The IRS has released the 2019 Health Savings Account (HSA) inflation adjustments. To be eligible to make HSA contributions, an individual must be covered under a high deductible health plan (HDHP) and meet certain other eligibility requirements.
New HSA 2019 limits are as follows:
Age 55 Catch Up Contribution-As in 401k and IRA contributions, you are allowed to contribute extra if you are above a certain age. If you are age 55 or older by the end of year, you can contribute additional $1,000 to your HSA. If you are married, and both of you are age 55, each of you can contribute additional $1,000.
HSA/HDHP Market Growth
HSA holders own the assets in the accounts and can build up substantial sums over time. Enrollment in HSA-compatible insurance plans has increased to 10 million earlier this year, from 1 million in March 2005, according to, America’s Health Insurance Plans (AHIP), a trade group.
HSAs were authorized starting in January 2004. Since then, AHIP has conducted a periodic census of health plans participating in the HSA/HDHP market.
The number of people with HSA/HDHP coverage rose to more than 11.4 in January 2011, up from 10.0 million in January 2010, 8.0 million in January 2009, and 6.1 million in January 2008.
30 percent of individuals covered by an HSA plan were in the small group market, 50 percent were in the large-group market, and the remaining 20 percent were in the individual market.
14% of all workers in the private sector that have access to a Health Savings Account acc. to Bureau of Labor Statistics.
States with the highest levels of HSA/HDHP enrollment were California, Ohio, Florida, Texas, Illinois and Minnesota.
HSA Advantages:
Opportunity to build savings – Unused money stays in your account from year to year and earns tax-free interest. The HSA also gives you an investment opportunity.
Tax-free contributions and earnings – You don’t pay taxes on contributions or earnings.
Tax Free Money allowed for non traditional Medical coverage– As per IRS Publication 502, unused moneys can be used for dental,vision, lasik eye surgery, acupuncture, yoga, infertility etc. Popular Examples
Portability – The funds belong to you, so you keep the funds if you change jobs or retire.
Our overall experience with HSAs have been positive when employer funding is at minimum 50% using either the HSA or an HRA (Health Reimbursement Account-employer keeps unspent money). Traditional plans trend of higher copays and new in network deductibles has also led to the popularity of an HSA.
IRS Update on Other Spending Limits (11/15/18):
The contribution limit for dependent care accounts (DCAs) are fixed as $5,000 per household or, if married and filing separately, $2,500 per taxpayer.
Is your HSA compliant? Which pre-tax qualified HSA, FSA, HRA spending card is right for you? Please contact our team at Millennium Medical Solutions Corp (855)667-4621 for immediate answers. Stay tuned for updates as more information gets released. Sign up for latest news updates.
NYS Pushes Back Association Plans and Short Term Medical
NYS is pushing back on Association Health Plans (AHP) In reaction to President Trump’s Executive Order of Association Health Plans expansion. The President expanded the role of association plans earlier this week rule to makes it easier for small businesses and trade groups to band together to purchase health coverage outside of Obamacare’s insurance markets.
These regulations provide an additional basis for a group or association of employers to be treated as an “employer. New York’s top insurance official said the Trump administration’s final rule making it easier to form association health plans will not hamper the state’s ability to continue regulating the health insurance industry. Other states like Massachusettes have have also pushed back over Association Plans. “Yesterday’s announcement by the Trump Administration to dramatically expand the footprint of Association Health Plans will invite fraud, mismanagement, and deception – and, as we’ve made clear, will do nothing to help ease the real health care challenges facing Americans,” Healey and Underwood said in a joint statement. “We believe the rule, as proposed, is unlawful and would lead to fewer critical consumer health protections.”
One program getting attention are inpexpesivive but limited short-term health insurance plans. According to yesterdays NYS DFS annoncment, however, New York regardless of federal actions will prohibit these plans as consumer protection. Current federal rules only permit short-term plans — which are exempted from certain health benefits coverage requirements, such as chronic pre-existing conditions — to last up to three months, but the Trump administration wants to expand that up to 364 days. “Such ‘limited health’ plans, whether limited to less than three months or one year, are not short-term at all, but rather an end-run around requirements applicable to individual or group hospital, surgical or medical expense coverage and are prohibited under New York State law,” DFS wrote in a circular letter to insurers.
