Profit Strategies Inc. News

Cutting Health Care Costs - Like Japan

2012-02-10T14:16:00.000-08:00

Everyone wants to reduce the cost of their health care which is about 18% of GDP Today. Most are looking for someone to blame (insurers, doctors, etc.). But maybe we need to point the finger at ourselves. Obesity rates are going up as well. Consider that suger consumption in 1900 was about 1 pound for every American per year. It went to about 15 pounds after World War II and 115 pounds in the mid 80s. The latest available data shows the late 2000s to be 205 pounds! No one thinks they consume that much. But with processed foods and high fructose corn syrup, you may be surprised to find the amount of sugar and salt in just your bread.

Here are some facts. Treating a person with Type 2 diabetes is about $22,500 versus a healthy worker at about $1,700. And employers with higher obesity rates also happen to have the lowest productivity rates. Japan recognized that those with two out of five Metabolic Syndromes (metS) are 725% more likely to be a health risk. So the Japanese government required employers to demonstrate a 1.5% reversal in metS by 2012 and a 3% overall reversal by 2015 or pay a penalty to the Japanese government retirement program.

A whopping 74.1% of Americans are obese or overweight compared to only 22.6% of the Japanese, we obviously face a larger health care crisis. I'm not advocating government involvement in regulating health care or pushing it down to the employer level. But let's face it, we as employers pay the cost until MediCare kicks in and then pass it on to the government. Which will end up costing us in the end anyway.

Exempt Classification Analysis - Not Likely In 2012

2012-02-06T12:03:00.001-08:00

The fed has said they will want employers to create a written classification analysis document for every exempt employee on staff. The change known as "Right to Know" rule would require employers to perform a written classification analysis and share that info with all affected workers. Companies would also be required to retain the analysis documents in the event of a DOL investigation.

However, after being pushed back several times last year, the DOL changed the classification of the Right to Know rules from the "Proposed Rules Stage" to "Long-Term Actions". Long-Term Actions are usually items under development but for which the agency does not expect to have a regulatory action within 12 months.

Whew!

Reporting Health Coverage Costs on W2 Begins 2012

2012-01-16T12:57:00.000-08:00

Beginning 2012 employers with 250 or more W-2s will have to report the aggregate cost of employer-sponsored health coverage on the Form W-2 of their employees. The Internal Revenue Service recently revised their interim guidance issuing Notice 2012-9 clarifying the original Q&As and adding some new ones.
Small Employer Exemption Employers with fewer than 250 Form W-2 are not required to report for 2012. But you will need to start in 2013 so be prepared.
Stand-alone dental and vision plans In determining whether the cost of coverage under a dental and/or vision plan is included in the aggregate cost is the same standard for determining whether such coverage is an excepted benefit under HIPPA. Certain stand-alone dental and vision plans may be exempt from the reporting requirement
Excess reimbursement for highly compensated The report requirement does not apply to the cost of coverage includible in income under Section 105(h) of IRS Code or payment or reimbursements of health insurance premiums for 2% shareholder-employees of an S corporation.
Coverage under employee assistance program or similar programs An employer that does not charge a premium for an EAP, wellness program or on-site medical clinic to COBRA- qualifying beneficiaries is not required to include the cost of such coverage in the aggregate reportable cost.
Optional reporting of exempted benefits Employers may, for convenience, include in the aggregate reportable cost the cost of coverage that is not required (coverage under HRA for example) provided certain conditions are met.
Reporting non-applicable employer-sponsored coverage Employers may use any reasonable method to determine the relative allocation of cost for benefit programs.
Employee election changes after year-end The aggregate reportable cost for a calendar year reported on a Form W-2 may be based on the information available to the employer as of December 31 of the calendar year without regard to any election or notification made or provided in subsequent calendar year that has a retroactive effect on a previous year's coverage.
Payroll periods crossing two taxable years This notice provides employers with various options for reporting the aggregate reportable cost for a payroll period that spans two taxable years.
Hospital indemnity/specified disease insurance Employers are required to include the cost of coverage in the aggregate reportable cost on Form W-2 if the employer makes any contribution to the cost of coverage that is excluded from the employee's income, or if the employee purchases a policy on a pre-tax basis under a cafeteria plan. However, if the employer provides the opportunity for employees to purchase an independent, non-coordinated fixed indemnity policy and the employee pays the full amount of the premium with after-tax dollars, the cost of coverage provided under that policy is not required to be reported on Form W-2

Do Your Employees Understand Their Benefits

2011-12-16T10:45:00.000-08:00

Although human resource decision makers believe it is important for employees to fully understand their benefit options, it is estimated that about 40% of them do not. With the trends in health care pushing more and more responsibility on employees to manage their own benefits, there is clearly a disconnect here.
The majority of large and midsized companies believe web based tools increase employee understanding of benefits and their overall engagement, yet the majority of large and midsized companies don't provide them. In fact six out of ten HR decision makers, regardless of company size, believe Mobile access to benefit information is important. Yet fewer than half of the companies provide mobile access now.

Ways To Use Your FSA Before Year End

2011-12-06T11:15:00.001-08:00

Many employees have trouble identifying expenses they can purchase with a health care Flexible Spending Account (FSA). Circulating a list of health care and dependent eligible expenses may help them use their fund prior to year end. Here are some examples:

Over the counter medications prescribed by your doctor can be reimbursed.

Submit any outstanding receipts for health care such as Rx or dependent care such as day care or summer camp.

Get a back up supply of regularly used medical supplied such as contact lenses and solution, prescription glasses etc.

Behind on any exams? Visit chiropractor or acupuncturist, dentist or physician before year end.

Get up to date on vaccinations including flu shot.

Smoking cessation and weight loss counseling accompanied by letter of medical necessity can be reimbursed.

Mileage to and from eligible appointments as well as pharmacy are reimburseable. From January to June 2011 the rate is 19 cents a mile and from July to December 2011 it is 23.5 cents a mile.

Sick Days Could Save $1 Billion

2011-11-17T21:19:00.000-08:00

Access to paid sick days could save $1 billion in medical costs annually according to a report by the Institute of Women's Policy Research. Currently more than 44 million American workers do not have access to sick days and are unable to use time of to take care of sick children or family members.

Seeing a primary care physician or receiving preventative and early treatment is common sense. But millions of Americans cannot do so without losing pay or their jobs. So we pay over $1 billion each year in emergency department costs. The United States spends approximately $47 billion annually on emergency department services. IWPR findings show that, by shifting the treatment of some preventable illnesses from emergency departments to less expensive doctors' offices, clinics and hospital outpatient settings, access to paid sick days would save $1.1 billion annually.

IWPR's analyses reveal that paid sick days are associated with better self-reported health, fewer delays in medical care, and fewer emergency department visits for adults and their children. Workers without paid sick days are 40% more likely than workers with paid sick days to delay medical care for themselves or a family member. Employees with access to paid sick days have an easier time getting to a doctor during regular business hours to care for themselves or family members.

Health Care Reform - No Going Back

2011-11-15T16:03:00.000-08:00

The New York Times - Nov. 15: For the nation's health care system, there may be no going back. No matter what the Supreme Court decides about the constitutionality of the federal law adopted last year, health care in America has changed in ways that will not be easily undone. Provisions already put in place, like tougher oversight of health insurers, the expansion of coverage to one million young adults and more protections for workers with pre-existing conditions are already well cemented and popular.

And a combination of the law and economic pressures has forced major institutions to wrestle with the relentless rise in health care costs.

From Colorado to Maryland, hospitals are scrambling to buy hospitals. Doctors are leaving small private practices. Large insurance companies are becoming more dominant as smaller ones disappear because they cannot stay competitive.

States are simplifying decades of Medicaid rules and planning new ways for poor and rich alike to buy policies more easily. But how to pay for these changes, and what will happen to the 30 million uninsured Americans the law intends to cover, will be up in the air if the mandate at the heart of the law the requirement that individuals buy health insurance or face a penalty is struck down.

The election results of 2010 and stiff state opposition to the mandate also complicate the picture. Hospital administrators, insurers and doctors are counting on federal subsidies and coverage expansion that would result in a surge of patients with insurance to offset cuts in government programs that many fear could soon become draconian. Large health systems could then use their newfound clout to demand higher prices from private insurers even as federal and state governments pay less.

Other changes influenced by the legislation may leave some patients and doctors lost in the new land of giants. As medicine moves from a cottage industry to one dominated by large organizations, some patients with insurance will probably find their choices more limited. But their care may be better coordinated, as hospitals, doctors and even insurers join to streamline services.

Hospital systems are anticipating a major influx of federal funds and patients as a result of the law. In Maryland, for instance, the Johns Hopkins Hospital and Health System recently bought two suburban hospitals and is spending several hundred million dollars on computer systems to link its clinics and hospitals across the state. It has hired hundreds of primary care doctors and nurses, forged partnerships with urgent care clinics and expanded home health service to serve an expected flood of new patients.

The law's passage was 'a statement that things need to change and that the status quo doesn't work,' said Paul Markovich, chief operating officer at Blue Shield of California, a health insurer based in San Francisco. 'It sends a loud message to all the players.'

So far, other requirements under the law have prompted state regulators, insurers and others to work with federal officials over new regulations.

For example, insurance companies now must spend at least 80 cents of every dollar they collect on health care for their customers, limiting how much they are permitted to spend on brokers' commissions, executive salaries and profits.

Federal and state regulators were granted greater authority to review insurers' proposals for raising premiums, and the federal government has already awarded the states about $155 million in grants to help their oversight efforts.

Some states are taking matters even further than the federal law, to adopt changes regardless of whether it is ruled void. 'What we've tried to do here in California is to take the provisions of the Affordable Care Act and put them in the state law so we can move towards implementation,' said Dave Jones, the state's insurance commissioner. He credited closer review of insurance rates for saving residents about $87 million a year.

There is no question that creating insurance exchanges that would provide coverage for more than 20 million uninsured Americans would be more difficult without the backing of the law. Peter V. Lee, a former Obama administration official who is heading the exchange effort in California, said the state already has rules that make it possible to create a marketplace for small businesses, but covering individuals without federal subsidies and a mandate would 'be a challenge for the system.' California has received about $40 million in federal funds for its efforts.

Large Migration Away From Employer Paid Health Unlikely

2011-11-14T17:29:00.000-08:00

In a recent Mercer survey only about 8% of employers believe they are "likely" or "very likely" to drop their plans and send all their employees onto the insurance exchanges. Small employers are more likely than large employers. Since employers still get a tax break on the health premiums and offering health plans helps them retain the top talent, most still plan to continue their health plans. Dropping coverage would also equate to a substantial pay cut for most employees. Raising pay to offset that expense would increase the workers comp and payroll taxes as well.

IRS Increases Retirement Plan Contribution Limits for 2012

2011-10-21T07:46:00.001-07:00

The Internal Revenue Service has increased the maximum pre-tax contribution limit for 401(k) and 403(b) retirement plans (also most 457 and federal government Thrift Savings Plans) by $500 from $16,500 to $17,000 as a result of cost-of-living adjustments.

The IRS said the catch-up contribution limit, currently $5,500, for those aged 50 and over remains unchanged.

The Social Security Administration also announced a cost-of-living increase of 3.6% in annual benefits. The amount of earnings subject to the Social Security tax will also increase to $110,100 from $106,800.

Limits were also increased on the Adjusted Gross Income for phase-out of Roth IRAs, IRA contributions covered by a workplace retirement plan and the saver's credit.

New Law - Mandatory Maternity

2011-10-12T07:56:00.000-07:00

Yes it is true, Governor Jerry Brown signed legislation (SB222) Thursday mandating maternity coverage on all health policies in California. Group policies have required maternity. But Individual and Family policies began eliminating the coverage to mitigate rising health care costs. Plans covering maternity are much more expensive and come with high deductibles.

The problem with creating a "law" mandating these coverages is the premium for all health plans will now go up. So even if your family is unable to have children, you will bear the cost of those that do. Insurance shouldn't be about covering the choices people make as much as covering the unexpected health issues that arise.

So in these tough economic times we will once again see our health premiums rise because of government intervention.

Tax On Health Benefits Buried in Jobs Bill

2011-09-27T19:46:00.000-07:00

Tucked on page 155 of the jobs bill is a provision to count a portion of the value of health benefits provided to high earners - individuals making more than $200,000 and families making more than $250,000 - taxable income.

