Worksite Health Promotion

The fastest-growing use of EAPs since 2002 has been tied to employees’ financial worries.

Over the last five years, there’s been a announced 69% jump in staff member employee assistance program use related to personal financial concerns. the trend isn’t all that surprising.

Statistics show that, for the first time since the Excellent Depression, the typical American has negative savings - in other words, debt exceeds income - in a typical month.

With salaries frozen in many organizations and many workers racking up higher and higher credit card debt, the problem may continue to get worse.

Troubling trends

Here are some ominous numbers from a recent worker survey -

• 27% of respondents said they were “one major setback away from financial disaster”

• 22 percent say they were “worse off than last year, with less take-home income and more debt”

• 40 percent say their employer is “insensitive to their employees’ financial needs,” and

• only 6 percent said they felt comfortable with their current financial situation and ability to manage their debts.

The majority of personal-finance related employee assistance program (EAP) use arises from concerns over debt management, household refinancing and/or failed investments.

The problem of presenteeism - staff members showing up at work but taking a “mental vacation day” - isn’t going away any time soon.

A recent survey found the typical employee has three unused vacation days at the end of the year. But 33% admit that they sometimes take “unofficial” vacation days of a half-day or more.

Not surprisingly, the day after Thanksgiving, Christmas Eve day and December 26 rank one of the highest “presentee” days among companies (in particular in the white-collar realm) that remain open on those days.

In terms of the expanded question of presenteeism, what’s keeping people  from using their vacation time as it’s intended?  Top answers -

• supervisors frown on staff members taking vacation time

• there’s too much work to make up after using vacation time, and

• individuals  want to “reserve” time in case of an emergency.

On the flip side, many folks who take vacation time have trouble leaving work behind. One staff member in four admits to checking work e-mail and/or voicemail while on vacation.

And 29 percent say they have trouble forgetting about work-related stress, even when they’re using compensated time off.

Among all industrialized nations, U.S.  workers receive the fewest yearly vacation days - 14 on average.

It’s tough to get workers to participate in benefit programs that they don’t even know exist.

Seventy-one% of employees lack basic knowledge of standard benefit programs, as reported by a new study by the American Payroll Association (APA).

Low participation rates

The ASA study  focused on workers knowledge of their company’s pre-tax benefits. While nearly three quarters of workers say they live paycheck to paycheck, and would like to stretch their current salaries -

• 52 percent don’t participate in available flex spending accounts (and 6 percent of had never even heard of an FSA)

• 17% didn’t know their corporation offered a health savings account or health reimbursement arrangement (46% of those aware of the benefit still don’t participate), and

• 18% are unaware of existing transportation benefits or subsidies their business offers.

Compliance with HIPAA non-discrimination rules is a big challenge for wellness programs. the old rules were unclear about which incentives passed muster.

That’s all changed, with the rules established earlier this year by the DOL and USA  Treasury Department. the rules themselves haven’t changed, but they’ve been clarified. Here’s what you need to know -

‘Participation incentives’ are fine

As long as you structure incentives as rewards for wellness participation, the new rules provide a lot of freedom. All of these are fine under HIPAA -

• reimbursing all or a portion of the cost of fitness club membership

• financial rewards for undergoing health risk (assessment|appraisal}s so long as the reward is based on participation rather than test results

• encouraging preventive care by waiving co-pays or deductibles for these services (i.e., well-baby visits or prenatal care)

• reimbursing staff members for the cost of smoking-cessation programs without regard to the result, and

• offering rewards tied to employees attending a monthly health education seminar or working with a health coach.

Conditional rewards OK if…

But what if you want to make the reward conditional on participants meeting specific health goals? Example -  Staff Members who achieve a cholesterol count under 200 get a 20% reduction in the cost of their medical plan contributions pending results of an annual cholesterol test.

The feds say it’s OK under health insurance portability and accountability act (HIPAA) to do this, too, but your plan must meet five additional requirements -

• the reward can’t exceed 20 percent of the cost of employee-only (or, when you allow dependents to participate, employee-plus-dependent) coverage under your health plan.

• the standards ought to be reasonable (e.g., you can’t limit rewards to folks who can run a marathon). the rewards also can’t be used as a backhanded way to adversely single out certain workers (e.g., rewards for all non-diabetics).

• Participants must’ve the opportunity to qualify for the reward at least once per year (e.g., a smoker who fails to quit this year gets another chance next year).

• Rewards should be available to all “similarly situated individuals.” In other words, you can’t make a company-paid weight control program available to certain employees but not others.

When, for medical reasons, it’s unreasonably difficult for an individual to satisfy conditions that are otherwise reasonable, you must offer an alternative. Example -  A pregnant employee might not be able to meet certain standards, so you must offer her an alternative.