Summary of Trump’s Association Health Plans Expansion
• Purpose of Association. Employers may band together in an association for thepurpose of obtaining health coverage.However, the association also “musthave at least one substantial business purpose unrelated to offering andproviding health coverage or other employee benefits to its employer membersand their employees.”The DOL clarifies in its safe harbor that a “substantialbusiness purpose is considered to exist if the group or association would be aviable entity in the absence of sponsoring an employee benefit plan.”
• Commonality of Interest. Employers in the association can either (1) be fromthe same trade, industry, line of business, or profession; or (2) all have aprincipal place of business in a State (or portion of a State, such as a city orcounty) or in the same metropolitan area (even if the metropolitan area spansmore than one State, like New York, Washington, D.C., or Kansas City
• Structure and Control.There must be a formal organizational structure with agoverning body and by-laws or similar formalities, to control the association,including the establishment and maintenance of the group health plan. Thecontrol can be direct or indirect through the regular election of directors,officers, or other similar representatives; however control must be present bothin form and in substance. Ultimately, the functions and activities of the group orassociation are controlled by its employer members, and the group’s orassociation’s employer members that participate in the group health plancontrol the plan, by determining contributions, plan designs, and benefits.
• Eligibility. Only employees and former employees of association members (andtheir eligible family members) may participate in the association health plan.Inother words, it cannot be an insurance exchange for any interested party.
We will closely monitor this as awell as all Health Care Reform developments. Sign up for our premium newsletter below. Learn how our Agency is helping buinsesses thrive in today’s economy. Check out PEO Case Studies here and learn how they can apply to you. Please contact us at info@medicalsolutionscorp.com or (855) 667-4621.
A new law entitled the “New Jersey Health Insurance Market Preservation Act” was signed by Governor Phil Murphy on May 30, 2018 to reestablish the recently repealed “shared responsibility tax”. The law, which will take effect on January 1, 2019, will require every New Jersey resident to obtain health insurance with minimum essential coverage or pay a fee, essentially adopting the rules of the ACA.
This legislation will directly impact residents of NJ and indirectly affect employers with employees residing in the state.
State Individual Mandate
The New Jersey Health Insurance Market Preservation Act will require all New Jersey residents to have Minimum EssentialCoverage (MEC) beginning January 1, 2019, or pay a penalty.
In light of Federal repeal on Dec 29, 2017, Tax Reform Bill Includes Repeal of Individual Mandate Beginning in 2019, NJ’s mandate is scheduled to take effect on January 1, 2019, making NJ the second state, after Massachusetts, to enactan individual mandate. The mandate includes an annual penalty of 2.5% of a household’s income or $695 per adultand $347 per child – whichever is higher. The maximum penalty is based on household income and will not exceed theaverage yearly premium of a bronze plan.If it’s based on a per-person charge, the maximum household penalty will be $2,085.
A “hardship exemption” will be available for individuals who cannot afford coverage, determined by the State Treasurer. NJ expects to collect between $90 million and $100 million in penalties. This money, along with additional federal funding, willbe used on a reinsurance program, which Murphy also signed into law.
Employer Action
While these bills do not directly affect employer sponsoredplans, the individual mandate requirement for NJ residentswill likely require education for employees. As residentsin NJ will now be required to obtain health overage toavoid a state income tax penalty, employers may see anincrease in plan enrollment. Unlike Massachusetts whichrequires specific coverage components, the NJ law onlyrequires that coverage be MEC. Thus, most traditionalemployer-sponsored group health plans should meet thisdefinition. However, coverage for only dental benefits,certain medical indemnity policies and vision benefitsare likely not sufficient for purposes of avoiding the statetax. For now, employers with employees who reside inNew Jersey may wish to educate employees at OpenEnrollment that by January 1, 2019 health coverage willbe required for NJ residents to avoid a penalty.
Conclusion
New Jersey lawmakers feared the repeal would drive healthier people out of the marketplace causing premiums to spike. They believe this law is pertinent to stabilize the marketplace, keep people insured, and prevent a death spiral of the individual market.
Learn how our Agency is helping buinsesses thrive in today’s economy. Check out PEO Case Studies here and learn how they can apply to you. Please contact us at info@medicalsolutionscorp.com or (855)667-4621.
Last Friday, June 1, 2018, the NYS 2019 Rate Requests filings were released. Great news for SMB! The total weighted average increases were a modest 7.5% small groups but 24% for the individual market. This early filing request deadline request requirement is not an Obamacare requirement. As per NY State Law carriers are required to send out notices of rate increase filings to groups and subscribers.
