Final Proof by HR Professionals of Greater Memphis Magazine

Volume 1 : Issue 3

www.HRprosMemphis.com

L&P ANNUAL BENEFITS SURVEY

Nancy Blair-Bonk Leads FedEx Express Employee Benefits HEALTH & WELFARE

Get Ready for HEALTH CARE

Exchanges

DEFENDING

Unemployment Claims

Northeast Arkansas SHRM BOARD

GINA Discrimination

From right here, one of the biggest on the job anywhere.

The largest law firm in the Mid-South that devotes its practice to representing management in all areas of labor relations, employment law and human resource consulting

Kiesewe er Wise Kaplan Prather, PLC

3725 Champion Hills Drive • Suite 3000 • Memphis, Tennessee • 38125 • 901-795-6695 • www.kiesewe erwise.com Cer fica on as a labor and employment specialist is not currently available in Tennessee.

Contents

Human Resources & Management Expertise

75% WOULD RATHER Pay More Out of Pocket

than Have Their Benefits Reduced

www.HRprosMemphis.com Editor Cynthia Y. Thompson, MBA, SPHR Publisher The Thompson Firm LLC

Features 4 5

Contributing Writers Nancy Blair-Bonk V. Latosha Dexter, SPHR Jonathan C. Hancock Jim Horrell Whitney M. Harman Lisa Lichterman Leach Lisa May Amber Isom-Thompson Cristie Upshaw Travis

Board of Advisors Austin Baker Jonathan C. Hancock Ross Harris, CFO, CFA Diane M. Heyman, SPHR John E. Megley III, PhD Terri Murphy Susan Nieman Robert Pipkin Michael R. Ryan, PhD

to the RSSFEED

Letter from the Editor Health Care Reform Defining the Role of Health Care Exchanges

HR Consulting and Employee Development

Art Direction Brantley Bowden & Co.

www.HRprosMemphis.com

Tennessee Employment Law Tennessee’s New Summary Judgment Standard Pt. 2

the HR Scene and Events Calendar

19 22

Profile: Nancy Blair-Bonk Who’s Who? HR Professionals as Benefits Managers

Departments

Columns

16 20

SHRM-Memphis Bulletin Meet the North East Arkansas SHRM Board

Greater Memphis Employee Benefits Council

Benefits FedEx Express Benefits

Tennessee Employment Law New Legislation Makes it Easier for Employers

13 17

Minimize Risk with PostEmployment Screening Leadership

Dr. Steve Perry on Memphis Schools Contact HR Professionals of Greater Memphis: To submit a letter to the editor, suggest an idea for an article, notify us of a special event, promotion, announcement, new product or service, or obtain information on becoming a contributor, visit our website at www.HRprosMemphis.com. We do not accept unsolicited manuscripts or articles. All manuscripts and photos must be submitted by email to Cynthia@HRprosMemphis.com. Editorial content does not necessarily reflect the opinions of the publisher, nor can the publisher be held responsible for errors.

21 22

HR Professionals Of Greater Memphis Magazine is published every month, 12 times a year by The Thompson Firm, LLC. Reproduction of any photographs, articles, artwork or copy prepared by the magazine or the contributors is strictly prohibited without prior written permission of the Publisher. All information is deemed to be reliable, but not guaranteed to be accurate, and subject to change without notice. HR Professionals Of Greater Memphis Magazine, its contributors or advertisers within are not responsible for misinformation, misprints, omissions or typographical errors.

Perceived Value of Benefits Advocacy Health Care Reform

2012 Timeline for Health Care Reform EEOC Update

Industry News 27

GINA Discrimination Update

Next Issue Compensation

Small Biz Best Practices 4 Steps You Can Take NOW To Get Ready for Health Insurance Exchanges

Performance Management

Breaking News Cost of Living Increases for Defined Contribution Plans

stay current Follow Us! www.HRprosMemphis.com

on the Agenda.

a note from the Editor

“Welcome!” new subscribers! Welcome to our new subscribers! If you are a first time reader, our mission is to serve the HR professional and advance the profession. We reach over 5500 members of the Society for Human Resource Management (SHRM) in Tennessee, Mississippi, and Arkansas. In addition, the Greater Memphis Chamber of Commerce members are included in our distribution along with the top 100 CEOs in the Mid-South area. HR Professionals of Greater Memphis is approved by SHRM and is in partnership with SHRM-Memphis, one of the largest chapters in the country. We cover topics on every discipline of the Human Resources function. These are topics of importance not only to HR professionals, but all business leaders. It is our goal to cover the current hot topics and bring you solutions to the problems that keep you up at night. This issue focuses on benefits and health care reform. Our cover this month is Nancy Blair-Bonk, Managing Director of Employee Benefits Health and Welfare for FedEx Express. She has also written an article about Fed Ex benefits that will serve as a benchmark of comparison for you as you design your 2012 benefits program. We also bring you the results of the recent Lipscomb and Pitts Annual Benefits Survey that will provide you with national and Mid-South benchmarks for the most popular benefits of 2011. We look forward to your comments about this month's articles. Please contact us at Feedback@HRprosMemphis.com and let us know if you found this issue helpful in your annual benefits planning process. I was so excited to be invited to the annual Urban League Luncheon, and to have the opportunity to meet Karla Davis, Commissioner of the Tennessee Department of Labor and Workforce Development! What an honor to have a photo “opp” with her! She was the keynote speaker at the luncheon, and it was so inspiring to hear what she and her staff are doing for our displaced workforce across the great State of Tennessee as we work our way out of this recession. October and November were action-packed; and I thank each of you who invited me to your events so that we can share them. Remember to send your news and announcements about events and meetings to News@HRprosMemphis.com. In this season of Thanksgiving, I extend a special word of thanks to our Sponsors and to SHRM-Memphis for their continued support.

Cynthia Y. Thompson | Editor cynthia@HRprosMemphis www.HRprosMemphis.com

www.HRprosMemphis.com

Urban Leag Luncheon ue Karla Davis, Comm issioner of the Te nnessee Department of La bor and Workforc e Development!

BE NE FI TS

DEFINING the Role of Healthcare Exchanges BY JAMES HORRELL

Background

A key element of the health reform legislation (the Patient Protection and Affordable Care Act or the PPACA) is the establishment of health insurance Exchanges. How the Exchanges will operate, and how they will influence the market for health insurance, will be important considerations for employers and employees.

The PPACA imposed a number of requirements in regard to health insurance coverage that apply to both individuals and employers. Chief among these are the requirement that individuals be covered under plans that meet minimum standards, and the requirement that employers offer plans that meet these minimum standards and which are affordable (as defined by the law). Failure to meet these requirements results in penalties which can be substantial. The Exchanges are intended to enable individuals and small employers to access coverage that meets the standards set by the law (and thereby avoid the penalties mentioned above). However, the Exchanges will also fulfill a number of additional important functions.

Exchange Functions Beginning in 2014 each state will have at least one Exchange available to individuals, and one Exchange available to small employers (although it’s possible for a single Exchange to serve both). These Exchanges are intended offer more uniform coverage

choices, improve quality, reduce cost, and provide a national mechanism to deliver cost subsidies for lower-income individuals.

More specifically, they will:

1Certify

that the plans offered by the

insurance companies in the Exchange meet the minimum standards as defined by law (“qualified health plans”).

2Determine

whether

individual

applicants qualify for the Exchange, or qualify for Medicaid, CHIP or other governmental programs.

3Determine

whether individuals will

qualify for tax credits (which will offset the cost of Exchange premium) and costsharing reductions (which will reduce the individual’s out of pocket expenses when claims are incurred).

4Facilitate enrollment in qualified health plans by both individuals and small employers www.HRprosMemphis.com

5Help individuals compare the services

and costs of competing qualified health plans

6Collect

and remit premiums from

individuals, and collect, aggregate, and remit premiums for groups purchasing coverage through the small employer Exchange. (The small employer Exchange is known as the Small business Health Option Program or “SHOP”.)

Exchanges will also develop websites, run call centers, and develop on-line calculators to assist individuals with the purchase of health insurance plans.

Exchanges and Employers The “SHOP” Exchanges are intended to assist small employers in arranging coverage for their employees. In calendar years 2014 and 2015 a “small employer” is an employer with no more than 100 employees (although states may elect a lower limit). In 2016 the 100-employee limit would apply in all states. In 2017 states may optionally open the SHOP to larger employers. There are no final regulations that define how group coverage might be arranged. Options include a traditional group arrangement (where the employer selects a single qualified health plan to be offered to all employees) or the option of allowing employees to select from any of the qualified health plans available in the Exchange. Employers may permit employees to purchase Exchange coverage using pre-tax contributions (through a cafeteria plan); this option is not available to individuals purchasing coverage in the Exchange.