The provision would take affect in 2013 and also proposes lowering the amount of out-of-pocket health costs high earners can deduct from their income taxes.

The bill seems to have little chance of passage but Republicans have indicated they're willing to work with the White House on certain provisions that would lower payroll taxes and extend unemployment benefits.

IRS Releases Guidance - Mobile Phones Tax Treatment

2011-09-20T12:50:00.000-07:00

IRS guidance explains a provision in last fall's Small Business Jobs Act of 2010 that removed cell phones from the definition of listed property, a category that normally requires taxpayers to perform recordkeeping.

IRS Notice 2011-72, issued Wednesday, provides guidance on the treatment of employer-provided cell phones as an excludible fringe benefit. When an employer provides an employee with a cell phone primarily for non-compensatory business reasons, the business and personal use of the cell phone is generally non-taxable to the employee. The IRS will not require recordkeeping of business use in order to receive this tax-free treatment.

Simultaneously with the notice issued Wednesday, the IRS also announced a similar administrative approach that applies to arrangement common to small businesses that provide cash allowances and reimbursements for work-related use of personally owned cell phones. Under this approach, employers that require employees, primarily for non-compensatory business reasons, to use their personal cell phones for business purposes may treat reimbursements of the employees' expenses for reasonable cell phone coverage as non-taxable.

This treatment does not apply to reimbursements of unusual or excessive expenses or to reimbursements made as a substitute for a portion of the employee's regular wages.

Strangest Things On An Application for Employment

2011-09-06T15:48:00.000-07:00

In a recent survey by CareerBuilder of the strangest things applicants have put on their resume include:

The more you paid him, the harder he worked

Just wanted an opportunity to show off his new tie

Included previous jobs he was fired from as references

Listed dog as a reference

Listed ability to do the moonwalk as a special skill

Included "versatile toes" as a selling point

Said he would be a "good asset to the company" but didn't include the et in the word asset

Included email address on resume which had "shakinmybootie" in it

Included that she survived a bite from a deadly aquatic animal

Used first name only on application

Insisted that the company pay him to interview with HR because his time was valuable

shipped a lemon with resume stating "I am not a lemon"

Included that he was arrested for assaulting his previous boss

Will Employers Drop Health Benefits In 2014?

2011-09-06T13:50:00.000-07:00

According to the Associated Press the White House has taken issue with the recent Towers Watson study showing 10% of employers will stop offering health benefits when the insurance exchanges become operational. This is the second such study to evoke the ire of the White House this summer. The June study by McKinsey & Co. found 30% of employers would either "definitely" or "probably" stop offering workers health insurance.

The Towers Watson survey showed in addition to the 10% that would drop coverage, another 20% admitted they were unsure what they will do.

Is your company planning on dropping health benefits?

Health Care Reform Dealt a Blow

2011-08-15T12:53:00.000-07:00

Friday, August 12,2011 an appeals court dealt a blow to President Barack Obama's health care law. The court ruled as "unconstitutional" the law's requirement that individuals buy health insurance or pay a fine, but upheld the rest of the law passed by Congress last year.

The lawsuits challenging the reform law will likely reach the Supreme Court next year.

So what does this mean. If the rest of the law continues without the individual mandate, premiums will likely skyrocket. Would you buy insurance prior to needing it if you could get without exemptions when you need it? So only the sick would buy insurance.

I have to believe Congress would recognize this problem and make the necessary changes to the law that would allow affordable health care for everyone. We'll have to wait until the final decision next year though.

An Ounce of Prevention

2011-07-28T13:51:00.000-07:00

Went to see my dentist today. When they looked at my chart and told me how long ago my last visit was, I was shocked. Life just seems to get in the way. I've been pretty good this year: physical-check, teeth-check, dermatologist is next.

We all know how important it is to have the scheduled preventive checks, insurance is paying 100% of most of these procedures. But we still have to take time off of work, and some tests require a commitment of a couple of days.

So how do we encourage our employees to have these important tests?

If you have an HSA you can reward the behavior with an additional contribution. You can give up to 20% more to individuals that have recommended preventive screenings.

You can also charge 20% more premium to employees that do not have an annual physical or other recommended screenings.

If you have voluntary benefits (think Aflac) your employees may also get a check for having the screenings done.

You could inform employees you will not dock their time for preventive medical appointments.

We all know the importance of having preventive screenings, but most of us still don't take advantage of them. Helping employees identify a problem may not only save their life, but save you substantial money. Having employees dealing with illness at work lowers their productivity. Catching chronic conditions early when they may be more easily treatable like diabetes or high blood pressure, could keep your employee well and productive.

Employers have an opportunity to drive the healthy behavior and benefit from it as well.

Dodge Illness During Air Travel

2011-07-13T17:00:00.000-07:00

Whether you're the frequent business traveler or finally taking that much deserved vacation, airplanes are loaded with bugs. The low humidity in an airplane dries out your nose and mouth, making you more susceptible to catching a virus says Mark Gendreau M.D., Vice Chairman of Emergency Medicine at Tufts University School of Medicine's Lahey Clinic in Burlington Mass. The airplane is loaded with influenza, staphylococcus and norovirus. And a trip to the bathroom can contain more bacteria including E.coli than any other public bathrooms including those in airports, restaurants and offices. So here are some tips to safeguard yourself:

1. Build up your resistance with plenty of sleep. Take immune-strengthening supplements like elderberry or North American ginseng extract, Vitamin D or Emergen-C Immune Defense with zinc and elderberry several days before traveling.

2. Hydrate! Drink plenty of water prior and on the plane. Increasing the moisture in your nose, mouth throat and eyes is a great barrier to infection. For an extra punch, drink electrolyte-loaded coconut water before your trip.

3. Declare germ warfare. Wipe down your seat-back tray, armrests and air and light buttons with antibacterial wipes. Turn on your overhead air vent and position it to hit in front of your face. The air current will literally push the germs away. Use hand sanitizer spray or wipes and a nasal spray containing xylitol that will prevent microbes from attaching tot he nose and curb ear infections in children.

4. Pass on airline snack food. Caffeinated and alcoholic beverages dehydrate you as does sodium. Sugar suppresses the immune system by feeding bad bacteria and making the lower digestive tract more acidic and hospitable to bad bugs. So avoid the peanuts and little liquor bottles. Instead eat lightly on the day you fly so you don't overwhelm your digestive system.

5. Cabins are pressurized to feel like you're at 5000 feet. So if you're used to living at sea level you might experience symptoms of mild altitude sickness such as nausea, headache and blocked ears. Many people take antihistamine to prevent ears being blocked. This doesn't reduce the stress on your ear and can dry out your nose (see #2) making it more susceptible to germs. Instead try chewing gum to open your Eustachian tubes and ease the pressure during ascent and descent. You can pick a gum with xylitol as well.

Wage and Hour Investigator Just Showed Up...What To Do?

2011-07-11T16:39:00.000-07:00

The U.S. Department of Labor (DOL) is responsible for ensuring that employers that are subject to federal laws comply with basic labor standards. The Wage and Hour Division (WHD) of the DOL is responsible for administering and enforcing not only wage and hour laws but also myriad other federal laws such as those laws related to child labor, garnishment, prevailing wages, OSHA field sanitation standards, and migrant and seasonal agricultural workers. A WHD investigator does not have to call an employer before he or she arrives at a work site. The purpose of these visits, per the DOL website (www.dol.gov/whd/regs/compliance/whdfs44.htm) is “to directly observe normal business operations and develop factual information quickly.”

Given that there may be a variety of reasons why the WHD shows up unannounced at your door, what should you do?

Let him or her in the door and be polite and civil. The WHD investigator is authorized under federal law to investigate if the employer under its jurisdiction. The WHD especially tends to target low wage industries or investigate a variety of industries within a specific geographic area.
Designate a company representative to interact with the investigator. You many want to consider using your attorney as a representative or having the representative consult with your attorney.
Demonstrate that you are cooperative and willing to assist the investigator.
Tell your managers that the investigation is occurring so that they know what to expect.
Don’t discourage your employees from cooperating with the investigation.
Know that the reason for the visit may be an employee complaint, however the investigator likely will not tell you anything about it because all complaints are confidential. Do not respond negatively in any way towards any employee who has filed a complaint.
Before you hand over any documents, make sure you understand the scope of what is being asked for and that you only include documents that are responsive to the request. Request that your attorney or accountant review everything before you hand it over.
Call your attorney or accountant. Employers have the right to be represented by an accountant or attorney at any point in the investigation process. Even after the WHD conducts an investigation and a violation is found, you have the right to present additional facts for consideration.
If you have concerns, conduct a wage and hour audit now either internally or with an experienced wage and hour attorney or human resources consultant.

Leslie McAdam is an employment litigator with Ferguson Case Orr Paterson LLP in Ventura, California. She can be reached at lmcadam@fcoplaw.com or (805) 659-6800.

IRS Changes Mileage Rate For Next Six Months

2011-06-27T10:45:00.000-07:00

The IRS has changed it's mind about raising the mileage rates. They made the announcement that effective July 1, they are increasing the standard mileage rate to 55.5 cents per mile (previous rate was 51 cents per mile) These rates will be effective July 1, 2011 through December 31, 2011. The other rates increased as well: Medical and Moving 23.5 cents per mile (previous rate was 19 cents per mile), Charitable 14 cents per mile (unchanged).

Congress Looking at Making E-Verify a Requirement

2011-06-21T12:38:00.000-07:00

The Legal Workforce Act (H.R. 2164) was introduced by Representative Lamar Smith (R-TX). The House Immigration Subcommittee held a hearing on the proposal June 15. The new bill would:

Replace the current paper I9 system with electronic eligibility check.

Mandatory E-Verify for new hires would be phased in over six month increments beginning with enactment: 10000 or more employees use E-Verify within six months of enactment, 500-9999 within 12 months, 20-499 within 18 months and 1-19 within 24 months.

Employees performing "agricultural labor or services" would only subject to an E-Verify check within 36 months of enactment. An individual engaged in seasonal agricultural employment would not be considered a new hire if the individual starts work with an employer for whom they had previously worked.

Preempts state laws mandating E-Verify but retains the ability of states and localities to condition business licenses on the requirement that the employer use E-Verify in good faith under the federal law.

Grans employers safe harbor from prosecution if they use the E-Verify program in good faith, and through no fault of their own, receive an incorrect eligibility confirmation.

Get App Happy - Apps to help you get healthy, wealthy and wise

2011-06-13T16:02:00.000-07:00

In the fast moving age of technology, there are many apps to help you track your fitness goals, count calories, improve your investing IQ. Here are a few:
Limeade available for iPhone and Android tracks your daily wellness goals, allows you to compete with friends can incorporate Company goals.
Mint lets you link your accounts, categorize expenses and budget.
LearnVest is similar to Mint with great links to articles
Fidelity See how much you need to save for Retirement
JogTracker provides Distance using GPS for variety of activities (jogging, hiking, walking) along with calories burned. Can be shared with friends.

GO GET UM!

New Bill to Revise HSA Provisions (Undo Some of Reform)

2011-06-06T07:05:00.000-07:00

Senator Orrin Hatch (R-UT) and Representative of the House Erik Paulsen (R-MN) have introduced a bill, The Family and Retirement Health Investment Act of 2011 which would give back some of the features to HSAs prior to Health Care Reform such as reducing the deductible limits of $2000 for single and $4000 for family coverage for small group plans, and remove the restrictions on the use of HSA and FSA dollars for the purchase of over-the-counter drugs. The bill would also "clarify the use of prescriptions drugs as preventive care... not subject to HSA plan deductible. Here are all the provisions:

Allow a husband and wife to make catch-up contributions to the same HSA

Remove the restrictions on the use of HSA and FSA dollars for purchase of over-the-counter drugs

Allow individuals to roll over up to $500 from their FSA account

Clarify the use of prescription drugs as preventive care that will not be subject to an HSA-eligible plan deductible

Reauthorize the use of Medicaid health opportunity accounts

Expand the definition of qualified medical expenses to encourage more exercise and healthier eating habits

Allow seniors enrolled in Medicare Part A to continue contributing to their HSAs

Allow for the purchase of low-premium health insurance and long-term care insurance with HSA dollars

Repeal the recently enacted deductible limits of $2000 for single coverage and $4000 for family coverage for plans sold to small employer groups

Allow purchase of COBRA coverage, long-term care insurance, and HSA qualified policies from an HSA.

