Official Announcement from the IRS:

As of July 1st, the IRS's optional reimbursement rate has increase from 50.5 cents a mile to 58.5 cents a mile for the rest of 2008.

From the official IRS release:

"The rate will increase to 58.5 cents a mile for all business miles driven from July 1, 2008, through Dec. 31, 2008. This is an increase of eight (8) cents from the 50.5 cent rate in effect for the first six months of 2008, as set forth in Rev. Proc. 2007-70.

In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2008. The IRS normally updates the mileage rates once a year in the fall for the next calendar year."

For more information, visit www.irs.gov.

1. Not treating employees with respect. There is no law that says you must treat employees with respect; it's just good common sense. Remember the golden rule: Do unto others as you would have them do unto you. If you want to be treated with respect, you must treat others with respect. It's a two-way street. 
2. Ignoring sexual or race-based jokes or comments. Sure, you’re culture is a big ol’ boy’s club – when you start adding women to the mix, you have to make sure that your employees change their behavior to accommodate. Same goes if you start adding men to an all-women mix – they can’t continue to treat the workplace like they’re in an episode of Sex and the City. Managers cannot allow such behavior in the workplace. Ignoring it can be construed as condoning it – a big no-no.
3. Making sexual jokes or sexual comments, using profanity, and/or touching other employees. Managers must lead by example. Just like they can’t ignore inappropriate behavior, neither can they participate. You’re just asking for trouble.
4. Hesitating to Document Performance Issues. In HR, you know how valuable documentation is. But do your managers? NASCAR claims it fired the employee who is now suing because of performance issues; she claims that she always got good performance reviews. If someone makes a claim and you fire that person, it will look like retaliation (see #5 below). But if you fire that same person after they make a claim, and you have documentation on poor performance going back months before the claim was made, you now have a leg to stand on. Doesn’t mean the fired employee won’t sue; just means you have a stronger defense.
5. Retaliating (or inadvertently retaliating) against an employee who has made a complaint. Managers must be careful in issuing discipline, changing schedules, assigning duties, etc., because any of these may be construed as retaliation.

There was a program launched in 2007 that offers huge discounts in prescription costs. The California Rx Card Program is for all California residents and can save many people as much as 75% on prescriptions.

As a resident of California, you and your family have access to a FREE Prescription Drug Card program. Simply download your Prescription Drug Card and receive savings of up to 75% at more than 50,000 national and regional pharmacies. You may create as many cards as you need. Participating pharmacies include the following: CVS/pharmacy, Walgreen’s, Rite Aid, and K-Mart, as well as thousands of independent pharmacies.

Just go to http://www.californiarxcard.com/, enter your name and e-mail address and they will generate a printable membership card for you. This card is pre-activated and can be used immediately.

This program is available to the uninsured.  So if you or a relative have a prescription that you have to pay out of pocket for, be sure to ask about this program.  I went to CVS last weekend and asked about it.  They knew exactly what I was talking about.  My brand name prescription was only $144 under the program instead of the $224 I usually pay.  What a difference!

Business Insurance magazine recently reported that Senator John McCain has proposed requiring older couples with incomes of $160,000 or more to pay higher premiums for Medicare D if they are enrolled in the program.  Interestingly, President Bush had called for a similar proposal as part of his fiscal year 2009 budget.  This modern day Robin Hood scenario is a bad idea for many reasons.  

First and foremost, why should the government penalize Medicare beneficiaries who have successfully planned for their retirement?  Our government should encourage people to save for their future - not charge them more for a benefit for which they have been making contributions for more than 40 years.  

Second, the process for managing Medicare D deductions is already inefficient; so inefficient and just plain bad that according the Medicare Advocacy website (medicareadvocacy.org), there are 3 pending lawsuits resulting from the government’s inability to properly process the deductions and fix errors in a timely matter.  Part of the problem is that there are 3 separate government agencies involved in the process - the Centers for Medicare & Medicaid Services (CMS), the Social Security Administration (SSA) and the Internal Revenue Services (IRS).  The other part is that, unlike Part B which has a single deduction option, there are multiple deductions for Part D, depending on the selected plan.  Add another layer to the matrix, namely income, and the problems will only get worse.