These are simply requests and the state’s Department of Financial Services has authority to modify the final rates. But they are the first indication of what New Yorkers can expect when shopping for health insurance on the individual marketplace at the end of this year. The news comes as insurance companies across the country brace consumers for another year of large rate hikes, owing in part to the composition of the individual market, and in part to the uncertainty over the future of the law under the Trump administration.
Background:
By contrast last year’s NYS 2018 Rate Request early filing request were higher at 11.5% small group but much lower 16.6% for individuals. The NYS final August 2018 rate approval are expected to be lower. For example, the final filing rates were aproved NYS 2018 Final Rates at 9.3% small group and 13.9% for individuals. Incidentally, the NYS 2017 Rates final rates were 8.3% small group and 12.3% for individuals. Using these past figures one projects a 2019 Final Rates of 6.5% small groups and 19% individuals.
With only 3 months of mature claims in 2018 to work of off Insurance Actuaries have little experience to predict accurate projections. Simply put the less credible information presented to actuarial the higher the uncertainty and higher than the expected rate increase. The national rate trend, however, has been much higher than in past years due to higher health care costs and the loss of Federal reinsurance fund known as risk reinsurance corridor.
Summary of 2019 Requested Rate Actions
Individuals:
Individual rates are expected to be higher than the small group market. The national rate trend, however, has been much higher than in past years due to higher health care costs Like other states throughout the nation, the 2019 rate of increase for individuals in New York is higher than in past years partly due to the termination of the federal reinsurance program. The loss of the program’s aka federal risk reinsurance corridor funds accounts for 5.5 percent of the rate increase.
The single biggest justification offered by insurers for the requested increases is the recent repeal of the individual mandate penalty –Tax Reform Bill Includes Repeal of Individual Mandate Beginning in 2019. The individual mandate, a key component of the Affordable Care Act, helped mitigate against dramatic price increases by ensuring healthier insurance pools. Insurers have attributed approximately half of their requested rate increases to the risks they see resulting from its repeal. Without the federal action, the average requested rate increase would be 12.1%. As DFS reviews all of the submissions, we will continue to ensure that any rate increases are fully and actuarially justified by appropriate medical cost increases and are not inadequate, excessive or unfairly discriminatory, in accordance with New York law.
Small Groups:
Most encouraging to see the average rate requests for the small group market reflect the increased stability of that market in New York State. The combination of 2-50 and 51-100 market underscores the stability for msall bsuinesses under 50 employees. Prior to the NYS regulatory combination, the 2-50 market was running an average 12-13% trend.
The Obamacare health insurance tax, aka The HIT, is responsible for approximately 2.5%. Whiel the HIT moratorium was approved it had indeed come back last year. The total projection is $14 Billion. Notably, Empire Blue Cross has filed a modest 6% increase as their portfoliio is running stable. Additionaly, Oscar’s inbdustry low 3% filing is practially at break-even considering the HIT.
THE THREE R – RISK CORRIDOR, RISK ADJUSTMENT & REINSURANCE designed to mitigate the adverse selection and risk selection. The problem, according to many insurance companies, is that the formula is flawed, and CareConnect executives have consistently complained that they are at an unfair disadvantage. The Cuomo administration has taken steps to ameliorate some of those problems, giving the DFS the authority to essentially overrule the federal numbers. In its first-quarter financial report, executives made clear that the risk adjustment penalty was a threat to its business.
Company Name
2019 Requested Rate Change
Aetna Life
16.2%
CDPHP
6.7%
CDPHP UBI
6.1%
Crystal Run Health Insurance Company
11.5%
Crystal Run Health Plan, LLC
12.5%
Emblem
12.0%
Empire Healthchoice Assurance
6.0%
EmpireHealthchoice HMO
5.2%
Excellus*
3.8%
Healthfirst Health Plan, Inc.
21.0%
Healthfirst Insurance Company, Inc.
7.0%
Healthnow New York
-0.1%
IHBC*
3.8%
MetroPlus*
4.7%
MVP Health Plan
7.0%
MVP Health Service Corp*
10.3%
Oscar
3.0%
Oxford Health Insurance Inc*
8.3%
UnitedHealthcare Ins Company of New York
7.2%
Weighted average:
7.5%
Conclusion
Defined Contribution Choice: Instead, the correct approach for a small business in keeping with simplicity is a defined contribution model using a PrivateExchange. This is a true defined contribution empowering employees with the choice of leading insurers offering paperless technologies integrating HRIS/Benefits/Payroll. Both employee and employers still gain tax advantage benefits under the business. Also, the benefits, rates and network size are superior under a group plan as THE RISK OUTLINED ABOVE ARE HIGHER FOR INDIVIDUAL MARKETS THAN SMALL GROUP PLANS.
