9 Areas of Focus for HR Right Now – Part 7

Thanks for joining us on this nice little reflective exercise. There has been so much news to keep up with this year, that we thought it would be helpful to put pen to paper on our key COVID takeaways. We hope our numbers 1 through 6 provided some food for thought, and also some helpful advice. We are back this week with number 7, and it’s a big one.

 

  1. Leave & Accommodations

Leave laws are always front and center for us at Spring, but this year we had different considerations. While this topic interplays with many of the other themes on this list, I thought it important to reiterate some key legislative items we’ve been dealt this year.leave management covid

 

Currently there are very few legal parameters for supporting working parents during the pandemic, and no protections for employees worried about exposing people in their household. Any accommodations allowed here are largely based on the discretion of the employer. For working parents, consider flexible hours and different shifts. Further, companies should think about whether teleworking could work more permanently, you are likely to face some employee hesitancy to return to the office. This will be especially important depending on your office location and the case rates in that area.

 

As we think about traditional ADA accommodations processes and try to carry them out in a COVID world, we pose the following questions:

  • If an employee self-identifies themselves as high-risk, should an employer be asking for proof?
  • If an employee states they cannot wear a mask due to a disability, but cannot provide documentation, what does the employer do?
  • If an employee is asking for leave but is not eligible under ADA or FMLA, what other options are available?

I recently presented at DMEC where we suggested implementing short-term accommodations trials, especially when there is difficulty obtaining documentation, which there has been due to closing of medical offices to non-emergency patients and reluctance to visit medical offices out of fear. So if an employee asks for accommodation without documentation, try something that you find reasonable for 3 or 6 months without asking for medical information, and then revisit the trial at that point. Further, exhaust all return to work options (whether in-person or remote) first, and use leaves as a last resort.

With the expiration of the FFCRA, Emergency Paid Sick Leave (EPSL) and Emergency Family and Medical Leave (EFMLA) is no longer required, but the tax credit has been extended. Click here for more details on that. All of these complexities are making the case for federal leave law, in which we could avoid this patchwork of different leaves, but speakers remarked that while the desire is there, there are too many challenges to get it going during this economic climate.

Several states have implemented their own leave policies related to COVID: California, New York, New Jersey, Colorado, Washington D.C., with pending legislation in Massachusetts. Employers in these states will need to weave these into their programs.

Further, while there is no leave currently for those afraid to return to the workplace, employers should be cautious as it is possible for debilitating anxiety to occur in these cases, which could trigger a leave.

 

At the end of the day, while employers often worry about misuse of programs, research shows that less than 5% of individuals taking leave are abusing it. Further, as engrained in our culture, people are generally shamed of needing time of work to take care of themselves or others. To this end, we need to take a caring lens when it comes to leave and accommodations. Lastly, communicate your policies often, be proactive, make it easy for employees to find available resources, check in on  your colleagues, and be sure to have formal Stay and Work and Return to Work programs in place and updated.

 

Don’t miss our series wrap-up, numbers 8 and 9, coming to your inbox next week!

9 Areas of Focus for HR Right Now: Parts 5 and 6

Thanks for tuning back in as we share our most noteworthy reflections around how priorities have changed for folks in this industry. We hope you caught numbers 1-4 (link). After over six months of combatting COVID-19, we have figured a lot out, but questions remain. Here we are with numbers 5 and 6 on our list.Women in the workforce COVID

 

  1. Women in the Workforce

Policies like maternal leave and breastfeeding accommodations have long been debated, but this year women are facing even more pressure. For one, it’s been reported that women continue to shoulder the burden of having children while working at home. I am sure there are plenty of involved dads out there, but it does seem to be women who are largely being tasked with homeschooling, activities, meals, etc. and who are being interrupted by children during the workday. They may be struggling to keep up with the demands of work and home, and feeling like they have to choose. We hope that once we start seeing consistent success in education during the pandemic, and eventually vaccines, women will gain back their confidence. However, employers should be thinking about how to be flexible with working mothers so that they don’t have to take leave, as reengagement will be difficult.