Negative incentives violate HIPAA

So what’s not permitted under health insurance portability and accountability act (HIPAA)’s non-discrimination rules? Anything that punishes people  for their medical conditions or health risks.

The rules prohibit employers from charging different premiums, contributions, co-pays or deductibles based on personal health factors such as obesity or use of tobacco. Notwithstanding, it’s OK to reimburse these expenses based on someone’s participation in your wellness program, without regard to success.

In addition, the feds have added an important new non-discrimination rule -  Companys’ health plans can’t deny benefits for treatment of injuries resulting from a medical condition, even if the condition wasn’t diagnosed before the injury.

For example, some health plans have a “suicide exclusion” that denies payment for treating self-inflicted wounds from a suicide try. Now let’s suppose the employee suffers from clinical depression. Even when the depression was undiagnosed prior to the suicide try, it’s illegal for your plan to deny benefits to this employee.

Ever set out to organize and dispose of old employee files and paperwork in the office? the job is tougher than it seems.

Best practice -  Create a records retention policy as your first step. A host of federal and state laws specify how long you must retain pay- and benefits-related documents.

Compliance is essential if a current or former worker sues or the DOL, IRS or the state audits your records.

Here’s a records-retention schedule advised by employment lawyer Jacqueline McManus -

• Retain for two years worker personnel files, including performance reviews and training.

• Hold these for three years -  wage records, including time cards, base pay and overtime wage-rate calculations and records explaining wage diferentials for workers performing the same job, and hold I-9 forms for three years from hire date or one year after termination, whichever is later.

• Keep these four years -  all Payroll documents, including - home address records, and all wage records, including weekly OT earnings, straight time pay, deductions, bonuses, pay period designations and payment dates.

• Use a five-year retention window for staff member health info such as medical and first-aid records from on-the-job injuries, and drug and alcohol testing records.

• Keep this benefits data for six years (or one year after plan termination) -  elections and enrollment forms, benefit change documents, and COBRA notices.

• Retain 401(k) files indefinitely.

Many companys attempt to reward employees during the holidays. But be cautious -

There’s a common misbelief that the IRS considers gift cards worth $20 or less de minimus benefits and, thus, they’re tax free. Unfortunately, that’s not true.  With few exceptions, the IRS considers almost anything with cash value a taxable form of compensation.

Practically speaking, the IRS is unlikely to go after your firm or an staff member over several small-value gift cards for which you withheld no taxes. But they could, specifically if your firm regularly hands out gift cards.  

At some firms, those $5 to $20 cards can add up to a few thousand dollars worth of uncompensated taxes in a few years. Each $15 gift card would typically require about $5.55 withheld.

To be safe, you are able to use gift cards sparingly and pay the tax for the recipient. Or else you are able to educate folks proactively that Uncle Sam requires you to take out for taxes.

Read the fine print

Gift cards could be money-wasters or or morale-killers when employees have a bad experience trying to redeem them. Read the fine-print before you purchase. Three common pitfalls to watch -

• expiration dates. Some retailers offer cards that last forever. But many have expiration dates, rendering the cards worthless after a period of time

• dormancy fees. A $50 card can end up worth only $40 at stores that deduct “dormancy fees” after a certain period of time, and

• redemption fees. Some stores charge a fee for redeeming cards that could be used in multiple locations.

The good news -  There are some good deals out there. Employer use of gift cards has doubled since 2001, and related sales bring in $20 billion a year to retailers. With such fierce competition, it compensates to shop around.

In recent years, it’s become increasingly common for corporations with as few as 200 staff members to explore self-insurance. But beware of hidden traps.

If your organization is weighing self-insurance - or has already taken it - here are three pitfalls that can develop unexpected costs.

1. Unfavorable staff member mix

It’s impossible to completely eliminate the risk of unexpected, high-dollar health claims. But here’s a guideline to decrease your risk. Health claim stats suggest the “ideal” employee population for a self-insured plan is predominately young, non-tobacco use and male.

Be aware that stop-loss insurance carriers often “laser” those staff members considered higher risk. Lasering means that your company would have to pay out much more in claims for these staff members before the stop-loss coverage kicks in.

2. Loss of network discounts

Some firms learned after the fact that going the self-insurance route caused them to lose providers’ network discounts they previously received under fully insured plans. When reviewing  plan providers’ administration-only choices, ask -

• Will the vendor’s network alliances work in your best interests, cost-wise?

• Will the vendor only oversee claim payments or negotiate to build the best provider network, quality-wise, for your staff members.

Bottom line -  You ought to get the same types of plan designs, networks and discounts as a fully insured plan.

3. Wasteful reinsurance contracts

If the language of your reinsurance contract doesn’t match your health plan’s summary plan description, you might be compensating for coverage you don’t need and can never use.

It’s also key to make sure your firm has enough money in reserve to cover run-out claims and other costs that may occur before reinsurance will cover payments. Best practice -  annual audits of your financial reserves.

