“[Employees] are now moving down the path of being more engaged in the management of their health,” said Mercer’s Tim Weber.

Once considered a side dish, voluntary benefits are now making their way to the main course — especially supplemental health care coverages such as hospital indemnity insurance, gap insurance, accident insurance and critical illness insurance.

In the most recent Mercer National Survey of Employer-Sponsored Health Plans, which surveyed large employers with more than 500 employees, 59 percent of respondents reported that they offer an accident plan. Almost half (45 percent) offer critical illness plans, and 21 percent offer hospital indemnity insurance. It did not measure gap insurance.

The rise of health care costs contributed to this growing interest, as these health plans are designed to ease the financial burden of events such as accidents, hospital visits and diagnoses. Fifty-five percent of the survey respondents cited improving the financial health of employees as motivation to offer these supplemental plans.

Gap insurance, recently covered in the Wall Street Journal, is the most rigid type of supplemental health coverage and specifically covers the increase in hospital out-of-pocket costs that comes with the rise of health care expenses. The money is paid directly to the provider rather than directly to the employee, and doesn’t allow for flexible spending.

The other three types of insurance measured in the Mercer survey cover a fixed amount based on the occurrence of an incident, and the employee receives a check from the insurance company that they can use for any related cost.

Ginny Palmieri, vice president of specialty services at Independence Blue Cross

Accident insurance pays a fixed amount based on an accident happening. If someone breaks their arm, they could use the check for a hospital co-pay or a sling, among other things. A critical illness plan comes into play when, for example, someone is diagnosed with cancer. They could use the money for hospital costs or for any transportation/lodging costs they picked up while traveling to a specialist in another city.

Finally, a hospital indemnity plan pays a fixed amount based on what a person’s hospital stay looks like. They might get, for example, $1,000 for the admission plus a per-day amount.

“Hospital indemnity insurance provides a multiple-dimensional approach to the medical insurance,” said Ginny Palmieri, vice president of specialty services at Independence Blue Cross. It provides an employee with financial stability and flexibility. Palmieri said that within her own company, hospital indemnity was the fifth best-selling insurance of 2014, and interest has grown since.
As HR managers continue to see the health care landscape changing and the larger shift to high deductible plans, Palmieri said HR managers should make sure that they’re providing different ways to make sure the employee has stability with their coverage.

These insurance types fit into the wider category of voluntary benefits. Five years ago, these weren’t widely considered part of a comprehensive benefits program, but today they are offered along with core benefits packages, said Tim Weber, who heads the voluntary benefits practice at Mercer.

Tim Weber, who heads the voluntary benefits practice at Mercer.

“Employers are looking toward them as a strategic part of total benefit offering,” he said.

When employers are asking benefits counselors about their options during open enrollment, Weber said, it accomplishes a couple things. It helps the employer offer employees coverage that addresses risks, and it also results in the employee being more engaged in the risks they face.

“[Employees] are now moving down the path of being more engaged in the management of their health,” said Weber.

Andie Burjek is a Workforce associate editor. Comment below, or email at aburjek@humancapitalmedia.com. Follow Workforce on Twitter at @workforcenews.

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You may recall that

How did that case turn out for the employer? Not well. From the EEOC:

Saint Vincent Health Center will pay $300,000 constituting back pay and compensatory damages to a class of six aggrieved former employees … .

In addition to requiring monetary relief and offers of reinstatement for the six employees, the consent decree contains multiple injunctive components. Under the decree, if the Health Center chooses to require employee influenza vaccination as a condition of employment, it must grant exemptions from that requirement to all employees with sincerely held religious beliefs who request exemption from the vaccination on religious grounds unless such exemption poses an undue hardship on the Health Center’s operations, and it must also notify employees of their right to request religious exemption and establish appropriate procedures for considering any such accommodation requests. The decree also requires that when considering requests for religious accommodation, the Health Center must adhere to the definition of “religion” established by Title VII and controlling federal court decisions, a definition that forbids employers from rejecting accommodation requests based on their disagreement with an employee’s belief; their opinion that the belief is unfounded, illogical, or inconsistent in some way; or their conclusion that an employee’s belief is not an official tenet or endorsed teaching of any particular religion or denomination.

Ouch.

What does this mean for employers? I’ll allow Philadelphia District regional attorney, Debra M. Lawrence, who prosecuted the Saint Vincent Health Center case, to explain.

While Title VII does not prohibit health care employers from adopting seasonal flu vaccination requirements for their workers, those requirements, like any other employment rules, are subject to the employer’s Title VII duty to provide reasonable accommodation for religion. In that context, reasonable accommodation means granting religious exemptions to employees with sincerely held religious beliefs against vaccination when such exemptions do not create an undue hardship on the employer’s operations.

In other words, if you require flu shots for your employees (a policy I wholeheartedly endorse), you must be willing to exempt certain employees as an accommodation for their religions (and disabilities, as well).

Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. Comment below or email editors@workforce.com. Follow Hyman’s blog at Workforce.com/PracticalEmployer.

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By Rita Pyrillis

With recent pot laws allowing marijuana for medical or recreational use, things get murky for employers that implement drug testing.

It was a banner year for marijuana-use advocates as a number of states passed laws in November that approved its medical or recreational use. It also creates new challenges for employers as they develop drug-free workplace policies.

Arkansas, Florida and North Dakota approved the medical use of marijuana while Montana voted to expand an existing law, bringing the total number of states with legalized medical marijuana to 28. California, Massachusetts, Nevada and Maine also legalized the use of recreational pot.

Whether it’s medical or recreational use, each type of state law poses different challenges to employers as they develop their drug policies, said Kathryn Russo, an attorney with law firm Jackson Lewis and an expert on workplace drug testing and substance abuse.

“With medical marijuana, presumably, the employee is disabled and that raises discrimination issues if the employer refused to accommodate, so it’s trickier and more complex,” she said. “With recreational marijuana, I think it’s less complicated to administer policies because we’re not dealing with disability issues anymore. Employers can treat it like alcohol and prohibit its use. But it does get tricky with drug testing.”

In the case of recreational pot, most state laws have provisions protecting an employer’s right to create a drug-free workplace, she said.

California law states “that it does not alter or amend the rights and obligations of public and private employers to maintain drug- and alcohol-free workplaces and to have policies prohibiting the use of marijuana by employees and applicants. It further does not require employers to permit or accommodate the use of marijuana in the workplace, or prevent employers from complying with state or federal law.”

Things get murky for employers that implement drug testing.

“People might think, ‘Oh I can do whatever I want now. I can smoke all weekend,’ and the problem is that you don’t know if someone was using drugs while off duty or on duty,” Russo said. “That’s a dilemma for employers who conduct drug testing. You need to look at your policies and figure out what you want to prohibit and be very, very clearly about it. You can put employees on notice that if they want to do this on your own time that’s fine but if they test positive at work there will be consequences.”

Rita Pyrillis is a writer based in the Chicago area. Comment below or email editors@workforce.com. Follow Workforce on Twitter at @workforcenews.

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