See the entire bill here

The IRS Wants Your Thoughts

2011-05-26T15:32:00.000-07:00

The IRS wants to hear from business regarding the provisions in healthcare reform law...the shared responsibility mandate. But you have to submit by June 17, 2011. (link to submit: http://www.irs.gov/newsroom/article/0,,id=239023,00.html )

The mandate referred to as "Play or Pay" the shared responsibility provision would require firms with at least 50 full-time equivalent (FTE) employees to pay a penalty if they fail to offer workers healthcare coverage, the coverage is unaffordable, or doesn't provide minimum value; starting in 2014.

The IRS wants your input on definitions of: employer, employee, hours of service, proposed methods for calculating work hours for hourly and non-hourly, and other issues.

IRS Announces 2012 Cost of Living Changes

2011-05-26T14:53:00.000-07:00

The IRS has released the 2012 cost-of-living adjustments affecting Health Savings Accounts (HSAs). The HSA contribution limits and High Deductible Health Plan (HDHP) out-of-pocket maximums will increase slightly, while the HDHP minimum required deductibles remain unchanged.

The 2012 annual HSA contribution limit for individuals with self-only HDHP coverage is $3,100 (a $50 increase from 2011). The limit for individuals with family HDHP coverage is $6,250 (a $100 increase from 2011).

The 2012 minimum annual deductible for self-only HDHP coverage remains $1,200. Family HDHP coverage remains $2,400.

The 2012 maximum limit on out-of-pocket expenses (including items such as deductibles, co-payments, and co-insurance, but not premiums) for self-only HDHP coverage is $6,050 (a $100 increase from 2011). The limit for family HDHP coverage is $12,100 (a $200 increase from 2011).

For further details, please refer to the complete document, which is available on the IRS website at: http://www.irs.gov/pub/irs-drop/rp-11-32.pdf.

We're From The Government. We're Here To Help.

2011-05-17T11:46:00.000-07:00

The U.S. Department of Labor recently announced a free smart phone application designed to help employees independently track the hours worked and wages owed. The app allows users to enter their daily work hours manually or automatically using a timer, and to view and e-mail time reports. In addition to recording work hours and calculating basic hourly wages, the app includes a prominent "contact us" button, with links that allow users to easily call or send an e-mail to the DOL's Wage & Hour Division.

DOL's news release says: “Users conveniently can track regular work hours, break time and any overtime hours for one or more employers. This new technology is significant because, instead of relying on their employers’ records, workers now can keep their own records. This information could prove invaluable during a Wage and Hour Division investigation when an employer has failed to maintain accurate employment records.”

According to Secretary of Labor, Hilda Solis, she is “pleased that my department is able to leverage increasingly popular and available technology to ensure that workers receive the wages to which they are entitled . . . This app will help empower workers to understand and stand up for their rights when employers have denied their hard-earned pay."

The app is currently available for Apple with Android and Blackberry versions to come. The program encourages employees to keep what amounts to a separate set of books raising a host of potential questions including: should rest breaks be tracked by employers, is this reliable evidence in a wage and hour claim, and will this impact the burden of proof in a claim.

Finding The Right Solution to Health Care

2011-05-15T08:41:00.000-07:00

We're all reeling from the constant rise in health care costs. The tax breaks afforded to small businesses have just kept us even with those increases and offered no real relief. As with many of the economic issues we face, the right answer is also the most difficult and sometimes uncomfortable one.
In California, our politicians (bless their hearts) are trying to help by passing yet another bill (AB52) which would require the Department of Managed Health Care and the Department of Insurance to review any rate changes and would prohibit them from approving any rate change that is found to be excessive. It would also allow them to go back to January 2011.
While it's easy to vilify the Insurance Companies for the premium increases we receive, remember we have already required them to provide all preventive procedures at 100% coverage, remove all lifetime maximums, guarantee issue all children, cover adult children to age 26 and spend between 80-85% of all premium dollars on health services. So thinking about your business for a moment.....if California told you they would review your contracts with customers and determine if they were fair and reasonable, what would you do?
Many carriers may move from the state reducing competition here and perhaps subjecting us to the single payer plan that most of us do not want. Remember a good portion of your health care cost already goes to subsidize Medical which doesn't pay it's fair share. So I personally lack the confidence Government can provide a viable health care solution.
The long term solution is to provide a system to promotes healthy behavior, manages disease early and effectively, and puts the power and responsibility back on the individual. But that also requires work on our part.

All Employers Must Have Written Injury/Illness Prevention Program

2011-05-02T16:27:00.001-07:00

Many employers believe they are too small to be required to have an Injury/Illness Prevention Program (IIPP). All Employers are required to have this policy. The exceptions for small employers are in the details required. For example employers with fewer than 10 employees:

are permitted to "communicate to and instruct employees orally in general safe work practices with specific instructions" to hazards unique to the employees' job.

maintain inspection records only until the observed/known hazard is corrected in lieu of maintaining records for one year

Employers with fewer than 20 employees that are not designated on the high hazard list and who have a Workers' Compensation Experience Modification Rate lower than 1.1 percent and are on a designated List of Low Hazard Industries may limit their written documentation to the following items:

The identity of the person(s) with authority and responsibility for program implementation as required by Title 8 California Code of Regulations Section 3203(a)(1).

Schedule periodic "inspections" to identify unsafe conditions and work practices as required by Section 3203(a)(4).

Training and instruction provided to employees as required by Section 3203(a)(7).

Additional information regarding requirement and exceptions can be found at www.dir.ca.gov/dosh/etools

Interview Questions That Tell You Everything You Need To Know

2011-04-25T17:41:00.000-07:00

We've all wondered "what can you ask" in an interview. And how will I get to the info I really need to know. Here are 5 questions that will give you some insight:

Thinking about your last position, how soon after you started did you consider yourself a productive employee?

Tell me about the last goal you set for yourself? What challenges did you face? Did you meet it?

If I call your last supervisor, what do you think they would say your two greatest strenghts are? Your two greatest weaknesses?

Tell me about something you really tried to accomplish but failed.

What really motivates you to go the extra mile on a project?

So maybe they wont tell you "everything" you need to know. But they will give you some great insights into the personality of your interviewee.

Health Costs Shifting to Individuals - Need Favorable Tax Treatment

2011-04-25T12:24:00.000-07:00

As health care becomes more expensive, much of the expense is shifting to the employee and individuals. The success of Consumer Directed Health Plans (CDHP), Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA), tools that allow employees to pay their out-of-pocket expenses with pre-tax dollars have been very popular. Consumers are starting to see the value in saving money and paying their own way. This is the behavior we all want since it could curtail the ever growing cost of health care.

However the recent Health Care Reform (Patient Protection and Affordable Health Care Act) set limits on the annual contributions to FSAs at $2500 and requires a prescription for over-the-counter drugs in both FSAs and HSAs making it more difficult for the consumer.

The Employers Council on Flexible Compensation (ECFC) is fighting to repeal these two parts of the health care reform as well as the use-it-or-lose-it system of the FSA. “They’ll use a more expensive prescription medication because you’ve removed the convenience of the over-the-counter medication,” explains Allen Wishner, a board member for the ECFC and CEO of Flexible Benefit Service Corp.

Getting rid of the use-it-or-lose-it condition would benefit the consumer, he adds. “It would take the guess work out for people with chronic conditions. It would allow them to maximize the benefit, and if they don’t use the money, the funds would be subject to income tax, just as it would be without it,” he says.

President Signs to Repeal Expanded 1099 Reporting

2011-04-19T15:47:00.000-07:00

President Obama signed legislation Thursday, April 14 repealing the expanded 1099 report requirements in the health care reform law. “This is a big win for small businesses,” wrote SBA Administrator Karen Mills in a blog post. “The SBA and President Obama supported repealing this provision, which would have required businesses to send 1099 forms for all purchases of goods and services over $600 annually. With this bipartisan effort, we have removed a requirement that would have been an undue barrier to small business growth....."

Quick Calculator for Retirement Contributions

2011-04-12T08:27:00.000-07:00

Want to know how much your 401(k) contribution is going to cost you? Here's a great tool from Fidelity that calculates the reduction in your Take Home Pay for your pre-tax contributions to a retirement plan. https://401k.fidelity.com/public/content/401k/Tools/TakeHomePayCal

IRS Offers Small Employers Relief from W2 Reporting of Health Premium

2011-04-05T16:56:00.000-07:00

The Affordable Care Act provides that employers are required to report the cost of employer-provided health care coverage on the Form W2. Notice 2010-69 issued last fall made this requirement optional for all employers for the 2011 Form W2. IRS notice filed March 29, 2011 provided further relief for smaller employers (those filing fewer than 250 W-2 Forms) by making this requirement optional for at least 2012 and continuing this optional treatment for smaller employers until further guidance is issued.

Taxes To Promote Healthy Behavior

2011-04-05T08:08:00.000-07:00

Taxing vice is nothing new. Arizona's cash-strapped Medicaid program is considering charging patients $50 a year if they smoke, have diabetes or are overweight. The fee is intended to push patients to keep themselves healthy. One part of the proposal affects people with diabetes. Diabetics who fail to follow their doctor's orders to lose weight would be subject to the $50 charge. Some private employers and state governments have instituted higher premiums for workers who are overweight or smoke. Arizona's plan would be the first time a state-federal health care program for low-income residents has charged people for unhealthy lifestyles.

2011 Mileage Reimbursement Rate Could Go Up!

2011-03-31T19:07:00.000-07:00

Gas prices have risen almost 20% since the IRS set the 51 cent a mile reimbursement rate for 2011. Congressman Sam Johnson (R-Texas) recently sent a letter to the IRS and asked the agency to raise mileage rates to reflect the recent spike in prices at the pump. Johnson says taxpayers and small businesses "deserve rates that reflect the current cost of travel."

Small Businesses Still Confused about Healthcare Reform

2011-03-25T14:36:00.000-07:00

Los Angeles Times wrote that a year after Healthcare Reform was signed, small business in California are still unaware of provisions in the law. The survey of more than 800 businesses with fewer than 20 employees found that 57% are unfamiliar with new tax credits in the law that small employers with low payrolls can claim to offset the cost of an employer-provided health plan. 62% didn't know about new state regulated insurance markets or exchanges to be created by 2014. Nearly half of the small businesses surveyed said they feel negative about the new law.
It should be noted that many small business owners feel Healthcare Reform increased the cost of healthcare beyond the benefit of the tax credit.

Restrictions On Retroactive Termination Under PPACA

2011-03-14T15:51:00.000-07:00

Health care reform law puts new restrictions in place for terminations. To summarize:
Plan Sponsors cannot terminate coverage retroactively if:

Member was covered through plan error and
Member paid premium or contributed to the cost of the plan

Plan Sponsors may terminate retroactively if:

The member did not pay any premium or contribution for coverage past the termination date.

Carriers will be reviewing terminations more closely and employer groups may need to provide additional information for termination requests with dates that have passed.

IRS asks for $62 Million to Ready for PPACA

2011-03-14T12:59:00.000-07:00

The IRS is asking for $62 million to prepare for the coming Patient Protection and Affordable Care Act (PPACA) provisions. The cost would cover implementation of the provision that establishes shared responsibility payments for both individual and employers. The initiative will fund the development of the necessary information technology, infrastructure and systems....according to Douglas H. Shulman, IRS Commissioner. "The IRS has significant information technology development work that must be completed in order to administer these provisions. The vast majority of the resources that IRS will require between now and 2014 will be dedicated to technology and associated business process design required the effectively administer these new provisions."

Shulman addressed what the plan means to employers: "The IRS will administer the employer responsibility payment for large employers who do not offer affordable coverage, and have at least one employee who received subsidized coverage through the exchange. This provision closely intersects with the rest of the exchange provisions, and we are working closely with the Department of Health and Human Services and the Department of Labor to reach out to the employer community, understand what questions and issues they foresee, and incorporate the feedback that we get..."

Wellness Programs Improve Health and Lower Cost

2011-03-01T14:44:00.000-08:00

American workers say the top reason they participate in a wellness program is better overall health (43%) according to the latest Principal Financial Well-Being Index. Other reasons include reduced health care costs (33%) and greater chance of living longer healthier lives (31%).

