Filed under: Benefits, Health Reform, Healthcare Tax, Human Resources, Landrum Lagniappe | Tags: employees, employer, Health Reform, Human Resources, Insurance Reform, PEO
The Carrot or the Stick – Tax credits vs. Penalties
By Susan Hunsucker,CEBS
Well, I’ve spent the last three weeks talking about different aspects of health care reform. Because of the complex structure and its carrot vs. stick approach to health insurance in the form of credits and penalties for businesses, employers may want to take a new look at offering health insurance benefits. Keep in mind additional, clarifying information to help with implementation will trickle down from government agencies for some time to come. We will post updates as they are available.
There is no employer mandate to offer health insurance. The mandate is on individuals who, beginning in 2014, will have access to coverage through state insurance exchanges; however, this is where the “sticks” come into play. If you are a large employer and don’t offer qualified, affordable health insurance, there will be penalties. In 2014 when most of the new rules take full affect, employers will have to weigh the cost of paying to provide health insurance for their employees against paying the penalty for not providing it.
THE STICKS – Penalties for Large Employers
Large employers, defined as an employer that employed an average of at least 50 full-time employees on business days during the preceding calendar year, will be subject to penalties for the following:
• Failure to offer minimum essential coverage: Penalty for any month is equal to the number of full-time employees over 30, multiplied by one-twelfth of $2,000 ($166.67).
• Not offering minimum essential coverage and having at least one employee being certified as receiving a subsidy or tax credit for the premium . Penalty is one-twelfth of $3,000 ($250) for each employee, capped at 30, multiplied by one-twelfth of $2,000.
• Providing unaffordable coverage, defined as coverage with a premium required to be paid by the employee that is more than 9.5% of the employee’s household income: Penalty applies for any employee receiving an affordability waiver. Direction will be required for this as employers will not know the household income of their employees.
THE CARROT – The Small Business Tax Credit
(Employers with 25-50 employees are not eligible for credits)
According to a recent article in the Miami Herald, 80% of Florida’s small businesses (246,000) with fewer than 25 employees will qualify for the tax credit, and 77,400 of them will qualify for the maximum 35% for this year. In a previous blog I provided information on eligibility and how to calculate the credit. These credits may pay for up to half of the costs of providing health insurance. The maximum credit is 35% before 2014 and 50% for two years after. However, there is no transition after the two year cutoff. So come 2016, some firms’ costs could double, or they may be forced to drop a benefit that employees have relied upon.
WHAT NOW
We’ll have to wait for further clarification and instruction from the government agencies overseeing the implementation of healthcare reform. But here are a couple of options to consider if you have more than 50 employees:
Option 1: Don’t offer health insurance coverage to employees.
Result: There is a tax of $167.50 per month for all full-time employees (less 30).
Option 2: Do offer minimum essential coverage to all employees and dependents
Result: Employer cost of premiums
$250 tax per month per full-time employee getting subsidies, or $167.50 tax per month for all full-time employees (less 30), whichever is less.
Total cost will depend on several variables, such as employer contribution to the plan (minimum 50%), employee participation rate, and number of employees receiving the subsidy.
Employers will want to run the numbers and strategize how to best control costs. One strategy would be to minimize the number of employees receiving the subsidy by matching the lowest level in the Exchange, so employees aren’t eligible for the subsidy. Then the employer contribution must be high enough to make it affordable to employees.
I don’t know about you, but I’m looking forward to the release of additional direction on these matters. Without the final regulations and direction it may be too early to run the numbers, but it might not hurt to talk with your tax advisor and see how things look for your organization. Check back to the Landrum Blog for updates.
Susan Hunsucker, CEBS
A Certified Employee Benefit Specialist from the Wharton School, Susan serves as Director of Operations, for Landrum Professional Employer Services. She handles benefits administration and payroll administration for thousands of employees throughout the Southeast. Susan has over 20 years experience in all aspects of benefits administration including insurance, retirement plans, COBRA, HIPAA, and ERISA.
Filed under: Americans with Disabilities Act of 1990, Human Resources, Landrum Lagniappe | Tags: ADA, Americans with Disabilities Act, PEO
Looking Back 20 Years: Changes Brought by the ADA
By Yvonne C. Nellums, PHR
It is hard to believe that just 20 years ago it was perfectly legal to discriminate against people with disabilities. There was no requirement for handrails, wheelchair ramps or easy access to public buildings. In 1980, one student with disabilities was not allowed to have a roommate while attending Harvard. He was told that he might “impair [the other student’s] experience.”