Another hot topic related to women is the issue of pregnancy during these COVID times. Many pregnant women have extra fear of being exposed to the virus and are likely to err on the side of caution, meaning they may be reluctant to return to the workplace. Things get tricky here, as pregnancy is not a disability in the eyes of the ADA and therefore does not offer an accommodation to pregnant women. Further, because of the Pregnancy Discrimination Act, employers cannot single out pregnant employees. This conundrum has several states trying to fill this pregnancy gap in upcoming legislation. Finally, let us not forget, as employers, about single women lacking a support system at home.

 

  1. EAPs

I got a lot of value out of one DMEC session focused on Employee Assistance Programs (EAPs) and I thought I would share. EAPs are a severely under-utilized tool. This is due to lack of awareness, stigma around mental health and addiction, company culture, confidentiality concerns, and accessibility or time constraints. Many employees don’t realize the amount of free or discounted services associated with EAPs, with costs being another barrier.  However, as we saw, mental and behavioral health problems are rising at an unprecedented rate, and EAPs could be a critical mitigating factor, but only if they are leveraged.

When it comes to EAPs, you should:

  • Ensure managers are adequately trained on the program(s) offered
  • Partner with your provider to increase communications and remove obstacles
  • Link EAP access to other HR programs such as wellness initiatives
  • Monitor program effectiveness through regular surveys and performance checks
  • Check in with employees before, during and after an EAP request – did they find the resources they were looking for?

We may see EAPs transform from a “nice to have” to a “must have” in the future. If that’s the case, all of us in this industry need to understand how to better drive utilization, because it’s clearly not enough to simply provide one. Spring can help with this!

 

We’ll be back soon with our #7 and beyond.

9 Areas of Focus For Employers Right Now: Parts 3 and 4

We are back with more industry food for thought. We hope you caught #s 1 and 2, telework and workplace safety here. We are continuing on with more unique challenges HR, benefits and absence management professionals are still facing in light of the pandemic.

 

  1. Mental and Behavioral Health

Mental and behavioral health has long been a concern for employers, but COVID-19 complicated this area in a myriad of ways. Research shows that by the end of the year, it’s projected that someone will die by suicide every 20 seconds. This could be the next pandemic, in that COVID-19 will lead to PTSD and increased rates of depression. In conjunction with suicide, overdose rates are rising and alcohol sales have skyrocketed. Domestic violence is also of particular concern as many have been stuck at home in unsafe environments, and with children largely out of schools and programs, there are less opportunities to report issues.employee mental health

One DMEC presentation shared that 45% of employees surveyed reported their mental health being negatively impacted in some capacity by COVID-19, and that it is often more difficult for older adults, those working in healthcare, and those with pre-existing conditions. The rapidly changing news on public health and the crisis is further contributing to anxiety.  However, the number one stressor for employees across the board pertains to finances.

Non-job related factors affecting mental health right now include:

  • Childcare
  • Health of family members and self
  • Social disconnectedness
  • Postponing or canceling of events and celebrations
  • Grief/loss

Then, of course, there are job stressors that may come into play, such as career development and relationships at work.

Now that I’ve painted a very grim picture, let’s talk about what employers can do to mitigate these mental and behavioral health complexities. Here are some ideas:

  • Conduct manager sensitivity training
  • Understand what signs of depression might look like, especially in this virtual world. An example might be morning fatigue from lack of sleep
  • Offer flexibility when possible – this could mean scheduled breaks or a switch from full-time to part-time
  • Treat mental health as you would physical health problems
  • Ensure employees understand what resources are available, such as EAPs
  • Offer benefits like 401(k) and retirement planning, HSAs and/or flexible spending accounts, emergency hardship assistance, etc.
  • Offer thoughtful perks like noise-canceling headphones, as those dealing with depression will have a harder time focusing
  • Leverage your disability carrier for help

Confronting and assisting with mental and behavioral health problems is not only a compassionate move, but a sound business decision as well. An employee with a mental health or addiction issue will be about half as productive; a DMEC presenter stated that this level of lost productivity can cost a company with 1,000 employees a minimum of $2.4 million a year.