The survey also found that more than half (53% of workers use weight management programs offered by their employers. Nearly half (48%) of workers surveyed said wellness benefits encouraged them to stay in their current employment situation and 43% said that wellness benefits motivated them to work harder and perform better.

Wellness Programs: A Series

2011-02-18T17:38:00.000-08:00

This is the first in a series of articles on Wellness Programs. Below describes some financial resources available. Future articles will discuss what other employers are doing and also some programs available to assist you in design and implementation.
The Patient Protection and Affordable Care Act signed into law on March 23, 2010 provide significant funding for wellness initiatives. Among the initiatives is the Wellness Grant for Small Business (less then 100 employees) that did not have a wellness program in place prior to the enactment of the Health Care Reform Laws. To qualify for the grant, the wellness program must be comprehensive and contain at least the following components:
1. Health awareness initiatives, including health education, preventive screenings and health risk assessments.
2. Efforts to maximize employee engagement and mechanisms to encourage employee participation, such as financial incentives
3. Initiatives to change unhealthy behaviors and lifestyle choices, which may include coaching or counseling seminars, online intervention programs and self-help education materials.
4. Supportive environment efforts, including workplace policies to encourage healthy lifestyles, healthy eating, increased physical activity and improved mental health.
The grants which being in 2011 will be available through the U.S. Department of Health and Human Services (HHS). At this time we do not know the application process or how much will be available per employer. That should be clarified later in the year. But we do know so far $200 million has been allocated in the federal budget for this program.
Also scheduled to be offered is technical assistance to employers (regardless of size) to train staff on how to evaluate their existing wellness program. This assistance will include offering evaluation resources and consultation through web portals and call centers.

105 Million in U.S. Have Diabetes or Prediabetes says CDC

2011-01-27T09:49:00.000-08:00

105 Million in U.S. Have Diabetes or Prediabetes says CDC

Diabetes now affects nearly 26 million Americans of all ages and 79 million people have what doctors call "prediabetes," according to 2011 estimates released Wednesday by the U.S. Centers for Disease Control and Prevention.

The vast majority of cases of diabetes are type 2, which develops when the body's cells gradually lose sensitivity to insulin.

According to experts, there's one very big reason for type 2 diabetes' continuing rise among Americans -- weight gain.

The 2011 diabetes incidence estimates mark a continued rise. In 2008, for example, the CDC estimated that 23.6 million Americans (7.8 percent) had diabetes and 57 million adults had prediabetes.

Still, "these distressing numbers show how important it is to prevent type 2 diabetes and to help those who have diabetes manage the disease to prevent serious complications such as kidney failure and blindness," Ann Albright, director of CDC's Division of Diabetes Translation, said in an agency news release.

"We know that a structured lifestyle program that includes losing weight and increasing physical activity can prevent or delay type 2 diabetes," she added.

Diabetes is the seventh leading cause of death in the United States and now costs $174 billion a year, including $116 billion in direct medical expenses, according to the CDC. People with diabetes are at increased risk for heart attack, stroke, high blood pressure, kidney failure, blindness and amputation of feet and legs.

"With more patients, there are more costs. But even the cost per patient has gone up," Resta said. "Newer diabetes medications are expensive, often 10 times the cost of older generic medicines. When patients are diagnosed younger, they are more likely to eventually require multiple diabetes medications, which also drives up costs. Also, the longer the duration of diabetes, the more likely the patient is to have [expensive] complications."

If current trends continue, as many as one in three American adults could have diabetes by 2050, predicted a CDC study published last year.

Top 10 Most Expensive States For Individual Plans

2011-01-25T20:56:00.000-08:00

Below are the top 10 most expensive states in which to buy individual and family health insurance:
Individual coverage

Alaska – $6,047
Massachusetts — $5,268
New Hampshire — $5,227
Wisconsin — $5,132
New York — $5,121
Maine — $5,119
Washington, D.C. — $5,082
Rhode Island — $5,059
Vermont — $5,001
Delaware — $4,955

Family coverage

Massachusetts — $14,723
Wisconsin — $14,656
Vermont — $14,558
Wyoming — $14,319
Washington, D.C. — $14,222
Alaska — $14,182
Connecticut — $14,064
Louisiana — $13,846
Maryland — $13,833
New Hampshire — $13,822

Nondiscrimination Provisions of Health Reform

2011-01-12T14:29:00.000-08:00

Under the Patient Protection and Affordable Care Act (Health Reform), fully insured group health plans may not have rules/criteria for member eligibility or benefits that have the effect of discriminating in favor of highly compensated employees (non-grandfathered plans). This was to become effective for plan renewals and effective dates after September 23, 2010. However on December 22, 2010 the IRS issued Notice 2011-1 delaying enforcement. Prior guidance indicated the rules for determining compliance were to be similar to the rules for self-insured plans. The new notice acknowledges that plans will need more details to comply with this provision adequately.

The notice states that:

· The Treasury Department and the IRS, as well as the Departments of Labor and Health and Human Services will not require fully insured plans to comply with the nondiscrimination provisions until after regulations or other administrative guidance of general applicability is issued.
· When this guidance is issued, it will not be applied retroactively.

The comment period for this notice continues through March 11, 2011. Therefore, we assume further guidance will be issued no earlier than that date. We'll provide more details to you when the new guidance becomes available.

Ideas About America's Best Health Care System

2011-01-04T07:05:00.000-08:00

Recently I read an article (in a Health Insurance Agent trade magazine no less) that discussed a variety of studies from 2003 to 2010 by various states. The Studies were done by such groups as The New England Journal of Medicine (2003) The Annals of Internal Medicine (2004) and The Journal of Surgical Research (2009). In these studies the Veteran's Health Administration provided both lower-cost and better-quality care than Medicare or other private-sector health care organizations.

Ok I'm not ready to throw in the towel on our Private Health Care System. But there were some great points in this article. Mainly that the Veterans Health Administration views their relationship with patients as a "lifetime" relationship. We've been preaching that the cure for rising health care costs is to better educate and incentivize our insured to be healthy. We know that a healthy workforce means better productivity and fewer employees either at work feeling poorly or absent....blah blah blah. We also don't view our employees as lifetime employees. So our incentives often fall short of really educating them to be healthy for a lifetime.
So here are some statistics for you to chew on: Veterans as a group are older, sicker and poorer than the U.S. population as a whole. They are more prone to mental illness, homelessness and substance abuse. About half are over age 65. More than a third smoke, about twenty percent have diabetes (compared to seven percent of U.S. residents in general) and they have a much higher percentage of chronic diseases (Alzheimer's, cancer, sclerosis of the liver etc.). But the VA's cost per patient was $7532 vs. average for all Americans of $8160 in 2009. Oh and from 1995 to 2003 the VA increased it number of patients treated by 75% with only a 32% cumulative increase in its budget.

So how do they do it! Two things really stand out. First they have a Rockin state-of-the-art medical records system. This internally designed information system bundle of over 20,000 software programs written primarily by individual Va physicians and is "open source". This program has dramatically improved patient safety at the VA and has helped physicians develop medical protocols based on hard data. Second the lifetime relationship with patients creates a different economic focus. Investing in chronic disease control could mean huge future savings where in the private sector investing in chronic disease control means short term cost. The VA has an incentive to invest in prevention and chronic disease management to keep people out of the hospital where as a fee-for-service hospital's cash flow would drop. The VA might for example include different and more expensive drugs in it's formulary if they were more effective because of it's long term patient view.

Can Americans influence the drastic change in our private health care system to reward healthy behavior? Incentivize Primary Care Physicians and patients to take better care early? Should Employers shoulder this burden? We are asking our readers (local small businesses) to tell us what programs they have instituted to drive healthy behavior in their workforce (carrot and/or stick). The results will be summarized here and sent out to all our readers. Please participate. We would love to hear about programs that have worked.

Auto 401(k) Enrollment -- Participation soars to as much as 90%

2010-12-08T20:38:00.000-08:00

Despite the recession, evidence shows that automatic enrollment-where employees participate in the 401(k) plan unless they opt out- is a very effective way to increase both participation and savings. Employers are discovering that automatic features are very popular with employees, making employers that have adopted them more attractive, thus increasing the ability of these employers to recruit and retain employees. Simple mechanisms like automatic enrollment and escalation enable employees to build the retirement security that they will eventually need, while feeling more secure now because they have savings. Companies using automatic 401(k)s have seen employee participation rates soar--often to well above 90 percent--especially among the lower-income and minority workers who are often left behind. Full article Employee Benefit News

Average 401(k) Participant Can't Afford Retirement Until 73

2010-12-07T20:11:00.000-08:00

The average 401(k) participant needs to work until age 73 to be able to afford retirement according to an analysis of 10,000 accounts by employee benefits consulting firm Nyhart. Nyhart found that only 19% of the employees will be able to retire by age 65.

Flu Shots Save Employer Money

2010-11-29T07:15:00.000-08:00

According to a recent study reported in the Los Angeles Times Flu vaccinations for employees can help an employer's bottom line. Research found each employee vaccinated can save employer $63 to $95 per person.
The study analyzes the cost of providing flu vaccine to employees and the cost in terms of absenteeism and lost productivity from having some workers out wit the flu. The key is to immunize workers early.
You don't need to set up a vaccine clinic, you can purchase "prepaid flu care card" through Citi or identify a pharmacy in your area.
Jury's out as to whether or not you can make shot mandatory. But you can use the "carrot and stick" method by charging employees who fail to get shot more premium than those that do (up to 20%).

Assisted Living Benefit for Veterans

2010-11-27T07:42:00.000-08:00

The Veterans Aid and Attendance Benefit can provide around $2000 a month to pay for all types of medical care, including hospital and doctor care, and also home health assistance. Veterans serving during a declared war including WWII, Korea, Vietnam, Iraq and Afghanistan my be eligible if he or she is 65, discharged other than dishonorable and had 90 days of active duty with one day during wartime and needs help with daily living activities because of health issues.
There are some other minor criteria (dates war was declared, income eligibility guidelines etc.) Monthly benefits range from $2540 for two married veterans, $1949 for a veteran with a dependent spouse, $1644 for a single and $1056 for a surviving spouse.
Using available veterans' benefits can pay for medical expenses or for an assisted living facility and protect the family's nest egg. The Veterans Aid and Attendance Benefit is completely separate from Medicaid.
Visit www.vaausa.com, or http://www.va.gov/

Fed Up with Health Care Costs?

2010-11-23T08:12:00.000-08:00

We've heard repeatedly that most of our health care costs come from controlable diseases (Diabetes, High Blood Pressure, Heart Disease). Problem is most people don't manage their health but instead seek treatment when the problems escalate. A recent survey by Towers Watson brings this fact home when 57% of those surveyed said they'd tried to take better care of themselves. 33% went to the doctor for only more serious conditions.
Somehow we're not getting the message out!
We've made preventive 100% covered, tried the HMO model to promote the family physician model, launched Health Savings Accounts/High Deductible plans trying to encourage the savings associated with good health. Still nothing.
It shouldn't be the responsibility of the employer to manage the health of our employees. But since we bear a greater portion of the cost, this is where we find ourselves. It has to be the carrot and the stick method and it looks like the stick needs to be bigger! We only have 20% to play with, but we can charge employees 20% more for their health insurance if they fail to get an annual physical or complete a health evaluation (independent of course).
We'll be asking our network of employers what they've done and be letting you know their successes shortly.

Amendment to Regulations on "Grandfathered" Health Plans

2010-11-16T15:46:00.000-08:00

The purpose of the grandfather regulation is to help people keep existing health plans that are working for them. Previously, one way employer group health plans could lose their grandfathered status was to change insurance company. Today's amendment allows all group health plans to switch insurance companies and shop for the same coverage at a lower cost while maintaining their grandfathered status, so long as the structure of the coverage doesn't violate on of the other rules for maintaining grandfathered plan status. For more details visit http://www.hhs.gov/ociio/regulations/grandfather/factsheet.html

Debt Reduction Proposal Could Decimate 401(k)s

2010-11-12T15:23:00.000-08:00

The federal government is looking for any way to raise income. It appears everything is on the table; mortgage interest deduction, social security income, deductible contributions to 401(k) plans. I've seen many recent articles suggesting the recent downturn has forced savers to raid their 401(k) plans now to keep their homes etc. Many face a steep uphill climb towards retirement trying to make up the shortfall. In all likelihood the lack of deductibility of their contributions would disincentivise many savers.
It will be interesting to see how all of this shapes up. There is a large population in the 50-60 year olds who fell in the crack between pensions and self directed plans. With these new plans coming later in their lifetimes, they haven't had the opportunity to save as much. Certainly not the amount needed to provide the significant portion of their income that the company pensions once provided. If they've found themselves drawing down their 401(k)s, they may not have the time to recoup. And the tax ability of those contributions is just another hit most cannot absorb.

