Joey Kramer, Aerosmith’s founding and longtime drummer, is suing his band mates after they blocked him from joining them at upcoming high-profile events, including this weekend’s honor as the 2020 MusiCares Person of the Year and its Lifetime Achievement Award at this weekend’s Grammys.
Kramer claims that Steven Tyler, Joe Perry, Tom Hamilton and Brad Whitford are not allowing him back in the band following a temporary disability from minor injuries he suffered last year. According to TMZ, Kramer claims the band required the Aerosmith drummer to audition to prove he was “able to play at an appropriate level” before he could regain his drummer role. He further claims that this audition is unprecedented in the band’s 50-year history, during which each of other members had to step away for various reasons.
This story about the Aerosmith drummer got me thinking about an employer’s rights when an employee seeks to return to work after a medically related leave of absence. Two laws potentially apply — the Americans with Disabilities Act and the Family and Medical Leave Act.
If an employer has a reasonable belief that an employee’s present ability to perform essential job functions will be impaired by a medical condition or that s/he will pose a direct threat due to a medical condition, the employer may make disability-related inquiries or require the employee to submit to a medical examination. Any inquiries or examination, however, must be limited in scope to what is needed to make an assessment of the employee’s ability to work. Usually, inquiries or examinations related to the specific medical condition for which the employee took leave will be all that is warranted. The employer may not use the employee’s leave as a justification for making far-ranging disability-related inquiries or requiring an unrelated medical examination.
As a precondition of restoring an employee out on FMLA leave for his or her own serious health condition, an employer can require the employee to obtain and present certification from the employee’s health care provider that the employee is able to resume work.
The fitness-for-duty requirement must be made pursuant to a uniformly-applied policy or practice that requires it for all similarly-situated employees (i.e., same occupation, same serious health condition).
An employer may only require a fitness-for-duty certification if it advised the employee of the requirement in the required FMLA designation notice at the outset of the leave.
The requested fitness-for-duty certification is limited to the particular serious health condition that caused the need for the FMLA leave, must certify that the employee is able to return to work, and may also certify (if requested) that the employee is able to perform the essential functions of the job.
Unlike medical certifications at the outset of an FMLA leave, fitness-for-duty certifications are a one-shot deal. No second or third certifications are permitted.
Failure by an employee to submit a requested fitness-for-duty certification strips an employee of his or her job restoration rights (unless the employer failed to advise the employee of the requirement at the outset of the leave).
The employer can require the employee to bear the cost of the fitness-for-duty certification.
Here’s where it can get really tricky. A failure by an employee’s medical provider to certify the employee as fit to return to work could trigger an employer’s obligation to engage in the ADA’s interactive process with the employee for a reasonable accommodation. If the employee’s medical provider, instead of returning the employee to work without restrictions, either asks for additional, finite unpaid time off or restrictions upon the return to work, the employer should engage with the employee to determine what accommodations are possible under the ADA. The failure to do so could result in an ADA violation.
These issues are tricky and fraught with legal risk. You should be contacting your employment counsel to help you navigate these issues when they arise.
Washington state employers now must comply with one of the strictest noncompete laws in the country, which the Legislature determined will apply retroactively to restrictive covenants entered into before Jan. 1, 2020.
Washington House Bill 1450 declares that noncompetes are unenforceable against employees who make less than $100,000 a year (and in the case of independent contractors, $250,000 a year). The law also requires significant disclosures to be made to the employee at the time they sign the noncompete — the absence of which could also invalidate the clause.
The law requires compensation to be paid to the employee during the period that it will be enforced at a rate not less than the employee’s previous salary, minus any compensation earned through subsequent employment during the period of enforcement.
Further, noncompetes lasting longer than 18 months are presumptively void. Under the law, any attempt by an employer to noncompetes against Washington employees or independent contractors in another state (i.e., through a forum clause) will render the covenant unenforceable.
Finally, the law states that in the case of a noncompete being declared unenforceable or enforceable in part or as modified, the party seeking enforcement must pay the aggrieved person the greater of actual damages suffered or a $5,000 penalty, plus reasonable attorney’s fees and costs.
IMPACT: Employers should be aware of any state restrictive covenant laws that may impact portions of the workforce.
Crescent Metal Products in Ohio fired Donald Tschappatt for a variety of instances of poor work performance.
He made “negative comments” about co-workers. He stood around doing nothing and disappeared from his work area. He took extended bathroom breaks. And he made various assembly and packing errors.
After the company fired the 55-year-old Tschappatt, he sued for age discrimination.
The problem with Tschappatt’s claim? Crescent Metal Products replaced him with someone 6 years older. That’s not a great fact for an employee claiming age discrimination.
Tschappatt fails … to show that he was replaced by someone younger. All of the competent and relevant evidence indicates that the company replaced him with Bob Hunter, who was 61.… Crescent put in plenty of evidence that Bob Hunter, age 61, replaced Tschappatt. Crescent reassigned Hunter to Tschappatt’s position, and Hunter has been “able to successfully reach the same production goals” and “perform all of the duties” of the position “without incident.”
The law protects older workers from discrimination favoring younger workers. An employee cannot establish this if replaced by someone older. Case closed.
The phrase “drugs in the workplace” understandably elicits an alarmed reaction from employers. But the truth is the amount of substances that are considered drugs are many and varied, and many are commonplace for an employee’s daily routine.
Substance use abounds in the workplace — and that’s just legal substances. Employees roll into work and can’t get anything done without their daily dose of caffeine. Colleagues meet in the break room with cases of beer to partake in the regular happy hour. Someone anxious about an upcoming deadline picks up a CBD-infused coffee at breakfast or a CBD-infused burger for lunch. And don’t forget about that roll of antacids or bottle of ibuprofen in the desk drawer or an energy drink in the fridge for a mid-afternoon pick-me-up.
