Family Medical Leave Act Expanded

Family Medical Leave Act Expanded to include Service Member Leave

On Monday, January 28, 2008, President Bush signed into law an expansion of the Family and Medical Leave Act (FMLA) which provides additional FMLA leave for military families.

Under FMLA, an employee must have worked at least 12 months and 1,250 hours in the past year to be eligible for the leave benefit. Eligible employees are entitled to a total of 12 weeks of leave during any 12-month period for one or more of the following: 1) birth of a child, 2) placement of child for adoption or foster care, 3) caring for a spouse, child or parent with a serious health condition or 4) the serious health condition of the employee.
The bill adds two new FMLA-qualifying events to include employees caring for an injured service member and employees who have a family member called to active duty. An employee who requests leave due to a call to active duty is eligible for 12 workweeks of unpaid FMLA leave due to a spouse, son, daughter or parent being on active duty or having been notified of an impending call or order to active duty in the Armed Forces. Leave may be used for any “qualifying exigency” arising out of the service member’s current duty or because the service member is notified of an impending call to duty.

An employee who requests leave to provide care for an injured service member is eligible for 26 workweeks of unpaid FMLA leave during a single 12-month period for a spouse, son, daughter, parent, or next of kin caring for a recovering service member. A recovering service member is defined as a member of the Armed Forces who suffered an injury or
illness while on active-duty that may render the person unable to perform the duties of the member’s office, grade, rank or rating.

The caregiver provision of the law is effective January 28, 2008, but the call to active duty provision will not be effective until the Secretary of Labor issues final regulations defining “any qualifying exigency.” Employers are still encouraged to provide the new types of leave to qualifying employees and to update and amend their policies, procedures, employment posters and notifications.

Workplace Hazards

As a business owner, it is very important to prevent accidents before they happen. Here is a checklist to help you identify any hazards in your workplace.

1. Is the floor clear of materials that could trip a worker?
2. Is lighting adequate?
3. Are there any electrical hazards that could be accidentally activated at any individual workstation, or elsewhere at the job site?
3. Are there any explosive hazards present or likely to develop (during processes, in storage areas, etc.)?
4. Are any tools (including hand tools), machines, or equipment in need of repair?
5. Are appropriate guards in place on tools, machines, and equipment? Have workers been successfully trained not to remove or bypass the guards?
6. Is there excessive noise in the work area, interfering with concentration and/or communication?
7. Is fire protection equipment readily accessible, and have employees been trained to use it? Are emergency exits clearly marked?
8. Are motorized vehicles properly equipped with working brakes, overhead guards, backup signals,horns, steering gear, and identification, as necessary? Are all employees who operate vehicles and equipment properly trained and authorized?
9. Has appropriate personal protective equipment, properly fitted, been provided to workers? Have workers received any needed training in its use, and are they, in fact, using it?
10. Is ventilation adequate, especially in any confined spaces?
11. Have any employees complained of headaches, breathing problems, dizziness, or strong odors?
12. Does any work have to be performed in extremes of heat or cold?
13. Is work done on different working and walking levels(heights), requiring guarding against potentialhazards of falls or falling objects?

Wellness

A new trend in Employee Benefits is to offer incentives for healthy behaviors, such as a lower medical premium contribution for non smoking employees. To read more about implementing a wellness program, please read the article in this month’s Foster Thomas newsletter.

Additional information regarding benefit trends can be found on the HR Webcenter (http://www.hrwebcenter.com/).

VETS issue final regulations for Vets-100A

Effective June 18, 2008, the new VETS-100A report is required of all Federal Contractors with federal government contracts of at least $100,000, where at least one contract was entered into or modified on or after December 1, 2003. The final regulations do not affect the current VETS-100 form, which must be completed by contractors with federal government contracts of at least $25,000. Some contractors will need to complete both forms.

The VETS100A must be filed in the 2009 reporting cycle. All contractors are expected to file the Vets-100 report as usual in 2008. The VETS 100 categories remain as follows:

1. Special Disabled Veterans – veterans having a 10-20% serious employment handicap or a disability rated 30% or more by the Department of Veterans Affairs)

2. Veterans of the Vietnam era

3. Recently Separated Veterans (those who have been discharged or released from active duty within one year)

4. Other Veterans - those who served on active duty during a war, campaign or expedition for which a campaign badge was authorized.

The VETS-100A categories are as follows:

1. All Disabled Veterans; - a veteran of the U.S. military, ground, naval or air service who is entitled to compensation under laws administered by the Secretary of Veterans affairs; or a person who was discharged or released from active duty because of a service-connected disability.

2. Recently Separated Veterans - those who have been discharged or released from active duty in the last three years

3. Armed Forces Service Medal Veteran - Veterans who served on active duty in the U.S. Armed Forces during a U.S. military operation for which an Armed Forces service medal was awarded pursuant to Executive Order 12985

3. Other Protected Veterans – veteran who served on active duty in the US military, ground, naval or air service during a war or in a campaign or expedition for which a campaign badge has been authorized under the laws administered by the Department of Defense.

Due September 30, 2008

EEO-1 Survey Due September 30, 2008
If you have 100 employees or if you are a federal contractor or subcontractor with 50 employees and 50,000 in government contracts or subcontracts, you must comply with the EEO-1 reporting requirements.
Changes were made to the EEO-1 survey requirements for the 2008 reporting cycle. Changes include a distinction to two levels of management: Senior Level Officials and First/Mid Line Management and the addition of the “Two or More Races Category.
It is recommended that employers who do not have employees classified to coincide with the new EEO-1 codes, re-resurvey the workforce.
Employee data to be filed includes all full-time and part-time employees employed during a selected payroll period. Employment data includes sex and ethnic background for each occupational category.
The filing deadline for the EEO-1 survey is September 30, 2008. The preferred method is the web based filing system.