Top 5 Healthiest Fast Food Joints

2010-10-27T22:01:00.000-07:00

Health magazine recently took a look at the nation's 100 largest fast food chains to find out which were the healthiest. They scored based on use of healthy fats, sodium counts, availability of nutritional info and use of organic produce. Drum Roll.....and here they are:

Panera Bread
Jason's Deli
Au Bon Pain
Noodles and Company
Corner Bakery Cafe

Honorable mentions include Chipotle, Atlanta Bread, Einstein Bros., Bagels, Taco Del Mar and Mc Donald's. Yes Mc Donald's came in 8th (Not the Big Mac). This chain's has added grilled chicken wraps, salads with low-fat dressing and parfaits.

Now For 10 Least Stressful Jobs

2010-10-18T07:54:00.000-07:00

Here is a list of the 10 least stressful jobs from Money and PayScale.com's list of America's best jobs.

Biomedical Engineer - These Pros embrace the fact the tools they're creating save lives. There is also plenty of downtime and flexible schedules.
Transportation Engineer - They get to interact with people and because traffic is always an issue, there are projects on the docket reducing fear of job loss.
Statistician - A balance between individual and group work, work in a variety of environments, developing solutions to complex problems, oh and a nice paycheck.
Web Developer - Hard work but also fun and freedom. Deadlines are weeks or months away and companies tend to reward website creators with parties and other freebies.
Geographic Information Systems Analyst - In emergencies there can be some stress, but ordinarily assignments might be suggesting ideal locations for stores or forecasting flood zones. Decent job security.
Technical Writer - These writers have autonomy, work as their own project manager and even get to interact with the product during development. Projects start months in advance so a tight deadline is minimized.
Test Software Development Engineer - It is easier to relax when your job mirrors what you would nor mall do for fun. Coding new commands or testing for software bugs, these tasks that engineers tend to enjoy makes this a rewarding career.
Marketing Consultant - These professionals enjoy independence and flexibility. The need to line up jobs can be stressful. But the chance to work with company leaders and dive into new businesses keeps things interesting.
Civil Engineer - Similar to traffic engineers, civil engineers design infrastructure. They say there's no better feeling than seeing something you thought of working just as you planned. With the chance to work anywhere (government, private sector or academia) and in any city lets them handpick their assignments.
Optometrist - They can work in a group, start a solo practice, teach or do research. There is a sense of accomplishment in helping someones troubled eyesight.

10 Careers With High Depression Rate

2010-10-14T14:20:00.000-07:00

Health.com recently released it's list of "10 Careers With High Rates of Depression" based on reported incidents.

Nursing home/Child Care 11% report some incident of anxiety or depression. Employees of both are dealing with patients/clients that require constant attention. Employees encounter people unwilling or incapable of expressing gratitude for their hard work and dedication. Nursing home employees are constantly dealing with death.
Food Service comes in second with 10%. Requiring fast-paced hours, tremendous criticism and little compensation.
Social Workers deal with hard luck cases and a lot of them lie or manipulate. They also deal with a lot of cases that end tragically.
Healthcare workers deal daily with death, loss and pain.
Artists, entertainers and writers. It's said that 95% of actors look forward to a wonderful career as bartenders or waiters. These professions have constant rejection, rare successes and little compensation. 7% have depression.
Teachers are constantly embroiled in the lives of their students, at odds with administration and income plateaus as demand continues to grow.
Admnistrative staff depended on to respond to every little problem yet blamed by upper management when something is missed. Compensation isn't great.
Maintenance workers Never hear they've done a good job and most people they deal with are angry, impatient and demanding. Get the dirty jobs no one else would attempt.
Financial advisors Stress of working with peoples most prized posession - money. Clients don't care about economic collapses or market fluctuations, still expect to see positive returns.
Salespeople every day is a new challenge. Your only as good as your last months commissions. Daily rejection and the feeling of being on a constant wheel.

On The Topic of Productivity

2010-09-27T15:04:00.001-07:00

First I want to thank all of you that responded to our question. We hope you’ll continue to participate in upcoming requests. The power of over 2000 local businesses providing their insight into issues we all face is so powerful. So here are some of the responses we got.
One company responded they use a log sheet tracking “attempts, contacts, leads, appointments” each week for their sales team. By tracking the numbers they can tell where a person needs help. They know their industry can average 7-10 leads from every 100 contacts.

One response was a point goal set daily. You would assign a task points with the goal of achieving 20 points a day. This system could be customized for different job classifications.

Randy of Make IT Work uses a combination of “new school….old school” managing tools. By using a Proprietary system designed for their business, a daily report/matrix noting goals/production to date with daily commentary and Face to face review.

On the subject of improving employee performance, Elliot Sturman of http://www.workscorecard.com/ was kind enough to weigh in with their innovative software solution. Work Scorecard allows business owners and/or managers to generate an overall performance score for every employee every work day much like an athlete’s game score.
The score can be developed using the following framework: Quality + Timeliness + Productivity = Overall Performance. In other words, if we know how well the work was done (Quality) and if it was done on schedule (Timeliness) and at a reasonable cost (Productivity) we will have a good sense of how successfully the job was done overall.
As Elliot explained it to me, the quality, timeliness, and productivity indicators used to measure any given job can be composed of existing metrics, new metrics, or a combination of both which Work Scorecard can help you craft.
Employees can instantly check their individual scores and their rank in comparison to their peers. For example an attorney could log in to see they were averaging a 4.2 out of 5.0 today and could even see the name of the attorney having the highest score of the day.
In addition to its potential value in improving the productivity of your team, I know of many companies dealing with commute times, employee home life issue etc. which would welcome a method of measuring output that would allow their workforce more flexibility. This may be one of the answers to this issue.

Lastly, we use Outlook Tasks. The beauty of Outlook Tasks is you can drag an e-mail to the task bar in Outlook, assigned the task to a staff member with a date for completion, instructions, include attachments and it stays in your task list under the assigned person's name. For work flow, this gives me a sense of security that jobs I assign will not get lost in the shuffle. I can then go over the task list with my employees as often as I need to.

With Health Care Reform comes Notices...

2010-09-21T07:38:00.000-07:00

Changes to your Health Plans isn't all that's required. Employers must provide notices to go along with the reform. Here are four:

Notice of Grandfathered Status. If your plan is maintaining it's grandfathered status, you are required to tell your participants.
Notice of Special Enrollment/Lifetime Limits. The law bans health plans from putting lifetime limits on the dollar amount of health care coverage. Employees who have reached their limits must now be given a special enrollment notice indicating they are eligible for coverage.
Primary Care Designation and OB/GYN Notice. Employee has the right to designate a primary care physician to coordinate their health care. Female employees can obtain OB/GYN care without prior authorization (think most of us have already been doing that).
Notice of New Dependent Eligibility Rules. Health Plans must now offer coverage to participant's dependent children under the age of 26. Participants must be notified their dependent children are now eligible for enrollment.

You may be able to get these notices from your insurance carrier but it is the employer's responsibility to make sure they get to participants.

Reporting Health Care Premiums on W2s

2010-09-20T16:38:00.000-07:00

Beginning tax year 2011 employers will need to include the total premium for health benefits on the employee's W2. This is for information purposes only and does not effect the employee's tax liability (for now). Employers do not have to itemize employer vs employee premium paid, nor do they have to itemize the types of coverage (ie. dental, medical etc.). Contributions to Medical Savings Accounts (MSAs) Health Savings Accounts (HSAs) Flexible Spending Accounts (FSAs) as well as long-term care, disability, accident insurance or specific disease and/or hospital indemnity plans do not need to be reported. The applicable employer-sponsored coverage that must be reported include:

Medical plans
Prescription drug plans
Executive physicals
On-site clinics providing more than de minimus care
Medicare supplemental policies
Employee assistance programs
Dental, Vision (unless stand-alone) plans

Employers have until January 2012 to calculate the premium. Since many employees are not immediately eligible or due to terminations mid year, the numbers will need to be tracked. Some companies are looking into updating their payroll systems to track this information.

You may need to track this information for former employees also. It may apply to employees such as retirees, terminated on COBRA or surviving spouses. The IRS has not yet issued guidance on these reporting requirements.

To Grandfather or Not to Grandfather

2010-09-07T10:50:00.001-07:00

What are the benefits of having a grandfathered plan anyway? Well, "grandfathered" plans are exempt from the provisions adding certain preventive benefits without charging consumers and Non-discrimination testing of benefits based on wages.

Even grandfathered plans will be subject to most of the changes to health care:

Elimination of Pre-existing condition limitations for children
Elimination of maximum lifetime benefits
Dependent coverage to age 26
Rescission of coverage
IRS W-2 reporting of value of coverage
Health FSA annual contribution limit to $2500
Medicare tax increase on wages over $200,000
Waiting periods limited to 90 days: Essential Health Benefits

Lose your grandfathered status by reducing employee health benefits, changing insurance carriers or increasing co-pays or deductibles (Co-pays by $5 or raising co-pays or deductibles by the rate of medical inflation plus 15%). You cannot reduce the amount the employer contributes by more than 5%.

90% of the companies surveyed recently said they plan to lose their grandfathered status by 2014. Even the feds admit that grandfathered plans are likely to vanish. According to Department of Health and Human Services estimates, 34% to 64% of large businesses' plans will no longer be grandfathered in 2013. That number skyrockets to between 49% and 80% amount small businesses.

We have seen the loss of grandfathered status across the board for small groups in our business. With premiums rising in excess of 15% and the increase of co-pays on most plans, small groups have been forced to abandon their plans to control cost. The idea you could "keep your existing plan if you want to" is really a sham since health care reform did little to control the cost and may even have increased it.

Health Reform - No Discrimination Based On Compensation

2010-08-30T08:02:00.000-07:00

Among the Health Care Reforms taking place September 23, 2010...plans may not discriminate in favor of highly compensated employees. This means that group health plans cannot base eligibility or the level of benefits on an employee's wage. The group can offer different levels of benefits as long as they comply with ERISA and are not tied to the amount an employee makes. The legislation defines highly compensated as:

One of the five highest paid officers
A shareholder owning more than 10%
Among the highest paid 25% of all employees (some exceptions)

It appears we can still offer different eligibility. The health care reform law "nondiscrimination by compensation" provision is specific to the benefit offerings of a medical plan and not the waiting periods established by a company.

What Do Successful Wellness Programs Have In Common

2010-08-12T17:49:00.000-07:00

Successful Wellness Programs might have a few things in common:

They emphasize better health not just weight loss. Helping your employees feel better including fitness and stress reduction rather than programs that just address how they look.
Convenient, Convenient, Convenient. Giving employees easy access to tools including nutritional guides and sites, exercise plans, and programs like smoking cessation, weight loss etc.
Management embraces the program. Having your top people on board is essential.
Incentives/Penalties. Offer discounts on health premium, paid gym memberships, bonuses for healthy behavior or program completion. If your company can't afford those things, get creative. Recognition goes a long way along with a small token like front parking space, 1/2 day off, picture in lobby.

Help Employees Stay Healthy

2010-08-10T20:23:00.001-07:00

Many employers have tried to put together incentives for Wellness. We've talked about the ability to incentivize employees by as much as 20% of the health premium. Which means you can charge 20% more to employees that don't complete certain tests (smoking cessation, biometrics, annual physical etc.) or benefit employees that do. Many large corporations have allocated budgets to Wellness programs. But small employers don't have the resources to allocate to a robust Wellness Program and many of the outsourced ones are expensive. Anthem recently rolled out the 360° Health® Wellness Calendar with timely health issues and solutions.

Each month the calendar features a different health topic with links to relevant programs and tools. For example August is National Immunization Awareness Month. Simply click on "National Immunization Awareness Month in the August square and the calendar links you to U. S. Government Center for Disease Control and Prevention (CDC) website with information about various vaccines.

The calendar also provides access to professionally developed wellness materials and resources to help employers communicate with employees. In August for example, employers can find articles on flu shot recommendations they can send to their employees. They can also download flyers to distribute or post in break rooms.