In short, regulating substance use among employees is not simple and straightforward. Drugs like caffeine and alcohol are legal, but employers may get into trouble if an employee’s alcohol consumption leads them to cause problems during the employee get-together.
Cannabis is still illegal federally in the United States as more states legalize it for medical and recreational purposes, causing confusion for employers who can’t keep compliance straight among the constant changes. And, a recent surge of “smart drugs” — substances taken to improve creativity, attention, executive function and working memory — poses major ethical questions about whether it’s OK to take a mental steroid to be productive at work.
PRODUCTIVITY
Much has been made about college students taking medication to stay productive and awake, but that habit doesn’t end at graduation.
People use cognitive enhancing drugs — also referred to as “smart drugs” — to improve their creativity, attention, executive function and memory. Much like athletes may use performance-enhancing drugs to improve speed and endurance, employees may use smart drugs to be productive at work.
“Some people start using them in college and then they’re carrying that habit with them into the workforce. And things don’t get easier when you go from college to the workforce,” said Nick Heudecker, vice president of research-data & analytics at Gartner.
The use of smart drugs isn’t limited to an industry or economic status, Heudecker said. Even though Silicon Valley workers taking microdoses of lysergic acid diethylamide — more commonly known as the hallucinogenic LSD — to stay focused has received media attention, knowledge workers aren’t the only ones taking part. “Every workforce population is engaging in cognitive enhancement in some way,” Heudecker said.
ADHD drug Adderall is by far the most common smart drug, he said, followed by Ritalin, or methylphenidate. Modafinil, a narcolepsy drug, is another common cognitive enhancer. Energy drinks and caffeine — common parts of many people’s daily routines — are also considered smart drugs, according to Heudecker. And the over-the-counter dietary supplements called nootropics claim to improve people’s cognitive abilities, as well. Nootropics alone, according to Grand View Research, Inc., is a $2.17 billion market as of 2018 and expected to be a $4.94 billion market by 2025. Meanwhile, microdosing LSD means that the user takes about 1/10th of a dose as a way to “break down cognitive barriers and help them be more creative,” Heudecker said, adding there is no research on how microdosing LSD impacts users’ health.
The nickname “smart drug” is a misnomer. “These drugs don’t make you smarter. They allow you to better use the facilities you already have,” Heudecker said. They do so by helping people stay more focused or awake. Users may have that “feeling of being in the zone” for longer.
The use of these substances “is becoming more prevalent, not less,” he said, adding that too few employers are thinking practically about how they will address smart drug use in their workforce.
Why People Take Them: In 2018, The European Agency for Safety and Health at Work, or EU-OSHA, released the report “Managing Performance Enhancing Drugs in the Workplace: An Occupational Safety and Health Perspective” to explore the trend of smart drug use among workers.
Employees take them for “increased monitoring of employee health, stress levels, alertness and fitness,” especially when these measures are used to judge an employees’ ability to do their jobs. “It is possible to anticipate that employees under this level of scrutiny may turn to various pharmacological means to allow some control over biometric readings,” the report noted.
Workers in low-paid jobs that are not protected under standard labor laws may feel increased pressure to hit certain productivity levels, especially since they are increasingly being monitored by their employers. Not wanting to lose a job they rely on, they may turn to smart drugs. “Electronic means of monitoring employees are likely to be accompanied by an increase in the stresses on workers,” the article noted.
Employers in general don’t seem aware that this trend is happening, Heudecker said. “It’s not like someone goes out for lunch, has a few martinis, and their speech is slurred. It looks like, ‘I’ve got a really productive worker.’ You’re not going to ask questions because it’s a positive outcome,” he said.
While employers may appreciate that their employees are being more productive, if employees must turn to drugs to reach those performance goals, then the employer should consider how the company culture or policy drove them there, Heudecker said.
“There’s a lot of demand to always be on, so you need to give your employees permission to be off,” he said. His 2017 Gartner report “Cognitive Enhancement Drugs Are Changing Your Business” also explored the main reasons that push employees to take these substances. Basically, employees either view smart drugs as an opportunity to push the boundaries of what they can accomplish in the workplace or feel coerced into taking them to maintain performance and keep up with their workload.
If employees feel forced, that has the potential to get employers in trouble. “This may expose organizations to legal risk if CED users obtain drugs illegally because they felt forced by colleagues or management,” the report noted.
Employer Response: Brian McPherson, labor and employment attorney at Florida-based law firm Gunster, has never had an employer raise the issue of smart drugs.
Medical cannabis is legal in Florida and that’s received all the attention, he said. “[Employers don’t have] the time or capacity to focus on the other issue that is brewing somewhat underneath.”
Studies support the increased use of Adderall, Ritalin and other drugs for performance, he said. Still, most employers try to stay away from getting involved in the prescription drugs employees are taking, and they assume they are complying with their physicians’ directions.
“We know it’s happening on a grand scale, at least more than it has in the past, but employers aren’t really talking about or dealing with it,” McPherson said.
Heudecker suggested policies companies can adopt to directly address smart drugs. A chief human resources officer can work with other leaders to draft a policy around cognitive enhancer use in the workforce. They also can support “non-pharmaceutical cognitive enhancement” — practices that naturally help people be more productive by “improving work-life balance, adjusting work schedules, promoting physical activity and educating employees on healthy nutrition and sleep practices,” Heudecker said.
An employer’s response also has to respect the fact that many smart drugs are prescription drugs that people need. “You don’t want to alienate people who need something for their ADHD,” Heudecker said.
THE LEGAL LANDSCAPE
The substance that employers mostly ask about is cannabis, said McPherson. Since medical cannabis is legal in the Florida, McPherson has fielded many questions about its use.