Finally, I doubt this is even cost-effective.  There are time and resources involved in working through the process, updating and testing systems, as well as trouble-shooting once in place.  Further, if the government is already in court as a result of their inability to handle the current matrix, I am fairly confident that by adding complexity and therefore increasing the likelihood for errors, more court cases are bound to follow.  In addition, according to the US Census Bureau, only 10.8% of households 65 or older earn over $100,000.   The percent of earners over $160,000 would be even less.  So Senator McCain’s proposal is to add complexity to an already inefficient process for less than 10% of the eligible population.  That fact alone speaks for itself.

What other options are there?  Well, if this process was taken over by a private entity, the first order of business would be to drive costs out of the process - what can be automated, simplified, eliminated?  Next, private enterprise would look for ways to reduce the costs of goods sold - in this case, the cost of the prescriptions.  Finally, the consumer pricing model would be reviewed, looking at both hard costs and soft costs.

There is no doubt that there is a need for the “modernization and improvement of Medicare”.  However, implementing a program that creates administrative burden, lawsuits, and penalizes Americans who successfully plan for retirement is not the answer. 

Earlier this week the FDA confirmed that 81 people have died and nearly 800 suffered severe allergic reactions to the tainted blood thinner, Heparin. For any watching this Heparin situation unfold, you should be scared – I am. For the rest that believe ignorance is bliss, it just may kill you the next time you take an FDA approved medication. Allow me to explain.

In the wake of this Heparin tainting, a congressional subcommittee questioned the commissioner of the FDA and uncovered some scary facts.

• The tainted Heparin came from China. (Not the first time the U.S. has received poor quality products from China - remember all those lead tainted toys last year?).
• 714 drug making plants in China provide prescription drugs to the U.S.

Scared yet?

• $20 Million is the estimated annual cost to inspect 15% (500) of the 3,249 foreign plants that ship drugs into the U.S.
• Roughly 10% (350) of foreign facilities will be inspected with the FDA’s $13 Million budget in 2008.

Are you scared now?

As I ponder these statistics, I am reminded of all those drug company excuses for the soaring prescription drug prices during the last ten years. You know the line, “Drugs are more expensive in the U.S. because of the FDA trials and the approval process.” My response, “What good is the FDA approval process if we don’t inspect the foreign facilities supplying us drugs?”

Perhaps drug companies should divert some of those huge profits from their advertising campaigns or their “drug pushing cheerleader” workforce or their massive political contributions to funding the FDA inspections of the foreign facilities they are using to supply us with drugs. Besides, they are the ones that moved to these foreign locations to add to their profits. 

With situations like this occurring, you may want to reconsider that next prescription.

David Boaz of the Cato Institute says that in a free society, citizens don’t turn to the national government to solve every problem.  In fact, he says that the measuring stick of a free society is the amount of life that remains outside the control of government.   

We’re in presidential election season and the so-called health care crisis is a primary topic among the three remaining candidates.  I’ll leave the industry diagnosis to others, but I thought a reasoned study of their positions would be helpful.

After carefully reading the health care policy positions of all three presidential candidates, it is clear that at least one major difference separates Senators Hillary Clinton and Barack Obama from their Republican Party opponent Senator John McCain – a government mandate that all Americans be required to purchase a health insurance plan.

Senator Clinton proposes a sweeping mandate that “every American (be) required to have coverage,” while Senator Obama only requires that “all children have health coverage,” apparently leaving adults with the option of going uncovered.  He does, however, require that “all employers offer ‘meaningful’ coverage” for their employees.  An in-depth search yielded nothing on how to define “meaningful coverage.”  So, though he doesn’t require individuals to acquire coverage on their own, he does require all employers to provide it.  Both candidates propose tax credits to those who purchase their own health insurance.

Senator McCain opposes any mandate for coverage, preferring to allow Americans their constitutional right to choose for themselves.  However, he does support federal funding to states that allow government programs like Medicaid and State Children’s Health Insurance Program (SCHIP) to be used to purchase private insurance.  And, like his opponents, he also proposes tax credits for those families who purchase their own health insurance.

As a believer in free markets and private – not government - solutions to big problems, John McCain’s commitment to keeping government from further intrusion into the health care industry is aligned with my personal philosophy.  However, the entirety of his proposal isn’t a win-win solution either.  I’m concerned about his proposed elimination of tax-favored employer insurance and how that will affect my livelihood.

