K-12 Organization P.S. 038 Rosedale New York

  

Individually critique the organization’s policies and/or practice based on the information presented in your readings, experience, and personal research. Focus on summarizing the current regulations (such as, Equal Employment Opportunity [EEO] laws and Equal Employment Opportunity Commission [EEOC] regulations, Americans with Disabilities Act [ADA], Occupational Safety and Health Administration [OSHA], minimum wage, Family and Medical and Leave Act [FMLA], etc.), how they affect decisions in the area, and what ultimate mandates they require a training department/organization to address. Individually present your findings to the group in written form to the small group area. 

Develop

 * Recommendations 

* Support for your critique and recommendations as appropriate 

 link of policies

http://schools.nyc.gov/RulesPolicies/default.htm

link of school

http://schools.nyc.gov/SchoolPortals/29/Q038/default.htm

Integrating disability, leave, workers’
compensation, health and other management

initiatives into one complete program can result
in lower costs and more efficient processes as w ell

as higher productivity and employee satisfaction.

Benefits Integration Boosts Health, Productivity
by | Karen Trumbull English

benefits integration

W
ith the ongoing transfor­
mation of the U.S. health
care system, and as com­
panies of all sizes and in­

dustries begin to recognize the impact of
the Affordable Care Act, more attention
is being placed on integrating disabil­
ity and absence management programs
with employer health plans. Addressing
health, disability and absence along with
employee assistance programs (EAPs)
and behavioral health, wellness and
population management forms a health
and productivity management (HPM)
platform that goes a long way to making
a workplace healthier, happier, and more
productive and efficient, while at the
same time reducing overall cost.

W hat Are the Core Components
of an Integrated Solution?

To understand the proper integra­
tion of health and productivity, it is
important to define the core programs
involved. Three main components
comprise a fully integrated health and
productivity solution:

1. Integrated disability management
(IDM) brings together disability,

Fam ily and M edical Leave Act
(FMLA) and o th er leave types
(and ideally workers’ compensa­
tion) as a baseline. These p ro ­
gram s are o rg a n iz e d th ro u g h
coordinated plan and policy lan­
guage, a single intake process,
com m on case managem ent and
re tu rn -to -w o rk (RTW ) p ro to ­
cols, and integrated data, track­
ing and reporting of metrics and
trends.

2. Total absence management (TAM)
encompasses all of the disability
management measures involved
in an IDM program while tying
in any type of reason an employee
is away fro m w ork. B rin g in g
other time-off programs together
with disability and leave supports
workforce planning and budget­
ing activities that are key to both
employer productivity and em ­
ployee engagement.

3. H PM is a fully in teg rated p ro ­
gram that takes into account all
that is included in IDM and TAM
while also linking health, an EAP
and behavioral health, wellness

and population management (see
the figure). HPM is the platform
an employer should be working
tow ard as it considers overall
health and wellness of its popula­
tion, enables true strategic plan­
ning for the business and p osi­
tions human resources (HR) as a
strong business partner.

W hy Integrate Benefits?
As alluded to in the opening of this

article, by implementing a comprehen­
sive health and productivity program,
an employer stands to benefit in a num ­
ber of important ways:1

• Better tracking and reporting
• Easier and more consistent ad­

ministration across programs
• Improved regulatory compliance
• Enhanced employee experience

and engagement
• Reduced costs and stronger pro­

ductivity outcomes.
In addition, these programs give

employers a mechanism to centralize
the management of their programs2 so
that management, supervisors and em­
ployees have one place for all adm in­
istration. W hether this means an out­
sourced vendor or an internal “go-to”
person for questions, centralized m an­
agement promotes fair and equal treat­
ment across the entire organization.

This treatment becomes essential
as FMLA continues to be clarified; the
number of state, municipal and county
leave laws keeps increasing; the Ameri­
cans with Disabilities Act Amendments
Act (ADAAA) grows in complexity;
health management initiatives become
more prominent; and the importance
of returning employees to work in a
safe and productive m anner is height­
ened.

Core Components of a Fully Integrated H P M Solution

H ealth and Productivity M a n ag e m e n t (H P M )

benefits magazine October 2015

benefits integration

It also happens to be crucial in maintaining and improv­
ing employee engagement. At a time when employees are
being afforded more choice in their benefit plan structure—
through consumer-driven health plans, exchanges as pur­
chasing forums, voluntary options and the like—compre­
hensive programs provide a clear path forward.