On July 26, 1990, President George H. W. Bush signed into law the Americans with Disabilities Act of 1990 (ADA). This Act ensures that disabled individuals are not deprived of their rights to employment, public accommodations, telecommunications, and public transportation and services. The ADA requires employers to make reasonable accommodations for qualified disabled people, unless doing so would cause the employer undue hardship. The Act covers a wide range of employment practices and is intended to help disabled individuals work closely with their employers in order to find reasonable accommodations that work for both parties.
On September 25, 2008, the ADA amendments Act of 2008 (ADAA) was passed into law. This legislation made even more significant changes and broadened the definition of a disability. Employers should review their reasonable accommodation policies to ensure compliance.
President Obama is joining the Ad Council and the American Association of People with Disabilities to launch a new series of radio and television public service announcements (PSAs). These ads will celebrate the progress that has been made during the last two decades, and remind the public there is still a lot of work to do so that all Americans have equal opportunity and full participation in this country. The Ad Council is distributing these PSAs to media outlets nationwide today.
Yvonne Nellums, PHR
Yvonne C. Nellums is Director of Human Resources for Landrum Professional Employer Services. She is a certified professional in human resources (PHR) and has more than 30 years of human resources experience in the corporate world, manufacturing environments, and the offshore industry.
Filed under: Corporate Culture, Human Resources, Landrum Lagniappe, Uncategorized | Tags: "human resources consulting", Communication, employees, Human Resources, Mayberry, Micro managing
July 26, 2010
Mayberry Monday – Rafe Hollister Sings
By Holly McLeod, PHR
Mayberry had two mayors depicted on The Andy Griffith Show. Mayor Pike was loveable, a little daft, and highly susceptible to the influence of others. In town council meetings, Mayor Pike’s opinion on any given subject was always identical to the person who had just spoken. Mayor Stoner, on the other hand, knew exactly what he wanted. Mayor Stoner was pretentious, condescending, and meddled in how Andy ran the sheriff’s office. Mayor Stoner was a micromanager. For the record, I never cared much for Mayor Stoner.
Mayor Stoner - from The Andy Griffith Show
The musicale was supposed to be an upscale event hosted in Mayberry. Barney Fife auditioned, of course, because he was under the delusion he could actually sing. While Barney was practicing for the audition,
Rafe Hollister - The Andy Griffith Show
Mayor Stoner and the head of Mayberry’s chapter of the Ladies League, Mrs. Jeffries, were aghast when they heard that Rafe Hollister was to represent Mayberry at the musicale. You see, Rafe was an uneducated farmer who looked and talked the part. Rafe wore dirty overalls and a floppy hat, he was unshaven, and I imagine he smelled like he needed a good bath. All Mayor Stoner could see was Rafe’s outward appearance, and wasn’t interested in considering there might be something beautiful on the inside.
To Mayor Stoner, micromanager, all that mattered was that he and Mayberry might be embarrassed. As a result he ordered Andy to tell Rafe he couldn’t perform at the musicale. Andy thought that if he spruced up Rafe’s appearance it might help change Mayor Stoner’s mind, so he devised a plan to get Rafe in a new suit (which was much too small for him). When the new and improved Rafe stepped in the room, his wife proudly told him he looked good enough to get buried – that’s high praise to folks like the Hollisters.
When Rafe went out of the room, Mayor Stoner told Andy he guessed Rafe “would do” and that he could sing at the musicale as long as he didn’t associate with anyone. Unbeknownst to Stoner, Rafe’s wife was right there and heard everything he had said. Andy then began making other plans.
When the big moment came and it was Rafe’s turn to sing, you can imagine Mayor Stoner’s astonishment when the “old” Rafe – the one in overalls – stepped on stage. Rafe then began singing a beautiful song and the audience was rapt with attention and appreciation. At the end of the song, the President of the entire Ladies League got up and graciously praised Rafe, his song and… his appearance. She praised Mayor Stoner and Mrs. Jeffries for having Rafe dress that way, since it was “so much more authentic.” Mayor Stoner had assumed Rafe would embarrass him, but Rafe ended up making the town of Mayberry proud.
Stoner hadn’t wanted Rafe to sing, and he didn’t want to listen to reason. He was a micromanager.
C. William Pollard, former CEO of ServiceMaster credited with the company being recognized by Fortune magazine as the #1 service company among the Fortune 500, said “It is a leader’s responsibility to set the tone, to learn to accept the differences of people, and to foster an environment where different people can contribute as part of the whole and achieve unity in diversity.” Such unity cannot be achieved when the direction of the group is being dictated by one person with tunnel vision.
