S&S Benefits.....Opinion, Hearsay & News Review

Why be like everyone else?

FMLA law has been clarified by the 11^th Circuit Court of Appeals. The appeals court says that FMLA does Not require employees to take sick leave before claiming the right to unpaid medical leave. According to a recent SHRM survey, some 60% of FMLA leaves are granted without advance notice.

Last issue we talked about CALPERS throwing out HMO bids ranging from 5.5% to 41% increases with an average of 25%. After re-bidding they are down to a reported average of 16%. However, Aetna, Lifeguard and Cigna have bowed out or been thrown out for non-compliance (depending on which article you read). Those 260,000 of the 1.1 million members will have to elect new coverage. The price increases quoted reflect the need for companies in today’s market to price for profit, rather than membership, even when it comes to a plan the size of CALPERS.

The Wisconsin insurance commissioner has approved the merger of United Wisconsin Services (the backing carrier for American Medical Security’s tipsy plans) with Blue Cross & Blue Shield of Wisconsin. BC will be a stock company as a subsidiary of UWS with the combination known as Cobalt Corp. Proceeds from stock of about $250 million will pay for the previous non-profit status of the BC/BS plan.

According to a CEBS and D&T study, the top 5 benefit priorities for HR managers for 2001 are; (1) Controlling health care costs (71%). (2) Expanding Internet or Intranet uses (58%). (3) Expanding self-service technology for benefits communication and administration (45%). (4) Providing financial and retirement planning tools and information (43%). (5) Providing increased investment education (36%).

A Health Affairs poll of 11,000 Americans showed that less than 1/3 are familiar with major details of their health plan. Of survey participants that had plans that did not cover visits to non-network providers, 40% of respondents were unaware of that provision. Moreover, more than half of the respondents thought their plan called for a referral to a specialist, when it did not! The irony is that those with health complications were slightly less informed than their more healthy counterparts.

Prudential has filed with New Jersey to become a stock company with a 4^th quarter IPO offering. The plan distributes shares or cash to 11 million policyholders. Prudential follows other large life insurers, Met Life and John Hancock to the stock tables.

Chairman of Aetna, William Donaldson has stepped down effective April 1^st. He will remain on the board after being among the leaders of a strategy that has left the company in shambles as far as servicing policyholders. CEO John Rowe, another HMO talking head, is now the Chairman and CEO.

According to Watson Wyatt, in 2000, 7.1% of payroll was attributed to direct absenteeism and disability costs. That’s an increase of 27% from 1997. According to Employee Benefit News, employers that simultaneously utilize disability case management, hire internal absence managers and involve in-line supervisors in absence management obtain a worker absence rate that is 74% less than employers who don’t use those practices.

A collaboration of BC/BS of Minnesota, Medica, Preferred One, Health Partners and the University of Minnesota has adopted guidelines for 50 medical conditions. Twenty- one medical groups representing 3,200 docs have adopted the guidelines that include such things as how to control blood sugar in diabetics, how to treat a heart attack and how to manage low back pain. The promoters say the guidelines are flexible. The detractors call it cookbook medicine. This is believed to be the first time universal guidelines have been adopted by competitors.

A survey of 360 employers by Watson, WBGH and HFMA show the top responses for rising health care costs. Respondents were companies that had over 1000 employees. 71% would increase employee premiums somewhat, while 52% said they would absorb some of the costs. 51% would increase cost sharing and 33% would target interventions for specific conditions. In reality, only 18% are looking to switch health plans and only 14% want to reduce coverage. For these larger employers, premium increases have averaged 10.5% for HMO, 9.6% for POS and indemnity and 9.1% for PPO, far less than the smaller employer market.

If you haven’t submitted comments on the HIPAA Privacy regulations and the current regulations are enforced, remember that when the renewal comes around and the competition you’re depending on to drive down prices doesn’t materialize.