How Does an Organization Get Started?
The type of deep integration required to realize these ben­

efits is quite a deviation from what many are used to, and
these programs do not come without effort. Although inte­
gration has become easier over time and the marketplace has
matured to provide stronger options, employers may face a
number of constraints as they embark on the path toward
integration. Hurdles often include lack of internal resources
and budget as well as the uncertainty of proper implementa­
tion steps.

Experienced consultants and brokers can help organiza­
tions through the process. The vendor community has ma­
tured significantly not only in its offerings, but also in the
resources that are dedicated to implementation and account
management. For organizations willing to expend the effort
and plan it properly, the payoffs of an integrated health and
productivity program are great.

While nearly every employer situation is different, some
general steps are common among most integration projects:

• Establish a philosophy. The underlying philosophy
will affect an employer’s early and continual decisions,
and staff needs to be thinking comprehensively.
Whether an employer is integrating to support safe
and productive return to work (RTW) or to encourage
employee health and wellness, this purpose should be
stated early and often and remembered as the program
evolves.

• Set a long-term strategy. Although a fully integrated
HPM approach is best, implementing in phases often
is more realistic. The program can start small and be
expanded over time. Bringing together the compo­
nents of IDM is most common, but how to proceed
may depend on how much influence those developing
the program have over other benefits and how much
change an organization can handle at once.

• Create a reflective model. Outsourcing program
management to an insurance company or third-party
adm inistrator is growing in popularity. However,

some employers prefer to keep the management in-
house or establish a cosourced structure. This will
depend on what’s best for a company’s composition
and culture and how staff and systems can be utilized
best.

• Gain senior management buy-in. Because there are
so many programs involved and resources across HR,
legal, benefits, payroll and others need to be aligned,
it’s important that senior management be committed
and that a framework for change management be in
place.

• Make a formal business case. Documenting the ratio­
nale for change and establishing a baseline of current
costs will be important at the beginning. Employers
that take this step have something to turn back to and
measure their success over time.

More practical activities, which will depend on the or­
ganization’s overall strategy and which programs it decides
to bring together initially, include aligning plan and policy
design, determining the best funding structure, developing
processes starting with intake and concluding with claim
closure, and establishing the metrics the organization will
track over time. For example, if IDM is the first step, this
translates to:

• Analyzing short-term disability, long-term disability,
FMLA and other leave policies for common language
and RTW incentives, as well as linkages to health and
other management programs

• Conducting a financial analysis to determine if in­
sured, self-insured or a combination approach is most
effective given the company’s claim experience and
risk tolerance

Education
The Americans With Disabilities Act (ADA)
FMLA

Short and Long Term Disability

Visit www.ifebp.org/elearning for more information.

From the Bookstore
Handbook of Employee Benefits: Health and Group Benefits
Jerry Rosenbloom. McGraw Hill. 2011.
Visit www.ifebp.org/books.asp78915for more details.

October 2015 b e n e fits m a g a z in e

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http://www.ifebp.org/books.asp78915for

benefits integration

• Integrating the management of various types o f leave w ith
disability, health, mental health and wellness benefits makes
tracking, reporting and compliance more efficient.

• Centralized management of all of these programs promotes
fa ir and equal treatm ent throughout an organization.

• The underlying philosophy fo r integrating benefits w ill affect
early decisions and how the program evolves.

• Integration can be done in phases— often by first bringing
together disability management and leave types such as
FMLA— or all at once.

• W hether program management w ill be outsourced or kept
in-house w ill depend on a company’s composition, culture and
staff and system capabilities.

Karen Trumbull English, ACI, ARM,
AU, CPCU, is a senior consultant and
partner with Spring Consulting
Group, LLC (formerly Watson Wyatt
Insurance & Financial Services,

Inc.). She has more than 20 years of experience in
the insurance industry with an emphasis on
product design, process improvement, bench­
marking and research. English’s areas of focus
include both health and welfare and property/
casualty, with particular emphasis on disability,
absence management, health management,
voluntary offerings and captive solutions. English
has her B.B.A. degree in risk management and
human resources from University of Wisconsin-
Madison and her M.B.A. degree in finance from
University of Minnesota-Carlson School of
Management. She also is a licensed insurance
broker.

• Establishing touch points for employee absence notifi­
cation, documentation, case management, RTW ac­
tivities, health management referral, and communica­
tion to supervisors/m anagers and other internal
departments and external partners

• Mapping technology to support tracking of absence

and how various systems used need to link to each
other and report data to key stakeholders.

