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Survey Shows Injured Workers Pharmacy Costs Up 6.5 Percent in 2009

Average pharmacy spending per injured worker increased by 6.5 percent in 2009, according to a report on “in-network” transactions released Wednesday, July 14, by a workers’ compensation pharmacy benefits manager.


The increase was driven by a 4.7 percent rise in prescription prices and a 1.7 percent uptick in utilization, according to Tampa, Florida-based PMSI.


PMSI said its findings are based on a review of 5 million customer retail and mail-order transactions conducted from 2007 to 2009. The report excluded data for out-of-network pharmacy transactions.


PMSI’s 2010 Annual Drug Trends Report is available online at www.pmsionline.com/annual-drug-trends-report.  


 Filed by Roberto Ceniceros of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


 


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Hotel and Garment Unions Settle on Breakup

The garment workers union will hang on to Amalgamated Bank and the hotel workers union will gain ownership of a 600,000-square-foot New York City office tower under terms of a tentative deal to end the bloody civil war that has raged between the two groups for nearly two years, sources on both sides said Monday, July 12.


As part of the deal, which still needs to be approved by the executive boards of both unions, the garment workers (Workers United) will also fork over a hefty amount of cash to the hotel workers (Unite Here). The total value of the deal to Unite Here, including the estimated $70 million, 28-story Seventh Avenue building, could be more than $150 million, according to sources familiar with the agreement. Unite Here will also regain control of some bargaining units that had flipped over to Workers United during the battle.


The trouble began almost immediately after the Union of Needletrades, Industrial and Textile Employees joined with the Hotel Employees and Restaurant Employees International Union in 2004 to create Unite Here, a 400,000-member group that presumably would wield dramatically enhanced clout. The relationship proved rocky from the start, as president Bruce Raynor of the garment workers’ side and president John Wilhelm from the hospitality side fought for power, virtually paralyzing the New York-based union.


The garment workers were a wealthy union, with holdings including real estate in New York City and Amalgamated Bank, which has nearly $5 billion in assets. The hotel workers had little in the way of financial assets, but added 250,000 members to the union’s ranks at a time when the dying textile industry threatened Unite’s membership.


When Raynor tried to annul the marriage, Wilhelm’s faction blocked the move. Some 100,000 of the garment workers then formed a breakaway union, Workers United, which affiliated with the powerful Service Employees International Union, led until recently by Andy Stern.


SEIU’s new president, Mary Kay Henry, was determined to end the fight and played an influential role in hammering out the tentative deal with Wilhelm, sources said. Its affiliate is paying a hefty price, but after almost two years of fighting that took time and resources away from organizing workers and a toll on the union’s reputation, leaders were anxious for peace, at whatever price.  


Filed by Daniel Massey of Crain’s New York Business, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


 


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Dear Workforce How Do We Handle Merit Increases When Changing to a Focal-Point Appraisal Process