Given all of the excitement of the Presidential Primaries nearing a close, I set out to educate myself on the current stance on major issues of the final three Presidential hopefuls. There are those topics that are heated and very publicly debated and then there are those that quietly loom in the wings waiting for their opportunity to emerge. One of those in the wings is healthcare. As I reviewed the candidates ideas on the subject of healthcare, I was both encouraged and at the same time scared to death.

I am seeking the opinions of you, my friends in the employee benefits arena. How does it make you feel to know that:

• McCain proposes the elimination of tax favored employer insurance?
• Clinton would like to mandate that all Americans have healthcare?
• Obama wants employers to provide coverage or contribute to a new public plan?

Any thoughts or ideas on these subjects?

After the recent release of a few different healthcare surveys regarding Consumer Driven Health Plans (CDHP) and their “modest” impact on benefits cost trend, I have been fielding calls from benefit managers seeking my opinion on CDHPs. As a result, I thought it would be wise for me to blog some of my answers and observations on these topics.

• CDHPs and “High Deductible” health plans are not the same thing.
• Large or “jumbo” self insured employers have the most to gain (financially) by introducing a CDHP, but only if they entice or force a sizeable enrollment in the plan.
• A CDHP shifts costs from employer to employee by increasing deductible/out of pocket costs and making participants responsible for managing their healthcare purchases.
• When voluntarily offered, CDHPs typically attract the young and healthy.
• A CDHP all by itself does not improve the health of its participants.
• Plan design, wellness incentives, access to cost and outcome information and communication tools are “key” elements to a robust CDHP offering. 

 For small to mid-size employers:

• A CDHP with all the bells and whistles does not exist in a fully insured environment, although a few insurers have “modified” CDHP offerings with some tools.
• If your rates are “pooled” or “book rated”, there is no improved financial impact with insurance carriers for having a healthier or wiser population.

While this is not a comprehensive write up on CDHPs, I believe it answers some of the recurring questions I receive.

All of us Americans are quietly sitting aboard the U.S.S. “feel good” with (name your politician) piloting our ship. Little do we know that we are racing towards a $53 trillion dollar iceberg that will make the sinking of the Titanic look like a walk in the park.  The $53 trillion dollar iceberg I am referring to is the Social Security and Medicare promises our politicians have made.

Do you have a spare $455,000 to pay your portion of this obligation? According to former Comptroller General of the United States, David Walker, this is the amount of money per household it will take to meet our obligations.

Why aren’t politicians talking about this or changing our course of direction to head off this impending tragedy? Why is this not the preeminent topic of political debate rather than super delegates or fanatical preachers? Is America listening? Does anyone care or are we all so consumed with the political bloodshed that we are enjoying our cruise on this “unsinkable” super structure?

Let me add some alarming perspective for you. Quoting U.S. Treasury Secretary Henry Paulson, he said, "Without change, rising costs will drive government spending to unprecedented levels, consume nearly all projected federal revenues, and threaten America's future prosperity." Did he say what I think he just said? ALL FEDERAL REVENUES WILL BE CONSUMED BY THESE TWO PROGRAMS.

The iceberg is coming into sight. We are only 11 years away from 2019, when the Medicaid trust fund will become insolvent. With the speed at which our government operates, it may already be too late to avoid significant damage to our vessel.

What caused this iceberg to break away from the larger ice mass? Perhaps Al Gore was correct with his Global Warming theory (forget for a minute that this has been our coldest winter in 40 years).  On the other hand, “burden passing” or inaction by one President/Congress to the next has caused the collapse of the ice structure and resulted in this massive $53 trillion dollar iceberg.  Forget for a minute all your other political beefs and ask your President, your Congress, yourself – “what are you doing to melt this iceberg?”  

Employee benefits are increasingly becoming the most important aspect of an employee's compensation package. Because of tax issues associated with most employee benefits, significant statutory and regulatory compliance burdens exist. The purpose of this program is to help HR professionals avoid some common mistakes that can lead to potential liability.

Benefits and Learning Objectives

HR Professionals will be able to recognize and correct some common compliance mistakes and misconceptions associated with the three general categories of employee benefits:

• Welfare benefit plans
• Retirement plans
• Executive compensation arrangements

With Super Tuesday right around the corner and the impending presidential elections coming up this year, do you find yourself wondering, "which candidate thinks most like me?" Well, MyFox LA came up with a way to answer that question - the MyFox Candidate Matchmaker! Take a few minutes out of your busy day to play 20 questions and see which current presidential candidate is your closest political match!