Spring Consulting has conducted research into trends in
HPM among employers, employees and providers to take
a periodic pulse of the industry and identify best practices
and potential pitfalls throughout the integration process.
Trends seen in the most recent health and productivity re­
search are:

• Integration continues to increase. As the years go on,
both employers and vendors are prepared to bring
more and more programs together. For example, while
IDM used to include only short- and long-term dis­
ability and FMLA, it now expands to other leaves of
absence (i.e., military leave, jury duty, bereavement
leave, company-specific leave, and state and munici­
pal/county leaves) and ADAAA support.

• Options are available for all employer sizes. Inte­
grated plan design across disability, health, workers’
com pensation and process adm inistration in the
forms of outsourcing, cosourcing or technology tools
used to be available only to very large firms but is
now offered to companies with as few as 500 lives or
even fewer.

• Health management programs are expanding. Most
employers offer EAP and behavioral health, wellness
and numerous other initiatives that easily can be in­
corporated into the disability and absence manage­
ment process through referrals and outcome manage­
ment.

• Regulatory activity is increasing program reach.
Due to all the case activity and clarification provided
by the Equal Employment Opportunity Commission,
the Department of Labor and other agencies, ADAAA
is prioritized as highly as FMLA, and paid sick leave
laws are driving the need for a total absence manage­
ment approach.

• Gaps are being filled with voluntary products.
Where employers are not able to offer the desired lev­
els or any disability coverage or, because of consumer-
driven health plans, employees could benefit from
having critical illness, accident or hospital indemnity
coverage, employers are making them available on an
employee-paid basis.

• Systems and automation are progressing. Technol-

benefits m agazine O c to b e r 2 0 1 5

b e n e fits in te g ra tio n

ogy and connected devices are making their way into
the health and productivity space, making it more
user-friendly and administratively efficient, which can
translate directly to a better employee experience.

W h a t O u t c o m e s C a n a n O r g a n iz a t io n E x p e c t?
The type of outcomes an organization can achieve from

integration will depend, of course, on how much change is
made at once and will include but may not be limited to:

• Increased RTW rates
• Reduced direct costs of disability, workers’ compensa­

tion and/or health benefits
• Enhanced employee satisfaction
• Lower claim incidence rates
• Better advance scheduling of absences
• Decreased absenteeism
• Improved employee experience
• Higher employee health and productivity.

A T re n d T h a t M a k e s S e n s e
Whether it is a step-by-step process, or a complete

overhaul of multiple programs at once, moving toward
the integration of disability, leave, workers’ compensa­
tion, health and other management initiatives into one
complete program is of great benefit to employers in this
age of health care reform. In a time when health care
costs and plan control are on the forefront of just about
every employer’s mind, the cost reductions and process
efficiencies, not to mention increases in productivity and
employee satisfaction, make integration a very attractive
option for employers of all sizes. O

E n d n o te s

1. Spring Consulting Group’s Integrated Disability, Absence and Health
Management Employer Survey 2013/2014.

2. DMEC and Spring Consulting Groups Employer Leave Management
Survey, 2014.

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Copyright of Benefits Magazine is the property of International Foundation of Employee
Benefits and its content may not be copied or emailed to multiple sites or posted to a listserv
without the copyright holder’s express written permission. However, users may print,
download, or email articles for individual use.

benefits magazine august 2015

Avoiding
Financial
Holes in Plan
Operations

A thorough re v ie w o f o p era tio n al procedures w ill help
b e ne fit plan m anagers e lim in a te unnecessary spending and
have a more e ffic ie n t plan, nipping problem s in th e bud.

by | Joseph A. R einhardt

C
ontrolling the cost of benefits
without sacrificing plan qual­
ity is a constant challenge.
Many employee benefit plan

managers shop their plans, endeavor­
ing to get equal or better services for
less cost. But plan managers also can
enhance the financial health of their
plan and increase overall efficiency by
improving their control over opera­
tional procedures and plan costs.

This effort involves taking steps
against inefficiency, unnecessary
spending, undetected cost overruns,
making decisions without sufficient

information and embezzlement. Plan
trustees who initiate a thorough review
of operational procedures will be able
to detect and rectify small problems
before they become big problems. This
review should encompass:

• Participant files
• Third-party administrators
• Finance and internal controls
• A dm inistrative expense alloca­

tions
• Payroll and personnel policies
• Purchasing policy
• Technology
• Plan management.

a u g u s t 2 0 1 5 benefits magazine

plan adm inistration

E d u c a tio n
Certificate Series

October 12-17, Las Vegas, Nevada

Visit www.ifebp.org/certificateseriesior more information.

F ro m t h e B o o k s to r e
Trustee Handbook: A Guide to Labor-Management Employee Benefit Plans,
Seventh Edition

Claude L. Kordus, editor. International Foundation. 2012.
Visit www.ifebp.org/books.asp77068ior more details.

