organizations but is sometimes difficult to capture. Go to your national organization and see if data is captured not only for compensation and benefit costs but claim data.

Data Into Action

Most importantly we need to turn the data that we receive and have properly analyzed and turn it into action. Program implementation should be documented and tracked so you are able to quantify successes in terms of an ROI for the program. Examples of such programs could include some of the following.

• Provide education about those claims you are seeing most. For example, is your number one diagnosis hypertension? Use payroll stuffers and articles and letters sent home to provide information on preventative care and personal health management of the disease.
• Get the family involved. Many companies have implemented wellness programs (some including financial incentives) to their employees but we should begin to include employee’s families as well. For example, if you are supporting a wellness initiative such as weight management or smoking cessation, it may help to build a supportive environment at home by including families in the initiative.
• Provide information about prescription drug choices. We have already used the tactic of making “non-preferred” drugs more expensive to consumers but go beyond that. Analyze your prescription data and if you see data telling you most employees are using preferred drugs rather than generics; educate. Make sure employees and their families are provided good information about drug tiers, costs, and equitability in prescription choices to allow them to make an informed decision. Face it, human resources professionals get confused about “tier one”, “tier two”, and “tier three” prescriptions…imagine how our employees feel. Communicate and educate.
• Actively work with your provider to ensure proper implementation and use of disease or care management programs. Work with your provider to ensure early detection of high risk / manageable illnesses and “pay the extra dollar” for disease management or case workers. According to a recent CIGNA study (2004, Health Care Report) active programs such as these can result in a potential savings of 20% for the entire cost of the illness. These programs allow us to show measurable ROI on the programs and continue implementation.
• Use rewards for health management. Reward employees and their families for completing health risk assessments. Reward for participation in wellness activities. Reward for self-care for minor illnesses and for lifestyle and behavior changes. Remember, rewards don’t have to be costly. Use creative rewards for those involved in managing their health.

Finally with data, remember that no system is perfect. Use the information you are receiving, and look at the “big picture”. Data analysis will allow us to make more informed decisions in our future plan designs and wellness programs in an attempt to reduce our overall health care costs. Remember, monsters always appear larger when we are in the dark. We can all swim easily in this sea of data as long as we work with our TPAs, providers, and/or brokers to understand what we are reading and properly analyze and implement programs to target our own monsters.

Patti Dunham is a Sr. Human Resources Consultant with Strategic Human Resources, Inc. (www.strategicHRinc.com). If you have any questions feel free to contact her at Patti@strategicHRinc.com.

by Patti Dunham, MA, MBA SPHR and Ray Roshek, Hylant Group

With the role of human resources shifting from service and administration to strategic planning partner, we need to take on more accountability for how we impact the success of the business. The biggest impact we can make is on the “human” resources the organization employs to maintain the business. Therefore, we must assess the quality and cost of recruiting and retaining these resources.

Health care costs are definitely still on the rise. Everywhere we turn it is in the news, so another article pointing out this fact would be futile. We should understand the events and how this all happened, but the reality is these increases have damaged our corporate fiscal objectives, and they are coming after us to get these costs in check. As professionals in human resources and benefit management we know that change is demanded, but what are we to change? As responsible human resources professionals, we have reviewed our employee plan contributions, we have changed plan designs, we have been diligent in promoting “good health” to our employees, what else can we do?

First we all have to look at our past and expected future trends of healthcare. We did have a surprise in 2003. The increase did not reach the expected 15% trend predicted, but many could argue that our diligence in making plan design changes moderated this trend.

Annual change in average total health benefit cost, 1987-2003

Note: Results for 1987-1988 are based on cost for active and retired employees combined.
The change in cost from 1988-2003 is based on cost for active employees only.
Mercer Human Resource Consulting – Surprise slow-down in US health benefit cost increase: December 4, 2003

Predictions for 2004 vary from 12% to 17% and we know that smaller employers are receiving bigger increases than the larger companies. Nationally, the cost for 2003 per employee for Health and Dental benefits was $6,215. Therefore if costs increase 12%, each of our employees will receive $746 of new income. Are you communicating that information to your employees in the form of benefit statements so they can see their increase in total compensation?

Who pays for the increased costs?

Employers. One choice employers have is to continue to pay these increasing costs. Employees are valuable and employees value their health insurance. We can all agree that medical science and advances in medicine have increased our expected lifespan and improved the quality of life. This improvement comes at a cost and we are willing to pay. All of this means, by offering an acceptable health and dental plan with substantial employer contributions you are creating a great retention tool especially given the labor market predictions.

Employees. If your company does not have the financial resources or feel that employees should share in the cost of the medical advances, we need to know effective tools to reduce the premiums cost to the employer. In short, there are two primary methods to reducing costs: 1. Reduce the Cost per Unit, or 2. Reduce the Number of Units (fewer doctor visits and medications).