**Please note: this is for entertainment purposes only. Precept does not endorse any political party or candidate. 

Richard makes a good point:  why would we rely on the opinions of other patients when we pick a physician?  We care most about how much an MD knows and how well they perform – after all, we want to be kept alive and healthy.  Most of us would trade the warm smile and prompt visit may impress others, for extra years of healthy, active life.

It is not hard to imagine an excellent system to rate how good a physician really is.  You want to test his or her knowledge of the illnesses and treatments that might affect you.  You want to know how well he performs against other physicians in treating real-life patients, those with diabetes, heart disease, and ear infections.  You want to know how thoroughly she informs her patients of what they really need to know, and whether she delivers the preventive care that you need to stay healthy.   And you’d really like to know if his patients are healthier and live longer than those of other physicians.

Unfortunately, that information isn’t available.  What is available isn’t even close to that ideal.  Mostly people rely on what their friends, family, or other physicians recommend, and there’s no evidence that is any better than flipping a coin when trying to identify a better-than-average physician.  What else can you do?

The answer is that patient opinions, for all their shortcomings and obvious problems, are one of the best answers we have today.  One example supporting this is the Consumer Assessment of Healthcare Providers and Systems, a system of scoring physicians and hospitals through patient surveys, which is being used by the US Department of Health and Human Services to improve performance.  Another example is California’s Integrated Healthcare Association, which rewards medical groups in part on the basis of patient assessment of physician performance.  No, it’s not ideal, but it’s a start.

Don’t make the perfect the enemy of the good.  Until we have real comparative information on physician performance and outcomes, consumer satisfaction is probably the best we can do to identify the physicians that most deserve our patronage.  

Zagat rated.  It is one of the most powerful, influential phrases in the restaurant and hospitality industries.  Reputations are bolstered, prestige rises, and business flourishes as a result of a hotel or dining establishment’s association with Zagat and its mighty rating system.  But can it do for the health industry what it does for the restaurant industry?  One insurance company is attempting to find out.

Starting in January 2008, select participants of Wellpoint’s Blue Cross/Blue Shield plans will launch an online survey tool which will enable participants to rate their physician experiences by utilizing Zagat’s 30-point scale.  While the survey will not tackle the two most important factors in a health-care encounter – quality and cost – it will let their patients rate physicians on elements of trust, communication, availability, and environment.  The main impetus behind the survey seems to revolve around efficiency, in the sense that higher rated experiences will most likely be utilized by would-be patients who are seeking more compact, succinct doctor visits in order to minimize time lost on their busy schedules.  However, there is already a brewing faction of harsh critics toward the ratings system, who says such ratings may cloud or even wholly mask deficiencies in the level of care that would be actually provided.  Ultimately, the detractors are worried that patients may inevitably sacrifice the best care available to them for the sake of shaving off a few extra minutes at the doctor’s office. 

The criticism regarding the concept of Zagat-rated physicians appears to be strongly warranted.  In the wake of the poll that Fidelity Investments conducted earlier this year which re-enforced the notion of ignorance the typical employee has about their benefits, it is quite easy to envision a similar lack of knowledge extending to the medical field itself.  Indeed, one wonders how many people may look at this scale, completely unaware of the important criteria missing from it, and base their health care decision solely on the softened measurements it features.  If the employee happens to be participating in a Consumer Driven Health Plan, this foreboding scenario and its negative ramifications would be magnified even further.  With that being said, it will be interesting to see how Wellpoint attempts to educate their target audience about the chief aspects of individual health care alongside these lesser tangibles.  Hopefully, they will look for ways to emphasize the absolutely vital role quality of care and cost must play in all aspects of health care decision making to its utmost. 

Of course, there is no guarantee that this survey would be embraced by its potential clientele.  People may not embrace the notion of choosing a doctor based on data culled from an organization that is traditionally used to tell them that the filet mignon at Morton’s or Fleming’s is delicious.  This possible mindset could lend itself to a great deal of indifference toward the survey, which is something that Wellpoint understandably would not want to see.  However, given the propensity of the average employee to not be astute in matters of their own healthcare, an apathetic attitude toward the concept of Zagat rated doctors may end up being the best scenario that could occur.  After all, being indifferent towards a product because of unease is a whole lot better than embracing it without being fully clear on its overall concept.

Is this something that you have faced in your own organization? If so, how do you handle it? Do you think this is a good thing or a bad thing?