Implications for employees A number of PPACA provisions have a direct bearing on individuals, including the elimination of a pre-existing condition limits and the imposition of substantial restrictions on rescissions. The availability of Exchange coverage should help eliminate much of the confusion that typically surrounds the purchase of health insurance. The availability of tax credits and reduced cost sharing should make coverage much more affordable for lower-income individuals. 6

www.HRprosMemphis.com

However, individuals that have access to “affordable” employer-sponsored coverage that meets the minimum PPACA requirements cannot qualify for tax credits or reduced cost sharing, even if they purchase coverage through the Exchange. An affordable plan is one that charges no more than 9.5% of household income for single coverage (and many employer plans will meet this standard). Some lower-paid employees, particularly those covering dependents, would prefer the advantages of the Exchange, but will be unable to access the tax credits and reduced cost sharing if the employer’s plan is “affordable”. Adverse selection may also influence Exchange pricing for individuals. One consulting firm (Oliver Wyman) has concluded that the Exchange requirements will increase premiums overall due in part to the inclusion of individuals with health conditions. They have also suggested that the mandated “spread” in premium rates (a ratio of no more than 3:1 from highest to lowest rates based on age) will tend to increase costs for younger individuals.

Influence on employers Employers will be required to communicate the availability of Exchange coverage beginning in 2013, and this will add more complexity to what for most employers is a difficult benefit communications challenge. Small employers that use the SHOP option may also experience additional administrative burdens (depending upon how the SHOP program allows employees and employers to access coverage). While the Exchange may present a viable alternative for employees (particularly lower-income employees) employers will face a difficult decision: offering “affordable” coverage that meets minimum requirements ensures that the employer will not be subject to tax penalties (known in the PPACA as shared responsibility payments) but will also deprive some lower-paid employees of the opportunity to receive tax credits and reduced cost-sharing through the Exchange.

Higher-paid employees are also affected: those with household incomes in excess of 400% of the Federal poverty level (estimated to be about $45,000 annually for a single person in 2014 and about $94,000 for a family of four) would not qualify for any tax subsidies. Depending upon age and other factors, purchasing coverage through the Exchange may be much less attractive than purchasing coverage through an employer.

Where are we today? Tennessee was one of 48 states that applied for Federal grant money to study the feasibility of implementing a statesponsored Exchange program. Work on this project is ongoing, but the Commonwealth Fund reports (as of September, 2011) that Tennessee is one of ten states that “has not had any legislative activity to create the legal authority to establish an Exchange”. (The Commonwealth Fund Blog, “State Health Insurance Exchange Legislation: A Progress Report”, September 12, 2011) Eleven states have passed enabling legislation, while 12 other states introduced legislation in 2011 that did not pass. To complicate matters, it is likely that the Supreme Court will review at least one aspect of the PPACA (the individual mandate) which may place the entire law in question. All of the Republican candidates for president have indicated that they would attempt to reverse the law if elected. Despite this considerable uncertainty, employers have a relatively limited time to create a strategy that is responsive to employer and employee needs, taking into account the “brave new world” of health reform. Jim Horrell, is a Principal with Mercer Health & Benefits, LLC, Tennessee Operations.

Send feedback to: feedback@HRprosMemphis.com

BE NE FI TS

HEALTH & WELLNESS A Large Employer’s Experience and Perspective on Strategy

BY NANCY BLAIR-BONK

FedEx Express is the world’s largest express transportation company, providing fast and reliable delivery to every U.S. address and more than 220 countries and territories. Headquartered in Memphis, Tenn., FedEx Express has a global workforce of more than 140,000 employees. Of that number approximately 30,000 work in the Memphis metropolitan area. At FedEx Express, the health and wellness of its workforce is a top priority. Like other companies, FedEx is concerned about the rising cost of healthcare. Healthcare spending in the U.S. represents approximately 17 to19 percent of the country’s total GDP. A report by the consulting ﬁrm PriceWaterhouse Coopers and the Health Research Institute (“Behind the Numbers”) concluded that healthcare cost for employers is expected to increase 8 percent in 2011 and 8.5 percent in 2012. ese statistics show why businesses are concerned about the long-term implications of healthcare trends. Understanding the cost drivers behind the increase is critical to managing costs. According to the National Health Center for Health Promotion and Disease Prevention, for every 100 individuals in the U.S. workforce: • 60 are sedentary • 25 smoke; 10 have diabetes • 50 have high cholesterol; 24 have high blood pressure • 50 are distressed or depressed • 27 have active cardiovascular disease • Many of these individuals have two or more of these conditions For an employer this means: • 20 percent of healthcare expenditures are attributable to preventable illness • 40 percent of healthcare expenditures are attributable to modifiable risk • 11,500 hours of productivity are lost each year due to health conditions

ese statistics demonstrate why FedEx, like many other employers, has implemented programs to help prevent and manage illness.

Since our employees have different health needs FedEx Express offers an array of wellness programs. Programs include Personal Health Teams to help employees with lifestyle issues such as stress, tobacco or weight management and Condition Management programs for Asthma, Diabetes, Hypertension, Low Back Pain and more. Additional programs include a 24-hour Nurse and Health Information Line, an Employee Assistance Program (EAP), a flu shot program and discounts on wellness programs such as weight loss and gym memberships. In the Memphis area, FedEx Express has three on-site fitness centers for employees to exercise and participate in group conditioning classes. FedEx Express makes available resources that help employees become better consumers of healthcare services. For example, an employee may contact a Personal Health Team advocate at the medical vendor to discuss a diagnosis or treatment options, or get support for managing a chronic condition such as asthma, allergies or high blood pressure. ese nurses, health coaches and other clinicians are dedicated to FedEx Express and work with employees regarding nutrition and fitness and also provide tools and information to help employees stay well and navigate the health care system.

www.HRprosMemphis.com

CONTINUED FROM LAST ISSUE...

Nancy Blair-Bonk is the Managing Director of Employee Benefits/Health and Welfare for FedEx Express, the world’s largest express transportation company.

In addition to her responsibilities at FedEx Express, Blair-Bonk participates in many national and local organizations. ese include the National Business Group on Health and the Conference Board’s Research Council for Employee Beneﬁts. She also serves on the leadership team for the Memphis Business Group on Health and the Healthy Memphis Common Table/Robert Wood Johnson Foundation’s “Aligning Forces for Quality” healthcare initiative. I 8

www.HRprosMemphis.com

•OVERT URNED • Tennessee’s New Summary Judgment Standard

TENNESSEE’S WILD TRACTOR RIDE

and Its Impact On Retaliation Claims

B Y J O N AT H A N C . H A N C O C K & W H I T N E Y M . H A R M O N

The Gossett decision was a very close one. It was in fact a 3 to 2 decision with a dissenting opinion authored by current Chief Justice Cornelia Clark. Justice Clark's dissent favored returning to the McDonnell Douglas framework and noted that Tennessee will be only the fourth state to abandon it. Justice Clark's dissent was seen by Tennessee employers as perhaps the only foothold in an increasingly employeefriendly litigation environment. On May 21, 2011, the ride got wild again. The Tennessee legislature, in an action very consistent with the sentiment expressed in Chief Justice Clark's dissent, passed legislation that restores the McDonnell Douglas framework to employment litigation in Tennessee by legislative mandate. House Bill 1641 specifically overrode the impact of Gossett by imposing a statutory burden shifting framework where employees must prove a basic prima facie case of discrimination, retaliation, or wrongful discharge, and only then will an employer be required to articulate its legitimate nondiscriminatory reasons for the challenged employment decision. Consistent with the McDonnell Douglas framework, an employee will be given an opportunity to demonstrate that reason for the adverse employment action articulated by the employer is actually not genuine, but absent an employee's ability to do so, summary judgment should generally be granted in an employer's favor. The net result of this legislation should be that meritless employee lawsuits will continue to be dismissed in Tennessee state courts before trial. Risk analysis and claim evaluation became extremely complicated for Tennessee employers after the Tennessee Supreme Court's decision in Gossett as employers were required to very early on determine whether the employee had any evidence of retaliation, even circumstantial evidence, as this was likely enough to survive summary judgment and dramatically impact the value of contested claims. Following Governor Haslam's passage of House Bill 1641, this is no longer the case in Tennessee. Employers can now return to the commonly accepted federal analysis, and hope for summary judgment in cases where the reasons for the challenged employment action cannot reasonably be characterized as pretextual, if it is otherwise legitimate. This is a positive development for Tennessee employers, as the wild ride that started in September 2010 has finally concluded and we can once again, at least for the moment, have some reasonable expectation of the most likely result in judicial proceedings. I M

To further improve employee well-being, FedEx Express analyzes health claims information and uses it to develop new and more effective programs. For example, diabetes is an epidemic in the United States, afflicting a rapidly increasing number of people each year. e disease affects not only quality of life it also consumes healthcare resources and accounts for absenteeism and loss of productivity. In 2006, FedEx Express developed and launched an incentive program for diabetes management that offers diabetic employees a $50 incentive (which represents a partial refund of co-payment costs) when they meet three criteria: 1) enroll in the Condition Management Program for Diabetes; 2) undergo an annual retinal vision eye examination; and 3) have an annual hemoglobin A1C test. e program aims to motivate diabetics to receive recommended care, thereby reducing complications, hospital admissions, emergency room visits and lower the cost of healthcare. As a result of implementing the program, diabetic emergency room visits by FedEx Express employees dropped 13 percent, inpatient admissions fell seven percent while the cost of a diabetic episode fell five percent. FedEx Express communicates regularly with employees to tell them about the health benefits available to them. Communications include a quarterly benefits newsletter with health tips and benefit updates including pharmacy, Employee Assistance Program, and work/life balance information. e communications promote health and wellness and provide tips and resources to improve health and manage chronic illness. FedEx Express understands the benefits of health and wellness programs and is committed to promoting wellness to improve the overall health of employees and their families.