Dear Moving Targets:
Many organizations have moved or are considering switching to a focal appraisal and salary review date. The “common review date” approach has a number of advantages: It strengthens the performance evaluation process as managers are comparing and ranking all employees at the same time. Also, it provides an opportunity to align pay internally based on performance, contributions and competencies, and it reinforces the pay-for-performance link. Organizations find that these benefits, as well as the ease of salary planning and administration (one time rather than every month), outweigh an often-heard objection: that it requires a greater time commitment to conduct all appraisals and salary reviews at the same time.
Timing of the focal appraisal and salary review date also is a consideration. Many organizations use a date a few months following their year’s end. This allows performance to be assessed based on end-of-year results and then provides sufficient time for managers to complete all performance assessments. For organizations whose year ends December 31, salary increases are often scheduled for an April 1 time frame.
There are many methods that can be used to determine an appropriate pay increase for each employee, ranging from a flexible approach with general parameters for management to a more disciplined one with specific guidance. The method selected is a function of the organization’s culture and goals.
One option is to give managers general criteria and guidelines to make an informed pay decision. These could include evaluating the employee’s absolute performance, relative performance (versus peers), overall contribution, market competitiveness, importance of skill set, high-performance potential and retention risk. This is an opportunity for the organization to make decisions about the allocation of increases among different employees based on their performance and contributions.
As a specific example, a focal-point appraisal allows a manager to provide an up-and-coming performer who clearly surpasses others with a greater increase and better pay alignment, relative to the steady performer who doesn’t contribute much beyond what is consistent with expectations. This approach is particularly relevant today, given the uncertainty of increases over the last few years in many organizations and the critical need for organizations to retain key employees.
Another approach is to establish a more formal framework whereby individual increases are ratably adjusted to reflect the shift in the timing of increases. During the conversion to the focal or common review date, some employees will receive an earlier-than-expected review and others will have their review date delayed. It is preferable to delay increases scheduled a few months before the common review date so employees won’t receive two salary increases within a short period of time. The increase can be prorated and provided as a lump sum or folded into the merit increase.
Example: If an employee is scheduled for a 3 percent increase on a common review date of April 1, but would have ordinarily received it January 1, then he/she could get a prorated increase of three months (January, February and March) either as a lump sum or folded into the merit increase. In this case, it would be 0.75 percent of the base salary as a lump sum or 3.75 percent added to base salary.
If the same employee were to receive an increase three months early, then 0.75 percent would be deducted from the 3 percent and the employee would receive a 2.25 percent increase.
These prorated calculations can minimize perceptions of inequity or being “shortchanged,” but no solution is perfect. For instance, the employee whose increase is delayed doesn’t have access to the raise as early as expected. However, the eventual percentage increase received is larger than for the employee who receives an early increase.
Whatever approach is ultimately selected, it is important that managers have tools available to explain to employees how their performance was evaluated and their increase was determined. The real key to a successful transition is communication.
SOURCE: Linda Ulrich, Buck Consultants, Secaucus, New Jersey
LEARN MORE: Please read how to change employee perceptions about performance appraisals.
The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.
Workforce Management Online, July 2010 — Register Now!
The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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Dear Workforce How Do We Persuade Management to Create Flex Schedules?

Dear Not Nimble:

Here are some facts from your statement, slightly rearranged:

1) Your company does not have a formal flex policy.
2) Some departments use flex schedules anyway.
3) You work in human resources.
4) You view flextime as a benefit and want your department to get the benefit, too.
5) You seek assistance in designing a pitch to your line executive.

To start: Instead of trying to see how flextime can benefit you, see how it can benefit your customers. Start with an important business need in which a flextime schedule would improve some aspect of customer service.

The human resources department is visible to all in the company. Limit your self-interest and you will build more respect for the HR function. Don’t make flextime simply about the HR department.

During my 20 years as head of HR for an S&P 500 company—incidentally an early adopter of flextime—we followed a guideline that our HR people would not have the most favorable cases for any company benefit. We (and most others) found that flextime could not be structured the same for research scientists, manufacturing assemblers, building maintenance mechanics, administrative services like HR and others..

Real-world examples: Our assemblers liked to start early (together), take short breaks and leave at 3:30 p.m. That fit their work pattern. Service functions needed long hours of coverage. Those departments tended to have some early starters, some later, with all present during “core hours” from 10 a.m. to 3:30 p.m.

To get your proposal together:

1) Forget about the most exotic flextime alternatives, like 4/40 schedules, three-day weeks and so on. Start with a business problem that has a natural, rational link to a flextime solution. Think of some ugly problem that your customers complain about or some service improvement that might be achieved by a conservative use of flextime.

2) Come up with the most concrete business rationale you can.

3) Do your research to be absolutely sure that nothing in your proposal violates or fudges any Fair Labor Standards Act rules or applicable state laws, especially for nonexempts (overtime-eligible employees).