All indications point to cannabis laws continuing to progress in more states, he said. Once states approve it for medicinal purposes, the “floodgate starts to open” and there is a “general march toward recreational use.” Currently, 33 states, the District of Columbia and Puerto Rico have passed laws broadly legalizing marijuana in some form. As of Jan. 1, 2020, 11 states — Alaska, California, Colorado, Illinois, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont and Washington — and the District of Columbia have adopted laws legalizing marijuana for recreational use.
“As long as marijuana remains illegal under federal law, employers are getting a comfort level that they can still enforce the drug-free workplace tests for marijuana,” he said. “If it ever becomes legal under federal law, that will really change the landscape, and it will become a much more complex situation.”
Drug use among many U.S. sectors is growing, according to the Quest Diagnostics 2019 “Drug Testing Index.” The data involved in this analysis come from pre-employment testing for safety-sensitive positions or drug-free workplaces, said Barry Sample, senior director of science and technology at Quest Diagnostics, which has been annually analyzing workplace drug testing data since 1988.
Cannabis is the most commonly detected drug in the workplace, according to the “Drug Testing Index.” Positive tests have increased in most sectors. Meanwhile, positive test rates have declined for cocaine, heroin and opiates.
Interestingly, the inclusion of cannabis in testing panels may vary by state, the index showed. In almost all states, 95 percent of organizations still test for it when they have the option. Colorado and Washington, the states where recreational use has been legal for the longest time, saw a 4 percent decrease in organizations testing for cannabis between 2015 and 2018.
There may be differences by industry, Sample added. “Where there are generally less skilled workers, employers are having difficulties finding employees that will pass all the background screening, including drug testing,” he said. “They may be making a risk-based judgment on their part that ‘We’re going to take the chance and ignore the use of marijuana, because we really need people on board.’ ”
Meanwhile, two organizations have announced more nuanced drug tests for cannabis that may hit the market in 2020, according to Business Insurance. A research team at the Swanson School of Engineering at the University of Pittsburgh has developed a breathalyzer prototype, and Oakland, California-based Hounds Labs Inc. plans on bringing a breathalyzer to market in 2020.
Such tools could help detect marijuana use, which can stay in a person’s system up to 30 days after consumption, McPherson said. “The employers I’ve talked to about these tests are excited and hopeful about them,” he said.
Dan Harrah, senior associate at Mercer and a consultant specializing in behavioral health and health care operations, is skeptical about these tests. “The science of impairment is not settled yet. There’s a lot of subjectivity,” he said.
There will need to be a way to review these tests and see how effective they actually are, he added.
Psychedelic Legislation: While laws regarding cannabis use is moving rapidly, legislation on psychedelics is slower, said McPherson. Two cities — Oakland and Denver — have decriminalized psychedelics such as magic mushrooms, and the Chicago City Council in October 2019 approved a resolution that experts say could pave the way to decriminalizing them. The resolution uses the term “entheogenic substances,” defined as any range of natural plants or fungi “that can inspire personal and spiritual well-being,” as well as other psychological and physical benefits.
“The most alert employers are watching what’s going on with the psychedelics and they are concerned,” McPherson said.
Regardless of the substance, he advises employers to stay informed.
ADDICTION
A person with an addiction is hyper-focused on obtaining their drug of choice and getting that high, which can affect their hygiene, sleep, basic social behaviors and work performance, said Andrea Elkon, clinical psychologist and director of behavioral health for Alliance Spine and Pain Centers. This hyper-focus applies to substances such as nicotine, alcohol or opioids as well as behaviors like gambling or shopping.
An employee struggling with a serious substance addiction is fairly obvious to spot, Elkon said. They may consistently come in late, leave early or not show up to work at all, take extended lunch breaks or exhibit erratic behavior such as falling asleep at their desk or acting more emotional than usual.
In such cases, managers need to be assertive, Elkon said. It may be an uncomfortable subject, but not enough people know how to handle it, she said. Managers should learn how to take action — sooner rather than later — while still showing concern toward the addicted employee.
When an employee does not yet have a serious addiction but is on the path toward one, managers can still notice behavior patterns like absenteeism that may point to a substance problem. “That is a way to address the early signs, to focus specifically on the behaviors that are disruptive to the workplace,” Elkon said.
Employer Communication: Many employers have benefits programs in place to address addiction but not an environment that allows for open conversations about substance use, Harrah said.
“When it comes to behavioral health, everybody is able to talk about [how they] didn’t sleep well last night, and there’s no stigma around that. But nobody says, ‘I’m really thinking about cutting down on my drinking.’ There’s more stigma around that statement.” he said.
More employers have been taking on behavioral stigma, but there’s still work to be done. And the lack of communication around substance use benefits can lead employees down the wrong road, Harrah said. For example, if someone with an addiction realizes they need help, oftentimes the first thing they do is Google treatments. While the employer plan may include in-network carriers with good programs for addiction, a simple internet search can lead to low quality, out-of-network care, he said.
“One of the things that I caution my clients on is you can have these supportive conversations, but you better understand what programs are in place. Because once you start having those conversations, your employees start to come to you, whether for themselves or a family member,” Harrah said.
Substance abuse and mental health benefits also belong in open enrollment conversations, said Morgan Young, vice president of client services, employee benefits at insurance brokerage Holmes Murphy. Young didn’t mention mental health and substance abuse benefits in a recent open enrollment meeting, and an employee later asked if the company covered mental health benefits. Young was reminded of how important it is to share that message to employees.
Substance abuse benefits should go beyond the employee assistance program, she added. Employers consistently see low utilization of EAPs and try to convince employees to use them more, but they’re not going to be the only solution, she said.
“We need to understand that while an EAP may be a good tool for some, it’s not going to dissolve all the needs we have. We need to come up with different tools, resources and policies and make them available to employees,” she said.