This article ran in two parts; the first of this article may be found online at www.hrprosmemphis.com Volume 1: Issue 2, page 6.

EM PL

TN EMPLOYMENT LAW

OY M EN T LA W

Unemployment Hearings and Witness Testimony: RECENT LEGISLATIVE CHANGES MAKE IT EASIER for Employers TO DEFEND UNEMPLOYMENT CLAIMS BY LATOSHA DEXTER

•AMENDED LAW•

FIRST HAND KNOWLEDGE.

Anyone having previous involvement with Tennessee Code § 50-7-304 the Tennessee unemployment process may have heard these words. In defending an unemployment claim and presenting proof of misconduct, employers have often been instructed to present only witnesses with first hand knowledge of the events leading to termination. The operative words “may” and “often” as unemployment hearings procedure have various interpretations depending on the hearing officer. Although the evidence rules used in court litigation are not necessarily applicable to unemployment hearings, some hearing officers require each witness to possess first hand knowledge and thus, exclude what they deem to be “hearsay”. This restriction means that a human resources representative cannot testify about the reasons an employee was terminated or disciplined unless the human resources representative was the one determining or administering the discipline. Previous disciplinary documents which may have formed a basis for subsequent termination also could not be presented by the company representative unless the company representative was the person who disciplined the employee. For example, in a Middle Tennessee case a restaurant was precluded from submitting negative customer comment cards from patrons as evidence that a waitress was rude and ignored diners. These restrictions on testimony on the part of the Department of Labor have placed employers in a difficult position. What if a key witness has left the company or otherwise became unavailable by the time the hearing is conducted? Consider the cost to the employer of allowing a line manager to be absent from work to testify at an unemployment hearing. In the restaurant case, should the restaurant be required to subpoena the complaining patrons to be physically present for this hearing? What if the employer has a “three strikes and you’re out” policy and the three letters of discipline came from three different managers? Should all three managers be required to testify at the unemployment

hearing? Further, an employer always has to consider that testimony presented during the appeals hearing could be used against the employer in some other matter unrelated to the unemployment claim. Therefore, limiting the witnesses presented might be to the company’s benefit if the witnesses are unreliable or unprepared. The process of contesting an employee’s unemployment compensation claim can be distracting and a drain on the employer especially if multiple witnesses have to be interviewed and prepared to testify. Well, the Tennessee General Assembly, in a win for employers, has provided a mechanism for addressing this issue. Newly enacted legislation, effective April 29, 2011, now allows an employer to submit personnel records and other business records in defense of an unemployment claim without strict compliance with the Tennessee Rule of Evidence. This legislation provides consistency in the unemployment process throughout the state and eases the burden on employers in defending unemployment claims. www.HRprosMemphis.com

TN EMPLOYMENT LAW

The newly revised Tennessee Code § 50-7-304 provides that personnel records and other business records are admissible and may constitute proof of misconduct if the following conditions are met:

Representing employers in employment and labor-relations matters since 1959. Jeff Weintraub, Best Lawyers for 16 years James Stock, Best Lawyers for 10 years

The records must be in the possession of the employer;

The records must be relevant to the claim;

The records must be accompanied by an affidavit of its custodian or other qualified person certifying the evidence as a business record.

These conditions are easily met by the prudent employer who properly documents and retains disciplinary and attendance records, performance evaluations, and other business records potentially pertinent and relevant to an unemployment claim. An affidavit supplied by a human resources representative or other company official who can testify to the fact that the record is routinely maintained by the company as a business record satisfies one of the statutory requirements. The affidavit is sufficient when it states that 1) the records were made at or near the time of the occurrence of the matters described in the record, 2) the records were kept in the course of regularly conducted activity, and 3) the records were made of the regularly conducted activity as a regular practice. In the current economic climate employers are more likely to receive unmerited and unwarranted unemployment claims. The more former employees you have collecting unemployment benefits, the higher your unemployment tax levy will be. Employers are well served to scrutinize unemployment benefit claims and contest them whenever a justified reason exists to do so. The ability to present an affidavit, rather than first hand “personal knowledge” testimony, makes the process easier and less costly for employers. Since the legislation also provides consistency throughout the state, employers thankfully now know what to expect and know what they can legitimately present as documentary evidence to contest a claim. I

Latosha Dexter, SPHR Attorney, Rainey Kizer Reviere & Bell, PLC

www.HRprosMemphis.com

2011

Today, legal problems and union

activities can impose an enormous financial strain on a company.

For this reason, Weintraub Stock is

strongly committed to preventative labor and employment relations and to providing the necessary

knowledge and assistance to employers to allow them

to effectively operate in a highly regulated, litigious

business environment. However, when prevention

doesn’t work, we fight to win the case.

www.weintraubstock.com Employment Discrimination Defense | Labor Relations | Employee Handbooks Management Training | Family Leave | Overtime & Benefits | ADA Immigration Law | Wrongful Discharge & Covenants/Unfair competition Litigation | Arbitration | Alternative Dispute Resolution No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers

TS FI

Trends

2011Benefits

If you are a Benefits Manager or a Human Resources Director, you are probably struggling with your budget and your employee benefits program for 2012. About this time of year, many HR professionals begin searching for appropriate benchmarks for their company in their industry, in the nation, and the Mid-South. Here are some of the trends that were uncovered by the recent 2011 Lipscomb and Pitts Benefits Survey. The survey encompasses 2799 (1.7 million employees) companies nationally (N) and 102 (104,402 employees) Mid-South (M-S) companies locally. We hope it will serve as a benchmark for your 2012 planning.

Medical Plan Trends 2011 Medical Cost Increases Still Outpace Inflation 5% locally | 9 % nationally in 2011 | 7% nationally in 2010 | 6% nationally in 2009 2011 M-S PPO | HMO/EPO plan design values are 5.6% lower than N 2011 M-S CDHP plan design values were 22.7% lower than N 11% M-S companies currently offer CDHP plans | 19% M-S companies are considering offering CDHP plans in 2012

Self-Insured Plans

Fully-Insured Plans

0-49

0.0%

87.5%

50-199

1.8%

69.6%

200-499

41.7%

58.3%

500-999

64.3%

35.7%

1000+

75.0%

8.3%

All Plans

20.3%

61.9%

#EEs

www.HRprosMemphis.com

Medical Plans According to the survey the national median deductible for PPOs in manufacturing, finance and insurance; and professional, scientific, and technical services was $500/$1000. The median coinsurance was 80%/60%. Median retail prescription copays were $10/$30/$50. 84% of all companies had PPO; 12% had CDHP, 3% had POS, and 1% HMO/EPO. The median percentage of M-S companies offering CDHPs was only 11%, and 0% of M-S companies plan to offer them in 2012. The median emergency room copay across plans is $200. The median coinsurance across plans for outpatient surgery is 80%.

(up 7.3% over 2010) (74 and 75)

Medical Plans Offered for Domestic Partners (M-S) 71% do not offer | 22% opposite sex | 5% offer both same sex and opposite sex | 2% offer same sex | 22% offer opposite sex

Employee out-of-pocket cost 17% Employee contribution 24% Employer contribution 59%

Median Monthly Premium PPO Plans EE $390 (M-S) $456 (N) | Family $1063 (M-S) $1330 (N)

2011 MEDICAL COSTS for a typical family of four are approximately $19,393

Prescription Drugs There was a 2.3% increase in spending on prescription drugs reaching $307 billion. There are currently about 2400 drugs in clinical development with approximately 50% for the treatment of cancer.

The Mid-South lags behind the national average offering wellness and disease management programs.