Essentially, those who were experiencing anxiety, addiction, or depression before are facing magnified conditions now, and we have a larger subset of people who were not struggling in these areas prior to COVID-19 but now are. Your employees could be worried their spouse is going to lose his/her job so they are putting in overtime to secure their own job. Others are dealing with pre-existing conditions, aging parents who need extra care, children at home, a lack of social life, and so on.

As mental and behavioral health problems continue to soar, everyone can benefit from an employer proactively addressing them.

 

  1. Travel

The vast majority of employers have banned non-essential business travel. For personal travel, quarantine policies may come into play. The future of business travel, business travel policythat is, in a post-COVID world, remains unclear. One DMEC presentation cited a poll that showed 28% of employers planning on reducing business travel after the pandemic, and 51% of companies are unsure what they will do. On the other hand, 62% of employees surveyed stated they would prefer to travel less when the pandemic is over than they did before it started.

 

Be sure to check back in for #5 and beyond!

Spring Hits it Big in Captive International’s US Awards

The Spring team is delighted to announce that we have been recognized in a number of categories by Captive International through their US Awards. Captive International is one of the most well known industry publications, and we are honored to have made this list among such impressive company. We are proud of our team members for their commitment to excellence; they are truly deserving of this recognition:

  • Actuarial Firm – Highly Commendedcaptive insurance consultants
  • Actuary: Steven Keshner – Winner
  • Actuary: Peter Johnson – Highly Commended
  • Feasibility Study Firm – Winner
  • Feasibility Study (Individual): Karin Landry – Winner

We want to congratulate all firms and individuals who appear on this esteemed list, and to thank Captive International for the acknowledgement. As with all industries, our work and priorities shifted a bit this year, but we were glad we were able to offer captives as a unique solution to difficult circumstances for our clients.

The full list of winners can be found here.

DOL Issues Updated FFCRA Regulations In Light Of Recent Federal Court Decision

On September 11, 2020, the U.S. Department of Labor (“DOL”) released a temporary rule updating certain FFCRA regulations.  The temporary rule is scheduled to be published on September 16, 2020, and will be effective immediately through the expiration of the FFCRA’s paid leave provisions on December 31, 2020.

COVID-19 law

The temporary rule updates FFCRA regulations issued in April 2020 in response to a recent federal District Court decision which found four portions of the initial regulations invalid:  provisions related to whether the FFCRA applies if employers do not have work available for employees; the timing for which employees must request the need for leave; the definition of health care provider; and the availability of intermittent leave.

While many anticipated that the DOL would appeal the decision, the DOL elected to reaffirm and clarify its position on some of these issues, while choosing to revise or update others. Thus, while the court’s order was limited to companies operating in New York (or potentially only those in the Southern District of New York), the DOL’s revisions to the regulations apply to all employers subject to the FFCRA (inside and outside New York).

The District Court’s order and the updated regulations are discussed in more detail below.

New York Federal District Court Decision

Soon after the FFCRA regulations were implemented, the State of New York sued the DOL in the United Stated District Court for the Southern District of New York claiming the DOL exceeded its authority when it implemented several provisions of the FFCRA regulations. The District Court agreed in part and, in August, the court issued an order invalidating several portions of the FFCRA regulations.

  • Work Availability Requirement – The original regulations limited the availability of emergency paid sick leave and expanded FMLA leave to certain situations where theemployer’s business is open or the employer has work for the employee, but employee is unable to work due to a COVID-19 qualifying reason.  The court vacated this requirement, making the FFCRA available even if the employer does not have work for the employee, such as situations where the employee is furloughed or the business is closed.
  • Documentation – The FFCRA statute requires employees to notify an employer of the need for leave “after the first workday” during which an employee requires paid sick time; however, the initial FFCRA regulations required documentation to be provided to the employer before any sick time is taken. The court determined this was beyond the scope of the statute and vacated this requirement. The content of the documentation and the need for documentation was not eliminated, just the timing of when it must be provided.
  • Definition of Health Care Provider – The initial FFCRA regulations used an expansive definition of health care provider, which included individuals who work in support of health care operations, such as cleaning staff, food service professionals and cooks, maintenance workers, IT staff, or other administrative support staff who support health care operations.   The district court vacated the definition of health care provider, finding it overbroad.
  • Intermittent Leave – The initial regulations allowed employees to take intermittent leave in certain situations with employer approval/agreement.  The court found this inconsistent with the statute and rejected this aspect of the regulation as an impermissible limitation on the availability of intermittent leave.