Elkon suggested resources that could help employees or dependents with addictions. One of the first steps is sending them for a substance abuse risk evaluation, she said. These evaluations can tell employers about the employee’s risk of substance abuse problems and treatment options.
If an employee does have a problem, employers can respond by showing concern and having treatment resources available, Elkon said. The employee could use a leave of absence to get the necessary treatment, with the assurance that they won’t lose their job while they’re getting treatment.
“If someone is showing any signs of addiction, it’s important to show concern but be firm with that person sooner rather than later because it could spiral and affect other co-workers.” she said.
Pharmacy benefit managers can help to reduce unnecessary opioid prescribing by improving coordination of care among physicians, pharmacists and patients to identify when the potential benefits of these medications outweigh the risks.
More than 10 million people in the United States misused a prescription opioid in 2018, and the opioid epidemic cost the country $179 billion including mortality, health care expenses, lost productivity, criminal justice expenses and assistance. The National Safety Council notes that the annual direct health care costs of individuals who misuse opioids are 8.7 times higher than those who do not.
The opioid epidemic offers an example of a preventable, complex public health and safety issue that has arisen due to a perfect storm of causative factors. Consequently, it requires multiple stakeholders to develop and deliver an effective solution to help lower costs and improve patient health outcomes. These stakeholders include health care providers, pharmacies, drug manufacturers and even employers.
However, the pharmacy benefit manager is one player in the opioid crisis that fills a critical role by employing clinical programs to ensure safe and appropriate utilization of medications. The PBM is a third-party administrator of prescription drug programs and primarily responsible for contracting with pharmacies for network services, negotiating discounts and rebates with drug manufacturers, developing and maintaining the plan’s list of covered drugs (a formulary), and processing and paying prescription drug claims.
PBMs have become an increasingly important part of health benefits since they first entered the market in the 1970s. Today, three pharmacy benefit managers control more than 80 percent of the American market. All are part of massive health care conglomerates that have interests in other aspects of the benefits food chain — from retail pharmacies to medical insurance.
This can create conflicts of interest, as these mega-corporations stand to profit from every stop on a patient’s journey. These conflicts of interest can in turn leave employers and patients vulnerable to increasing health care costs and crises such as the opioid epidemic.
The American public, from the employee to the executive suite and human resources professionals, as well as those who make decisions about employee-sponsored health care, seeks change in today’s profit-driven benefits industry. Here are just a few of the reasons why:
• In 2017, the average annual cost for prescription drugs used to treat chronic conditions reached $20,000, and drug prices increased at twice the rate of inflation.
• American families spent 67 percent more on health care in 2018 compared to 2008.
• Employer contributions toward health care costs rose 51 percent in the same period.
• More than 66 percent of bankruptcies are due to medical expenses or time out of work as a result of illness.
Mergers and acquisitions may answer the health care industry’s need to create new sources of revenue, but they can leave patients and plan sponsors behind. In a sector dominated by an outsized few, consumers all begin to look the same.
To compound the issue, PBM operations are often seen as veiled enterprises. Complex contracts and opaque business practices conceal the flow of dollars, making it difficult for plan sponsors, HR professionals and members to see what they’re paying for. It may seem impossible to demand meaningful change from such a sizable arm of the health care industry, but it doesn’t have to be.
Human resource professionals occupy a unique position in the U.S. workforce. As part of the decision-making process when it comes to employee benefits, HR leaders can demand change from the industry by learning how to spot PBMs that put member and plan sponsor interests first and move away from PBMs that don’t.
This requires understanding today’s health care landscape and how PBMs should be transforming to work for employers, not just for themselves. Here are four key indicators that demonstrate a PBM has broken from the status quo to operate in the best interests of its clients and their members:
• Pay-for-performance business model.
• Comprehensive clinical programs.
• Complete care coordination.
• Transparent contracting.
Pay for Performance
Most PBMs today operate on a fee-for-service model in which they are paid each time they perform a given function, such as a prior authorization review. While this type of business model is common, it fails to tie the PBM’s financial success to how well the company performs for consumers.
No matter how well or poorly the PBM helps the plan sponsor manage prescription spend, the PBM is paid the same. In some cases, it may even be paid more if the plan’s prescription spending grows based on profit incentives tied to per-claim fees and hidden revenue streams.
That’s why a pay-for-performance business model has so much potential in the PBM industry. Pay for performance is a relatively new model, so far only explored by a few PBMs despite its power to help tie the companies’ interests more closely to those of members and plan sponsors.
The pay-for-performance model helps to support transparent PBM operations by holding PBMs responsible for the quality of the work they do and putting dollars at risk if a plan sponsor’s prescription spending rises above a guaranteed maximum. This puts skin in the game and places people, not profits, first.
Under this type of pay-for-performance structure, the PBM is held accountable. Its success is tied directly to quality of service and whether it reduces overall drug spending through proactive clinical programs that help reduce inappropriate utilization. The plan sponsor is rewarded by performance guarantees tied directly to the PBM’s clinical programs and how well they improve health outcomes and lower costs over time.
This new approach helps encourage a straightforward pricing structure that does not benefit from unnecessary prescribing practices. It eliminates conflicts of interest and places plan sponsors and their members first.
Comprehensive Clinical Programs
Clinical programs can be easily overlooked when it comes to their importance not only in safeguarding patient health, but also in the amount patients and plan sponsors pay for health care each year. While many see programs such as step therapy and clinical reviews for prior authorization as sources of member disruption — and they can be if handled poorly — it’s important to recognize that these programs can positively impact plan sponsors and members alike.
An estimated 40 percent of opioid overdose deaths in 2016 involved a prescription opioid, highlighting the dangers that clinical programs have the chance to prevent. From 2011 to 2016, prescriptions were written for dozens of opioid tablets following surgeries, even when procedures would cause relatively little pain.