STD Elimination Period Based on Illness (M-S) 9% < 7 days | 50% 7-13% | 41% 14+days 58% offer 60% of salary 51% offer benefits for 13 weeks | 26% offer benefits for 26 weeks 56% pay 100% for accident | 56% pay 100% for illness

Paid Time Off 70 percent of Mid-South companies require employees to show a doctorâ&#x20AC;&#x2122;s note when they take paid sick time. 60 percent of Mid-South.

Paid Time Off Based on Length of Employment (M-S) Wellness Programs Offered Wellness newsletters 32% (M-S) | 44% (N) Employee assistance programs 27% (M-S) | 45% (N) Smoking cessation programs 20% (M-S) | 26% (N) Web-based resources for healthy living 17% (M-S) | 20% (N) Health club discount/reimbursement 14% (M-S) | 25% offered (N) Weight loss programs >10% (M-S) | 19% offered (N) Disease Management Programs Offered Diabetes 21% (M-S) | 25% (N) High cholesterol and obesity 13% (M-S) | 19% (N) Obesity 13% (M-S) | 17% (N) Asthma 12% (M-S) | 17% (N) Hypertension 11% (M-S) | 18% (N) Depression 8% (M-S) | 13% (N) Lower back pain 5% (M-S) | 10% (N)

New Hire

1-5 Years

6-9 Years

10+Years

Sick

Vacation

Personal

PTO Bank

Retirement Coverage (M-S) Retirement Coverage (M-S) (92) 61% offered defined contribution plans 401(k) | 403(b) 4% offered defined benefit and defined contribution plans 1% offered defined benefit plan only 34% NA Defined Benefit Plans Disappearing (M-S) 57% of plan sponsors surveyed froze their existing defined benefit plans 33% froze the plan for participation and benefit accruals 24% froze participation but continued to accrue benefits for participating employees 42% kept plans active

71% of M-S Companies Offered Dental Coverage 84% of those companies offered DPPO

Defined Contribution 93% have an investment allocation match that is employee directed 29% have 26+fund options available Most common company match is 50% up to 6% of salary.

Basic Life Insurance Amount Offered (M-S) 66% offer flat-dollar amounts | 12% offer 1 x salary 12% offer 1.5% x salary | 7% offer 2 x salary

Long Term & Short Term Disability Trends The majority of Mid-South companies responding to the survey require a 90 day waiting period for Long Term Disability benefits to kick in. 83 percent of companies pay 80 percent of the premium for LTD and 77 percent pay 60 percent of salary. However, the waiting period for Short Term Disability for 50 percent of companies is only 7-13 days if for illness, and 40 percent of companies require 14 day waiting period for STD due to an accident. LTD Base Elimination Period (M-S) 64% 90 days | 28% 180 days | 6% 60 days | 2% other 77% replace 60% of salary 10% offer buy up plan 83% of Mid-South companies pay 83% of base cost STD Elimination Period Based on Accident (M-S) 37% < 7 days | 23% 7-13 days | 40% 14+days 12

www.HRprosMemphis.com

Top 1 2 3 4 5 6 7 8 9 0

0 Cost Control Strategies

Negotiated lower costs with current carrier Increased deductibles Increased employee share of monthly premium Explored market (RFP) and changed carrier/health plans/TPA Increased employee out-of-pocket maximums Other Changes Increased RX drug copays or coinsurance Increased employee share of coinsurance Increased office visit copays Implemented wellness or disease management program

Lipscomb and Pitts conducts this survey every year as a service to the community. Anyone interested in participating in next year's survey can contact Betsy Kamler at betsyk@lpinsurance.com and she will add them to the invitation list.

Minimize

RISK

with Post-Employment Screening Solution BY LISA P MAY

The majority of companies in the US have embraced preemployment screening in their hiring process. It is estimated in 2010 that 9 out of 10 companies performed some sort of background check during the hiring process. Just as important and far less prevalent is the need for postemployment screening. Conducting post-employment screening regularly throughout an employee’s career can proactively identify risk which may give rise to negligent retention claims, workplace violence, shrinkage and negative publicity. The healthcare industry is at risk of being fined large civil monetary penalties for non-compliance of state and federal laws and regulations. Medical monthly monitoring reduces this risk and maximizes their protection. An employee may begin their career with a clean criminal history, drug-free lifestyle, and good personal financial practices, but there is no guarantee that their background will remain spotless. Crimes such as fraud are often committed by long-term, trusted employees.

SCREENINGSolutions

Offenses that may be uncovered during a post employment screen that would be relevant to the employer would be: 1. Drug use: A large number of employed Americans abuse drugs, and this number is increasing every year. Drug abusers can create risks in the workplace such as decreased productivity, greater likelihood of stealing, and altercations with co-workers. 2. Serious criminal offenses: These would be crimes that may show an increased risk to the company. Becoming aware of criminal convictions allows the employer to take measures to reduce the possibility of negative issues that range from fraud, to theft, to workplace violence. 3. Medical sanctions, exclusions or debarments: Monthly monitoring of providers’ and suppliers’ licenses and databases to ensure healthcare organizations remain compliant.

4. Credit problems: Periodically checking an employee’s credit report is one way to measure the person’s trustworthiness and decrease the risk of becoming a victim of fraud. NOTE: only utilize credit reports in this manner for positions in which an employee’s credit habits are relevant and fair.

A reputable employment screening company can provide specific periodic checks on the employee’s criminal and credit history and can continue to monitor current employees’ background information. Businesses need to realize that the screening of a new employee is not complete on their first day of work. While a good pre-employment screening process helps to decrease the possibility of hiring unqualified, dishonest, or dangerous applicants, implementing a screening process for current employees can further guard against risk to the company and the workplace. *The following is general educational information only. It is not legal advice. You need to consult with legal counsel regarding all employment law matters. This information is subject to change without notice.

Lisa P. May, VP Resource & Development, Data Facts Inc.

www.HRprosMemphis.com

WHO? Linda

(L-R)

Orman,

Administrator; and Carol Twyman, HR

1 2

Manager for the Greater Memphis Chamber

Commerce

the

www.GetOnTheCoach.tn.gov

Chamber Breakfast Forum on October

The Career Coach Mobile Centers provide services similar to what you might find in a Tennessee Career Center. These vehicles will arrive on the scene to provide a mobile computer lab with Internet access; create a venue for workshops including résumé assistance and interviewing skills; and serve as a recruitment center for companies moving into our state.

6th at the Marriott East. 2 The Tennessee Department of Labor and Workforce Development Career Coach was seen parked at the University of Memphis Holiday Inn during the recent League

Urban

Luncheon

where

Commissioner Karla Davis was the keynote

speaker.

The

Tennessee

Department of Labor and Workforce Development

rolled

out

Career

Coaches in April 2011. 3 (L-R) Dr. Steve Perry, Keynote Speaker at the October Lipscomb & Pitts Breakfast Club with Dr. Freda G. Williams, Commissioner-AtLarge Position 1 of the City of Memphis School Board. 4 Brooks Monypeny, Managing Director of the Morgan Keegan Strategic Plan Solutions Group, at the SHRM-Memphis Comp and Benefits Career Emphasis Group meeting at the University of Memphis Holiday Inn held September 28. 5 (L-R) Brenda Walker, Sr. Staffing Manager; and Tammy Griffin, Sr. Account Manager both with Randstad, at the Greater Memphis Chamber Breakfast Forum in October. 6 (L-R) Lisa May, VP Marketing with Data Facts, Inc.; and Trevor Beahm, Technology Consultant with Master IT, chatting at the Lipscomb & Pitts Breakfast Club on October 21. 7

4 5

(L-R) Tennessee State Representative District 83, Mark White; and Moya Dent, Private Banking at Independent Bank, attended the Lipscomb & Pitts Breakfast Club at Minglewood Hall. 8 (L-R) Joyce Margulies, Margulies Employment Law Consulting, at the recent Chamber Lunch and Learn at the First Tennessee Ron Terry Center; Beth Clawson with Flintco; and Jenny Harmeier and Karrie Porter of Above and Beyond Electric. 9 (L-R) Karla Davis, Commissioner of Tennessee Department of Labor and Workforce Development; with Tim Bland, Partner, Ford and Harrison, at the Urban League Luncheon in September.

“The most important thing in communication is to hear what isn't being said.”

– Peter Drucker 8 14

www.HRprosMemphis.com

SCENE

CALENDAR of EVENTS

11 Susan Stephenson, Co-Founder, Co-Chairman and President of Independent Bank speaks at the Small Business Council Marketing Summit held at the Racquet Club in August. 12 Brenda Rickborn, Associate Regional Director of Employee Benefits Security Administration, was keynote speaker at the SHRM-Memphis Comp and Benefits CEG Meeting, “Breakfast with Benefits”. Her topic was, Unlocking the Secrets of a Department of Labor Investigation. David Thornton; attorney with Bass, Berry, Sims also spoke on Outsourcing Fiduciary Obligations: Fact or Fiction. The meeting was sponsored by Morgan Keegan Strategic Plan Solutions Group, ADP, and OneAmerica. It was held at the University of Memphis Holiday Inn.