Successful teams are led by someone who seeks and incorporates the ideas of others; they also include team members who are allowed to freely express their thoughts without fear of being reprimanded for questioning the status quo. Effective managers empower their employees to think for themselves. If you find that you have any of the following “symptoms” of being a micromanager, you might try to learn a lesson from Mayor Stoner:
• Discouraging others from making decisions without your input
• Hesitant or refusal to delegate
• Spending a lot of time overseeing your staff members’ projects
• Dwelling on small details instead of looking at the big picture
• Consistently finding something wrong with your staff’s work
• Your staff doesn’t take initiative, and need to check with you before doing anything
• You’ve been referred to by others as a micromanager, controlling, judgmental, critical or “power
hungry”
Mayor Stoner might have served in office longer had he recognized the importance of teamwork and empowerment. Thankfully, Andy was wise enough to circumvent such unreasonable directives without losing his job. Had Andy told Rafe he wouldn’t be able to sing, as ordered by the mayor, Mayberry wouldn’t have been represented by such fine talent. In all probability, the audience would have had to painfully endure Barney warbling “something from the light classics!”
Incidentally, Rafe Hollister is portrayed by the very talented Jack Prince. To hear his beautiful performance of “Lonesome Road” as sung at the Ladies League Musicale, click here. I also have to correct a misspelling in earlier postings. For many years I have envisioned that Aunt Beatrice Taylor’s name would be spelled Aunt Bea. Beatrice… Bea… it makes sense, right? Upon doing some research this week, I realized her name is actually spelled Aunt Bee. My sincere apologies to the Taylor family.
See you in Mayberry again next Monday. Stay tuned…
Holly McLeod is a Human Resources Manager for Landrum Professional Employer Services and Landrum Consulting. She is a certified professional in human resources (PHR) and has more than 15 years of human resources consulting in the corporate world, healthcare and manufacturing environments
Filed under: Benefits, Health Reform, Healthcare Tax, Landrum Lagniappe | Tags: employees, Health Reform, Human Resources, Medical, PEO
As promised in earlier blogs, here is additional information on the Grandfather and Non-discrimination provisions of PPACA (aka healthcare reform).
GRANDFATHERED PLAN STATUS
Grandfathered plans are group health plans that were in existence on or before March 23, 2010. Originally, it seemed advantageous to maintain grandfathered status to avoid compliance with some of the new requirements; however, grandfathered plans may lose their status if certain plan changes are made. Employers will have to weigh the cost of maintaining the grandfathered status against the cost of making plan changes.
Grandfathered plans do not have to comply with the following requirements:
- Nondiscrimination requirements for fully insured plans
- Providing participants with the right to select a primary care provider/pediatrician
- Elimination of any pre-authorization or increase cost sharing for emergency services
- Elimination of preauthorization or referral for OB/GYN services
- Changes to the appeals process
- First dollar coverage for preventative care
- Reporting health care quality and wellness initiates to HHS
- Incorporating cost sharing limits on out of pocket deductible expenses
- Coverage of routine costs of patients who are part of clinical trials
- Providing for minimum essential benefits
Plan changes that could jeopardize grandfathered status:
Clarification regarding grandfathered plans was provided by Health and Human Services (HHS) on June 14, 2010. If a plan loses its grandfathered status, it becomes subject to the above mandates. The changes listed below will cause a plan to lose grandfathered status if implemented March 23, 2010 or later:
- Changing insurance companies or entering into a new insurance policy
- Cutting benefits resulting in loss of coverage for a particular condition
- Reducing an employer’s contribution by more than 5%
- Increasing a member’s coinsurance percentage by any amount
- Increasing a member’s fixed-amount copayment above a specified level (defined as Medical Inflation expressed as a percentage, plus 15%); however a copay increase up to $50 increased for Medical Inflation is permitted – that is $5 times Medical Inflation plus $5
- Increasing deductibles above a specified level (defined as Medical Inflation expressed)
- Reclassifying employees so that the reclassified employees are eligible for a different plan (even if it’s a grandfathered plan), without a bona fide employment reason
- Adding an overall annual limit or reducing an existing overall annual limit
- Failing to maintain at least one covered individual
Plan changes which will not jeopardize grandfathered Status:
- Changing third-party administrators (without changing insurer)
- Changing premiums
- Making changes to comply with state or federal law including PPACA
- Agreeing to binding renewals before March 23, 2010
- Allowing new employees and their dependents to enroll
- Allowing new dependents of current subscribers to enroll
NON-DISCRIMINATION RULES FOR INSURED BENEFITS
Retirement plans and self-funded insurance plans have long been subject to non-discrimination rules and testing. Now some of those rules have been expanded to insured benefit plans, including rules that the plan may not discriminate in favor of highly compensated individuals as to eligibility to participate.