This prescribing pattern has tremendous impact, as the probability of long-term opioid use and abuse increases sharply in the early days of therapy, particularly after five days. To prevent addiction and abuse, it is vitally important to ensure patients take prescription opioids no longer than is medically necessary.
PBMs can help to reduce unnecessary opioid prescribing by improving coordination of care among physicians, pharmacists and patients to identify when the potential benefits of these medications outweigh the risks. Comprehensive clinical programs offer a strategic way to ensure medical necessity while protecting patients.
Data from the Centers for Disease Control and Prevention show that the rate of opioid addiction is relatively low if only one day of opioid therapy is prescribed initially, with just 6 percent of patients on opioids one year later. The likelihood of addiction increases sharply with eight or more days of prescription opioid therapy (13.5 percent of patients on opioids one year later). This data demonstrate just one way that clinical programs, such as starter dose and quantity limits, can help protect patients.
Starter dose programs limit the initial supply of a drug to help determine its appropriateness for the patient. In the case of opioids, my company, BeneCard PBF, found that a program limiting the initial supply to three days helped curb the number of prescription opioid claims by 67 percent as part of a comprehensive, clinically driven approach preventing opioid addiction. The starter dose program helps avoid members having excess opioids on hand when therapy is needed for just a few days. This approach also reduces the risk of opioid fraud, waste and abuse.
Quantity limits, which control how much of a medication can be dispensed at a time based on medical best practices, can provide similar protection. This helps to prevent unused medication from building up in the home, where it presents a danger not only to the patient, but to others who may be accidentally exposed to the drug (such as children and pets) or who may be at risk of using the medication without a prescription and a physician’s oversight.
Carefully designed and managed clinical programs have the power to save lives and to protect members and their employers from fraud, waste and abuse of prescription medications. There is an urgent need to do so that extends beyond controlled substance abuse. The United States spends about $21 billion on medication errors and $935 billion in overall health care waste each year. However, many PBMs rely primarily on retrospective reviews of prescription drug utilization to identify problems. This approach may represent a conflict of interest, as many PBMs charge a per-claim fee, meaning they get paid every time a prescription is filled.
Instead, look for a PBM that offers comprehensive clinical programs designed to be proactive, not reactive. These programs should include a retrospective review, but they should also work to identify potential concerns before a medication is dispensed and prevent potentially dangerous or wasteful prescription utilization instead of addressing it after the fact.
Complete Care Coordination
Since today’s health care system is so complex, a clinically driven PBM model is important in protecting patient and plan sponsor interests and helping to control prescription spending.
Unfortunately, many PBMs rely primarily on rebates and negotiated discounts to control prescription spending. While these negotiations are necessary in today’s marketplace, they focus on only one part of the equation.
As in any other industry, obtaining strong discounts is simply not enough. PBMs must also be smart about where and how money is spent. That’s why a clinical focus is key. Rebates and discounts do little good if the number of prescription claims continues to rise because patient welfare has become secondary to numbers on a spreadsheet.
But how do you put people first in this challenging environment? Select a PBM that empowers its pharmacists to coordinate care between the various members of a patient’s health care team. This team can include primary care physicians, specialists, retail pharmacists and others.
Often, these individuals are spread across multiple practices, and communication between them can be difficult. However, the PBM’s pharmacists have a unique perspective, with insight into the prescriptions written and filled by multiple providers. This puts them in an ideal position to facilitate more effective communications between all parties involved in a patient’s care.
PBMs should understand a patient’s condition, symptoms, medical history and any other medications they use to help ensure each prescription dispensed is medically appropriate. They must know each drug’s manufacturer recommendations and FDA guidelines to understand if it offers the most effective course of treatment for that particular individual. PBMs also must take into account industry best practices, which constantly evolve as new medications and new clinical data become available.
All of this helps to support better health outcomes by reducing the risk of side effects and adverse drug reactions, improving treatment efficacy and supporting a better quality of life. This, in turn, can reduce the need for repeat visits to the doctor and lower the risk of hospitalization. It can also lower the risk of patients taking a medication that offers little or no benefit. All of this helps to lower overall health care costs, improve member satisfaction and support a stronger workforce.
Health care must be a coordinated team effort to achieve positive results for both the patients and the PBM.
Transparent Contracting
The ongoing conversation regarding PBMs and their role in controlling costs often focuses on transparency, and it must continue to do so. In many cases, PBMs practice selective transparency, allowing consumers to see only what’s favorable to the PBM and its revenue streams.
Complicated contracts help to conceal revenue streams in an industry where conflicts of interest have become increasingly common. This creates an environment in which human resource professionals and their companies are not fully informed regarding how their money is being spent and where PBMs may be profiting at consumers’ expense.
Convoluted business practices and hidden revenue streams make accurate PBM comparisons virtually impossible. This means that there is a greater chance companies and their employees could be spending more to get less from their PBM.
The traditional PBM business model masks several revenue streams, including rebates and spread pricing, which pharmacy benefit managers enjoy at the expense of plan sponsors and members. To avoid these and other conflicts, it is vital to select a PBM that offers clear contract terms.
Clinically driven pharmacy benefit management works, and because it works so well, there’s no need for complicated contracts that conceal exactly what the plan sponsor and their members are paying for. Another method of avoiding hidden revenue streams and conflicts of interest is to work with an independent or privately owned PBM not beholden to shareholders and not driven by the needs of larger health care ventures. This allows the PBM to focus closely on providing superior service with less emphasis on profit margins. Typically, working with these PBMs means carving out the pharmacy benefit from the medical benefit, which offers further advantages and transparency.