Updated Regulations

In the updated regulations, DOL reaffirms its regulations related to the work availability and intermittent leave requirements, but provided further clarification or explanation of its regulations.  The DOL revised regulations related to the definition of “health care provider” and notice requirements.  The rationale and changes are discussed more fully below:

Work Availability

Specifically, for purposes of the work availability requirement, the DOL affirms that neither emergency paid sick leave nor expanded FMLA under the FFCRA may be taken unless the employer has work available for the employee (the “work availability” requirement).  The FFCRA statute provides that leave under the FFCRA is available if an employee is unable to work (or telework) “because of” or “due to” a qualifying reason under the FFCRA.  The DOL cites to U.S. Supreme Court authority that interprets “because of” or “due to” language to create a “but for” test or analysis. Thus, FFCRA leave must be the “but for” cause of the employee’s inability to work.  Furthermore, the DOL reasons that the plain meaning of the word “leave” in this context, and based on longstanding DOL interpretation, means that someone has to be absent from work at a time the employee would otherwise be working. Thus, the DOL stands by its original regulation and provides that an employee cannot take FFCRA leave if there was no work available from the employer for the employee to perform.

Finally, the DOL explains that this requirement was intended to apply for all qualifying reasons under the FFCRA, not just those that were initially listed in the original regulations.

Intermittent Leave

The FFCRA is silent about the availability of intermittent leave, but as the DOL notes in the preamble to the updated regulations, the DOL was given broad authority to develop rules under the law.  Thus, consistent with FMLA regulations, the DOL interpreted the availability of intermittent expanded FMLA leave for employees working onsite similar to how it applies for purposes of FMLA, which may also require employer approval.  For emergency paid sick leave, however, there is opportunity for spreading COVID-19 in the workplace.  Thus, it would be contrary to the purpose of the FFCRA to allow someone to take emergency paid sick leave intermittently (unless caring for a child whose regular day care provider is unavailable due to COVID-19). Therefore, for employees working on-site, the DOL reaffirms its decision to only allow intermittent leave for expanded FMLA leave purposes.  The DOL confirmed, however, as originally provided, that intermittent leave may be available for any FFCRA qualified reason if an employee is teleworking, as there is no risk the employee would spread COVID-19 at a worksite.  In any intermittent leave context, however, permission from the employer is still required.

Health Care Provider Definition

In an effort to ensure the public health system could maintain its necessary function during COVID-19 pandemic, the FFCRA allowed employers to exclude employees who are “health care providers” or “emergency responders” from eligibility for expanded FMLA leave and emergency paid sick leave.

The DOL took an expansive approach in defining “health care provider” in its initial FFCRA regulations to ensure health care operations would not be hampered, such as ensuring maintenance to health care facilities, trash collection, food services for hospital workers, and other similar services.  The District Court found this approach to be overly broad and, therefore, per the District Court’s order, the DOL opted to revise its definition of health care provider.  In the updated regulations, health care providers include employees who are health care providers under existing FMLA regulations and “any other employee who is capable of providing health care services such as diagnostic services, preventive services, treatment services, and other services that are integrated with and necessary to the provision of patient care and, if not provided would adversely impact patient care.”

This could include a variety of health care practitioners other than doctors, including nurses, nurse assistants, medical technicians, and laboratory technicians.  The preamble and rule provide numerous examples of what would constitute diagnostic, preventive or treatment services, and services integrated with these that are necessary for patient care, such as bathing, dressing, or feeding patients, among several others.  Food service professionals, IT professionals, building maintenance workers, HR professionals, or other individuals who do not provide health care services even though their work impacts health care services are no longer included in the definition of health care providers.

