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In
This Issue |
- Communication Hampers
HIPAA Compliance Efforts
- Proposal Suggests
FMLA Include Paid Time Off
- Rising Health Care
Costs Create Ripple Effects
- Suspension Not A
Violation Of ADA
- Prudential Programs
Help Boost Productivity
Levels
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Act Proposes More Choices For Health Care
Legislation has been introduced
in Congress that would expand the number of health care choices available
to individuals. The bill, known as the Patients' Health Care Choice
of 2003 (H.R. 3423), has been introduced by Rep. John Shadegg, R-AZ.
The proposed legislation calls for the creation of "HealthMarts" and
individual membership associations (IMAs), the expansion of medical
savings accounts (MSAs), a refundable tax credit for health
insurance costs, and a tax exclusion for employees who elect not
to participate in an employer-sponsored health care plan.
H.R. 3423 cites the need for
major structural reforms in the American health care system so that a
competitive system is created that's based on individual choice. It has
been referred to the House Ways and Means, Energy and Commerce, and Education
and the Workforce committees for further study.
Some of the proposed bill's
provisions included:
—Amending of the Public
Health Service Act (PHSA) to create HealthMarts. These entities would
be operated by health insurance issuers to provide health care coverage
to individuals through: indemnity insurance, a health maintenance
organization (HMO), a preferred provider organization (PPO),
or other health care options—one of which would be a non-network
option. Health-Marts would be required to offer coverage to all employers
and eligible employees in a specific geographic area. HealthMarts would
be deemed multiple employers welfare arrangements for purposes of the
Employee Retirement Income Security Act (ERISA).
—Amending PHSA to establish
individual membership associations (IMAs) that would operate under the
direction of an association to provide health care coverage to all members
of the IMA, as well as their dependents. An association would have to
have been in existence for at least five years and formed and maintained
for purposes other than obtaining insurance.
—Providing federal matching
funds to states equal to 50% of the monies expended for use with a high-risk
insurance pool, a reinsurance pool, or other risk-adjustment mechanism
that subsidizes the purchase of private health insurance.
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The Act cites the need for reforms in the health care system.
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—Adding a new section to
the Internal Revenue Code to provide a tax credit for amounts paid for individual
health insurance. The credit would be $3,000 or $1,000 multiplied by the
number of persons covered (whichever is lower). An income exclusion would
also be added to the Tax Code for "compensating payments" made
to employees who elect not to participate in an employer-sponsored health
care plan. The exclusion, however, would not apply to employees who are
covered under a spouse's employer-sponsored plan.
—Repealing existing
limitations on the number of MSAs that can be offered under the Tax Code
and permitting all employers to offer MSAs. Also permitting both
employers and employees to contribute to MSAs and permitting them to be
offered under Section 125 cafeteria plans.
Communication Hampers HIPAA Compliance Efforts
Despite the fact that the
Health Insurance Portability and Accountability Act of 1996 (HIPAA)
has been in effect since April 2003, only three out of four organizations
have become compliant with the legislation, according to the Phoenix Health
Systems Fall 2003 Survey.
The survey, which placed special
emphasis on the health care industry's Transactions and Code Sets (TCS),
showed that between 73% and 88% of all organizations were in compliance
with HIPAA. Providers represented 67% of the respondents, while payers
accounted for 19%, clearinghouses 3%, and vendors 11%.
The survey found that provider
compliance levels remained virtually unchanged since a spring 2003 survey
(76% versus 78%). Meanwhile, the survey showed that nearly 40% of providers
and 22% of payers that had claimed to be privacy compliant have not completed
all of their necessary business associate agreements. And about 15% of
providers have not initiated processes for accounting of disclosures and
for "minimum necessary" restrictions. Furthermore, about 50%
of all respondents reported that their organizations had one or more privacy
breaches over the previous six months.
Proposal Suggests FMLA Include Paid Time Off
The Family and Medical
Leave Act (FMLA) would be expanded to allow employees to take paid
leave to care for
themselves or a close relation under a suggested proposal being made by
Sen. Joseph Lieberman, D-CT. Businesses with fewer than 50 employees,
however, would be exempt from the proposal.
Sen. Lieberman noted that
many employees do not take advantage of the FMLA because they cannot afford
to do so. Under his proposal, employees would contribute part of their
income to a fund that would finance FMLA leaves at half-salary for a period
of up to one month. The cost to employees is projected to be approximately
$30 a year.
A spokesperson for the U.S.
Chamber of Commerce said the proposal, if adopted, would create concern
about lost worker productivity among the businesses that would be affected.
Rising Health Care Costs Create Ripple Effects
As health care costs have
increased, employees have cut back on workplace benefits they receive
at additional costs, and have switched to less expensive health plans
or dropped their health care coverage completely, according to an American
Express Financial Advisors survey (2003).