To be clear: These trends affect a small subset of the insurance market—non-group plans that cover less than 2 percent of the population. Many qualify for tax credits that lower their net costs and reduce or eliminate the impact of year-to-year rate increases.However, non-group customers with incomes above 400% of the poverty level ($48,560 for a single adult) get no subsidy—and feel the full brunt of any hikes.
Resource
You may view the NYS 2019 Rate Requests DFS press release, which includes a recap of the increases requested and approved by clicking here.
For a custom analysis detailing YOUR upcoming 2018-2019 renewal please contact our team at Millennium Medical Solutions Corp (855)667-4621. We work in coordination with Navigators to assist with Medicaid, CHIP Child Health Plus, Family Health Plus and Medicare Dual Eligibles. We have Spanish, Russian, and Hebrew speakers available. Quotes can also be viewed onour site.
New Jersey Governor Phil Murphy (D) signs law to take in effect within 3 months that will reduce Surprise Out-Of-Network Medical Bills.This is well needed and in-step with NYS law passed 3 years ago – No More Surprises – NY Surprise Medical Bill Law.
The reform is designed to protect patients, businesses, and others who pay for medical care from the high-cost bills associated with emergency or unintentional care from doctors or other providers who are not part of their insurance network. The law requires greater disclosure from both insurance companies and providers — so patients are clear on what their plan covers — ensures patients aren’t responsible for excess costs, and establishes an arbitration process to resolve payment disputes between providers and insurers, a mechanism intended to better control costs.
The Problem. This has been a pattern in recent years and posted in Out of Control Out of Network Charges (March 2012). According to an investigation report commissioned by Governor Cuomo recognizing the unexpected out-of-network claim problem. Officials say that this is now “an overwhelming amount of consumer complaints.” Some examples cited in the report An Unwelcome Surprise – “a neurosurgeon charged $159,000 for an emergency procedure for which Medicare would have paid only $8,493.” Another example: ” a consumer went to an in-network hospital for gallbladder surgery with a participating surgeon. The consumer was not informed that a non-participating anesthesiologist would be used, and was stuck with a $1,800 bill. Providers are not currently required to disclose before they provide services whether they are in-network.” The average out-of-network radiology bill was 33 times what Medicare pays, officials say.
The blog post goes on to say “Today, 90% of SMB members have in network only benefits but the few remaining consumers are paying for eroding out of network benefits with little transparencies and necessary protection from new out of network billing practices. The NY Dept of Financial services is calling for providers in non-emergency situations to disclose whether or not all services are in-network, what out-of-network charges will be and how much insurers will cover.”
The Solution: The The out-of-network Consumer Protection, Transparency, Cost Containment and Accountability Act requires greater disclosure from both insurance companies and providers — so patients are clear on what their plan covers — ensures patients aren’t responsible for excess costs, and establishes an arbitration process to resolve payment disputes between providers and insurers, a mechanism intended to better control costs. The law sets a timeline and other parameters for negotiations between the payer and the provider and, if they can’t resolve the issue, requires the state to hire an independent expert to decide between the final offers presented by both sides. While earlier drafts of the bill included a range of factors for the arbitrator to consider in making this decision — including the doctor’s experience, the patient’s condition, and certain payment benchmarks — these details were eliminated entirely in the final version.
NJ becomes the 7th State to enact such consumer protection. The other states include California, Connecticut, Florida, Illinois, Maryland and New York.
Learn how a Private Exchange and our PEO Partnership can help your group please contact us – info@medicalsolutionscorp.com or (855)667-4621.
President Trump announced earlier today a new pharmacy cost reduction program, “American Patients First”. The program aims to provide new tools to Medicare to negotiate lower prices, stop limiting pharmacists from helping patients save money and speed up approval of over-the-counter medicines so that fewer will require prescriptions.
The plan has 4 components:
Increasing competition.
Easing negotiation.
Creating incentives to lower prices.
Lowering out-of-pocket spending on drugs.