13 Jeff Weintraub, Managing Partner with Weintraub Stock PC, spoke on Surviving Emails at Dixon

Hughes Goodman at the recent Small Business Council Breakfast. Barbara Richman, Sr.

November 17, 6:00 -8:00 PM at U of M Fogelman Executive Center Health Reform in Tennessee What Could Impact Your Business in 2014? A light dinner will be served. Brian Haile, Director, Insurance Exchange Planning Initiative for the State of Tennessee, will be the speaker. This event is sponsored by MBGH, Health Choice, Metro-Care Physicians, Methodist Healthcare, Healthy Memphis Common Table, Memphis Medical Society and the University of Memphis School of Public Health. Register now at www.MyHealthChoice.com December 2, 8:45 AM-3:45 PM, at Memphis Hilton, 939 Ridge Lake Blvd. Memphis Bar Association Annual Seminar The Labor and Employment Section of the Memphis Bar Association is holding its Annual Seminar at the. It will include many topics and speakers of interest to HR Professionals and the program has been submitted to the HR Certification Institute for review for credit.

Consultant with HR MPACT, spoke on Email Etiquette. 14 (L-R) Desi Franklin, Executive Director of Workforce Investment Network, was the keynote speaker at the Greater Memphis Chamber Breakfast Forum in October. John Duncan,

VP Member Development,

Greater Memphis Chamber; Andrew Douglas, News Anchor for WMCTV. 15 Lisa L. Leach, Partner with

SAVE THE DATE!

Kiesewetter Wise Kaplan and Prather with Johnny Pitts, Chief Manager at

Do not miss your chance to hear presentations from Equal Employment Opportunity Commission Commissioner Chai Feldblum and Acting National Labor Relations Board General Counsel Lafe Solomon. Registration Fees: $85 (HR Professionals, including HRCI credit pending)

Lipscomb & Pitts Insurance at the October L & P Breakfast Meeting held at Minglewood Hall and hosted by Kiesewetter Wise Kaplan and Prather. 16 John Veazey, Partner with Leadership Coaching and Consulting, was the guest speaker at the joint meeting of ASTD and SHRM-Memphis in October at the University of Memphis Holiday Inn. The topic was HR Professionals and Training Professionals as Internal Coaches. 17 Kelly McDonald signs copies of her new book at the NEA SHRM Seminar on October 10 at the ASU Alumni Center in Jonesboro, AR.

"I have never gone to a seminar, and not met someone of significance, or bumped into someone I knew and strengthened the relationship." – Jeffrey Gitomer 16

December 9, Weintraub Stock PC, Counselors and Attorneys at Law Come join us for a morning of labor law and an afternoon of employment topics. Our special guest is William Harvey, former attorney and Assistant to the Regional Director with the National Labor Relations Board, who will discuss the behind-the-scenes politics and driving forces that have led to some of the strange determinations by the Board. Location: 6465 N. Quail Hollow Road, Memphis, TN 38120 Time: 8:30-12:00 Labor Law 1:00-4:30 Employment Law Contact: Joni Prouser — 901.526.0431 www.HRprosMemphis.com

BULLETIN A HeaRt for Memphis Human capital is the new currency for cities. HR professionals know that human capital is the lifeblood of their organization, but now communities across the country are embracing a human capital development approach to talent development from cradle to career. With this new community leadership focus, HR professionals can now take advantage of a farming approach to talent development and recruitment as opposed to the hunter gatherer methods that yield mixed results. SHRM-Memphis has developed several community caring solutions that are yielding real results for HR professionals and their companies in Memphis. Workforce development is at its best a public/private partnership. We are embracing this model to li up the community through our Workforce Development Roundtable, our participation in People First and our partnerships with community organizations. e Workforce Development Roundtable is led by Barbara Knight; experienced workforce development specialist and Pauline Vernon, who is over workforce development with the Memphis Bioworks Foundation. ey are providing a heart centered data driven approach to helping companies align their talent development initiatives with caring workforce development partners in order to deliver custom talent to organizations. Have you thought about how you take advantage of farming developed talent before the applicant even applies to your organization? e biggest way that HR professionals can “do good, while they do well” is to embrace this community building talent model. You can now access the SHRMMemphis network of talent development partners that are a mixture of non-proﬁt, private and government funded agencies through the SHRM-Memphis Workforce Roundtable. People First is a major cradle to career talent pipeline community collaboration hosted by Memphis Fast Forward led by Blair Taylor, with Memphis Tomorrow and Douglas Scarboro, with Mayor Wharton’s oﬃce of Talent & Human Capital. SHRM-Memphis is partnering with People First to take a community building approach to building, retaining and engaging better talent in the Memphis metro area. is collaboration includes our school systems, higher learning institutions, community leadership organizations, industry and political leadership. Now HR has a seat at the table and a voice in the community talent conversation. Beyond these major initiatives, SHRM-Memphis is partnering with the Leadership Memphis: Memphis Talent Dividend to increase college attainment and Leadership Academy’s Recruit, Relocate, Retain and Memphis 101 programs to improve talent in Memphis Do you feel like you can align your organization to “do good, while it does well?” Do you have a HeaRt for Memphis? Austin Baker President SHRM-Memphis

YOU’RE INVITED. . . Come Join us!!

SHRM-MEMPHIS

UPCOMING EVENTS November 16th Topic: The Carrot Principle Speaker: Joel Bishop Time: 11:30 AM to 1:00 PM Cost: Members $20 & Non-Members $30 Location: The Holiday Inn at The University of Memphis The first 125 people to register get FREE copies of book, The Carrot Principle!

$ 1 7

December 6th

Holiday Social

www.shrm-memphis.org/join.php

If you are not yet a member of SHRM-Memphis, you are invited to join now! Current membership in the Society for Human Resource Management is required to join SHRM-Memphis. To find out more about joining SHRM, please visit their website www.shrm.org and complete an application online. Once you’re a member of SHRM, you only need to affiliate with SHRM-Memphis to be a member of our local chapter as well. There are no additional dues!

www.HRprosMemphis.com

Time: 5:00 to 7:30 PM Cost: Members $10 & Non-Members $20 (proceeds donated to a local charity) Location: The Memphis Hilton Come celebrate with us with fantastic food & drinks, door prizes and a silent auction to benefit the SHRM Foundation!

LE AD ER SH

“The most dangerous person you will ever encounter is one without education.”

DOCTOR

STEVEPerry Dr. Steve Perry Addresses Lipscomb & Pitts Breakfast Club

ou could say that Dr. Steve Perry has “fire in the belly”, a term frequently used by HR professionals which implies that someone is passionate about their work. This is an understatement. Dr. Perry addressed the business community of greater Memphis, the “rainmakers”, as he referred to them, to do something about the state of our failed schools. To put it bluntly, he “told it like it is.”

Dr. Perry was born into third generation poverty on his mother’s sixteenth birthday. He believes that circumstances don’t change unless you change them, and he is certainly proof of that. He graduated from the Pennsylvania School of Social Work on a full scholarship and went back to his hometown of Middleton to run a homeless shelter, became a candidate for state representative, and published four books---- before the age of 26.

Dr. Perry is founder of Capitol Preparatory Magnet School, best selling author of "Man Up", and an education contributor on CNN.

He founded ConnCAP, the Connecticut Collegiate Awareness Program that sent 100% of its low-income first generation graduates to four-year colleges for six years. Dr. Perry started a public middle and high school in the state’s lowest performing district, Hartford. Today, Capital Prep is one of the nation’s most successful public middle/high schools. Dr. Perry pointed out that Memphis is one of the least literate cities in the country and that our current system is ineffective. If we have to put metal detectors in a school, we should shut it down. No child should go to a school that does not provide a safe learning environment. Perry suggested that we allow the leaders of successful Memphis schools to take over those that have failed. He also promoted a voucher system that would allow low-income families to afford the school of choice. If no action is taken, what will it mean to the HR community and business leaders in Memphis? It’s very simple. As Dr. Perry asked, “Where are our next employees coming from?” If we don’t change the system, our children will look to other cities to raise their children. He reminded us that all children, regardless of income, are capable of learning. It is up to the grown people to provide the opportunity and the environment. Dr. Perry challenged us to put together a school of people who love children and want solutions. Dr. Perry asked us, “If now isn’t the time, then when?”