Of the 958 people responding
to the survey, more than two-thirds said their share of health care costs
had increased. As a result, 55% said they are reducing discretionary spending,
24% are cutting back on workplace benefits that carry additional costs,
12% said they are switching to less expensive health plans, and 6% are
dropping their health care coverage completely.
In addition, 37% of those
responding said they are planning to decrease the amount allocated toward
their savings and investment plans. Rusty Field, a vice president with
AmEx's Financial Education and Planning Services, said "employees need
to be well educated on the options they have to help them handle the increase
in health care expenses without compromising their ability to save for
the long term."
American Express said the
survey results showed that increases in health care expenses can have
a measurable effect on respondents' levels of financial stress. As a result,
70% said they would be interested in attending a free financial seminar
to help them understand and address rising health care costs.
Suspension Not A Violation Of ADA
An employee did not establish
that he was disabled as defined by the Americans with Disabilities
Act (ADA) and, as a result, his claim that his employer failed to
provide him with reasonable accommodation, was denied by the Fourth Circuit
U.S. Court of Appeals (Parkinson v. Anne Arundel Medical Center, et
al; No. 02-2000).
Ronald W. Parkinson began
work at AAMC in 1974 as a radiology technician and by 1995 he had been
promoted to chief of the ultrasound department. In June 1998, Parkinson
suffered a heart attack. Although he recovered, Parkinson claimed he was
prohibited from doing strenuous exercise or lifting heavy weights (activities
he previously enjoyed). Parkinson's doctor allowed him to return to work
if he avoided stress and did not work overtime.
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The plaintiff did not establish his disability qualified under
the ADA.
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When Parkinson returned to work
in September 1998, he claimed that he communicated his restriction regarding
overtime to AAMC. As a result, Parkinson said he was taken off "on call"
status and his work schedule declined to about 40 hours from 70 hours per
week. Parkinson contended, however, that his supervisors pressed him to
accept overtime and criticized him when he refused it. He admits he occasionally
did work overtime hours.
On December 15, 1999,
Parkinson stated that the manager of the radiology department insisted
he work overtime. After refusing, he was suspended for one day without
pay and was reportedly demoted from chief to senior ultrasound technician.
In his suit, Parkinson charged
that AAMC refused to honor his request not to work overtime after his
heart attack, thereby failing to accommodate the limitations imposed by
his disability. He also claimed retaliatory discrimination under the ADA
when suspended and allegedly demoted. The district court, however, ruled
in favor of AAMC and, on appeal, the fourth circuit court affirmed the
ruling. The courts reasoned that Parkinson had not established either
that his restriction on work or on physical activity made his impairment
an actual disability under the ADA, or that his employer regarded him
as having such a disability during the relevant period. As such, the courts
found that Parkinson could not make out a prima facie case of retaliation
for any actions taken by the employer.
In addition, the fourth circuit
court opinion stated: "Nothing in Parkinson's statements or actions in
refusing to work overtime that day would have reasonably led [the employer]
to understand that he desired accommodation of limitations imposed by
his coronary artery disease. In fact, it would have been far more reasonable
for [the employer] to have understood his request not to work overtime
to have been made for an entirely unrelated reason: so that he would not
miss an appointment he had scheduled for that afternoon."
Prudential Programs Help Boost Productivity Levels
The Prudential Financial companies
have received a "best practices" award by the Garden State Society of
Human Resources Management (SHRM) for instituting programs that are aimed
at keeping employees healthy and available to work.
Chief Medical Officer K. Andrew
Crighton says Prudential's goal in offering various benefits programs
"is not to just make workers feel good, though that matters. Rather, it
is to move participating employees into lower health risk categories."
As a result, the doctor notes, workers are more productive on the job,
otherwise lost time becomes "found" time, and health care costs decline.
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'Lost time' becomes 'found time' for healthy employees.
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Prudential's programs include
a wide array of medical, fitness, employee assistance, wellness, and work/life
options. Its wellness program includes: ergonomics training and evaluations;
screening and interventions for hypertension, cholesterol, and diabetes;
annual flu vaccinations; cancer awareness; stress and lifestyle management;
education focused on women's health and men's health; and smoking cessation.
The company has begun
to gather objective and quantitative data regarding health care cost savings
that are attributable to its wellness programs.
Dr. Crighton says smaller
companies can create programs similar to Prudential's by partnering with
other organizations. For example, he said, an area health care provider
could offer "lunch and learn" sessions on disease prevention and management,
as well as blood pressure and cholesterol screening clinics; and a nearby
hospital could provide mobile mammography exams. In addition, the doctor
said smaller companies could band together to share wellness services
and advice from specialists in occupational medicine.
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