Compliance regulations are expected from the Department of Labor, IRS and other federal agencies. We expect rules similar to those for self-funded plans to be applied to insured group health plans, including rules for eligibility, benefits, and controlled groups. If this is the case, it will affect employers who have “tiered” benefit plans – richer benefits for owners or highly compensated employees, or employers who have multiple companies and offer health insurance to employees of one company, but not to employees of another company with the same ownership. We are still waiting for clarification on how the non-discrimination rules will be applied. Check back for updates.
Susan Hunsucker, CEBS
A Certified Employee Benefit Specialist from the Wharton School, Susan serves as Director of Operations, for Landrum Professional Employer Services. She handles benefits administration and payroll administration for thousands of employees throughout the Southeast. Susan has over 20 years experience in all aspects of benefits administration including insurance, retirement plans, COBRA, HIPAA, and ERISA.
Filed under: Consulting, Human Resources, Landrum Lagniappe | Tags: "human resources consulting", Communication, employees, Human Resources, Job Performance
July 19, 2010
Mayberry Monday – “Opie the Birdman”
By Holly McLeod, PHR
One of my all-time favorite episodes of The Andy Griffith Show (TAGS) is “Opie the Birdman.” In this episode, young Opie is playing outside with his new slingshot. Andy, his “Paw” (aka Dad, for those of you who didn’t grow up in the South), had warned him to be careful. Opie was playing in his imaginary world of Good Guy vs. Bad Guy, when he pulled the sling and sent a shot catapulting into a nearby tree. He then stared in horror as a bird fell dead in front of him.
Opie’s first instinct was to run and hide, but it didn’t take Andy long to realize what had happened. In trying to teach Opie a valuable lesson, Andy opened Opie’s bedroom window so that Opie could hear the baby birds chirping for their mother, who would never return. Opie not only learned the lesson Andy was trying to teach, but he took it upon himself to personally care for the baby birds.
He gave them a safe place to live, and much to Aunt Bea’s chagrin fed them “nice, juicy worms” that he dug out of the back yard. Opie took wonderful care of these birds, until one day he noticed they were flapping their wings and trying to get out of the cage. Andy, in his wise and diplomatic way, helped Opie realize it was time to set the birds free.
Opie had nurtured these birds when they were unable to care for themselves. Now that they were older and more mature, Opie had to make the difficult decision to do what every mother bird faces – to push the birds out of the safety and security of what they knew, and to face the new, exciting, and sometimes scary world of the unknown.
The life cycle of an employee is not as clear-cut as it was for Opie’s birds, but employers do get the opportunity to nourish an employee’s growth and maturity. You won’t see an employee literally flapping its wings to get out of the cage; however, if you look closely and pay attention you might just see the signs of someone in need of new challenges and opportunities, or who is becoming discontent in his/her job:
- Decreased productivity
- Decreased enthusiasm
- Uncharacteristic attendance or punctuality issues
- Showing frustration over work
- Uncharacteristic irritability
- Showing decreased enjoyment in work
- Request for additional responsibilities
- Request for transfer to another position (even if it’s a lateral move)
These behaviors are symptoms of discontent, and could be warning signs for more serious issues like burnout or depression. By paying closer attention, you can avoid losing great employees by intervening early and finding ways to keep your employees engaged and passionate about their work.
Consider developing career paths within your organization if you haven’t already done so. Knowing there are future opportunities for growth and development will go a long way in maintaining a content workforce. Look for the flapping birds in your organization, and act quickly to keep them engaged in their work and in your company. Be aware when someone matures to the point of needing new challenges. But also be aware when someone is on the verge of burnout and needing some fast relief!
Opie learned the valuable lesson that you shouldn’t keep something caged that is destined to fly. Like Opie, you may find yourself needing to help your employees out of the cage. That’s what mother birds do for their young, and what good employers do for their employees.
The ending scene of “Opie the Birdman” demonstrates why this is the right thing to do. After Opie released the birds and each of them had flown out of the cage, Opie looked sadly at the cage and told Andy it sure looked empty. “Yes it does,” Andy replied, “but don’t the trees sound nice and full.” Imagine how nice and full your organization will be if everyone is happily flying, doing the work they are destined to do.