4) Rather than box in your vice president of HR with a formal memo, meet briefly face to face after you have developed a business rationale for flextime. .

SOURCE: Harold Fethe, organizational consultant, Half Moon Bay, California, June 1, 2010.

LEARN MORE: Be aware of changes to the federal Fair Labor Standards Act that address flexible scheduling issues.

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

Workforce Management Online, July 2010 — Register Now!

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

Ask a Question
 Dear Workforce Newsletter
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Court Rules Employer Can Count Award Toward Workers Comp

Employers are entitled to credit an employee’s third-party liability award against future workers’ compensation benefits for which they may be responsible, Connecticut’s Supreme Court said in a ruling released Tuesday, July 13.


In Janice Thomas v. Department of Developmental Services et al., Thomas argued that a lien provision in Connecticut law applies only to workers’ comp benefits that an employer already has paid and not to future benefits.


The provision entitles an employer that is paying workers’ comp benefits to place a lien against any third-party judgment or settlement that an employee receives, court records state.


Thomas filed a workers’ comp claim after falling on an icy sidewalk leading to her workplace in 2004. She also filed a third-party lawsuit that was settled for $45,000.


After the settlement, a dispute arose over the lien issue in Connecticut law.


In 2007, a workers’ compensation commissioner ruled in favor of Thomas, finding the state agency was not entitled to credit her third-party award against future workers’ comp benefits it could be obligated to pay.


But a compensation review board overturned the commissioner’s finding.


In the Tuesday ruling, the Connecticut Supreme Court affirmed the board’s decision, ruling that “well-established public policy” in the law says that “double compensation for an injury is to be avoided.” 


 Filed by Roberto Ceniceros of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


 


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Social Media Wont Work for Benefits Information, Survey Suggests

Many U.S. workers use social media for personal reasons, but they aren’t as keen about receiving benefit communications through online sites such as Facebook and Twitter, according to a survey that the National Business Group on Health released Wednesday, July 7.


Forty-seven percent of full-time U.S. employees surveyed by NBGH said they use Facebook either daily or weekly for personal reasons, but only 7 percent said they use the social networking site for business.


Moreover, about three-fourths of workers said they were not interested in receiving information via Facebook about their employer-sponsored health benefits, tips on improving their health or saving money on health care. About 80 percent said they had no interest in being “tweeted” with health benefits information via the Twitter website.


“Because we hear so much about social media … we’re made to feel that we’re out of it if we’re doing the old-fashioned things like home mailings,” said Helen Darling, present of the Washington-based NBGH, a consortium of nearly 300 large U.S. employers. “But even the youngest employees prefer receiving communications the old-fashioned way.”


In fact, less than 20 percent of employees younger than 34 said they would like to receive information such as how to choose a health plan or exercise tips via Facebook, according to the survey.


Based on the findings, Darling recommended that employers test the use of social media before adopting it for their employees. She also said that employers should not abandon the tried-and-true methods of benefit communications, including print mailings and workplace distributions and e-mail.


The survey, which was conducted in March, included responses from 1,500 full-time workers ages of 22 to 64.  


Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


 


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With a Sour Economy, Psychiatrists Are in Demand

Demand for psychiatrists is growing faster than for other medical specialties, according to Merritt Hawkins, the physician search division of AMN Healthcare Services Inc.

The company noted 179 requests for psychiatrists from April 1, 2009, through March 31, 2010—up 47 percent from the previous year and up 121 percent from three years earlier.


“When the economy goes down, mental health problems tend do go up,” said Merritt Hawkins president Mark Smith. “But there is more to the rising demand for psychiatrists than the recession. A combination of factors is driving a psychiatrist shortage that could soon reach crisis levels.”


More than half of all psychiatrists are 55 or older and nearing retirement age as fewer medical school graduates are showing an interest in psychiatry, according to Merritt Hawkins.


Meanwhile, demand for psychiatric services is expected to increase by 19 percent from 1995 to 2020.  