Check it out at http://wellnesscalendar.anthem.com/

1099 Information Reporting Will Change...But How

2010-08-09T06:50:00.000-07:00

When the Patient Protection and Affordable Care Act (Health Care Reform) was passed it included expended 1099 reporting requirements for businesses. Basically it required everyone to report via 1099 when they spent more than $600 at a vendors. Can you imagine the number of 1099s that Starbucks would receive?

After much screaming from business groups about the increased burden on business, many of our Congress are drafting bills that include provisions to repeal or revise the provision.
The Small Business Jobs Act (which was recently squelched by Republicans) has been amended to include a modified version of the Republican amendment to repeal the 1099 filing requirement.

Senator Mike Johanns, R-Neb, recently proposed an amendment to repeal the expanded 1099 requirement. Senator Reid however favors a similar amendment from Bill Nelson D-Fla which would raise the threshold for reporting transactions from $600 to $5,000.

Most of the objections to the amendments are the provisions that would pay for eliminating the 1099 provision. They range from eliminating the $15 billion Prevention Trust Fund which pays for providing preventive services and screenings including smoking cessation programs in the new Health Care Reform bill to repealing tax cuts for the five largest oil companies that allow them to deduct 6 percent of their income from oil and gas production from their tax liability.

It looks likely the 1099 provision will be revised or repealed. Just not sure what bill it will be buried in and how they will choose to cut cost to cover the projected loss of income.

Questionable Interview Questions

2010-07-27T22:14:00.000-07:00

Here are a few questions that could land you in trouble if asked during an interview

How far do you commute? The answer could lead you to the conclusion the applicant lives in a less desirable area, possible populated by specific ethnic groups. You may just want to know they can make it to work on time. Better to ask them that.
How many sick days did you take last year? First I'm not sure you could rely on the answer. But for obvious reasons this question could fall under prohibited by asking the candidate about their personal health information. You could ask how many days of work did you miss last year.
Asking about clubs and social organizations might lead to an answer about political or religious affiliations. You may just want to know about hobbies and extracurricular activities. You should limit your questions to "do you belong to any professional groups that are relevant to this position"?

Your Firm May Qualify for Health Care Tax Credit

2010-07-27T21:49:00.000-07:00

Firms with less than 25 Full Time Equivalent (FTE) employees qualify for the reduced credit and those with 10 or fewer FTE for the whole credit (assuming they pass the other requirements). Many small employers have more than 25 employees but those employees work less the 40 hours. The Full Time Equivalent is important because you divide the total hours worked by 2080 and round to the lowest whole number giving you the Full Time Equivalent. For example you have 46 half time employees that would be equivalent to 23 full time. The tax credit is as much as 35% of the premiums for the year.

Germany May Tax Obese

2010-07-27T21:41:00.000-07:00

According to Reuters,Marco Wanderwitz said "it is unfair and unsustainable for the taxpayer to carry the entire cost of treating obesity-related illnesses in the public health system". The German health care system is paid for by a bunch of mandatory health insurance funds which are being overused. People are blaming those who live unhealthy lifestyles. Germany is a country popular for their beer, port and chocolates. Germany is considered to be one of the "fattest countries in Europe" according to AOL news. Full story

Passing 401(k) Plan Fees Through to Participants

2010-07-13T22:21:00.000-07:00

Many plan sponsors are looking for ways to cut expenses on their 401(k) Plan. One question that comes up is "What fees can I pass through to the participants"? The plan fees would be subject to ERISA's fiduciary rules. Otherwise, the plan must be established and maintained by the employer for the "exclusive benefit" of the employees and beneficiaries. So the plan participants can pay fees related to the administration of the plan including operating expenses such as Plan Amendments, EGTRRA Restatement, Testing and Terminations.

Expenses that would be considered to be the employer's responsibility would include Consulting or Legal expenses regarding the formation or termination of the plan, Plan design studies and cost projections, or Financial impact of plan changes.

Now how would you pass the fees onto the participants. Fees can be charged on a pro-rata basis or as a % of assets. Passing fees onto the participants on a pro-rata basis may penalize the lower income participants because they could represent a larger % of their contributions or balance. Many plans pick a combination of Flat Fee combined with asset based fee.

With Fee disclosure coming in the next few years, great caution will need to be taken in how you disclose the fees to the participant and how you charge them. We will be doing follow-up articles on the Fee disclosure efforts being taken by both Department of Labor and Congress.

Orange Painted Sticks

2010-07-12T18:01:00.000-07:00

A few years back when we had better economic times, employers used incentives (carrots) to incentivize healthy behavior. Some employers combined the rewards with penalties (sticks). Most of us have found that the rewards only method isn't bringing lasting results. According to a recent survey by Hewitt Associates, 47% of employers either already use or plan to use financial penalties for employees who do not participate in certain health improvement programs. Of those using penalties, 81% say they will do so with higher premiums, increasing deductibles and increasing out-of-pocket expenses both came in with 17%.

When asked what behaviors they would penalize, Smoking was #1 with 64%. Not participating in disease management or lifestyle behavior programs got 50% and biometric screening got 45%.

Incentive programs don't tend to work in the long run though. There is a hefty tax on tobacco products, but there are still numerous smokers. The way to get long lasting results is to have fun. As budgets get leaner Benefit Administrators are going to have to come up with more creative ways to increase participation in exercise, smoking cessation and healthy diet. I'm starting to lean towards increased pressure on unhealthy behaviors. Nothing like peer pressure to help you quit. Worked to get us started! Add more fun upbeat games centered around healthy behavior next. We're trying walking to lunch as an option during the week. One example given in www.benefitnew.com was how Volkswagen transformed a set of stairs within the Stockholm subway into functioning piano keys. They saw an increase in the utilization of the stairs of 66%. Most of us can't afford to transform our stairs into piano keys. But if we want to transform our workforce into healthy members, we may need some of this creativity.

Recent Changes in Health Care

2010-07-02T13:56:00.000-07:00

Thursday July 1st 2010 HHS Secretary Sebelius Announces New Pre-Existing Condition Insurance Plan (PCIP) that will offer coverage to uninsured Americans who have been unable to obtain health coverage because of pre-existing conditions. This program is a transitional program until 2014 when insurers will be banned from discriminating against adults with pre-existing conditions.

The Affordable Care Act provides $5 billion in federal funding to support PCIP in every state. Starting immediately the program will be operating in 21 states by HHS. All states will offer it by end of summer.

In other news, the Obama Administration unveiled New Apps for Health and Other Services. 18 mobile phone based applications, including several health-related programs. The applications are part of a redesign of USA.gov which provides information on government services.

Consumers can download the applications at no-cost from the USA.gov website or through smartphones. One application allows users to download nutritional information for more than 1,000 food products through the Department of Agriculture. Another provides alerts on products and food recalls from Consumer Product Safety Commission. View the available apps at http://apps.usa.gov/ .

Don't Fall Into the "Health Food" Traps

2010-06-28T12:26:00.000-07:00

We know we need to eat healthier. But how disappointing when we pick up a package of something we believe will be healthy just to find it loaded with sugar or fat. Here are some of the words and phrases to be on the lookout for:

Natural - This does NOT mean organic. Companies can use the word "natural" to mean just about anything. Organic on the other hand has stringent guidelines.
Healthy - To be called healthy, foods must meet various U>S> Food and Drug Administration (FDA) standards (fat, calories, etc.) per serving size. But that doesn't mean you have to change the product....just shrink the serving size.
Whole Wheat - To use the label "made with 100% whole wheat (or whole grain) it only has to contain a tiny amount of whole wheat.
Zero trans fat - Just because the product contains zero trans fat doesn't mean it isn't loaded with fat.

Here are a few simple rules you can follow:

The less processed the food, the better. Opt for fresh vegetables, fruit, nuts and make your own meals. They will have less of the bad items like corn syrup, monosodium glutamate etc.
half your plate should be vegetables and fruit. Only a quarter should be protein.
When buying bread, look for Whole Wheat as the 1st ingredient. Shy away from anything that says "enriched".

Also, check out www.mypyramid.gov . You can enter your personal information and get ideas about the foods you should be eating.

IRS Compliance Check Questionnaire

2010-06-25T08:02:00.000-07:00

The IRS is sending out about 1200 Compliance Check Questionnaires to plans that filed Form 5500 in 2007. If you receive this questionnaire, you should make sure you work closely with your consultants on your plan. The questionnaire will cover topics like:

Demographics
401(k) plan participation
Employer and employee contributions
Top heavy and nondiscrimination rules
Distributions and plan loans
Other operations
Automatic contribution arrangements
Designated Roth features
IRS voluntary compliance programs
Plan administration

The Importance of Education in Benefits

2010-06-23T07:35:00.000-07:00

Thinking back to my career prior to employee benefits. I remember being handed booklets describing the health plan options and not knowing the difference between an HMO and PPO. Not really understanding how I would or could utilize the benefits. And of course, being young I had no real experience other than "I have a cold, see a Physician". I relied on some of my more experience co-workers to tell me the difference and usually picked the cheapest.

The recent MetLife study on effective benefit communication shows that only one-third of employees polled this year thought their benefits coverage was effectively communicated. The employers thought their benefit communications had improved! This approval was down from 40% in 2007.

The younger generation showed the greatest interest in learning more about financial advice programs. The study may indicate that age and life-stage communications may be more effective. Different forms of communication might be more effective too. While all ages value face-to-face contact, "older Boomers still appear to be a little more comfortable with printed materials and want their questions answered voice-to-voice". "Generation X and Y are comfortable using the Web to learn about different options and choices or compare plans."

If your spending $8,000 to $10,000 on benefits you want ot make sure that everyone really understands what they're getting and what that contribution represents.

Another Risk To Your Companies Data

2010-06-01T13:57:00.000-07:00

Bet you never considered your company copier to be a window into your companies most private information including some protected by HIPPA. Your digital copier has a hard drive that can store 10s of 1000s of documents. When you sell your copier you can give access to all that information. Here is an interesting video about how easy it is http://www.cbsnews.com/video/watch/?id=6412572n

Little Known Tax Change Buried In Health Care Reform

2010-05-26T07:34:00.000-07:00

Starting in 2010 businesses must issue a 1099 to corporations they have paid more than $600 in a calendar year. So if your business:

Sends employees on a business trip and pay a hotel chain $1500. You must now issue that chain a 1099.
Frequent local restaurants spending over $600 at any one restaurant. Issue a 1099
Lease space for more than $600. Issue a 1099.

As you can see, this could be very difficult for businesses. Imagine having to collect the Tax ID for every establishment you utilize during the year and then issue a 1099! Hopefully this will be clarified, simplified or eliminated prior to 2012!

Retirement Spending Miscalculated

2010-05-19T12:19:00.000-07:00

A recent actuarial study on retirement spending shows where most people have miscalculated and there's some good news. The typical retirement planning calculator uses your last base salary as the spending target for retirement and then adjusts it up for inflation. In fact, retirement spending actually declines over time. The average spending by household in 2008:
Between the ages of 55 and 64 - $54783
65 and 74 - $41433
Over 75 - $31692
That's a 42% drop in spending as a person ages. Food, housing and clothing use up less income as time passes. Entertainment spending falls by as much as 65%.

The bad news is most people spend more than they expect in the first few years of retirement. In the early period they feel healthy and are able to travel and pursue hobbies putting a dent in retirement savings.

Can You Discriminate Against Smokers?

2010-05-07T06:59:00.000-07:00

It is estimated that a smoking employee costs a company approximately $12,000 a year in increased health care utilization and lost productivity. Many employers are asking if they can ask the question on an application, Do You Smoke? Can they terminate employees who do? And would they have the ability to fire an employee who lied?
Approximately 20 states have adopted protection for employees from “Lifestyle Discrimination” including obesity and smoking. But a few states have allowed employers to not only Not Hire smokers but fire employees that refuse to quit. The movement has been spurred by the ever increasing cost of healthcare.
California does protect applicants from some forms of discrimination. However, it is within the rights of an employer to make their entire workplace smoke free, including outside areas (in fact it is required for Employers to make their inside workplace smoke free). Employers can increase premiums on health insurance for smokers, not allow smoking breaks (outside the parameters of the normal breaks provided by law), and ban smoking on the premises, including parking lot. Some employers have even gone so far as to say there can be no evidence of smoking including odor. So unless an employee wants to bath, shampoo and brush their teeth after every cigarette, they’ll have to abstain during work hours. And of course if you asked the question on your employment application “Do You Smoke?” and the employee liked, that is grounds for termination.
Special Note: There are provisions in the new health reform allowing for rate increases of up to 50% for smoking!