www.HRprosMemphis.com

on the cover

Nancy BLAIR-BONK LEADS FEDEX EXPRESS EMPLOYEE BENEFITS Nancy Blair-Bonk is Managing Director of Employee Benefits for FedEx Express Corporation headquartered in Memphis, Tennessee. FedEx Express, the largest FedEx Corporation operating company, is the world's largest express transportation company, providing fast and reliable delivery to every U.S. address and to 215 countries and territories. Ms. Blair-Bonk has over 20 years experience in health care management in both the public and private sector. She is responsible for the research, analysis, design and development of health and welfare programs for approximately 260,000 lives with an annual healthcare spend of approximately $1 billion. Prior to joining FedEx, she managed the health and welfare programs for the largest three-service utility municipality in the country. She earned a BBA with emphasis in Human Resources from the University of Tennessee. She has held leadership positions in many charitable and not-for-profit organizations. Currently, she serves on the Board for the Memphis Business Group on Health, Leadership team for Memphis Healthy Common Table, steering committee for the Aligning Forces for Quality Consumer Engagement and member of the National Business Group on Health Committee for National Leadership on Consumerism and Engagement. Ms. Blair-Bonk is very active in cost and quality initiatives regarding healthcare on a regional and national level. Nancy graciously agreed to share a recent presentation she made on FedEx Express benefits to the Greater Memphis Employee Benefits Council at the Crescent Club. You will find it on page 7.

www.HRprosMemphis.com

NORTH EAST ARKANSAS (NEA) SHRM CHAPTER î&#x201A;&#x160;e North East Arkansas Society for Human Resource Management was chartered in 1977 with 27 members. Our current membership is over 70, all of whom are national SHRM members. We are located in Jonesboro, Arkansas, and our membership consists of human resources professionals primarily from Craighead and Greene Counties in Arkansas.

1 BOARD OF DIRECTORS Back Row (L-R) Dwayne Douglas, VP of Programs; Allen Devereux, PHR, Past President; Sonya Sanders, Past VP of Membership and Diversity; Melissa West, VP of Membership. Front Row (L-R) Dr. Faye Cocchiara, College Relations Chair; Mary Hamrick, Foundation Chair; Diane Fletcher, VP of Finance.

Board members not pictured: Melissa Coles, President-Elect; Ruth Anderson, VP Legislative Affairs; Alan Decker, Workforce Readiness Chairperson; Tracey Crafton, Diversity Chairperson; Amber Jackson, VP Communications

2 Misty Carr, 2011 NEA SHRM President 3 Kelly McDonald, Speaker for the Seminar and author of How to Market to People Not Like You.

4 NEA SHRM members enjoying Kelly McDonaldâ&#x20AC;&#x2122;s presentation. 4

Best selling book, How to Market to People Not Like You, by Kelly McDonald The event was held at the ASU Cooper Alumni Center on the campus of Arkansas State University. Kelly McDonald, president of McDonald Marketing in Dallas, was the speaker. Kelly McDonald is a marketing and advertising expert with specialization in generational insights, multicultural marketing and Hispanic marketing. She worked in top positions for several global ad agencies before starting her own marketing firm in 2002. Her client experience includes brands such as Toyota, Kimberly-Clark, Miller/Coors, Sherwin-Williams and Nike.

www.HRprosMemphis.com

GREATER MEMPHIS

EMPLOYEE

BENEFITS COUNCIL

CONGRATULATIONS

The Greater Memphis

Employee Benefits Council The Greater Memphis Employee Benefits Council (GMEBC) is a non-profit organization, which serves as a forum for sharing ideas and information. The vision of the Greater Memphis Employee Benefits Council is to advance employee benefits, refine professional skills, and through each of its members, provide a higher quality of service to the community. www.gmebc.org

Brad Box Super Lawyer

Michael Mansfield Rising Star

Super Lawyers magazine names attorneys in each state receiving the highest point totals from their peers and in independent research. Rising Stars are the state’s top up-and-coming attorneys. Both Brad and Michael are members of the Rainey Kizer Employment Law and Civil Rights practice group.

The GMEBC was organized in 1977 with this in mind and it is their goal to continue these consistent aims in the midst of ever changing benefit needs among the employees they serve. It is designed to: • increase the professionalism of each member • advance employee benefits • refine professional skills • provide a higher quality of service to the community.

The 2011- 2012

OFFICERS President - Mark Schirmer, SVP Willis VP/Programs - Larry Loew, Director of Account Management; Humana Co-VP/Programs - Linda Yoakum, Retirement Plans Education Advisor; Fedex Corporation Immediate Past President - Linda Tripp, Director, Retirement Plan Consulting/Marketing Coordinator; Wealth Strategies Group, Inc. VP/Membership - Sandy Bradford, Regional Director of Business Development; Lifesigns Treasurer - Peter Voss, Director of Personnel for the City of Bartlett Secretary - Leigh Ann Alexander, Retirement Plans Advisor; FedEx Corporation Co-Secretary - Antoinette Wiseman, VP/Human Resource Manager; Independent Bank Members-at-large - Ted Archdeacon, Senior Manager Human Resources; Brother Industries, (USA), Inc.; Todd Currey, Sales Manager, BMHCC/BHSG; Donna Winfrey, Corporate Director of Benefits; Methodist LeBonheur Healthcare

M E M P H I S / J A C K S O N / w w w. r a i n e y k i z e r. c o m

Perceived Value of Benefits

75% WOULD RATHER Pay More Out of Pocket

than Have Their Benefits Reduced

According to the 2011 Mercer Workplace Survey, nearly eight out of 10 employees in the U.S. said their benefits are one of the reasons they work where they do, and almost as many (76 percent) said that benefits make them feel appreciated by their company. Both of these results represent significant increases from the 2010 survey. Higher Health Care Costs In addition, employer-sponsored health care continues to be a critical component of the overall benefits offering. Even as health care costs continue to rise, employees appear ready to accept changes to the employer-employee cost-sharing model. In 2011, almost half (44 percent) of the employees surveyed reported that they were asked to pay more out of pocket for health benefits in the past 12 months. Nevertheless, 46 percent responded that their health benefits are “definitely worth” the cost (up from 38 percent in 2010). Moreover, participation increased in programs that encourage healthy behaviors. Nearly a third of employees said they take advantage of their employer’s wellness program “a great deal,” up from only 23 percent in 2010, while 26 percent said they take advantage of their employer’s disease management program “a great deal,” up from 15 percent. Yet, as employees ponder exactly how those changes will affect them, 75% said they would rather pay more out of pocket than have their health benefits reduced. www.HRprosMemphis.com

SHRM

ADVOCACY Know where they stand. ...on Healthcare Reform.

– Congressman Steve Cohen, 9th District D-Tenn The Affordable Health Care for America Act is the most significant health care reform bill ever passed in Congress. I am proud to have lent my input and support for this landmark legislation that will provide health insurance coverage to 96% of Americans. The Affordable Health Care for America Act will help The MED in Memphis by drastically reducing the number of uninsured patients. It will provide resources for more community health centers and family practice doctors in our inner city. This bill will help our city’s mothers and families through the inclusion of infant mortality programs, a measure based on my NEWBORN Act, which would establish 15 pilot programs across the country aimed at lowering the rate of infant mortality to promote research, education interventions, and access to prenatal care.

October 6, 2011 – U.S. Senator Lamar Alexander, R-Tenn recalls the White House Summit last year, where he warned the President that individual plan premiums would increase under the health care law: “this was predicted by Republicans who offered an alternative to take steps to decrease costs in health care, instead of this big, comprehensive law that expanded a system that already costs too much.”

October 14, 2011 - U.S. Senator Bob Corker, R-Tenn made the following statement regarding the announcement today that the Department of Health and Human Services is not able to implement a key provision of the president’s health care law. “I'm glad the administration has finally put a stop to one of the worst schemes ever concocted to pay for health care. By taking in premiums for the first five years and paying out no benefits, the CLASS Act appears to reduce deficits in the first 10 years to help pay for the president's health care law, but then would significantly add to deficits over the next decade, eventually becoming another insolvent entitlement. We need to repeal this flawed program that even its architects admit won't work.”

MEMPHIS WHO'S who

WHO’S who? Getting to know your Board

Every issue we spotlight Board members,chairpersons and prominent leaders in the HR and business community. Yvette Brooks, PHR Vice-President of Membership

Yvette Brooks, PHR, serves as co-VP of Membership for SHRM-Memphis along with Audrey Darnell, PHR. The role of VP of Membership is to manage the membership function of the Chapter and to successfully achieve an increase in chapter membership and retain members, especially SHRM members to your chapter. She is also Director of HR Analytics & Technology for Methodist Healthcare. This is a position she has held since February 2006. She is the point person creating a five-year technology roadmap across enterprise, defining HR technology purchases and deployment based upon organizational needs. She is also responsible for providing data for workforce-planning initiatives including assisting in the preparation of 5-10 year forecasts and succession planning. Prior to this role, Yvette served as Director of HR Systems and Payroll at Methodist. Yvette obtained her undergraduate degree in Organizational Management from Crichton College (now Victory University) in 1998. She received her MBA, Human Resource Administration, from Colorado. Other roles Yvette has filled in SHRM-Memphis include VP of Communications from 2009-1010 and Website and Career Center Chair during 2008. She is also a member of the International Human Resources Information Management Chapter and is involved in the University of Memphis Professional Mentor Program.