Filed by Staffing Industry Analysts, a sister company of Workforce Management. To comment, e-mail editors@workforce.com.


 


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Google to Reimburse Tax on Domestic Partner Benefits

Google Inc. is offering to reimburse its gay and lesbian employees for the additional federal tax they pay on the value of company-paid domestic partner benefits.


The offer, which would apply retroactively to January 1, came after a gay employee pointed out the disparity for same-sex couples covered by the Mountain View, California-based technology firm’s employee health benefits plan, a spokesman said Thursday, July 1.

Laszlo Bock, Google’s vice president for people operations, acknowledged that it wasn’t fair that same-sex couples were paying an estimated $1,069 more annually in federal taxes on those benefits, the spokesman said.


To equalize other benefits available to same-sex partners of employees, Google also is eliminating a one-year waiting period to qualify for infertility benefits. It also is including domestic partners in its family leave policy, going beyond the federal Family and Medical Leave Act, which requires employers to give at least 12 weeks of unpaid leave to workers to recover from a medical condition or care for family members.


The Google spokesman said it is uncertain at this point how many of the company’s 20,600 employees are likely to take up Google on the reimbursement, which will be noted as a line item on their paychecks rather than added to their pay. He explained that adding it to their compensation would give the impression that gay and lesbian employees were being paid more than their heterosexual counterparts.


“We’re not actually increasing the salaries of the employees. Salaries are tied to the work you do. It’s more of a reimbursement. It’s like a company paying for an employee’s cell phone bill. We’re offering the option of a reimbursement to cover a federal tax,” the spokesman said.


He said Google is not disclosing the estimated additional cost for the reimbursement.  


Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


 


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ADP Announces Deal to Acquire Workscape

Automatic Data Processing Inc. announced it struck a deal to acquire Workscape Inc., a privately held firm that provides Web-based benefits administration and human resource management software.

Terms of the transaction were not announced. The deal is expected to close in the third quarter.


Marlborough, Massachusetts-based Workscape serves more than 3.5 million users in more than 180 companies, according to ADP.


ADP provides payroll services as well as professional-employer-organization and other services. 


Filed by Staffing Industry Analysts, a sister company of Workforce Management. To comment, e-mail editors@workforce.com.


 


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Workers Comp Claimant Cannot Sue Third Party and Administrator

The workers’ compensation exclusive remedy doctrine bars an injured correctional officer from suing an “independent third party” and the party’s third-party administrator, a Connecticut appellate court has ruled.


The ruling in Daniel D’Amico v. ACE Financial Solutions Inc. et al., to be published Tuesday, June 29, stems from injuries D’Amico suffered while restraining an inmate in a youth correctional facility in 1992, court records state.


He suffered neck, back, shoulder, arm and hand injuries and later was diagnosed as suffering from post-traumatic stress disorder, depression, fibromyalgia, hypertension and other problems.


The state provided D’Amico benefits for many of the claimed injuries, but in 2001 it transferred its responsibility for claims to ACE, which the Connecticut Appellate Court opinion described as a “corporation involved in the business of financial derivatives.”


ACE engaged Berkley Administrators of Connecticut Inc. to administer state claims including the one filed by D’Amico, court records state. Then in 2003, Berkley said it no longer would pay for D’Amico’s psychiatric medication and treatment “because it was considered palliative and no longer necessary.”


In 2005, D’Amico sued ACE and Berkley, alleging breach of contract and breach of the implied covenant of good faith and fair dealing. A trial court in 2008 granted the defendants summary judgment based on the workers’ comp exclusive remedy doctrine.


The correctional officer appealed, arguing that ACE is an “independent third party” and not an insurer, so the exclusive remedy doctrine does not apply. But the state appellate court disagreed.


It upheld the lower court’s dismissal of the suit and said the exclusive remedy provision bars D’Amico’s action, even if ACE is an independent third party as D’Amico asserted. 


Filed by Roberto Ceniceros of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.


 


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