Participant Files
To help control benefit expenses,

participant files must be as accurate
as possible. Procedures should be in
place to correctly capture data and
then to review and maintain the data
going forward. This process includes
proper security of electronic files to
lessen the possibility of data being
changed without proper authorization
and to ensure compliance with federal
regulations such as the Health Insur­
ance Portability and Accountability
Act (HIPAA). Any discrepancies dis­
covered by the outside independent
auditor during the course of benefit
testing should be reviewed and re­
solved in a timely way.

The Internal Revenue Service (IRS)
and D epartm ent of Labor (DOL) both
require that accurate, up-to-date files
be kept. Employers with missing files
can be required to investigate and
reconstruct data, often at greater ex­
pense than would have been needed to
m aintain the files correctly in the first
place.

Third-Party Administrators
Use of a third-party administrator

(TPA) to manage the plan, handle a
specific benefit or both requires regular

monitoring by the plan administrator
of the following:

• A d m in is tr a tio n fees m u st be
reviewed to make sure they are
in com pliance w ith th e agree­
ment.

• TPA re p o rts need to be co m ­
pared with plan records and eli­
gibility confirmed.

• Benefit processing should com ­
ply with the plan document and/
or fee schedule.

• Bank accounts the TPA uses for
benefit payments need to be rec­
onciled on a timely basis and dis­
crepancies promptly resolved.

• The annual Service Organization
C ontrol (SOC) 1 re p o rt on the
TPA should be reviewed to en ­
sure that TPA internal controls
are sufficient.

• O n-site operational reviews by
plan administrators should take
place at TPAs.

Finance and Internal Controls
Financial internal controls are im­

portant for three reasons:
1. To confirm that no one is skim ­

ming off plan assets
2. To reduce opportunities for h u ­

man error

3. To provide confidence in the ac­
curacy of the data.

Internal controls and procedures
require periodic review to ensure they
are being followed. They may require
updating as the organization or its en­
vironment changes. For example, roles
may change when funds merge, creating
an overlap of duties or lapses in control
that may go unnoticed. Computer con­
versions may also result in changing
procedures, resulting in unanticipated
weaknesses in internal controls. The
plans financial records should be up­
dated monthly.

In addition, it is important to review
the valuation techniques used to value
plan investments. Moreover, it is vital
that plan management understand the
valuation. Accomplishing this may re­
quire the assistance of the plan’s invest­
ment managers and accountants.

Regular reviews of investment state­
ments help ensure that investment
managers are following the plan invest­
ment guidelines and that investment
income is being received properly. Ad­
ditionally, investment expenses should
be reviewed to assure they are being
calculated correctly, pursuant to the
investment management contracts. For
other administrative expenses, adm in­
istrative expense budgets and forecasts
can isolate operational problems and
identify when corrective steps are nec­
essary.

Administrative Expense
Allocations

Cost-allocation studies—done cor­
rectly and updated at regular inter­
vals—can do much to protect a plan.
Cost-allocation methodology should
be well-documented in a formal cost­
sharing agreement and reviewed by the

benefits magazine august 2015

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http://www.ifebp.org/books.asp77068ior

plan adm inistration

trustees on an annual basis. That documentation can also
prove very useful should DOL make an inquiry.

The cost-allocation study consists of two components:
the payroll allocation and the space allocation. The accu­
rate allocation of shared payroll expenses can be achieved
by using an employee time-recording system. DOL will,
in most cases, look to the underlying docum entation sup­
porting employees’ duties in evaluating the accuracy of the
payroll allocation study. If the plan has not implemented an
electronic time-recording system, then time sheets should
be completed by all plan employees for a period of at least
eight weeks. Those time sheets should be used in preparing
the payroll allocation study. Remember, as duties change
or are reassigned, payroll allocation studies should be u p ­
dated.

The allocation of space to specific employees is based
on their payroll allocation. Com m on areas are allocated
based on a variety of methodologies. For example, a con­
ference room may be allocated based on usage, while a
restroom used by all employees may be allocated based
on the payroll allocation study. Once again, when changes
to the space occur, the space allocation study should be
updated. Administrative expenses that can be allocated
to a specific plan generally are paid by that plan. Shared
expenses that pertain to the space, such as m aintenance
supplies, generally are allocated using the space alloca­
tion. Shared expenses that pertain to the employees, such
as the telephone expense, generally are allocated using the
payroll allocations.