HR Professionals as Benefits Patricia McDaniel

SHRM-Memphis

Managers

Patricia “Tisch” McDaniel is Manager of Pension, Benefits & Compliance for Verso, a large paper manufacturing company headquartered in Memphis with 3000 employees nationwide. She began her career with Verso four years ago as a consultant before becoming a full-time employee. Some of her past experience includes being a human resources/benefits consultant for a large professional trade association—The Mason Contractors Association of America, working on the start-up team for the National Civil Rights Museum, working with the NCAA to implement professional improvement seminars for the Black Coaches Association and the Collegiate Marketing Directors, VP of HR for the 3rd largest home health agency in the nation, a Corporate HR Director for a construction and manufacturing family-based business in Memphis, and a HR Supervisor for the start-up of Circus Circus Casino. Tisch is a member of the International Society of Human Resource Executives (since 2004), Society for Human Resource Management (since 2000), SHRM of Northwest Mississippi (local chapter member since 2004; currently Past President), and WorldatWork. She cites her major challenge for 2012 gearing up for the next phase of health care reform and fee disclosures on retirement accounts.

www.HRprosMemphis.com

SMALL

BizBEST PRACTICES

STEPS

YOU CAN TAKE NOW To Get Ready for Health Insurance Exchanges B Y C R I S T I E U P S H A W T R AV I S

The federal and state governments are hard at work 2 Understand the impact of exchanges on how you offer health scoping out and planning for what is anticipated to be a benefits. Do employers have to offer benefits through the exchange? Employers can choose to offer benefits “outside the exchange”. major “market changer” in expanding access: health However, even if you offer benefits outside the exchange, employers insurance exchanges. The exchanges, which will become will need to offer the required essential health benefits; offer services to everyone, even those with pre-existing conditions; and categorize operational in 2014, are designed to offer affordable health into tiers based on cost-sharing provisions. Also, keep in mind that if insurance options for individuals and small employers exchanges are effective, costs should be lower in the exchange. How will employers/employees choose from the plans in the exchange? starting in 2014 and large employers in 2017. For employers, establishment of these exchanges will have significant impact on how you offer health benefits to your employees. Although 2014 seems a long way off, it will be here before you know it. Here are four steps you can take now to start that preparation.

1 Learn the basics about health insurance exchanges. The health insurance exchange program for employers is the Small Business Health Options Program, usually referred to as the SHOP. Who operates the SHOP? There are two ways in which a SHOP can be offered in your state. The state itself can operate the SHOP or, in the absence of the state operating the SHOP, the federal government will operate the SHOP. Which employers can participate in the SHOP? In general, beginning in 2014, the SHOP can serve employers with up to 100 employees and in 2017 can expand access to those with over 100 employees. How does the SHOP function? Basically, the SHOP will offer: • A number of “qualified” health plan choices, with each health plan offering a number of different benefit designs. • Common rules for both offering and pricing of these health insurance options • Information for employers and consumers to compare the cost and quality of health plans and options.

Employers offering benefits through the exchange will need to decide if you want to select a plan or set of plans from the exchange and offer only that plan to your employees (employer choice) or, do you want to give your employees the choice of any plan in the exchange (employee choice).

Under either choice, the employer can establish the contribution it will make toward the premium. Under the employer choice model, the payroll contributions from employees would be the same. Under the employee choice model, the employee’s payroll contribution would be different based upon which plan and benefit design the employee chose in the SHOP. The employee choice model could be complex to administer because of so many different payroll deduction amounts. However, under the employee choice model, small businesses can offer their employees health benefit choices that are usually only available to those that work for larger employers and may, therefore, become an employer of choice. Will brokers still be used in the exchange? There appears to be general consensus at both the federal and state level that brokers will continue to play an important role for employers that choose to offer benefits through the exchange. However, the specific role of brokers in the exchange, and how their compensation will be determined will www.HRprosMemphis.com

SMALL BIZ BEST PRACTICES

be defined by each state as they design their exchanges.

3 Familiarize yourself with the timeline for SHOP implementation. Right now, many of the details have not been finalized at the federal level, resulting in continued uncertainty about how exchanges will actually evolve at the state level. From a practical standpoint, states will need to decide if they will operate their own SHOP or let the federal government operate a SHOP in their state by 2012, in order to be prepared for the January 1, 2014 implementation date. 4 Get more information about exchanges in your state. If states decide to operate their own SHOP exchanges, it will be important for employers to understand the specifics about the exchange in their state. Websites for more information on the development of health insurance exchanges in the Mid-South are: Arkansas:

www.hbe.arkansas.gov/

20=

HEALTH CARE REFORMREQUIREMENTS

Get Ready for Summary of Benefits and Coverage Rule 1 2 3

Employers to distribute uniform benefit summaries to participants

Comparative effectiveness group health plan fees begin

Employers to provide 60-day advance notice of material modifications Form W-2 reporting for health coverage (delayed until 2012 W-2 form typically provided in early 2013)

Required Content of Summary of Benefits and Coverage The proposed rule generally parallels the statute with regards to the content and provides a template. For a sample template, go to ttp://www.dol.gov/ebsa/pdf/SBCSampleCompleted.pdf.

The proposed rule provides that an SBC must be printed in a 12-point or larger font and limited to four double-sided pages, and that the SBC must be a stand-alone document. In general, an SBC must contain: • Uniform definitions.

Mississippi:

www.mid.state.ms.us/pages/health_care_reform.aspx

• A description of the plan’s coverage, including exceptions, reductions and limitations.

Tennessee:

• The plan’s cost-sharing provisions, such as deductibles, co-pays and co-insurance.

Memphis Business Group on Health is a coalition of employers sharing solutions and providing tools to manage the cost and quality of health benefits in an ever-changing environment. www.memphisbusienssgroup.org

• Information about continuation of coverage.

www.tn.gov/nationalhealthreform/exchange.html

Note: Regulations regarding health insurance exchanges are not yet final. In addition, there are many more requirements in the Accountable Care Act that address exchanges than could be covered in this article. So, please do not rely on this article solely, but use it as a guide to learn more about how exchanges may operate and impact employers.

• Hypothetical coverage examples selected by the Secretary of Health and Human Services to illustrate the benefits that would be provided for certain common benefits scenarios. • A statement as to whether the plan provides minimum essential coverage and whether the plan pays at least 60 percent of the total cost of benefit (beginning January 1, 2014). • An Internet address (or similar) for obtaining a list of the network providers. • An Internet address where an individual may find more information about the prescription drug coverage under the group health plan or health insurance coverage. • An Internet address where an individual may review and obtain the uniform glossary. • Premium information for insured plans or cost of coverage for self-insured plans. • A statement that the SBC is only a summary and that the plan document, insurance policy, contract or certificate of insurance should be consulted for more information about the coverage provided under the plan. • Contact information for questions or for obtaining a copy of the plan document or the

Send feedback to: feedback@HRprosMemphis.com

Cristie Upshaw Travis CEO, Memphis Business Group on Health

www.HRprosMemphis.com

insurance policy, contract or certificate of insurance. The Patient Protection and Affordable Care Act requires provision of the summary of benefits and uniform glossary beginning March 23, 2012.

Penalties for Violations A group health plan or health insurance issuer that willfully fails to provide an SBC will be subject to a fine of up to $1,000 per enrollee who does not receive the SBC. Excise taxes and selfreporting requirements under section 4980D of the Internal Revenue Code also apply.