There are several small to midsize privately held PBMs that are advancing clinical care, transparency and innovation — outperforming the industry giants for customer satisfaction in numerous categories. The PBMI “PBM Customer Satisfaction Report” is an annual survey of pharmacy benefit managers’ customers to show client satisfaction in multiple categories such as delivery of promised savings; meets financial guarantees; effective tools to manage prescription costs; no conflicts of interest issues; and other important factors.
Let the Past Inform Our Future
To effectively manage a benefits program and protect its members as well as its financial viability, it is essential to understand the issues inherent in the pharmacy benefit management system, as well as the steps necessary to create meaningful and lasting change. This entails exploring smarter, more strategic PBM clinical programs designed to promote clinical efficacy and reduce wasteful and inappropriate prescription utilization. It also involves resisting the traditional per-claim fee structure, which can be prone to fraud, waste, and abuse.
Addressing the underlying issues in the PBM industry requires persistence and tenacity. Armed with proper knowledge, employers can begin asking their PBM the tough questions and start demanding more for their plan and for their members.
Road maps are a form of content that will help you navigate key areas of people management. Road maps focus on the changing terrain of employee engagement. This guide offers a step-by-step process for creating a measurable engagement strategy that will deliver results.
Most of your employees are probably not engaged and it’s hurting your bottom line.
But don’t feel bad. Almost every company is in the same boat.
Despite years of talking about the importance of employee engagement to hiring, retention and productivity, only 34 percent of employees are engaged, according to data from Gallup. Worse, 13 percent of employees are actively disengaged. “The numbers have improved over the last decade, but not as much as we want,” said Jim Harter, chief workplace scientist for Gallup.
The good news is that employee engagement can be improved if companies focus on the right things. Harter has seen dozens of organizations across industries increase engagement levels when they implement targeted strategies and stick with them over time. “Change happens incrementally but it does happen,” he said.
When it does, the payoff is clear. Gallup research shows organizations with high levels of employee engagement achieve better earnings-per-share, and see substantially better customer engagement, higher productivity, better retention, fewer accidents and higher profitability.
The trick is understanding who has the power to influence employee engagement, and what they can do to generate change, said Jill Christensen, employee engagement consultant and author of “If Not You, Who? Cracking the Code of Employee Disengagement.”
HR should be involved. HR still needs to plan, implement and measure employee engagement strategies — but senior leaders need to be the voices of the program to make it work. It’s a collaboration, and this road map provides a framework for how senior leaders and HR can work together to make engagement happen.
PART 1: MAKE A PLAN
Get leaders on board. Leaders will never independently take ownership of engagement, so HR has to pull them in. Harter suggests sharing data linking employee engagement to business performance to pique their interest, then showing them how their words and actions impact outcomes.
Ask employees what they think. If you want to identify your engagement issues, you have to listen to what employees are saying, said Amanda Popiela, researcher with The Conference Board. “Continuous listening strategies are key to understanding engagement.” Along with reviewing annual survey results, she suggests conducting periodic pulse surveys, hosting employee focus groups, monitoring social media posts, and talking to employee teams about what they love about working for your organization, and what needs to change.
Identify skill gaps. Most leaders and managers are never taught good coaching skills, like how to give feedback, build trust or manage conflict, all of which is key to driving employee engagement. So management training has to be part of the plan. Look for content that is quick and easy to access and let managers know they will be expected to use it.
Set realistic goals and expectations. If you want to foster change you have to hold managers accountable, Christensen said. She suggested setting a goal to increase engagement levels by a specific amount in one year then tying those results to performance reviews. “That’s how you make culture change happen.”
PART 2: START ENGAGING
Make employee engagement part of every conversation.Define specific communication steps for managers and leaders to integrate engagement into their talking points. These might include discussing engagement issues in every team meeting, sharing engagement strategies in town hall events, and having weekly one-on-ones with team members to identify their specific concerns or needs. “You need to tell them exactly what to do or they won’t do it,” Christensen warned.
Keep employees up to date. Employees want to feel like they have a voice and that their opinions matter, so keep them in the loop. Report employee engagement survey results, share your action plans to address specific problems, and keep them up to date on progress. “Exceptional communication is an important part of employee engagement,” Harter said.
Teach managers to coach. Managers are busy and will often skip training to focus on the next deadline. So you have to make it easy to access, immediately relevant and a clear priority, Popiela said. One way to do that is to get senior leadership involved. Popiela recently worked with a financial services company whose CEO posts a monthly webcast discussing one tip for managers on how to improve engagement. “Managers know what they should be doing, but they don’t always do it,” she said. These short, thought-provoking webcasts make them stop and think about what they could do better.
Deal with the disengaged. When teams have toxic, negative or disruptive members, no amount of coaching will make a difference. “These employees can be toxic,” Christensen said. And it’s up to managers to deal with them. They need to be ready to have these difficult conversations, set clear performance goals, and fire people who refuse to change. A lot of managers ignore toxic employees because they don’t have the skills to deal with them, but the consequences of this approach can be severe, she said. “When leaders don’t take action with these employees, it will breed disengagement in everyone around them.”
PART 3: MEASURE RESULTS
Conduct annual survey results. The annual employee survey is the best baseline measure of engagement and proof that your efforts are working. Remember, even small shifts are a good sign. “Change takes time,” Harter said. But companies that stick with it can achieve dramatic and sustainable change over a few years.
Conduct pulse surveys. Short pulse surveys that sample a percentage of the employee population, or ask everyone a few questions, can give you a sense of progress and help you see what’s working (or not). But don’t overdo it, and don’t use surveys to replace real conversations.
Check your eNPS. Employers can now use NPS to measure employee engagement. The one-question survey tells you how likely your staff members are to recommend your company as a place to work on a scale from 0 to 10. “It’s a simple way to gauge engagement,” Christensen said. And it can be a quick easy way to demonstrate results.