Employees falling within the new definition of health care provider can work in a variety of settings including, but not limited to, hospitals, clinics, doctor’s offices, medical schools, local health departments, nursing or retirement facilities, nursing homes, home health providers, laboratories, or pharmacies.

Notice of the Need for Leave

In the updated regulations, the DOL clarifies that notice of the need for emergency paid sick leave must be provided as soon as practicable (instead of before emergency sick leave is taken), which is consistent with the position the plaintiffs took when they challenged the original regulations.

Additionally, the DOL revised the regulations regarding notice of expanded FMLA leave.  For a foreseeable need to expanded FMLA leave, the employee must provide notice as soon as is practicable, which may mean the employee may have to provide advance notice of the need for leave if the facts and circumstances support prior notice.  Prior notice is not required for unforeseeable need for expanded FMLA leave.  Finally, the employer may require an employee to substantiate the need for leave as soon as practicable, which may be at the same time notice is provided.

The DOL also updated its FFCRA FAQ’s consistent with the updated regulations.

Conclusion

As mentioned previously, the DOL’s updated regulations impact all employers subject to the FFCRA, not just those with employees in New York. Thus, all impacted employers should familiarize themselves with the updated regulations and administer them accordingly moving forward.

To the extent an employer has employees impacted by the revised regulations, such as individuals previously included in the DOL’s broad definition of health care provider or employees who were denied emergency paid sick leave for failing to provide advance notice, they should consult directly with counsel to discuss how to address those specific situations.

About the Author.  This alert was prepared by Marathas Barrow Weatherhead Lent LLP, a national law firm with recognized experts on the Affordable Care Act.  Contact Danielle Capilla (danielle.capilla@aleragroup.com) with questions.

The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients.  This is not legal advice.  No client-lawyer relationship between you and our lawyers is or may be created by your use of this information.  Rather, the content is intended as a general overview of the subject matter covered.  This agency and Marathas Barrow Weatherhead Lent LLP are not obligated to provide updates on the information presented herein.  Those reading this alert are encouraged to seek direct counsel on legal questions.

© 2020 Marathas Barrow Weatherhead Lent LLP.  All Rights Reserved.

Make Better Healthcare Decisions Through Claims Repricing

Background

As healthcare costs skyrocket, we know that employers struggle especially with high medical claims; how to fund them, mitigate them, and understand how they impact their plan. However, it has become increasingly difficult to accurately compare costs across different health plans and networks due to low transparency and complicated relationships among employers, brokers and bidders.

What is Claims Repricing?

This is where medical claims repricing comes into play. Using a third-party actuarial expert will enable a fair comparison through a rigorous data collection process and a systematic, objective analysis.

Repricing provides clients with an objective view of medical claims cost repricing based on actual claims data to help them pick the best network for containing costs. The purpose of repricing is to choose the best network providing desired provider coverage at the lowest available cost. It can be used to evaluate reference-based pricing as well as more traditional networks.

Why Claims Repricing?

Medical claims repricing helps clients compare medical claims costs across different health plans/networks on the same basis. It gives them a clear view of their options. The primary benefit of the repricing exercise is to provide an objective and actuarially sound analysis of claims cost comparison among different networks.

An accurate repricing analysis requires bidders to reprice each procedure performed by each provider according to their contracts. Without clear instructions and rigorous practice, bidders usually provide analysis on an aggregate level that does not reflect the demographics and experience of the client. Therefore, bidders’ self-reported results usually provide an apple-to-orange comparison and could be very misleading.

Medical Repricing Case Study

Client Challenges

Spring recently conducted this repricing process for a client in the dairy industry with over 1,500 employees and four manufacturing sites across different states. They were looking to understand if their carrier rates were competitive:

  • Would utilizing reference-based pricing (RBP) save costs?
  • Would it make sense to switch to a new carrier?
  • Did performance vary by state and major service category?

