Tip of the Day: Cost-Cutting measures for benefit plans

Want to know how to trim the fat from your benefit plan? Here are five easy suggestions.

1. Implement a premium surcharge for smokers or a premium discount for non-smokers.
   
2. Offer wellness screenings for employees, employer-subsidized gym memberships or premium discounts or incentives for participation in wellness programs (e.g., weight loss, blood pressure/cholesterol lowering, etc.).
3. Review vendor fee and service provider fee arrangements (e.g., HMO, claims administration, COBRA and FMLA administration, etc.), including actuarial, investment management and plan administration; and re­bid for vendors if necessary.
4. Freeze traditional defined benefit plan, and, going forward, offer a 401(k) plan with employer contributions.
5. Audit your retirement plans for operational compliance (voluntary correction of operational failures is less expensive than correction after discovery by the IRS).

Many thanks to Robert Flanagan, employee benefits and executive compensation partner at Seyfarth Shaw, LLP, for today's tip.

News You Can Use: IRS modifies 409A

The IRS recently issued a ruling to modify and amplify Revenue Procedure 2008-3, 2008-1 I.R.B. 110, regarding which rulings and determination letters will not be issued concerning tax consequences of arrangements in Section 409A.

News You Can Use: Market chaos may affect women's retirement outlook

Women may have to rethink their retirement savings strategies due to the shake up in the U.S. banking system and its affect on the stock market, reports the Web site Women's enews.com.

While women's participation in retirement plans has risen considerably relative to men in recent years, they traditionally have been conservative investors. Their accounts are smaller, compared to men's. Consequently, a sudden and huge loss to the account is a major setback in building an adequate retirement nest egg, according to the online magazine. Data on 2007 balances in defined contribution plans shows that women on average hold $19,749 in their accounts, while the mean for men is $32,391.

Alicia Munnell, director of the Center for Retirement Research at Boston College, told Women's enews.com that recent financial crisis will cause many women to reevaluate their retirement plans and strategies. Some women may have to work longer than they had expected to recoup their losses in the stock market, she added.

Related EBN coverage:

• Running the retirement savings marathon
• Ten techniques for communicating about retirement plans

News You Can't Use: Get political ... or not.

Unless you're in DC like we are, it's probably bad form to talk politics at work. But a new survey by Accountemps says that 53% of workers feel as if the level of office politics has increased compared to five years ago. Only 12% reported a decline.

According to 54% of respondents, it's wise to be aware of what's going on without getting involved. Mmmm hmmm ... we really believe that.

But what we do enjoy are the five types of "common political players" and Accountemps' suggestiosn for how best to interact.

• The Pundit. This person loves to talk office politics and rarely tires of speculating about what's really happening. While the Pundit may provide useful insights on occasion, it's best not to share too much information with this individual, as it could fuel the rumor mill.
  
  
• The Lobbyist. The Lobbyist is a strong advocate for his or her projects and is adept at gaining buy-in for ideas. While some Lobbyists are effective at building cross-departmental support, others may be unreceptive to outside points of view. When interacting with this person, be aware of the agenda being pushed, and be willing to stand up for your ideas.
  
  
• The Covert Operator. The Covert Operator often uses manipulation rather than hard work to get ahead. While this type of person can be charming, keep your guard up when dealing with anyone who criticizes a coworker or takes credit for other people's projects.
  
  
• The Activist. This professional likes to facilitate change within an organization and is quick to take on causes, even those that don't necessarily advance the company's big-picture goals. While the Activist can be a valuable advocate, carefully evaluate the merit of the issues when asked for support.
  
  
• The Advisor. This person often is closely aligned with a company's leadership and serves as their "eyes and ears." For example, the Advisor could be a senior aide or an executive assistant. Because the Advisor wields significant behind-the-scenes influence, develop a good rapport with him or her.
  

New you can use: Health care quality varies widely by region

While it’s kind of a “no duh” headline, it is also important to remember. The National Committee for Quality Assurance’s new report shows that New England plans perform better than the average and that South Central plans fall short of the average. What’s more the group notes that HMOs generally score better than PPOs. PPOs trail HMOs significantly in several areas, according to the report, like follow-up after hospitalization for mental illness and persistent beta-blocker treatment after a heart attack.

NCQA urges that any health reform proposal include the following to further reduce disparities in care quality by geography:

-Require routine quality measurement and reporting by all health plans and providers.
-Establish benchmarks for improvement in each region of the country.
-Enact reforms that tie payment to the quality of care delivered.

Cost is also known to vary widely by region. That’s caused some to consider medical tourism. At our recent national conference, I was reminded that doesn't have to mean India as Northeastern residents could fly first class across the country to receive comparable care at a much lower cost. So what are you doing to take advantage of quality and cost disparities to serve your employees and improve your bottom line?

News You Can Use: Think long-term when saving for retirement

Most people who have self-directed [retirement] plans need to look at the long term, says Jan Grude, president and executive managing director at Buck Consultants. He speaks about how to educate employees about long term savings.

Read more on Employee Benefit News.com.

News You Can Use: Diversity programs expanding

Diversity strategies are a hot topic, states new research from the Institute for Corporate Productivity. Nearly three quarters of organizations plan to expand their diversity programs, and nearly half already have a diversity strategy in place. For large companies (over 10,000 workers) that number dips to only 11% without a strategy already in place.

“Diversity programs have gone from nice-to-have to must-have for most firms,” said Jay Jamrog, i4cp senior vice president of research. “Strong diversity strategies help in the attraction and retention of top talent as well as customer relations, and companies not paying attention to that are missing the boat.”