Impact of Health Care Reform On HSAs

2010-04-24T21:04:00.000-07:00

How does the new health care reform impact my HSA?

Does the new law eliminate HSAs? No, the new health law does not eliminate HSAs and you can continue to use your HSA as you have - at least until the end of 2010.
What are the specific changes to HSAs in the new law? Starting in 2011, the 10% penalty for non-eligible (non-medical) distributions is increased to 20% and you can no longer use your HSA for over-the-counter drugs.
Can I continue to contribute the same amount to my HSA? the new law does not change the HSA contribution limits. However, new rules on the definition of what is a Qualified Health Plan could change your eligibility to contribute to an HSA in 2014 or later.
Can I still use my HSA for over-the-counter drugs? Yes, for the rest of 2010. No, starting January 1, 2011, over-the-counter drugs are no longer considered eligible medical expenses. This is your last year to buy aspirin, non-prescription cold medicine, contact lens cleaner and other over-the-counter items tax-free and penalty-free with your HSA.
I heard that FSAs are now limited to $2,500, does that rule apply to HSAs? No. the new law will limit Flexible Spending Accounts (FSAs) contributions to $2,500 starting in 2013, but that new law does not apply to HSAs.
Did the penalty increase for HSAs? Yes, the 10% penalty for using your HSA for non-eligible medical expenses will increase to 20% in 2011.
Will the law change my HSA in the future? Other than items discussed, the new law does not directly change HSAs. Indirectly, however, the new law may eliminate the ability to make contributions in the future. Starting in 2014, the new law requires Americans to buy Qualified Health Insurance that offers an Essential Health Benefits Package. Your current High Deductible Health Plan (HDHP) required to be eligible to make a contribution to your HSA may not qualify as a Qualified Health Plan. In other words, you may have to buy different insurance coverage in order to avoid taxes and penalties. Regulatory agency rulings and interpretations will provide more information on this point over the coming months.
What happens to my HSA balance in the case where I can no longer contribute new money? You can continue to use any amounts in your HSA for eligible medical expenses or save it for later even if you are no longer eligible to contribute more to your HSA. This is important to know in case you do change insurance plans to a non-HSA eligible plan to comply with the new law. The HSA remains one of the best tax favored options available. One good strategy is to accumulate assets now in the HSA to prepare for whatever happens.
Should I change anything based on the new law? The new law is a foundational change to our health care and insurance system and mostly likely will impact everyone. For now; however, the combination of a High Deductible Health Plan and HSA remain very competitive and a good choice for many businesses and consumers.

Severance Pay May Not Be Subject To FICA

2010-04-20T11:16:00.000-07:00

There has been discussion recently that Severance Pay is not wage since no service or employment is rendered and therefore may not be subject to FICA/FUTA. Let me just say now that I am not giving any tax or legal advice and am not qualified to do so. I simply want to point out that many companies have been forced to downsize and layoff staff. They may want to investigate whether they may be eligible for a refund of the employer portion of the FICA/FUTA paid on the severance. Employees who had FICA/FUTA withheld from their check may also apply for a refund.
Consult with your tax advisor to see if you qualify.

Employers Ready to Penalize Workers for Unhealthy Behavior

2010-03-31T21:45:00.000-07:00

In Hewitt's annual health care trends survey of nearly 600 large U.S. employers, 47% say they either already use or plan to use financial penalties over the next three to five years for employees who do not participate in certain health improvement programs.

Of those companies using or planning to use penalties, 81% say they will do so through higher premiums. Increasing deductible and out-of-pocket expenses were cited as possible penalties.
Behaviors or programs they would penalize were: smoking (64%), not participating in disease management/lifestyle behavior programs (50%) and not participating in biometric screenings (45%).

Tips On Employee Documentation

2010-03-26T07:44:00.000-07:00

You know you should document everything. But it's time consuming! Remember that standing in front of a judge and stating "I spoke with the employee on numerous occasions" isn't sufficient to win your case. You need evidence. So first take the time to write down any situation that takes your special attention or is recurring. Here are some errors to avoid:

Failing to sign and date the document. And have employee sign if appropriate
Handwriting is illegible
Late, don't rely on your memory
Inaccurate information
Opinions. Write the facts. And don't make comments in the borders. These are all admissible in court.
Vague. Give as much accurate information as possible
Inconsistency
Lies

Final Tweeks to Health Care Reform Passed Thursday

2010-03-26T07:26:00.000-07:00

The Senate made some small changes to the Health Reform bill and then passed it back to the House for a final vote of 220-207 to pass.
The reconciliation bill now eliminates the so-called "Kornhusker Kickback" which would have covered $100 million in increases in Medicaid payments only to the state of Nebraska, as well as special treatment for Medicare Part D subsidies for Florida senior citizens. However, the bill preserves the so-called "Louisiana Purchase" providing an extra $300 million in Medicaid spending for the Hurricane Katrina state.
The reconciliation bill also scales back the 40 percent tax on so-called "Cadillac" health insurance plans. delaying it from 2013 to 2018, and increasing the threshold from $8500 to $10200 for individuals and from $23000 to $27500 for families. It also includes a Medicare surtax of .9 percent on wages and 3.8 percent on investment income over $200,000 and $250,000 for couples.
And finally the changes involved provisions in the student lending bill that was added to the health care reform legislation in the House. the Senate parliamentarian agreed with Republicans on technical fixes to provisions that increase Pell grants for college students and reduce subsidies to private lenders.

Obesity The New Number One

2010-03-23T19:41:00.000-07:00

For decades tobacco hs been the number one cause of preventable death and disease. Smoking kills more than 440,000 people a year through direct contact and second-hand smoke. But now obesity is nipping at tobacco's heels. from 1993 to 2008 smokng among U.S. adults declined by 18.5 percent while obese people increased by 85 percent...an alarming rate!

HR3590 Health Reform Will It Win Over Small Business?

2010-03-23T16:53:00.000-07:00

In an early review of the bill just passed by the House, there may be some "candy" for small business owners to garner their support early on. For tax years 2010 through 2013, organizations with no more than 25 employees and average annual wages of less than $50,000 that purchase health insurance for employees would receive a tax credit. Talk is of a credit of around 35% for 2010. That could be significant for a small business that has been offering benefits all along. And it just might be enough to have them adopt a wait and see attitude about health care reform. Most of the bitter medicine comes in 2014 with Health Insurance Exchanges, individual mandates, subsidies and fines. That's when we'll really start to see how this effects rates and services.
Oh and one other item to keep in mind. How will the minimum coverage levels effect Consumer Driven Health Plans? Will the contributions to Health Savings Accounts be included? We'll just have to see how the battle continues.

Employers, workers share lack of love for health reform

2010-03-18T17:33:00.000-07:00

Companies and their workforces agree — federal healthcare reform will increase costs, if it ever gets passed.
A whopping 71% of employers say they expect higher healthcare costs in general if reform makes it out of Congress, according to a survey by the National Business Group on Health.
Other findings:
69% of employers say it’ll boost the cost of their benefits programs, and
35% feel it’ll lead to fewer companies providing subsidized coverage.
Employees aren’t happy about it, either
Workers, too, are giving federal healthcare reform the cold shoulder.
According to a second survey by Towers Watson, employees feel reform would:
result in higher benefit costs (67%)
reduce available benefits (54%), and
lower the quality of care (53%).

Sitting Can Shorten Your Life

2010-03-10T17:41:00.000-08:00

Scientists now say that the 12+ hours a day Americans spend siting can be deadly. Even if you exercise in the morning, sitting at a desk could erase all your effort according to USC San Diego . Getting up and moving around during the day can burn some serious calories. For example, walking around 5 hours a day burns about 2500 calories a week which adds up to 37 pounds a year.
In looking at the lifestyles of many other nations, we find their cultures include more walking and bicycle riding. In some research it's estimated that the average Canadian burns about 50,000 more calories a year than the average American.
You may not be able to work on a treadmill. But you can get up and walk around every hour or put the printer farther away from your desk.

???s to Ask Your Tax Preparer

2010-03-08T07:07:00.000-08:00

Most of us are meeting with our CPAs about this time of year. While your tax situation is clearly in their view, ask them a few questions about 2010:

The much touted Roth Conversion - Should I?
Am I now or will I be subject to Alternative Minimum Tax?
What do you estimate my tax bracket to be in 2010
Do I have any loss carryforwards?

These answers can help you and your Financial Advisor build a strategy going forward that provides you optimum tax benefit.

5 Most Annoying Workplace Behaviors

2010-03-03T17:01:00.000-08:00

A company called Opinion Research asked 1,800 people to choose the workplace behaviors that are the most annoying. Here are the, uh, winners:
1. Grumpy or moody co-workers (37%). Usually, this involves people who bring their personal problems to work. An early-morning spat with a spouse is a top contender for the cause of such behavior. Anyway, it’s what we hate the most, according to the survey.
2. Gossipers (19%). Apparently, many who were polled don’t see the value in baseless stories about who’s cuddling with whom, who’s getting fired and who’s answering polls. Or maybe they were the ones being gossiped about.
3. The use of jargon (18%). Clearly, the people who put this on their list are incapable of “thinking outside the box.”
4. Loud phone talkers (18%). We imagine this one’s triple-annoying when the speaker is gossiping and saying stuff like “thinking outside the box.”
5. Poor toilet etiquette (16%). The less said about this, the better

Top 5 Employer Staffing Concerns

2010-02-18T12:33:00.000-08:00

According to a Career Builder survey, here are the top five staffing concerns of more than 2700 employers:
1. Providing competitive compensation (34 percent)
2. Maintaining productivity levels (33 percent)
3. Retaining top talent (31 percent)
4. Worker burnout (30 percent)
5. Providing employees opportunities for upward mobility (25 percent)

Ways employers plan to keep talented employees:

Offering more flexible work arrangements (28 percent)
Investing more into training (21 percent)
Promising future benefits...when economy picks up (18 percent)
Higher salary without title (11 percent)
Higher salary with title (10 percent)
Higher title without salary (7 percent)

Children - More Than 25% Have Cronic Health Problems

2010-02-18T09:37:00.000-08:00

In a recent Los Angeles Times article research was quoted showing a significant increase in chronic health conditions in U.S. Children. The rate increased from 12.8% in 1994 to 26.6% in 2006. The findings show that children today suffer from different illnesses than those seen in previous generations according to Dr. Neal Halfon, director of UCLA Center for Healthier Children, Families and Communities.
Many of the behavioral and mental health conditions weren't diagnosed decades ago. But Obesity and related conditions accounted for a large percentage of child illnesses.
Addressing health problems early in life is likely to yield large dividends financially for the nation, Halfon said.

About 40% of Cancers Are Preventable

2010-02-05T09:12:00.000-08:00

According to the World Health Organization, cancer is responsible for one out of every eight deaths worldwide. WHO warns that without major changes, global cancer deaths will jump from about 7.6 million this year to 17 million by 2030.
Experts said about 21% of all cancers are due to infections like the human papillomavirus (HPV) which causes cervical cancer, and hepatitis infections that cause stomach and liver cancer. While the vaccines to prevent these cancers are widely available in western countries, they are almost nonexistent in developing countries. Nearly 80% of the world's cervical cancer deaths are in poor countries.
In Western nations, experts said many of the top cancers - like lung, breast and colon - might be avoided if people changed their lifestyle habits. People should stop smoking, limit their alcohol consumption, avoid too much sun, and maintain a healthy weight through diet and exercise.

US Healthcare had largest one year increase in 2009

2010-02-04T08:18:00.000-08:00

CMS released a report Wednesday in the Journal Health Affairs that showed healthcare spending continued to grow in the US last year, and now constitutes 17.3% of our GDP. The Washington Post (2/4, A7, Brown) reports, "Healthcare spending in the United States grew last year despite a contracting economy". The 1.1% increase "in 2009 compared with 2008" is "the largest one-year increase since at least 1960". The government estimates that by 2019 "healthcare spending will be $2 trillion higher than it is now and will represent 19.3 percent of the economy, and the government will pay 52 percent of it". The Wall Street Journal (2/4, A1, Landers, subscription required) reports on it's front page that in 2011 government programs are predicted to take up more than half of the country's healthcare spending.
The New York Times (2/4, A18, Pear) explains, "A major factor in the growth of health spending was the increase in Medicaid enrollment and Medicaid spending as a result of rising unemployment. As people lost jobs, they lost private insurance and many turned to Medicaid."