Share the data. Any time you survey employees you have to share the results, otherwise it could actually make things worse. Report engagement levels to the entire company, celebrate big successes and share what you plan to do next, Popiela said. Then discuss the data with executives, drawing connections where possible between engagement and productivity, retention, and business performance. “It’s important to show them the ‘so what’ of improved engagement,” she said. “Especially when it effects the bottom line.”
In 2005, Monika Starke filed a charge of discrimination with the EEOC alleging that her employer, CRST Van Expedited, Inc., subjected her to sexual harassment.
The EEOC expanded that initial charge into a federal-court lawsuit over whether CRST engaged in sexual harassment against myriad of its female driver trainees.
What followed was 14 years of litigation, severaltrips to the court of appeals, one trip to the U.S. Supreme Court, and an attorney-fee award of over $3.3 million against the EEOC for frivolous, unreasonable, or groundless conduct in the filing and prosecution of the underlying claims.
The issue that lead to the large fee award was the EEOC’s heavy-handed prosecution of a pattern-or-practice harassment claim, even though it did not plead such a claim in its complaint.
Late last year, the 8th Circuit Court of Appeals affirmed the fee award (which had previously been reduced on appeal from an initial award of $4.5 million).
As the master of its own complaint, it was frivolous, unreasonable and/or groundless for the EEOC to fail to allege a pattern-or-practice violation and then proceed to premise the theory of its case on such a claim. Claims necessarily premised on the inclusion of this claim are likewise frivolous, unreasonable and/or groundless.
As attorneys, we are responsible for our conduct in litigation. When that conduct gets out of hand or crosses the line, there are often consequences. Sometimes, those consequences are harsh, even if warranted. In this case, the EEOC learned a tough lesson, hopefully one that will end one of the longest running discrimination cases in history.
In the past few years, “weed at work” has grown as a workplace issue.
More and more Americans appear to be turning to marijuana as a way to treat various ailments, including epilepsy, migraines and anxiety. Moreover, public sentiment about marijuana has shifted, with polls showing that more people support marijuana legalization at the federal level. Yet, the issue might not be so easy for the nation’s employers. While marijuana remains illegal as a matter of federal law under the Controlled Substances Act, states are taking matters into their own hands by enacting medical and recreational marijuana laws.
Currently, 33 states, the District of Columbia and Puerto Rico have passed laws broadly legalizing marijuana in some form. As of Jan. 1, 2020, 11 states — Alaska, California, Colorado, Illinois, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington — and the District of Columbia have adopted laws legalizing marijuana for recreational use.
While most of these laws still allow employers latitude in enforcing their drug and alcohol testing and substance abuse policies, recent legal developments at the state and local level may be a sign that employee protections are on the horizon. For instance, Illinois’ new law is the most expansive recreational law to date and has created a lot of uncertainty for employers.
In addition, Nevada now prohibits employers from taking adverse action against applicants who test positive for marijuana with exceptions for, among others, safety-sensitive positions and motor vehicle drivers who are subject to testing under state or federal law. And, starting next year, New York City, with some similar exceptions, will bar employers from requiring any pre-employment marijuana testing.
The issue becomes more complicated when applicants and employees use marijuana for medicinal purposes. Approximately a dozen states — including Arizona, Connecticut, Illinois, Massachusetts, Minnesota, New York, and Pennsylvania — have employment protections for medical marijuana users, with such protections directly in the statute or derived from case law. These laws generally protect off-duty medical marijuana use and prohibit employers from discriminating against individuals for either being a registered medical marijuana cardholder or testing positive for marijuana. In addition, an employer may (depending on the state at issue), have a duty to engage in an interactive process to determine whether a reasonable accommodation might be necessary.
Litigation involving employers and their responses to medical marijuana users continues to make the news. This summer, a New Jersey appellate court held that employers may have a duty under the state’s anti-discrimination law to accommodate an employee’s off-duty medical marijuana use.
And the American Civil Liberties Union recently filed suit against the District of Columbia Department of Public Works claiming that a worker was denied reasonable accommodation and placed on an indefinite leave of absence after disclosing that she was a medical marijuana cardholder under the District’s medical marijuana program. The worker at issue claimed that she had been prescribed medical marijuana for off-duty use only.
When she requested a temporary transfer to a clerical position during the fall leaf-raking season as an accommodation for her disability, she was purportedly denied the transfer, and after she disclosed that she possessed a medical marijuana card, she was allegedly placed on an unpaid leave of absence and told that she could not resume her duties as a sanitation worker until she successfully passed a drug test (which she would inevitably fail due to her medical marijuana use) because she was working in a position that the District considered to be “safety sensitive.”
This rapidly evolving legal landscape presents new challenges for employers, especially multistate employers. Employers must balance complying with conflicting federal, state and local laws, maintaining a safe work environment, and protecting applicants’ and employees’ privacy and other legal rights. Because of these changing laws and social norms, some employers are even considering eliminating preemployment testing of applicants for marijuana or marijuana testing altogether, while maintaining other drug testing requirements.
Employers also are now beginning to reconsider their practices as they relate to possible accommodations of medical marijuana users and whether to accept medical marijuana use as a medical explanation for a positive test result. That said, however, no state requires an employer to tolerate an employee being under the influence of or impaired by marijuana while they are at work or during work hours.
Because marijuana can remain in a person’s system for days and even weeks, the fact of a positive test result, without more, says nothing about impairment. On this point, earlier this year, an Arizona federal district court judge entered judgment against a national retailer for terminating the employment of a woman who had been prescribed medical marijuana because the employer had not established through expert evidence that the employee was actually impaired by marijuana at work despite high levels of marijuana in the results of her drug test.