1) Reducing the Cost per Unit.

If you have been an astute Benefits Manager, then you have already reviewed the PPO and HMO networks that offer discounts in services. If you are already with the ‘best’ network for discounts and have employees using the doctors and hospitals in these networks, your ability of “Reducing the Cost per Unit” is now limited only to shifting the premium cost. Therefore, your options are either increase employee payroll deductions and reducing employer cost or changing the plan design to reduce the premium.

2) Reducing the Number of Units

Greater focus today seems to be on Defined Contribution Plans. Thinking pensions? No, Defined Contribution Plans (sometimes called self-direct or consumer driven health care plans) are a new plan design that offers an element of consumerism. Employers choose to give their employees a fixed amount of dollars each year to spend on health or dental care services along with (typically) a high deductible insurance product that protects catastrophic health care concerns. Unused dollars can carry forward to the next year building a savings account that can potentially bridge the gap of the high deductible plan. This incentive to not spend unnecessary dollars ideally should reduce the number of units used (fewer doctor visits and medications).

A byproduct of this design is to focus on health. If an employee can get healthy and begin lifestyle changes that promote future improvements in health, the number of units used reduces more. However, there is some potential backlash of this type of product. One potential could be care avoidance. Some individuals may focus too much on not spending their limited dollars and not get the care or medications they desperately need. Therefore, effective plans should include preventive care riders and/or prescription drug riders. Other backlash may be employer “blame” for a lack of paternalism. Since this type of plan gives employees the power to make decisions, a poor decision may be blamed on the employer. Also, the potential of out of pocket expenses for employees with a catastrophic health event are significant. Although employees like seeing the large dollars up front, if a catastrophic event does occur, those are the employees who end up paying the large out of pocket dollars. As a result, the employer will lose the perception of offering adequate coverage for employees.

As Human Resources professionals and Benefit Managers, our jobs have never been so difficult. Working closely with our financial counterparts to keep health and dental costs under control is essential in today’s competitive markets. The good news is we have more health and dental care options than before, but quality research is necessary to avoid buying into the hype on the next fly-by-night, flavor of the month. Be sure to look at all of the available options, talk with your peers, and ensure proper communication and understanding of plans before making financial decisions that may effect the health of your employees and organization.

Ray Roshek is the VP of Group Benefits for Hylant Group. Patti Dunham is a Sr. Human Resources Consultant with Strategic Human Resources, Inc. (www.strategicHRinc.com). If you have any questions feel free to contact Ray at Raymond.Roshek@Hylant.com or Patti at Patti@strategicHRinc.com.

by Patti Dunham, MA, MBA SPHR

The Employee Retirement Income Security Act (ERISA), legislation that sets uniform standards to assure that employee benefit plans are established and maintained in a fair and financially sound matter, turned 30 in September of this year. And, unlike many other pieces of legislation, the law that was hurriedly pushed through congress to avoid getting backlogged behind the Nixon impeachment trial has fundamentally remained unchanged in its 30 years.

ERISA, most definitely, is a complex series of rules that have become the cornerstone of employee benefit plans today. Although in place for 30 years, you will have a hard time finding an HR professional who doesn’t shiver at the mere mention of the word. With typical legal language and it’s affiliation with the Internal Revenue Code, it’s easy to quickly become intimidated when ensuring we are in compliance. The following outlines some of the general requirements surrounding ERISA and what you should be aware of when ensuring compliance.

ERISA Basics

ERISA, in general, applies to a wide variety of employee benefit plans, typically welfare plans. Examples of the types of plans that fall under the legislation include: medical, disability, death, pension, profit-sharing, stock and bonus plans. To determine if a plan is covered, it is necessary to review the guidelines on plan coverage. These guidelines are tricky but the general requirements are that (1) it is a plan, fund, or program that is (2) established or maintained by an (3) employer or employee organization for the (4) purpose of providing specified benefits to participants or their beneficiaries. Remember, unfunded benefit or payroll practices such as vacation, holidays, PTO, etc. are not included. Group-type voluntary insurance programs in which the employer makes no contributions are also excluded.

What does ERISA require?

Responsibilities under ERISA vary depending on the type of the plan involved. Pension plans are subject to all of the rules, while welfare benefit plans must only meet the rules on reporting and disclosure, fiduciary responsibility, prohibited transaction and benefit claims procedures.

Reporting. Administrators of covered plans must file summary plan descriptions (SPDs), Summaries of Material Modifications (SMMs), and annual reports, including Form 5500 for each plan.