I hope you plan to meet me in Mayberry again next Monday. Stay tuned…
Holly McLeod is a Human Resources Manager for Landrum Professional Employer Services and Landrum Consulting. She is a certified professional in human resources (PHR) and has more than 15 years of human resources consulting in the corporate world, healthcare and manufacturing environments
By Yvonne Nellums, PHR
Yesterday in Albuquerque, New Mexico, a former employee entered a fiber optics manufacturer and killed three employees and wounded eight others before turning the gun on himself. It appears this incident is a result of a domestic dispute. Albuquerque Chief Ray Schultz stated, “In a situation like this, there are other people in the building and they became, unfortunately, casualties as well.”
According to the Bureau of Labor Statistics, in 2007 there were 610 homicides in the workplace. Workplace violence and domestic violence in the workplace have devastating effects on management and employees. There is a personal loss, which also can lead to an incalculable economic toll.
Employers should take definitive measures to minimize the risk within their respective workplaces. Training employees to be aware of potential dangers and instituting measures to mitigate risks are crucial to preventing problems before they occur. A great resource for more information is the National Institute for Occupational Safety and Health (NIOSH), which provides guidance on warning signs, prevention, and how to protect your property and employees.
If you don’t already have a violence protection program in place, now is the time to take a proactive approach to institute one. Once you have developed a program:
• Communicate the emergency action plan to all employees
• Practice the emergency action plan
• Form a committee of individuals to call upon should a situation arise
• Have employees trained in CPR and first aid
Having practices in place to secure your workplace is vital to the protection of your employees. Taking these important steps now may prevent your business from making unwanted headlines in the future.
Yvonne Nellums, PHR
Yvonne C. Nellums is Director of Human Resources for Landrum Professional Employer Services. She is a certified professional in human resources (PHR) and has more than 30 years of human resources experience in the corporate world, manufacturing environments, and the offshore industry.
Filed under: Benefits, Consulting, Health Reform, Healthcare Tax, Human Resources, Landrum Lagniappe | Tags: "Business Etiquette", "human resources consulting", Human Resources, Insurance Reform, tax
By Susan Hunsucker, CEBS
For those of you who are gluttons for punishment, here’s more about health care reform. This topic does come with some good news for those employers who qualify for a tax credit. The full 35% tax credit is available to employers with fewer than 10 full time equivalent (FTE) employees averaging annual wages of $30,000. The tax credit is reduced for employers that have fewer than 25 FTEs, averaging $50,000 in annual wages. The information below is a summary. The actual IRS calculations can be much more involved. Click here for the complete IRS News Release.
Here’s how the Small Business Health Care Tax Credit works:
Requirements:
• Have fewer than 25 full-time equivalent (FTE) employees employed during the tax year
• Wages averaging less than $50,000 per employee per year
• Offer a qualifying health plan (generally, health insurance bought from a state-licensed insurance company)
• Employer must pay at least 50% of single coverage for their employees
Step I. Do YOU QUALIFY?
A. Do you offer qualified health insurance?
For any tax year beginning in 2010, 2011, 2012 or 2013, qualified health insurance is insurance coverage within the meaning of Code Sec. 9832(b)(1). Generally, health insurance coverage bought from a state-licensed insurance company.
B. Determine the number of FTEs:
Divide the total number of hours paid to employees during the year (not to exceed 2080 for any one employee) by 2080. Round fractions to the next whole number. Some employees may be excluded from the calculations, such as seasonal workers.*
C. Determine the average annual wages:
Divide the total wages paid to employees during the employer’s tax year by the number of FTEs for the year. Round down to the nearest $1,000. Wages means wages as defined for FICA purposes.*
D. Determine the amount of eligible premium:
Health and Human Services (HHS) has determined the average premium for the small group market in a state and the IRS has published those figures. The amount of an employer’s premium payments for purposes of calculating the credit cannot exceed the published average premium for the state the employer is operating in. For Florida, the amount is $5,161 for employee-only coverage and $12,453 for family coverage. For other states, click here.
Step II. CALCULATING THE AMOUNT OF THE TAX CREDIT
Example: For the 2010 tax year, a qualified employer has 12 FTEs and average annual wages of $30,000. The employer pays $96,000 in health care premiums for those employees (which does not exceed the average premium for the small group market in the employer’s state) and otherwise meets the requirements for the credit.