Developing a well-defined employment policy on marijuana use can minimize the risk of harm from a workplace safety perspective and decrease the likelihood that drug testing and disciplinary action based on marijuana use will open the door to liability for adverse employment decisions. Employers operating in states where medical and recreational marijuana use is allowed should consider taking a fresh look at their substance abuse policies.
It is imperative that employers review the laws of the states in which they operate and work with employment counsel to help navigate this complex and rapidly evolving area of the law.
Four former Google employees claim that their ex-employer fired them Thanksgiving week in retaliation for their efforts to organize a labor union.
The NLRB is now investigating the firings. For its part, Google denies that anti-union animus played any role in the firings. “We dismissed four individuals who were engaged in intentional and often repeated violations of our longstanding data security policies, including systematically accessing and disseminating other employees’ materials and work. No one has been dismissed for raising concerns or debating the company’s activities.”
The NLRB will ultimately have the final word. Suffice it to say, however, an employer cannot terminate a pro-union employee if the employer’s anti-union animus is a substantial or motivating factor for the termination.
But that’s just the tip of the iceberg of an employer’s prohibited conduct when confronted with union organizing.
And my use of the idiom “tip of the iceberg” is no coincidence, as T.I.P.S. is the acronym commonly associated with the four main categories of employer prohibited conduct in a union organizing campaign.
Threaten: Employers cannot threaten employees, or, worse, carry out those threats against employees, because they support unions or unionizing. For example, a manager cannot tell employees he will lower their wages or demote them if they support the union. Or, in the Google example, fire employees.
Interrogate: Employers cannot ask employees about their own, or other employees’, support of unions or unionizing. For example, management cannot ask employees if they signed a union authorization card or how they intend to vote.
Promise: Employers cannot promise employees some reward for not supporting a union. For example, management cannot offer raises or bonus if the union loses.
Surveil: Employers cannot spy on union activity. For example, management cannot photograph or video record union activities or eavesdrop on employee conversations.
And, if it’s not already clear (Google), you cannot fire employees because they support the union.
Yet, just because an employer cannot engage in T.I.P.S. does not mean that an employer is powerless to oppose and fight a labor union that is trying to organize its employees. Indeed, an employer has its own legal rights under the National Labor Relations Act to a fair and balanced secret-ballot election prior to the NLRB certifying a labor union as the bargaining representative for its employees. An employer that does not take advantage of these rights is omitting valuable information and a valuable opportunity to communicate its beliefs.
What can an employer communicate to its employees?
What are your values as an employer?
What are the benefits of working for your company? Wages, benefits, steady work, responsive management, etc.
Explain to employees what union authorization cards, how the secret-ballot election process works, and that just because an employee signed an authorization card does not bind that employee to vote for the union in a secret election.
Remind employees that just as you will not retaliate against any employee who is pro-union, you will not tolerate any employee who retaliates against a co-worker for being pro-management.
Explain the meaning of “dues checkoff,” and let employees know that union dues will almost certainly be deducted from their paychecks whether or not they support the union or use its services.
Inform employees of the potential disadvantages of labor unions, such as the possibility of strikes and work stoppages, that in the event of a strike you might hire replacement workers to take their jobs, that a collective bargaining agreement might require promotions and raises to be granted on seniority and not merit, and that employees might lose direct access to management to adjust issues in favor of a formal grievance and arbitration process.
Tell employees of your prior experience with labor unions, and any facts you know about the particular union that it trying to organize them.
Remind employees of the advantages of your benefits package, especially as compared to union fringe benefits that they might have to accept in lieu of your traditional benefits (which will still be offered to anyone outside of the bargaining unit).
Finally, you are always free to express your hope that employees vote against this or any union.
These issues can be nuanced, and if handled incorrectly, can expose an employer to significant liability at the NLRB. When in doubt, there are professionals you can hire (labor lawyers or other consultants that specialized in union avoidance campaigns). The bottom line, however, is that you cannot ignore a union organizing drive, because if the only viewpoint your employees hear is that of the union, it’s not hard to guess how the election will turn out.
Joint employment is a legal theory in which the operations of two employers are so intertwined that each is legally responsible for the misdeeds (and the liabilities that flow from those misdeeds) of the other. It’s also a legal theory with which federal agencies and courts have struggled over the past several years.
More recently, however, more measured and business-friendly federal agencies have ratcheted back these expansions. In December 2017, the NLRB announced that it would require “actual … joint control over essential employment terms” for a finding of joint employment. A few months earlier, the DOL pulled its joint employment rules, leaving the issue in limbo in wage and hour claims.
Earlier this week the DOL announced a final rule to update the regulations interpreting the definition of joint employment under the FLSA.
In the final rule, the department provides a four-factor balancing test for determining FLSA joint employer status in situations where an employee performs work for one employer that simultaneously benefits another entity or individual. The balancing test examines whether the potential joint employer:
Hires or fires the employee;
Supervises and controls the employee’s work schedule or conditions of employment to a substantial degree;
Determines the employee’s rate and method of payment; and
Maintains the employee’s employment records.
The DOL adds that this rule “will add certainty regarding what business practices may result in joint employer status,” promote “uniformity among court decisions by providing a clearer interpretation of joint employer status,” and “improve employers’ ability to remain in compliance with the FLSA.” I cannot agree more.
This rule (available here) becomes effective on March 16, 2020.
Workers in low-paid jobs that are not protected under standard labor laws may feel increased pressure to hit certain productivity levels, especially since they are increasingly being monitored by their employers. Not wanting to lose a job they rely on, they may turn to smart drugs. “Electronic means of monitoring employees are likely to be accompanied by an increase in the stresses on workers,” the article noted.
Keep employees up to date. Employees want to feel like they have a voice and that their opinions matter, so keep them in the loop. Report employee engagement survey results, share your action plans to address specific problems, and keep them up to date on progress. “Exceptional communication is an important part of employee engagement,” Harter said.