Payroll and Personnel Policies
Most likely, payroll is an organization’s largest administra­

tive cost. To control it, plan managers will want to make sure
plan employees:

• Work in the most productive m anner possible
• Are properly supervised
• Have regular personnel performance evaluations
• Take regular vacations, rotating duties to ensure cover­

age.
The system should include measures to make sure pay­

roll funds are properly accounted for, to guard against ex­
cess vacation or sick days, and to docum ent promotions
and raises.

Developing and using a personnel practices manual is
strongly recommended. Make sure it complies with applica­

ble regulations and its policies are being rigorously followed.
Also consider employers’ insurance for protection against
lawsuits for unfair labor practices, discriminatory behavior,
or sexual harassment.

Purchasing Policy
Scrutinizing the cost of doing business will often bring

measurable rewards. A vigilant purchasing department
should always be on the lookout for ways to save. Here are
some steps staff can take:

• Maintain an adequate number of vendors and alterna­
tives to help ensure that individual vendors don’t be­
come complacent and the plan does not become be­
holden to any single vendor.

• Remain open to new offers.
• C onstantly shop for value, reliability and the m ost

competitive pricing.
• Make sure there is a procedure in place for identifying

and taking advantage of vendors that offer discounts
for prompt payment of invoices.

It is also critical to employ an appropriate system of checks
and balances to limit opportunities for embezzlement. For
example, the plan office should make sure the accounts pay­
able and purchasing functions are segregated. A purchase or­
der system should be in place, and vendor contracts should
be reviewed on a periodic basis.

• IRS and DOL require plans to have accurate participant data on file.

• Financial internal controls need to be reviewed and follow ed to
guard against embezzlement and human error and help ensure the
accuracy of data. Records should be updated monthly.

• Regular studies of how payroll and space are allocated can help
protect a plan. Adm inistrative expenses tha t can be allocated to a
specific plan generally are paid by tha t plan.

• The cost of payroll, generally the largest administrative expense,
can be better controlled by making sure employees are productive,
properly supervised and evaluated regularly.

• A purchasing department should always be looking for ways to
save.

• Sometimes it’s w ise to have an outside consultant assist w ith
operational reviews, upgrades and finding opportunities to control
costs.

a u g u s t 2 0 1 5 benefits magazine

plan adm inistration

J o s e p h A . R e i n h a r d t , C P A , is an audit
partner at Berdon LLP, a full-service
accounting and advisory firm with
offices in New York City and Jericho,
New York. He has more than 30 years

of experience in public accounting. Reinhardt
advises employee benefit plans and labor organiza­
tions on strengthening operations, meeting
regulatory requirements and planning for growth
and development. He graduated from Hofstra
University with a bachelor of business administra­
tion degree in accounting. Reinhardt can be
reached at jreinhardt@berdonllp.com.

T e c h n o l o g y
Computer systems need to keep pace with an organiza­

tion’s growth. Does the current system produce accurate re­
ports that aid in decision making? Are plan managers able to
extract the data needed to fulfill reporting requirements of
governmental agencies?

Someone within the organization should be responsible
for monitoring new applications and software packages that
can increase efficiency, improve flexibility and meet antici­
pated needs.

A qualified information technology (IT) professional
should regularly review disaster planning, data recovery and

security. The organization should be prepared for disaster by
maintaining protected backup systems and securing an off-
premises storage facility. Alternate resources for technical
support must be able to take over during a breakdown or cri­
sis. The plan’s outside auditor should be asked for the results
of its IT evaluation, which should have been performed in
conjunction with its annual audit of the organization’s finan­
cial statements.

P l a n M a n a g e m e n t
Plans require regular, unbiased operational and manage­

ment reviews to evaluate their performance. If “pride of au­
thorship” prevents plan administrators from stepping back
and taking a fresh look, an outside consultant should be hired
to assist with operational reviews, upgrades and finding op­
portunities to control costs. Also, plan managers should keep
in mind that health and welfare plans need to review opera­
tions periodically to ensure compliance with Health Insur­
ance Portability and Affordability Act regulations.

Keeping a close eye on a plan’s operations will have
short- and long-term payoffs, allowing managers to run a
more efficient, cost-effective operation. It will give them the
information needed to avoid rash or unwise decisions in
hard times and help circumvent unnecessary spending for
operational or infrastructure revamps. By staying on guard
and applying a little internal medicine, plan managers will
have more resources available to devote to benefits, now
and in the future. ft

52 b e n e f i t s m a g a z i n e a u g u s t 2 0 1 5

mailto:jreinhardt@berdonllp.com

Copyright of Benefits Magazine is the property of International Foundation of Employee
Benefits and its content may not be copied or emailed to multiple sites or posted to a listserv
without the copyright holder’s express written permission. However, users may print,
download, or email articles for individual use.