The credit is calculated as follows:
1) Initial amount of credit determined before any reduction:
35% x $96,000 = $33,600
2) Credit reduction for FTEs in excess of 10; $33,600 x 2/15 = $4,480
3) Credit reduction for average annual wages in excess of $25,000;
$33,600 x $5,000/$25,000 = $6,720
4) Total credit reduction $4,480 + $6,720 = $11,200
5) Total 2010 tax credit: $33,600-$11,200 = $22,400
Step III. CLAIMING THE TAX CREDIT
The credit is claimed on the employer’s annual income tax return. For a tax-exempt employer, the IRS will provide further information on how to claim the credit.
The National Association of Professional Employer Organizations (NAPEO), has been busy in Washington looking out for the interests of small businesses. They were successful in having a provision included in PPACA, which allows a “look through” of the PEO to the client size, when determining eligibility for the tax credit. So if you are a Landrum Professional Employer Services client and would qualify for a tax credit, your relationship with Landrum does not change your eligibility. As a matter of fact, we can provide you with much of the information for your CPA to make the tax credit calculations.
*For more detailed information and examples, visit the IRS website.
Don’t forget to sign up for the free Health Care Insurance Reform Seminar at www.landrumhr.com. The speaker is Diane Boyle, Vice President, Federal Government Relations National Association and Financial Advisors.
Susan Hunsucker, CEBS
A Certified Employee Benefit Specialist from the Wharton School, Susan serves as Director of Employee Benefits and handles benefits administration for thousands of employees throughout the Southeast. Susan has over 20 years experience in all aspects of benefits administration including insurance, retirement plans, COBRA, HIPAA, and ERISA.
Filed under: Human Resources, Landrum Lagniappe | Tags: "human resources consulting", Communication, employees, Human Resources, Mayberry, PEO
July 12, 2010
Mayberry Monday – Checkpoint Chickie
By Holly McLeod, PHR
Last week we visited Mayberry, USA, where a stranded businessman learned a valuable lesson about taking it easy. He discovered that life doesn’t always have to be about hurrying up; sometimes there are more important things to consider.
In Mayberry, Sheriff Andy Taylor’s trusted deputy is the ever-challenging Barney Fife. Barney means well, it’s just that he doesn’t always think before he acts. For example, Barney is the one who locked most of the town behind bars when Andy was away for a day. Barney is also the one who decided to go undercover and dress as an elderly woman in order to trick suspected cons into giving up valuable information. As you can imagine, Andy ended up having to save Barney that particular day.
A major characteristic of Barney is that he’s a stickler for rules. Depending on your personality traits, this could either be an endearing quality or a pain in the neck. One time Barney bought a motorcycle (complete with side car) from a police auction, and took it upon himself to monitor the traffic by setting up “Checkpoint Chickie” out on Highway 6. Highway 6 is the main thoroughfare for truck drivers, who have to get their trucks over a steep incline called Turner’s Grade. The posted speed limit on that road is 35 mph. After Barney’s first day of patrolling in his new motorcycle, he gave out several citations to the truck drivers.
The truckers had been driving 40 mph in order to have enough speed to get up and over Turner’s Grade, but Barney’s only concern was that they were driving 5 miles over the speed limit. The truckers appealed to Barney’s sense of reason; Andy appealed to Barney’s sense of reason. The thing is, Barney wasn’t seeing reason. “You give ‘em 40, they’ll take 45,” was Barney’s reply. He was single mindedly looking at the rule, and not the circumstance.
As an HR Manager I’m certainly in favor of rules. Rules are good to have, and they provide great guidelines for all concerned. The potential trouble with rules, though, is that they don’t always apply the same in all situations. Take the truckers… they needed the extra 5 miles per hour in order to get their trucks up Turner’s Grade. The truckers were doing what was necessary to get the job done, but were punished because they didn’t follow a particular rule.
Of course there are many rules that cannot and should not be varied in any circumstance. Rules designed to keep workers safe is a good example of this. Workers shouldn’t be allowed to arbitrarily bend rules in the name of getting the job done; however, in certain and limited circumstances it may be wise to revisit your rules and determine if they are necessary for everyone, or perhaps only necessary in job-specific situations.
On Highway 6, 35 mph is the speed limit for you, me, Cousin Ed or Aunt Martha. But it might be necessary to adjust the 
rules for certain groups of employees and/or for certain jobs. The lesson here is that rules are good and should be followed, but not all rules are applicable to all people. Steel-toed shoes are an absolute must for a person working in a glass factory, but not necessary for someone working in the corporate office of that same company. Likewise, 60 words-per-minute typing skills may be necessary for a medical transcriptionist, but not required of the nurse in that same medical practice.