Disclosure. Certain information must be communicated to plan participants so that they can be informed about their rights under the plan. These include SPDs, updated SPDs, SMMs, Summary annual reports (SARs), and notice of claim denials if a claim has been denied. Communications must be sent to employees in a method likely to result in full distribution, not merely a “posting”. It also must be easily understood by the average participant. ERISA also requires notification of continuation of benefits under COBRA, an explanation of ESOPs and other stock benefits, and the posting of all required state employment laws.

Fiduciary Responsibility. Plan fiduciaries have the responsibility of reviewing covered plans to ensure financial compliance. Fiduciary trouble areas typically involve:

• Not paying employee contributions on time
• Not administering the plan according to the document (i.e. loans, testing, etc.)
• Not monitoring investment alternatives
• Not updating plan documents and SPDs when required
• Inaccurate 5500 report filing

Benefit Claim Denials. An administrator who denies a participant’s claim for benefits has legal obligations and must provide information about the denial as well as the appeal process. Anyone who has medical coverage who has had a claim denied has probably seen the disclosure on the explanation of benefits that covers this requirement.

Why should we comply?

Well, the easy answer is “it’s the law”. If an organization is convicted of violating ERISA’s reporting and disclosure requirements, the company can face up to a fine of $100,000 and/or 10 years in prison. Not such a great thing. The more significant answer is the benefit that it provides to your employees and participants in these plans. Although there is always room for improvement, ERISA requirements have forced us to greatly improve our benefit communications. Employees feel more informed and clear about the benefit plans in which they are participating.

As we look back to the beginning of ERISA, it is alleged that the seed for ERISA legislation was the 1963 failure of the Studebaker Company. That failure left thousands of long service employees without their promised pensions. More currently we look at the Enron failure and the threats to the Pension Benefit Guarantee Corporation (PBGC). The PBGC has potentially significant liabilities with under-funded plans as a result of the downturns in the stock market and certain industries. We see plan trustees failing in their fiduciary responsibilities in events such as theft and/or misuse that end up in the courts and in prison. As ERISA turns 30, we can definitely see she has more bite than in her earlier years. Serious consequences for non-compliance and a 24% increase in DOL audits surrounding ERISA compliance show us that this is not just another birthday. Be aware of the ERISA requirements and be sure to work with your insurance broker and/or attorney to ensure compliance with this much celebrated piece of legislation

Patti Dunham is a Sr. Human Resources Consultant with Strategic Human Resources, Inc. (www.strategicHRinc.com) and can be reached at Patti@strategicHRinc.com.

by Robin Throckmorton, MA, SPHR and Linda Gravett, PhD, SPHR

Do you ever feel stressed? Nahhhh…none of us do, right? We don’t get stress headaches or have problems sleeping or get overly tired. We don’t even get those tense muscle pains in the back of our neck, shoulders, or back. And, we never ever get depressed or edgy, right? But do you realize that these are all symptoms of stress and if you don’t try to manage your stress it could lead to even worse problems such as high blood pressure, ulcers, heart attack, or damaged relationships?

What’s the best solution for stress? Exercise!

We’ll be the first to agree that exercise isn’t easy, but exercise also doesn’t need to be long and painful. You’ll see results even if you can only take a few minutes to exercise.  Once you get started you won’t want to stop and you’ll even be more productive with your every-day life including your ability to concentrate, energy level, and creativity.
But before you begin your exercise, you need to learn how to breathe right.

We all were born with the appropriate breathing technique but quickly lose it due to the day to day stress. Watch a baby – they breathe long deep breaths in through the nose and out the nose. Studies show that slowing down your breathing calms the nervous system, which in turn lowers blood pressure and heart rate, reduces stress hormone levels and increases energy levels. Therefore, the deep breathing we did when we were born is a highly effective tool against asthma, poor digestion, weight gain, sleeplessness, high blood pressure, heart disease, AND STRESS.
We suggest you try this as a prelude to your exercise routine and a way to calm your mind:

• Sit in a chair with both feet on the floor with your shoulders back and your chin up.
• Place your hands on your diaphragm so that you can feel the movement of your breathing.
• Breathe in deeply through your nose filling your abdomen and chest with air from bottom to top like you are filling a balloon.
• Exhale all the air out of your nose from top to bottom.
• Repeat 20 times, even just 5 – 10 will help.

This is just one breathing technique of many. If this one doesn’t work for you, research other techniques until you find one that is comfortable and refreshing for you. The key is controlling your breathing while you exercise will help you build endurance and continue to benefit from oxygenating your body.

Now that you know how to breathe, let’s talk about exercise. We’ve learned some excellent techniques and concepts about exercise and stress reduction from the martial arts. Robin studies Yoga and Pilates and has two children and a husband who are 1st Degree Black-Belts in the Maududo form of Karate. Linda studies Tai Chi and is a 5th Degree Black-Belt in TaeKwondo. We’ve learned that the first place to start for successful exercise is with deep breathing exercises, and then introduce some low-impact exercises that can actually be done while sitting at your desk and then work up to a full exercise routine to get your heart rate going.