“American Patients First” calls for reforms in Medicare Part D to allow plan sponsors to negotiate lower prices for high-cost drugs, including negotiation tools that may be available to private payers. The administration also plans to address incentives in Part D to push drug companies to lower prices.The plan includes a five-part plan to restructure the Part D program to reduce drug costs. The budget includes proposals to cap spending in Medicare Part B and move Part B coverage into Part D to facilitate better negotiation.
The Food and Drug Administration will begin acting quickly to bring more generics and biosimilars to the market to address competition issues, for example.
Another area of particular focus is using a US large buying group much as other countries have been doing traditionally. The U.S. pays for 70% of the profits of branded drugs among 35 leading countries because many have government-run health systems that pay one price for drugs, senior administration officials said. According to Trump the U.S. is essentially subsidizing the R&D costs for other countries.
Last Sundays 60 Minutes segement on how the Town of Rockford, Illinois can NOT meet its budgetery obligations due to crushing PBM influenced pricing. Example: In 2001 an infant drug cost $40/vile and now
$40,000/vile.
The Dept of Health and Human Services reiterated the agency’s focus on price transparency and said that was another crucial element of the drug pricing plan. The FDA, for example, is going to immediately begin
to examine ways to push drug companies to disclose prices in their advertising.Long awaited and a welcomed consumer policy.
Survey Shows 94% of PEOs Expect an Increase in Employees
Businessman pressing a People concept button.
Professional Employer Organizations (PEO) growth doesn’t appear to be slowing down. Earlier this year, NAPEO released the results from there 2017 Q3 Industry Pulse Survey. The findings showed that PEOs are continuing to grow, and at an impressive pace. In the report, 72% of PEOs reported revenue growth in Q3 of 2017, compared to Q3 of 2016.
With all that is happening with employment laws, healthcare and health insurance, and other areas of HR that impact small and medium-sized businesses (SMBs), it is easy to see why PEOs and other HR outsourcing options are seeing, in many cases, rapid industry growth.
Now, NAPEOs latest Quarterly Pulse Survey, which compared the 4th quarter of 2017 to the 4th quarter of 2016, shows that PEO growth is still occurring, and will almost certainly continue in 2018 and beyond.
DATA FROM THE 2017 Q4 NAPEO PULSE SURVEY
The NAPEO Quarterly Pulse Survey – Q4 2017 was conducted in early 2018, and was taken by 32 PEO executives.
The first result from the survey looked at PEO revenue. 71.9% of PEO executives said their organization’s revenue increased in Q4 of 2017, compared to Q4 of 2016.
Broken down further, 50% said that revenue increased somewhat, and 21.9% said revenue increased significantly.
Next, the survey showed that PEOs experienced an increase in the average annual wage per worksite employee (WSE), with 65.5% of executives responding.
NAPEO’s findings also revealed that 66% of PEOs saw an increase in gross profit. Of this 66%, 43.3% said gross profit increased somewhat, while 23.3% said it increased significantly.
OPERATING INCOME, NUMBER OF CLIENTS, AND WSE PROJECTION DATA
The next group of results from the survey uncovered data around operating income, the number of clients, and worksite employee projection information.
First, the report showed that 65.7% of PEO executives reported an increase in operating income in the 4th quarter of 2017, compared to the 4th quarter of 2016. The 65.7% can be broken down further, with 43.8% saying that operating income increased somewhat, and 21.9% increasing significantly.
Next, 59.4% of PEOs said that the number of clients increased, while 31.3% said that the number of clients stayed about the same. Of the 59.4%, 50% said that clients increased somewhat, and 9.4% said clients increased significantly.
Lastly, the survey asked PEO executives about worksite employee (WSE) projections over the next 12 months.
Perhaps the most promising and impressive statistic found in the quarterly survey, almost 94% expect WSEs to increase. Here is the full breakdown:
71% expect EE to increase somewhat
22.6% expect EE to increase significantly
3.2% expect EE to stay about the same
3.2% expect EE to decrease somewhat
With PEOs seeing an increase in revenue throughout 2017, and executives overwhelmingly expecting EE to increase over the next 12 months, revenue outlooks for the rest of 2018 and into 2019 look extremely promising throughout the PEO industry.
PROFESSIONAL EMPLOYER ORGANIZATIONS CONTINUE TO THRIVE
Much like the last few Quarterly Pulse Surveys from NAPEO, the 2017 Q4 survey shows that despite all of the uncertainty and complexity with various areas of HR, PEOs continue to grow.