Barney got hung up on the 35 mph rule and refused to see reason when a logical argument was made in favor of making an exception. As will frequently occur in this blog series, I encourage you to follow Andy’s example instead of Barney’s. Andy was willing to look at all the factors and determine that a change in the rule was warranted for the truck drivers. I imagine that if you look closely at all of your rules and policies, you might find one or two that may need tweaking. See you next Monday when we once again visit Mayberry, one of my all-time favorite places. Stay tuned…
Holly McLeod is a Human Resources Manager for Landrum Professional Employer Services and Landrum Consulting. She is a certified professional in human resources (PHR) and has more than 15 years of human resources consulting in the corporate world, healthcare and manufacturing environments.
Filed under: Benefits, Health Reform, Healthcare Tax, Human Resources, Landrum Lagniappe, Uncategorized | Tags: "Healthcare reform", employees, Human Resources, PEO
By Susan Hunsucker, CEBS
Landrum Human Resource Companies, Inc
To be completely honest, the health care reform complexities have my head spinning. The terminology and volume of the law is simply mind boggling. Implementation will be long (with some provisions not scheduled to take effect until 2018) and cumbersome. After reading through hundreds of newsletters, updates, articles 
and websites, I decided to make an attempt at wrapping my brain and arms around the more immediate provisions of the law. For additional information, attend the free Health Care Insurance Reform Seminar on July 15th at the Amos Studio at WSRE-TV, PJC. The seminar is being sponsored by Landrum Human Resources, O’Sullivan Creel and Combined Insurance Services.
Background
On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (P-PACA). Just two days later, on March 25th, Congress passed the Health Care and Education Reconciliation Act of 2010, which modified P-PACA and included other provisions. Together they are “health care reform.” Over a series of blogs, I’ll give you an overview of the provisions, how they affect employers and the timeline for implementation.
Provisions Taking Effect in 2010:
• Small Business Health Tax Credit: Up to 35% of premiums immediately available to small firms that choose to offer coverage. Applies to employers with fewer than 25 full-time equivalent employees. More detail on this in my next blog.
• Young Adults on Parent’s Health Plan: Health plans are required to allow young adults up to age 26 to stay on their parents’ health plan. The State of Florida currently allows young adults up to age 30 to remain on a parent’s plan if they meet certain eligibility requirements.
• Insurers are prohibited from excluding coverage of pre-existing conditions for children up to age 19, in the individual market. Beginning in 2018, insurers are prohibited from denying coverage to anyone with pre-existing conditions.
• Group health plans and insurance companies are banned from rescinding coverage due to a medical condition, once an individual is enrolled in a plan.
• Group health plans and insurers are prohibited from setting lifetime limits. Annual limits are banned in 2014.
• Non-Discrimination Rules: New group health plans cannot discriminate in favor of highly compensated individuals as to eligibility to participate. Also, the benefits provided under the plan may not discriminate in favor of participants who are highly compensated. This does not apply to “grandfathered” health plans. More on “grandfathered” plans in a future blog.
• New private plans are required to cover preventive services with no deductible and no co-payments. By 2018 this will apply to all plans.
Other 2010 Provisions:
• Temporary reinsurance program to help companies that provide early retiree benefits for individuals aged 55-64.
• A high-risk pool will provide immediate access to insurance for Americans who are uninsured because of a pre-existing condition. People who have been uninsured for at least 6 months and who have a pre-existing condition will be eligible for subsidized coverage through a temporary national high-risk pool.
• Medicare beneficiaries who pay for prescriptions out of pocket once they hit the $2,830 mark up until they hit $4,550 when Medicare picks up again, this is know as the donut hole, receive a $250 rebate. The coverage gap is closed completely by 2020.
• Increased funding for community health centers to serve the expected increased number of patients.
• States may cover parents and childless adults up to 133% of poverty level and receive current federal matching contributions.
• New limits set for the percent of premiums that insurers can spend on non-medicals costs. In 2010, health plans are required to report the proportion of premiums spent on items other than medical care
• Review of Annual Premium Increases: In 2010, the HHS secretary and states will establish a process for annual review of unreasonable premium increases. Health insurers will be required to submit to the Secretary and the relevant state a justification for an unreasonable increase prior to implementation of the increase.
Future blogs will expand on the Small Business Health Care Tax Credit, the effects of the non-discrimination rules and grandfathered plan rules, as well as a timeline for implementation of additional provisions of the law.