I'm Broke and Your to Blame

2010-02-03T14:10:00.000-08:00

We all know the economy is limping along and the consumer is tightening their belts. But the American Way seems to be to blame everyone else for their misfortune. Workers (those lucky enough to still have a job) are blaming Government (Federal 72%, State 60%, Local 47%), Wall Street (71%) and surprise surprise their Employer 33%. Looks like only 15% take any credit for their current financial dilemma. As employers we try to keep the business running, provide benefits, raise morale. But in the end it can be pretty discouraging when it's not appreciated.

COBRA Subsidy Extension - Notice due February 17

2010-01-21T11:46:00.000-08:00

Undoubtedly you've heard that the COBRA subsidy has been extended to 15 months for those eligible. But did you know that Employers must provide the notice to all affected employees by February 17th? Here's a link to the DOL site with more info http://www.dol.gov/ebsa/cobra.html

Employers Risk Lawsuit from Background Checks

2010-01-18T20:22:00.000-08:00

Two background check practices that can land you in court:
General policies against hiring anyone with.....
A policy that excludes anyone with say a criminal record or poor credit could be deemed to be discriminatory if it could be used to exclude black and Hispanic applicants. Per the EEOC program E-RACE (Eradicating Racism and Colorism from Empoyment) show that minority's often have lower credit scores and a policy excluding poor credit could be used to discriminate. Again it would be critical to show why credit or criminal record is important to the job function.
Failing to show a corelation between background checks and the job.
EEOC recognizes that some background information may have bearing on the applicants suitability. You need to show those corelations between background checks and suitability.

2010-01-15T22:11:00.000-08:00

The Department of Labor released a final rule that allows employers with pension and welfare plans with fewer than 100 participants to deposit employee contributions to the plans within seven business days upon receiving or withholding the funds.

Currently, sponsors and fiduciaries of small pension and welfare benefit plans are required to transmit participants’ contributions to such plans as soon as the funds were segregated from the employer’s other assets. They have to deposit the funds no later than the 15th business day of the month following the month in which contributions are received or withheld by the employer.

Rule Changes Effecting Benefits, Payroll and HR

2010-01-07T13:02:00.000-08:00

BENEFITS

There will be new clarification on who is a "fiduciary". Expect a final rule around May 2010
New Regulations requiring companies to disclose all retirement plan fees and expenses. Expect around September 2010
Changes to Family Medical Leave Act (FMLA) for military personnel and airline employees. Final rule date undetermined
Changes to Health Insurance Portability and Accountability Act (HIPAA). Expect changes around September 2010

PAYROLL AND HR

Updated recordkeeping reg for Fair Labor Standards Act (FLSA). Expect to keep more thorough records on payroll. Time undetermined
Increased wage-hour audits. DOL hired 250 new investigators to enforce wage-hour laws. Expect Early 2010
Firms using H-2B (foreign workers) can expect more scrutiny. Proposed rules regarding labor certification for foreign workers.
New definition of "temporary" workers. DOL wants to ensure temporary workers actually are.
More accountability on affirmative action. Focus on veterans. Expect November 2010
Union info disclosure. Companies will have to report arrangements used to persuade joining or not joining a union. Expect November 2010
Now standard on slip and fall hazards. OSHA promises the rule will cover "every non-construction worker in the U.S." Expect March 2010
Resurrecting old recordkeeping for musculoskeletal disorders. Expect January 2010

Fighting Hydra-Headed Monster, Health Reform

2009-12-23T20:20:00.000-08:00

While the Senate health-care bill is being rammed through, most debate is being focused on the expanded coverage, and higher taxes. But Professor Epstein, professor of law at University of Chicago article points out the risk to private insurance that is lurking within the bill and has not drawn attention or debate http://tinyurl.com/y88gxkl . This bill can kill private insurance by the excessive administrative costs, inability to price the plans profitably and the government determines how many insured you must take, what the coverages will be etc. A Carrier that opts not to join the exchange is still under the the federal and state regulations. The twisted logic is that price controls alone can force out waste and inefficiency. As Mr. Epstein points out that's like thinking "rent control is the perfect path to efficient competitive markets".
All hope is not lost though. Perhaps while Congress has lost all reason the Supreme Court will step in to STOP THE INSANITY. This bill in essence makes health insurance a utility. But health insurance is not a monopoly and even utilities have the right to a "guaranteed minimum rate of return".

5 Tips for Developing Employees

2009-12-13T11:03:00.001-08:00

5 Tips for Developing Employees

Take the attitude that training is really employee development. That will help you think more strategically about what your employees need to learn.
Recognize that formal training programs are only part of the picture. Most real training occurs on the job.
Help employees develop problem-solving skills and the ability to think by giving them work that will stretch them.
Set an example. Your own pleasant attitude and good work habits will influence your workers.
Understand that when you give employees an opportunity to grow, their job satisfaction and your ability to retain them as employees both increase substantially.

Fine Tuning the Retirement Plan for 2009 and 2010

2009-12-08T15:24:00.001-08:00

We are nearing the end of 2009. Many employers halted their matches for this year waiting to see what the year had in store. Now is a great time to see if you need to make any adjustments to your plan before you close the books on 2009. With many plans opting to stop the match, many employees followed suit and stopped deferring. Now owners are finding themselves "locked out" of the plan because they can't pass their testing. This is a good time to see if making available additional plan options like Tiered Profit Sharing or Cash Balance would make sense for the highly compensated.
For 2010 most plans would have made their Safe Harbor election already. Although new plans can still make that election. If your still leery of having a stated match or safe harbor, you may want to consider automatic enrollment. By having employees automatically enrolled for a nominal contribution like 3%, most companies have seen their participation soar to as high as 90%. Employees can still elect to increase, decrease or stop the contribution. But you will have the inertia effect (not doing anything) working in your favor instead of against you.
Last, but certainly not least in importance, is education. Giving your employees the education and tools to make decisions can make this benefit more successful for them and for your business. We all know in down years (in the market) employees view their retirement plan as more of a detriment than a benefit. But reminding them of the long term nature, how they should be contributing in the down markets to take advantage of the better markets, diversifying and reviewing their investments; can all turn their attitude around as well.

What If You Could Prevent Cancer?

2009-11-13T07:34:00.000-08:00

Many Americans take drugs to prevent heart disease and stroke. But cancer is different. More than 192,000 cases of Prostate Cancer will be diagnosed in the United States this year and more than 27,000 men will die from it. Yet there are two drugs that have been shown to prevent as many as 50,000 cases each year....after a "large and rigorous study" http://tinyurl.com/y9lago3. Nevertheless, researchers say, the drugs that work are largely ignored.
Scientists have what they consider definitive evidence that two drugs can cut the risk of breast cancer in half. But Women and Doctors have pretty much ignored the findings. Dr. Vogel says "If I had told you in 1990 that in 10 years I would have a pill that would cut the risk of breast cancer in half, you wouldn't have believed me". They found two and to his shock, "The world said, So What?"

People want control and prefer to believe exercise and nutrition will prevent disease. Yet study after study has failed to deliver definitive data. There are few ways knows for sure to prevent cancer. The biggest is to avoid cigarette smoking. That alone would drop the cancer death rate by a third. No other measure comes close.

Read the entire article at NYTimes.com http://tinyurl.com/y9lago3

Designing Benefit Plans with Health in Mind

2009-11-03T15:34:00.000-08:00

We all know that employee health affects our profitability, even if we can't quantify it. As employers we're trying to control the long term cost of offering health benefits by offering programs that address the overall wellness of our workforce and encourage healthy behavior. Not an easy task!
Designing benefit plans that encourage wellness makes sense because approximately 50% of medical costs are driven by unhealthy lifestyles that lead to costly disease management later. Comprehensive benefit design should focus on wellness as well as illness. So how do we encourage our employees to choose wellness? First lets consider that simply offering wellness programs gets participation of around 10%. Offering incentives like $50 or $100 to participate gets participation rates over 75% on average. With that in mind we can look at short and long term tools to help employees evaluate their current health, future likely health, and tools to change behavior to improve their health.
The short term tool is to encourage employees to take a risk assessment to identify and gauge their actual risk of health problems. The next step is to provide some sort of one-on-one or high-touch coaching to help employees change the behaviors and succeed.
By offering "wellness" instead of "illness" based benefits, employers can improve not only their cost of benefits over the long term, but their overall productivity.

Profit Strategies Inc. News

Cutting Health Care Costs - Like Japan

Exempt Classification Analysis - Not Likely In 2012

Reporting Health Coverage Costs on W2 Begins 2012

Do Your Employees Understand Their Benefits

Ways To Use Your FSA Before Year End

Sick Days Could Save $1 Billion

Health Care Reform - No Going Back

Large Migration Away From Employer Paid Health Unlikely

IRS Increases Retirement Plan Contribution Limits for 2012

New Law - Mandatory Maternity

Tax On Health Benefits Buried in Jobs Bill

IRS Releases Guidance - Mobile Phones Tax Treatment

Strangest Things On An Application for Employment

Will Employers Drop Health Benefits In 2014?

Health Care Reform Dealt a Blow

An Ounce of Prevention

Dodge Illness During Air Travel

Wage and Hour Investigator Just Showed Up...What To Do?

IRS Changes Mileage Rate For Next Six Months

Congress Looking at Making E-Verify a Requirement

Get App Happy - Apps to help you get healthy, wealthy and wise

New Bill to Revise HSA Provisions (Undo Some of Reform)

The IRS Wants Your Thoughts

IRS Announces 2012 Cost of Living Changes

We're From The Government. We're Here To Help.

Finding The Right Solution to Health Care

All Employers Must Have Written Injury/Illness Prevention Program

Interview Questions That Tell You Everything You Need To Know

Health Costs Shifting to Individuals - Need Favorable Tax Treatment

President Signs to Repeal Expanded 1099 Reporting

Quick Calculator for Retirement Contributions

IRS Offers Small Employers Relief from W2 Reporting of Health Premium

Taxes To Promote Healthy Behavior

2011 Mileage Reimbursement Rate Could Go Up!

Small Businesses Still Confused about Healthcare Reform

Restrictions On Retroactive Termination Under PPACA

IRS asks for $62 Million to Ready for PPACA

Wellness Programs Improve Health and Lower Cost

Wellness Programs: A Series

105 Million in U.S. Have Diabetes or Prediabetes says CDC

Top 10 Most Expensive States For Individual Plans

Nondiscrimination Provisions of Health Reform

Ideas About America's Best Health Care System

Auto 401(k) Enrollment -- Participation soars to as much as 90%

Average 401(k) Participant Can't Afford Retirement Until 73

Most Popular Methods of Controlling Health Costs

Flu Shots Save Employer Money

Assisted Living Benefit for Veterans

Fed Up with Health Care Costs?

Amendment to Regulations on "Grandfathered" Health Plans

Debt Reduction Proposal Could Decimate 401(k)s

Top 5 Healthiest Fast Food Joints

Now For 10 Least Stressful Jobs

10 Careers With High Depression Rate

On The Topic of Productivity

With Health Care Reform comes Notices...

Reporting Health Care Premiums on W2s

To Grandfather or Not to Grandfather

Health Reform - No Discrimination Based On Compensation

What Do Successful Wellness Programs Have In Common

Help Employees Stay Healthy

1099 Information Reporting Will Change...But How

Questionable Interview Questions

Your Firm May Qualify for Health Care Tax Credit

Germany May Tax Obese

Passing 401(k) Plan Fees Through to Participants

Orange Painted Sticks

Recent Changes in Health Care

Don't Fall Into the "Health Food" Traps

IRS Compliance Check Questionnaire

The Importance of Education in Benefits

Another Risk To Your Companies Data

Little Known Tax Change Buried In Health Care Reform

Retirement Spending Miscalculated

Can You Discriminate Against Smokers?

Impact of Health Care Reform On HSAs

Severance Pay May Not Be Subject To FICA

Employers Ready to Penalize Workers for Unhealthy Behavior

Tips On Employee Documentation