Regarding the survey, Pat Cleary, President & CEO of NAPEO, said, “This is just the latest example that more and more business owners are realizing the true value of using a PEO. Surveys and studies consistently show that using a PEO is good for a business and its employees. PEOs provide a real benefit to businesses by providing HR services and solutions that they would otherwise be unable to afford.”
Some additional findings from the survey include:
Average annual wage per WSE increased somewhat
Average number of WSEs per client company stayed about the same
Number of internal employees (including salespeople) stayed about the same
Number of Worker’s Compensation claims reported to carrier stayed about the same
The survey also revealed that the average PEO has 19 worksite employees per client.
Learn how a PEO can help grow your business. Check out PEO Case Studies here and learn how they can apply to you.
Click below for a free PEO assessment. OurPEO Quoting Tool ensures that we have first-hand insight as to what the small business owner needs to be successful.
If you would like a printable version of this guide, please email info@medicalsolutionscorp.com and we will gladly forward one to you.
Pension Contribution & Benefit Limits
2017 Limit
2018 Limit
Section 401(k), 403(b), or 457(b) annual deferral
$18,000
$18,500
SIMPLE plan annual deferral
$12,500
$12,500
Section 415 maximums
Annual benefit from defined
benefit plan
$215,000
$220,000
Annual additions to defined contribution plan
$54,000
$55,000
Maximum IRA contribution
$5,500
$5,500
Catch-up contribution limits
Retirement plan
$6,000
$6,000
SIMPLE plan
$3,000
$3,000
IRA
$1,000
$1,000
Compensation Amounts
Annual compensation limit
$270,000
$275,000
Grandfathered governmental plan participants
$400,000
$405,000
Highly compensated employees
any employee*
$120,000**
$120,000**
5 percent owner
no minimum
no minimum
* Employer may elect to limit to top-paid 20%** Due to the look-back rule, applies in determining HCEs during following year
Key employees
officer
$175,000
$175,000
1 percent owner
$150,000
$150,000
5 percent owner
no minimum
no minimum
Small Employer Health Insurance Credit Average Wage Phase-Out
$26,200
$26,600
Social Security/Medicare
2017 Limit
2018 Limit
OASDI taxable wage base
$127,200
$128,400
OASDI tax rate – employer
6.2%
6.2%
OASDI tax rate – employee
6.2%
6.2%
Medicare tax rate – employer
1.45%
1.45%
Medicare tax rate – employee
1.45%>
1.45%>
Maximum income without reducing Social Security retirement benefits
SSRA* or over
no limit
no limit
year individual attains SSRA*
$44,880/yr.^
$45,360/yr.^
under SSRA*
$16,920/yr.
$17,040/yr.
> Employer must withhold additional 0.9% from compensation in excess of $200,000* Social Security Retirement Age (age at which an individual may receive an unreduced monthly benefit)
^ No limit on earnings beginning the month an individual attains SSRA
Health Plan Limits
Maximum Health FSA
employee deferral
$2,600
$2,650
carryover
$500
$500
Maximum HSA contribution. More 2019 HSA info, here.
individual
$3,400
$3,450
family
$6,750
$6,850
catch-up
$1,000
$1,000
Minimum HDHP deductible
individual
$1,300
$1,350
family
$2,600
$2,700
Maximum HDHP out-of-pocket
individual
$6,550
$6,650
family
$13,100
$13,300
Maximum out-of-pocket (non-grandfathered plans)
individual
$7,150
$7,350
family
$14,300
$14,700
Transitional Reinsurance Fee (per person)
Only paid through the 2016 plan year.
Note: The information and materials herein are provided for general information purposes only and have been taken from sources believed to be reliable, but there is no guarantee as to its accuracy.
Learn More About your 2018 Options
Contact Us Now Learn how our Agency is helping businesses thrive in today’s economy. Please contact us at info@medicalsolutionscorp.com or (855)667-4621.
Like this blog article? You might also like our full HSA 2018 Limits page.
Spring started yesterday but Old Man Winter did NOT get the Memo. So what to do if it snows and employees are unable to get to work?
IF YOU CLOSE YOUR BUSINESS
If your company decides to stay open during bad weather, it’s important to understand some of the risks you face. According to a Connecticut Business and Industry Association survey of 430 member-companies, the most common practice when “bad weather forces a closing” is to pay hourly employees only for the hours actually worked. “This was true for a majority of both small employers (25 to 249 employees) and large employers (more than 250 employees),” according to the survey.