Evidence-based medicine has become a big buzzword in health care over the last few years. But certain non-traditional treatments, like chiropractic care, may also prove effective in certain cases.

The key -  Using these treatments also to - not in lieu of - conventional medicine may prove more cost-efficient in the long term.

What the latest research says

Do these five common complimentary treatments belong on your health plan? Here’s what recent research suggests -

1) Chiropractic care. Studies suggest these treatments may help cut absenteeism for staff members with uncomplicated lower back pain, in particular for individuals  who’ve had it for less than a month.

2) Acupuncture. Studies show acupuncture can help relieve osteoarthritis, chronic migraines, post-operative pain, low-back pain, fibromyalgia and carpal tunnel syndrome. There’s less evidence about its effectiveness as a tandem treatment for other conditions.

3) Acupressure. There’s no significant research to show this needle-free variation of acupuncture (a therapist applies pressure to specific points on the body) has the same medical benefits.

4) Biofeedback. According to the Mayo Clinic, there’s now some research to suggest this treatment can help with some kinds of chronic pain, particularly tension headaches and muscle pain.

How it works -  Monitors display a patient’s heart rate, breathing patterns, body temperature and muscle activity. A therapist then teaches the patient how to lower these readings via relaxation.

5) Aromatherapy. as yet, there’s no evidence of direct medical benefits. While it could be a relaxing treatment to reduce stress, few firms - if any - foot the bill on employees’ behalf.

When an worker ignores directions from a physician, who’s responsible when the worker causes a serious accident on the job?

In some cases, it’s your firm that ends up on the hook - both for workers’ comp and for other individuals ’s injuries caused by misuse of a prescription drug.

Situations like these raise three questions that even HR/benefits pros have trouble answering. How are you - or supervisors - supposed to know what meds individuals  are on and whether they’re taking them as directed by their physicians?

In most cases, you won’t.

Are you able to find out without violating HIPAA or other laws?

You can’t, unless the worker volunteers the info or a doctor notes the effects of medication being the reason for the accident.

So when you won’t know and can’t find out, how on earth can your firm be held responsible after the fact?

It all depends on the circumstances. Three key danger signs -

• A supervisor already has knowledge of an employee’s health condition, if not the meds themselves. Example -  the worker requested a schedule change and said it was due to a particular health problem

• the person has a history of erratic behavior that management suspects is medication-related, and/or

• the employee’s job involves potentially hazardous situations.

Spotting possible danger

A Florida case (Johnson v. Rentway) is a classic example of the two of the three large danger signs.

1. the supervisor knew an employee had insulin-dependent diabetes.

2. the staff member was under physician’s orders to take insulin at specific times, which required the company to adjust the employee’s schedule.

But due to short staffing, the worker was often forced to work shifts that overlapped with times he was supposed to take injections.

What’s more, the employee worked a potentially perilous job (he was a expert truck driver).

Finally, the inevitable happpened. the employee suffered a diabetic blackout at the wheel, causing a serious crash that injured himself and another driver.

The employee filed for workers’ comp, and the injured driver sued the company. the firm fought - and lost- both cases. Total cost -  $5 million.

Having even one problem drinker on your medical plan - including a covered family member with abuse issues - can cost your corporation big.

Some estimates place the potential cost as high as $35,000 a year per case. What’ your company’s risk?

Many wellness programs are geared toward managing employees’ health risks associated with illnesses like diabetes or asthma.

But unless the wellness program is integrated with an worker assistance program (EAP), chances are alcohol abuse-related risks go undetected. Here are two strategies that’re getting good results.

1. Include alcohol in biometric testings

If you already sponsor confidential worker health-risk assessments, it’s easy to screen for alcohol risks, too. This can be as simple as making sure three questions are added to the current appraisal -

• How often do you have a drink containing alcohol?

• How many alcoholic drinks do you’ve on a typical day? And

• How often in the last month have you had six or more drinks?

For male workers, more than 14 drinks per week, or one or more episodes of heavy drinking suggests a possible problem. for women, more than seven drinks in a week, or one or more episodes of drinking four or more drinks, is a red flag.

Alternative -  When you don’t offer appraisals, you are able to refer workers to a free, confidential online screening.

Benchmarking tools

Many experts say drug-free workplace policies and worker assistance programs (EAPs) are the two most proven solutions within companies’ grasp for minimizing the risks and costs of alcohol abuse by health plan enrollees.

To see when sponsoring an EAP makes financial sense, you can calculate your own firm’s current cost risk for free here. Plug in your corporation kind, locale and number of employees.

You’ll get a personalized estimate of yearly direct (absenteeism, disability, ER visits) and indirect (presenteeism, turnover) costs from alcohol misuse by a covered employee or family member.

To design a drug-free workplace policy - or check if your existing one is up to par and compliant with the law - more guidance is available here.