Don’t forget to sign up for the free Health Care Insurance Reform Seminar at www.landrumhr.com. The speaker is Diane Boyle, Vice President, Federal Government Relations National Association and Financial Advisors.
Susan Hunsucker, CEBS
A Certified Employee Benefit Specialist from the Wharton School, Susan serves as Director of Employee Benefits and handles benefits administration for thousands of employees throughout the Southeast. Susan has over 20 years experience in all aspects of benefits administration including insurance, retirement plans, COBRA, HIPAA, and ERISA.
Filed under: Consulting, Human Resources, Landrum Lagniappe | Tags: Andy Griffith Show, Mayberry
Introducing Mayberry Mondays
By Holly McLeod, PHR
I am a lifelong fan of The Andy Griffith Show (TAGS). It began airing a few years before I was born, but something about that television show touches me in a way in which no other program has done. It introduces us to the innocent world of Mayberry, USA, at a time when things were serious if you held someone’s hand, when neighbors were neighborly, and when broken hearts were mended with a hug and a slice of Aunt Bea’s homemade apple pie. Life in Mayberry simply oozes with good old-fashioned values. As we celebrate our country’s freedom and independence this week, I thought it appropriate to talk about those values.
Values are so prominent in TAGS that Landrum used it to demonstrate our adopted Standards of Excellence to employees. We gathered on “Mayberry Monday” for several weeks, with a brown bag lunch in hand, and watched selected episodes of TAGS that demonstrated each of our Standards. I recently had an epiphany when I realized that the values TAGS demonstrates are also sound HR principles. Depending on the episode, it either teaches what someone (employer and/or employee) should or should not do in any given situation.
Take the episode “Man in a Hurry” as an example. According to The Andy Griffith Show Rerun Watcher’s Club, as of this date this episode is the #2 fan favorite in an ongoing poll (second only to The Pickle Story, which we’ll save for another day). In “Man in a Hurry,” the car of a hard-working businessman breaks down in Mayberry when the man is anxious to get to his destination. Gomer Pyle, who operates the “fillin’ station,” doesn’t work on cars; he only knows how to add gas, water and air if needed. The businessman, Mr. Tucker, was incensed that no one could fix his car that day. You see, the car broke down on a Sunday, and Wally, the owner of the fillin’ station, didn’t work on Sundays. Therefore, Mr. Tucker had no choice but to wait in Mayberry at the hospitality of the town’s sheriff, Andy Taylor, and his beloved Aunt Bea.
Mr. Tucker sat in disbelief as he watched Andy pass the time away by trying to peel an apple without breaking the skin. He was dumbfounded at the town’s party phone line, when he couldn’t make a call because the Mendlebright sisters were chatting about someone’s feet falling asleep. He was outraged when Barney continually talked about going over to Thelma Lou’s to watch a little TV, instead of getting up and actually doing it.
Eventually, Gomer was able to get his cousin Goober to fix Mr. Tucker’s car. By that time Mr. Tucker had spent the afternoon with the Taylors and experienced what life in Mayberry is all about. He was touched at Gomer’s numerous attempts to help get his car repaired. He was appreciative when Aunt Bea 
prepared him a homemade picnic meal to take on the road. And he was tickled when Andy’s son Opie was disappointed Mr. Tucker wasn’t spending the night so that Opie could sleep on the ironing board (also known as adventure sleeping).
By the time he was supposed to leave, Mr. Tucker had learned a valuable lesson… that it’s not always best to be in a hurry. I think we can all learn a lesson or two from Mayberry, as Mr. Tucker did. Sometimes it’s best to appreciate those around us — our family, friends, neighbors, employees and colleagues — rather than always focusing on doing things better and faster. Sometimes there is a far greater reward in slowing down and truly enjoying the good things in life.
In the end Mr. Tucker decided to stay the night in Mayberry. He fell asleep on the front porch of the Taylor’s house with an apple and knife in his hands, trying to peel the apple without breaking the skin. To this day I try to do the same thing every time I peel an apple. Mayberry has lots of lessons to teach us about how to communicate, behave, treat others, and live. Continuing the tradition of Mayberry Monday, I hope you’ll plan to visit Mayberry with me each Monday as we review those lessons. Stay tuned…
Holly McLeod is a Human Resources Manager for Landrum Professional Employer Services and Landrum Consulting. She is a certified professional in human resources (PHR) and has more than 15 years of human resources consulting in the corporate world, healthcare and manufacturing environments.