EXEMPT EMPLOYEES
Exempt employees should be paid if a business is closed due to inclement weather- they should receive their weekly salary for this time. However, an employer can take these days out of the personal days, vacation time, or paid time off. As an employer, it is respectful and in some places required to alert employees that it will come out of their personal time. If it one full week of closure, employees do not need to be paid for that time. However, if work is done during any of the time the business is closed, employees need to be compensated.
If your company chooses to use accrued time to pay employees, but an employee does not have any paid time off accrued, you still must pay the employee their full wage. In some cases they will need to examine contracts to ensure that there are no limits to how much time can be taken away. However, if vacation or PTO is notoffered to employees in general, exempt employee should still be paid.
NON-EXEMPT EMPLOYEES
For non-exempt employees they do not need to be paid for hours they do not work. However, a company may give them the option to elect to use their paid time off or vacation time. When it comes to non-exempt employees who are paid a fix weekly salary for fluctuating hours they must be paid for the week if they work for at least three hours.
Local State Policies on Sending Employees Home
Like above, if an exempt employee goes to work, they must be paid for the entire day. However, non-exempt employees do not necessarily have to be paid for the time they do no work. Some states have reporting time pay- which means that they need to be paid for a certain number of hours regardless of whether or not they worked.
CONNECTICUT – This law only applies to four industries: beauty shop, mercantile trades, and laundry/cleaning/dyeing operations, all must be paid for a minimum of four hours and in the hotel and restaurant industry a minimum of two hours. It can be waived if the scheduled shift is less than four hours.
NEW YORK – Regardless if there is work to be done, if an employee shows up they must be paid for at least four hours of work, unless the scheduled shift is less than four hours in which case they must be paid for the full amount of time. This does not apply to: employees who are on call or live on the employers’ premises, building service industries, administrative, executive, profession, outside sales, farm laborers, taxicab drivers, babysitters, companions, golf caddies, staff counselors, and booth renters (those who rent space in a beauty shop).
EMPLOYEES WHO CAN’T MAKE IT TO WORK
If your business chooses to open but an employee cannot make it to work exempt employees can lose time out of their personal or vacation time. If no time has been saved or it has all been exhausted an employer may deduct funds from pay, only if the employee misses a full day of work.
TELECOMMUTING
If you allow employees to work from home, or expect them to work from home in the event of inclement weather they must be paid. Exempt employees should be paid for the day, or week, whichever is applicable. If an exempt employee is expected to any work whatsoever from home, or another location they must be paid for that time- even if it is beyond a week that the company is closed. As always, non-exempt employees should be paid for the hours they work.
If you are an employer it is important to recognize that snow days are an opportunity for you to support employees, especially those who have children or commute more than an hour away. If our HR Partners have written your employee handbook, office closings and delays are already addressed but it is important to use your best judgement a communicate with your employees early enough to give them time to make arrangements depending on their situation.
Click here to schedule a 1 on 1 compliance consultation.
Professional Services: New York Law Firm’s Benefit Benchmark Study Reveals Gap In Offerings
A law firm with a benefit offering below the New York law firm benchmark, no HR person on staff, no formal recruitment strategy and no employee development plan was struggling to attract top lawyers and paralegals, and to keep top producers. This was affecting their stability, employee morale, and ultimately, their bottom line. After losing one of their highest billing attorneys and a key associate to a larger firm with more robust benefit offerings, they realized they needed to make an immediate and drastic change to recruit and retain quality employees.
SOLUTION
Our PEO partner immediately assigned a seasoned Human Resources Manager with vast experience working with law firms to help, and conducted a market analysis of other firms in the area. After establishing a benchmark, the PEO developed an innovative employee benefits program that rivals top law firms in the area. Our PEO partner then devised a recruitment and retention strategy designed to reposition the firm in the marketplace.
RESULT
The firm now offers benefits and employee development that are on par with their top competitors. They have a clear plan on how to increase employee satisfaction and retain quality people while attracting top new talent. Their turnover has reduced significantly, and employees shared positive feedback during and after their benefit enrollment meetings via employee satisfaction and engagement surveys. Leadership can now focus on clients and on growing the firm.
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insurance companies and providers — so patients are clear on what their plan covers — ensures patients aren’t responsible for excess costs, and establishes an arbitration process to resolve payment disputes between providers and insurers, a mechanism intended to better control costs.