Spring Approach

Spring assists clients with choosing the right network. This will often be included in a formal Request for Proposal or handled more informally.  Spring facilitated the process using the following approach:

  • Requested detailed claim data from the incumbent including billed, allowed and paid amounts
  • Forwarded detailed instructions and claim data excluding allowed and paid amounts to prospective networks for repricing
  • Provided client with an independent actuarial repricing analysis by region and major service category

Our Solutions

Spring’s actuarial team conducted a rigorous medical repricing exercise and provided client with the following solutions:

  • Spring analyzed potential savings from utilizing a reference-based pricing vendor and determined that while moving to reference-based pricing would save on facility charges, the increase in other medical costs would outweigh these savings.
    • We did note that pairing the reference-based pricing solution for facility claims with a stronger non-facility network could potentially save money.
  • Spring also looked at claim charges for two other prospective networks and found that the incumbent carrier offers the highest overall discounts on claim charges, as illustrated below. In this case, switching entirely to either network will mean higher costs.


Medical Repricing

  • However, Spring provided further insight by state and major service category. Even though switching to bidder A means higher claim costs in total, the inpatient cost of bidder A was 26% lower than the incumbent in one state resulting in 10% overall savings for that state.

Medical Repricing

  • Spring recommended a national network solution carving out one state to maximize savings and minimize disruption.

 

Client Result

This analysis was valuable to the client in their consideration of carrier changes in certain regions:

  • Spring identified competitiveness of the incumbent carrier’s claim charges by state and service category
  • Spring’s analysis helped the client to make an informed decision not to move ahead with the reference-based pricing vendor as significant savings on facility costs were offset by increased physician and other medical costs
  • Recommended a new carrier in one state saving 10% of claim costs

As you can see, a repricing analysis can shed light on a slew of different factors at play within your network across different states and help you make the most cost-effective decision.

Spring Short-Listed for 6 Captive Review Awards

The past year has been busy and successful for the Spring team, and it shows! We are proud to announce that we have been named finalists for the 2020 US Captive Review Awards in the following categories:Captive Review Award Finalist

  • Captive Consultant of the Year
  • Employee Benefits Network
  • Captive Service Professional of the Year (Karin Landry)
  • Captive Innovation
  • Next Gen Initiative
  • Actuarial Firm

At Spring we work hard to consistently deliver creative, tailored solutions to clients; to stay abreast of industry trends and legislation; to contribute to the advancement and modernization of the industry; to expand our connections; to keep our eyes and our minds on both today and tomorrow; and provide sound actuarial guidance. We are honored to be recognized by Captive Review alongside so many thought leaders and trailblazers.

We look forward to the virtual awards ceremony in October, and hope to be popping some champagne!

Spring Launches 2nd Annual Healthcare Benchmarking Survey

Help Us Help You Benchmark Your Programs

We are excited to announce that we are in the midst of conducting our second annual healthcare benchmarking survey, and we’d love your input! The survey will yield a robust landscape of healthcare in the US and the different approaches employers are taking. Having this pulse on the market is all the more important as we continue to cope with the pandemic, and our data will help guide employers and vendors in pivoting their strategies accordingly. 

The survey, which can be accessed here, will be open through August 21, 2020 and will ask detailed questions about your company’s benefits. The contents of the survey include:

  • Background Questions
  • Benefits Offered
  • Disability
  • Life
  • Medical Plan Details
  • Pharmacy/Rx Plan Details
  • Retiree Medical
  • HSA/HRA
  • Health and Productivity
  • Dental
  • Vision
  • Retirement Benefits
  • Firmographics

It will take about 30 minutes to complete the survey. Please note that the survey will “remember” your responses, so you do not need to complete the survey in one sitting. Please be aware that there are sub-questions programmed into the survey that will only appear based on your responses to other questions. As such, the question numbering may not always be consecutive.

The data compiled will be summarized in a report that you can use to benchmark your company against others of similar size and industry. Please note that the data will be aggregated and individual responses will be kept confidential.

As an alternative to you completing the survey online, you can send us your company’s benefit information (e.g. your open enrollment kit) and we will fill in as much of the survey as we can, and come back to you to fill in any major gaps.

Please click the link below to begin and know that you are making a valuable contribution to the industry by doing so.

https://springconsulting.iad1.qualtrics.com/jfe/form/SV_6MCy4oC2ldOd4Y5?Source=Spring

 

Thank you! Please get in touch with any questions: insight@springgroup.com.