Some of the exercises we like are:
Tai Chi – Repulse Monkey Form
(Benefits: relaxes neck and shoulder muscles, improves circulation in hands and arms) Hold your left hand at face level with the palm facing upward.

• Swing your right arm back, following the motion with your eyes by turning your head to look over your shoulder.
• Sweep your arm forward and over your shoulder so that your right hand will pass over your left about 2 to 3 inches above it.
• Bring your right hand past your left hand.
• Turn your right hand palm up and wing your left arm behind you as your turn your head to follow the motion.
• Bring the left hand over the right without touching your hands together.
• Slide the left hand forward.
• Repetitions: Nine on each side, for a total of 18.

Tai Chi – Brushing Tree Trunk Form
(Benefits: tightens abdomen, improves circulation in hands and arms, relaxes shoulders) Extend your arms and reach for the ceiling. Take a deep breath expanding your diaphragm.

• Swing your right arm down across your chest to your left side. The left arm remains stretched towards the ceiling.
• As your right arm wraps around your waist on the left side, turn your head so you are looking to your right. Your body is twisted to the left but your head is turned in the opposite direction. Breathe out as you bend forward and tighten your abdomen.
• Swing your right arm up again and reverse the rotation so that your left arm is resting on your right hip. Turn your head to the left. Exhale as you bend over and twist.
• Repetitions: Nine times on each side.

Yoga Tree Pose
(Benefits: focus, concentration, balance, strength, and stretching)

• Stand straight with your hands at your sides balancing your weight evenly on both feet.
• Begin to shift the weight over to the right foot, lifting the left foot off the floor.
• Bend the left knee bringing the sole of the left foot high onto the inner right thigh.
• Keep both hips squared towards the front.
• Place your hands on your hips for balance. To advance, raise your hands up in front of you over your head.
• Focus on something that doesn’t move to help you keep balance.
• Hold for 30 – 60 seconds.
• Repeat standing on the left foot.
• For more challenge, try closing your eyes.

Yoga Plank
(Benefits: endurance, core strengthening)

• Lie on your stomach supporting yourself on your forearms
• Lift your body parallel to the floor keeping your head/neck in line with your spine looking straight down at the floor
• Hold this position for 30 – 60 seconds
• For more challenge, lift yourself up on your arms so your shoulders are directly over your wrists.

Pilates Hundred
(Benefits: strengthens the core)

• Lie flat on the floor on your back.
• Keeping your back flat on the floor, raise both your legs to a 90 degree angle and then lower back toward the floor to a challenging level without lifting your back off the floor.
• Keeping your back flat on the floor, raise your head and shoulders off the floor.
• Keeping arms extended, lift and lower them about two inches from the floor, breathing in on the lift and out on the lower.
• Do this for 5 up-and-down beats. Repeat 10 times until you have done a “hundred.”

These are just a few of our favorites that can be done almost anywhere but are especially a great way to start your day. To build your own routine, check out some of these resources:

• www.YogaJournal.com
• www.PotentialsUnlimited.com
• www.Assessment.com
• www.SpaSong.com
• yoga.About.com
• Darrin Zeer: Office Spa, Office Yoga, Everyday Calm
• Julie Lusk: Desktop Yoga
• Diana Fairechild: Office Yoga
• Dawn Groves: Yoga for Busy People
• Cynthia Quarta: T’ai Chi in a Chair
• Terra Wellington : Balanced Living
• Andrew Williams: How Do You Compare?

Remember, the main way to reduce physical stress is to release endorphins into the bloodstream which is done through exercise. Getting a 20-30 minute workout three to four days a week is critical to keeping the endorphins flowing and the heart pumping. According to the American Institute of Stress, Americans spend about $11.3 billion a year coping with stress-related illnesses and injuries. Stress has been linked to leading causes of death such as heart disease, cancer, and suicide. Up to 60% of employee absences are caused by psychological disorders. We encourage you to avoid being one of those statistics. Focus your breathing and figure out the best exercise plan for you…Get moving!

Robin Throckmorton, MA, SPHR, a Senior Human Resources Management Consultant is President of Strategic Human Resources, Inc. (www.strategicHRinc.com). Dr. Linda Gravett, Ph.D, SPHR, is with Gravett & Associates (www.Gravett.com). If you have questions or comments about this article or think your office would benefit from our highly interactive session titled “Martial Arts Strategies for Managing Stress at the Office,” please email Linda at Linda@Gravett.com or Robin at Robin@strategicHRinc.com.