EE OC UP DA TE

GINA

Genetic Information & Nondiscrimination Act – EMPLOYMENT PROVISIONS –

Reflections As the Two-Year Anniversary Date Approaches The employment provisions (Title II) of the Genetic Information and Nondiscrimination Act of 2008 (GINA) became effective on November 21, 2009. Almost a year later, on November 9, 2010, the EEOC issued final regulations implementing Title II with an effective date of January 10, 2011. The EEOC reported processing 201 GINA charges during 2010, the first full enforcement year for GINA. As the two-year anniversary of the effective date of GINA’s employment provisions approaches, we are only beginning to grasp the implications of GINA. BY LISA L. LEACH AND AMBER ISOM-THOMPSON

Overview of GINA Title II of GINA prohibits employers from discriminating on the basis of genetic information, restricts employers from acquiring and disclosing genetic information, and prohibits retaliation. The EEOC also has interpreted Title II to prohibit harassment based on genetic information. “Genetic information” includes an individual’s genetic tests, the genetic tests of that individual’s family members, family medical history, the request for, or receipt of, genetic services by an individual or his/her family member, the participation in clinical research including genetic services by an individual or his/her family member, the genetic information of a fetus of the individual or his/her family member, and the genetic information of an embryo held by the individual or family member using assisted reproductive technology. Examples of “genetic tests” include a test to determine whether someone has a genetic variant showing a predisposition to breast cancer, carrier screening to determine the risk of conditions such as cystic fibrosis in future offspring, amniocentesis, and DNA testing for paternity. “Genetic tests” do not include tests for alcohol or illegal drugs, an HIV test or a cholesterol test. 24

www.HRprosMemphis.com

The types of “requests” for genetic information proscribed by GINA include Internet searches on an individual that are likely to elicit genetic information, actively listening to third-party conversations, searching an individual’s belongings to acquire genetic information, and asking about an individual’s current health status such that an employer is likely to obtain genetic information. However, GINA’s general prohibitions do not apply in six narrowly-defined situations: (1) where the employer acquires the information inadvertently; (2) as part of health or genetic services (including a wellness program) provided on a voluntary basis; (3) in the form of family medical history to comply with the certification requirements of the Family and Medical Leave Act, state or local leave laws, or employer leave policies; (4) from sources that are commercially and publicly available, such as newspapers, books, magazines, and electronic media; (5) as part of genetic monitoring that is either required by law or provided on a voluntary basis; and (6) by employers who conduct DNA testing for law enforcement purposes as a forensic laboratory or for human remains identification.

Family Medical History Family medical history has proved to be the most problematic type of genetic information to monitor in the day-to-day supervision of employees. Employers should remind supervisors that GINA covers family medical history and that they should not engage in conversations with employees about the medical issues of employees’ family members. The exception for inadvertent acquisition of genetic information will not apply where a supervisor follows up a casual conversation about the general well-being of a family member with probing questions which are likely to result in the acquisition of genetic information, such as “whether other family members have the condition, or whether the individual has been tested for the condition.”

Safe Harbor Provision An employer should take advantage of the safe harbor language provided in the EEOC’s implementing regulations anytime an employer requests medical information about an employee. Use of the safe harbor language renders the receipt of genetic information in response to a request for medical information inadvertent. This safe

harbor language set forth at 29 CFR 1635.8(b)(1)(i)(B) includes a discussion of GINA’s prohibitions, provides a definition of genetic information, and instructs the provider to avoid including genetic information when responding to the employer.

Voluntary Wellness Programs Wellness programs have raised many concerns among employers since the enactment of GINA. The implementing regulations permit an employer to acquire genetic information about an employee and his/her family members when it offers a wellness program on a voluntary basis. However, the individual participating in the wellness program must give prior voluntary, knowing, and written authorization pursuant to a form that meets the requirements set forth in the implementing regulations. While employers cannot offer an inducement for individuals to provide genetic information as part of a voluntary wellness program, GINA allows financial inducements to encourage participation in a wellness program that contains a health risk assessment seeking information about family medical history or other genetic information if the employer informs the employee that the inducement will be provided even if the participant chooses not to answer the questions requesting family medical history or other genetic information. The EEOC’s implementing regulations provide the following example of a permissible financial inducement: A covered entity offers $150 to employees who complete a health risk assessment with 100 questions, the last 20 of them containing family medical history and other genetic information. The instructions for completing the health risk assessment make clear that the inducement will be provided to all employees who respond to the first 80 questions, whether or not the remaining 20 questions containing family medical history and other genetic information are answered. This health risk assessment does not violate Title II of GINA.

Once an employee voluntarily discloses a family medical history that would place the employee at increased risk of acquiring a future health condition, employers may then offer financial inducements for participation in disease management 26

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programs and other programs to encourage healthy lifestyles, including programs with coaching to employees for meeting particular health goals, provided the employer also offers the programs and inducements to individuals with current health conditions and/or to individuals whose lifestyle choices put them at risk of acquiring a condition. The regulations provide two examples of financial inducements for participation in programs and meeting health goals that do not violate Title II of GINA: Employees who voluntarily disclose a family medical history of diabetes, heart disease, or high blood pressure on a [GINA compliant, voluntary] health risk assessment…and employees who have a current diagnosis of one or more of these conditions are offered $150 to participate in a wellness program designed to encourage weight loss and a healthy lifestyle…[or offered the opportunity] to earn points toward “prizes” totaling $150 in a single year for lowering their blood pressure, glucose, and cholesterol levels, or for losing weight. Employers should keep in mind that wellness programs which provide medical care, including genetic counseling, and collect genetic information may be subject to additional requirements under Title I of GINA, the Internal Revenue Code, or the Employee Retirement Income Security Act. Additionally, wellness programs that condition rewards on an individual satisfying a standard related to a health factor must meet additional requirements under those statutory schemes. Moreover, employers still must comply with the Americans with Disabilities Act (ADA), the Health Insurance Portability and Accountability Act, and other applicable laws and regulations.

Confidentiality Requirements Under Title II of GINA, employers must keep the genetic information of applicants and employees confidential and may only disclose genetic information under limited exceptions. If genetic information is in writing, the employer must keep it apart from other personnel information in separate medical files. However, employers may keep genetic information in the same file as medical information subject to the ADA. The EEOC clarified in

the implementing regulations that employers are under no obligation to remove genetic information that was put in an employee’s file prior to the November 21, 2009 effective date of GINA. However, the EEOC further noted in the regulations that an employer is still prohibited from using or disclosing this pre-GINA genetic information.

Conclusion As we approach the two-year anniversary of the effective date of GINA’s employment provisions, employers still have much to learn about GINA and how to meet their obligations within the broad legal framework governing employment. Some of the most important steps an employer can take to ensure GINA compliance include:

Post the most current “EEO is the Law”

poster from the EEOC which includes a GINA provision;

Revise equal employment opportunity

statements in handbooks and policies to prohibit discrimination based on genetic information;

Review post-offer medical forms, medical

questionnaires, and authorizations to release employee medical information to ensure all authorizations to release or inquiries into family medical history have been eliminated;

Revise all correspondence requesting an

employee’s medical information to include the GINA safe harbor language;

Train management level employees on the

importance of refraining from asking applicants or employees about genetic information or family medical issues;

Revisit policies and procedures regarding

confidentiality of medical information; and

Audit voluntary wellness programs to

ensure GINA compliance.

Lisa L. Leach, Partner Kiesewetter Wise Kaplan Prather, PLC

Amber IsomThompson, Partner Kiesewetter Wise Kaplan Prather, PLC

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IRS Bulletin: Cost of Living Increases for Defined Contribution and Defined Benefit Retirement Plans On Oct. 20, 2011, The U.S. Internal Revenue

Service (IRS) announced cost-of-living adjustments (COLAs) affecting dollar limits for defined contribution and defined benefit retirement plans and other retirement-related items for tax year 2012. Many plan limits on contributions and benefits will rise because increases in the cost-of-living index met the statutory thresholds that trigger their adjustment.

Among the key changes effective as of Jan. 1, 2012: Defined Contribution Plans: COLA Increases for Dollar Limits on Benefits and Contributions Maximum elective deferral by employee

Catch-up contribution (age 50 and older during 2012)

Defined contribution maximum deferral (employer/employee combined)

to the RSSFEED

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Tennessee Employers are Required to Compensate Employees for Travel Time To and From Jury Duty In an opinion issued October 10, 2011, the Tennessee Attorney General advised that Tennessee employers are required to compensate employees for travel time to and from jury duty in addition to the employees' actual jury service. The Attorney General further advised that employers are required to compensate employees for time spent traveling to and from jury duty

Employee annual compensation limit for calculating contributions

Annual compensation of "key employees" in a top-heavy plan

Annual compensation of "highly compensated employee" in a top-heavy plan

regardless of whether the employee's usual compensation includes travel time. By way of example, the Attorney General stated that if an employee spends two hours traveling to and from jury service and four hours serving on the jury, the employee would be entitled to six total hours of his/her usual compensation. Covered Tennessee employees summoned for jury duty are entitled to be excused from work to serve, provided they notify their employer and their jury duty responsibilities exceed three hours. Employees

2012

2011

$17,000

$16,500

$5,500

$50,000

$49,000

$250,000

$245,000

$165,000

$160,000

$115,000

$110,000

are entitled to their usual compensation for any time spent traveling to and from jury duty and actual time spent in jury duty. Therefore, covered Tennessee employers should not only request that their employees submit documentation of their time spent in actual jury service, but also their travel time. Please note that time spent in jury duty would not need to be calculated as hours worked for overtime purposes under the Fair Labor Standards Act, nor would it need to be included in the employee's regular rate when calculating overtime. www.HRprosMemphis.com

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