Questions may be addressed to: Beth Bulger of FosterThomas –1-800-372-3626.

High Deductible Health Plan Explanation

Introduction

The rising prices of gasoline and food have forced people to review their expenses and become a more cost conscious consumer. This has also extended into health insurance. In the last few years, the cost for companies to provide employees with health insurance has risen dramatically. According to the Kaiser Family Foundation’s Employer Benefits Annual Survey 2007, from the Spring of 2006 to the Spring of 2007 the cost of premium increased on average 6.1%. Ten percent of companies experienced an increase of greater than 15%.

What actions can employers take to keep the health insurance affordable for both themselves and the employee? Many companies are implementing a High Deductible Health plan with a Health Savings Account.

A High Deductible Health Plan with a Health Savings Account was developed by the government to combat the rising cost of health care. The Health Savings Account allows employees to set aside pre-tax dollars to pay for expenses incurred toward the mandatory high deductible and other out of pocket eligible expenses.

Eligible expenses include office visit copays, deductibles, coinsurance, prescription drug copays, dental claims, vision care expenses, and certain over the counter items. A complete list of eligible expenses can be found in IRS Publication 502 (http://www.irs.gov/publications/p502/index.html). Members should keep their receipts from purchases in the event of an audit.

A Health Savings Account differs from a Flexible Spending Account, which is “use it or lose it.” The HSA is a personal bank account in which unused funds can roll over on an annual basis. The account is portable, so an employee may keep their HSA if they leave the company. There are also investment options, which will vary depending on the HSA vendor.

Besides an account used to pay for current eligible expenses, the HSA functions as a retirement savings vehicle. At the age of 65, an HSA can again be used to pay for eligible expenses or purchase a supplemental insurance plan (not Medigap) even if you do not participate in a HDHP.

It is important to note an employee cannot open a Health Savings Account if:

1. They are enrolled in another health insurance plan that is not a HDHP.
2. They participate in a medical Flexible Spending Account.
3. They are enrolled on Medicare.

How does a High Deductible Health Plan work?

Mary is enrolled in ABC Company’s High Deductible Health Plan, which has a $1,200 deductible for single coverage and $2,400 for family. After the deductible is met, most services (with the exception of prescription drugs) are covered at 100% (please note this plan design is for example purposes only- benefits can vary).

Mary visits her in network primary care provider due to illness. She has not incurred any expenses toward the deductible yet. Since she is enrolled in a HDHP, the provider charges her the contract rate of $100 for the service provided. Mary had opened a Health Savings Account, so she used $100 from her account to pay for the visit.

Note: When a member uses an in network provider, they are paying the discounted charge for the service. There are no discounts when utilizing out of network providers.

There are often several options in which to access the funds, the most popular being a debit card. Members can also use checks or an automatic debit feature. Like any other bank account, the funds must be in the account in order to make a payment or deduction. For instance, a member cannot deduct $400 to pay a claim if there is only $300 in the account. Also to be noted- there are banking fees associated with an H SA, which will vary by vendor.


Health Savings Account Funding

The most common way to fund a Health Savings Account is through pre-tax deductions via payroll. Unlike a Flexible Spending Account, employees can increase or decrease the amount of their election throughout the year. In addition, an employee can make a post tax lump sum contribution and claim it as pre-tax at the end of the year.

Companies often choose to fund the account as well. This can range from covering the entire deductible, half the deductible, or another set amount.


How can I make a High Deductible Health Plan attractive to my employees?

First and foremost, EDUCATE! High Deductible Health Plans initially seem overwhelming and require education on how to use them. Holding enrollment meetings with a knowledgeable representative is crucial. This gives the employees the opportunity to review the plan in detail and ask important questions.

If you have more than one plan design option, pricing is the key. Formulate the contribution structure to make the HDHP contributions significantly less than the HMO, POS, or PPO option. As mentioned previously, funding the Health Savings Account also provides an incentive to enroll in the HDHP.

Consumerism

A High Deductible Health Plan drives members to think about how they are using the plan, since their out of pocket costs are higher. This should in no way discourage members from seeking necessary care, but to research the cost of a procedure or prescription to find the most economical option. Most carriers have cost comparison tools that members can utilize to compare procedures at different facilities or the price of a prescription and various pharmacies.

High Deductible Health Plans also encourages members to seek preventive care, not making it subject to the deductible. Hopefully, this catches any conditions early, making them treatable and manageable.


Implementing a High Deductible Health Plan will assist in controlling the costs of benefits and also make employees more savvy consumers. To find out more about High Deductible Health Plans or to request a HDHP/HSA quote, contact your Account Manager, who will be happy to discuss the plans with you.

Sources:

The Kaiser Family Foundation and Health Research and Educational Trust.
Employer Health Benefits 2007 Annual Survey

Internal Revenue Service United States Department of Treasury. Publication 969 (2007), Health Savings Accounts and Other Tax-Favored Health plans. <http://www.irs.gov/publications/p969/>

COBRA Administration

It is crucial to be in compliance with COBRA regulations to avoid legal issues.




http://www.cobrainreview.com/newsletter/index.htm#1





Should you have any questions regarding COBRA Administration, please consult with a Foster Thomas representative.