Is Health Care Integration the Answer to Compliance?
Addressing worker health has many parts – health care, wellness, disability management and workers’ comp.
Managing them as a whole instead of discrete components can help reduce costs while improving outcomes, which is why more and more employers are moving toward an integrated approach to employee health and safety.
But streamlining administration of these programs and making decisions that go across the board can also have the added benefit of tightening up regulatory compliance.
The Americans with Disabilities Act (ADA) – and amendments made in 2008 – present employers with a thorny trail to blaze.
Especially after the implementation of the Affordable Care Act, employers are shouldering a greater responsibility for employees’ health and wellness, and rules imposed by the ADA can complicate matters as companies and organizations strive to improve worker health without overstepping boundaries.
The intersection of the ADA with other regulations like the Family and Medical Leave Act (FMLA) and the Pregnancy Discrimination Act (PDA) also creates gray areas for employers when it comes to deciding what benefits an injured or disabled employee is entitled to, if any.
In a National Law Review article, labor and employment attorney Melvin Muskovitz called the intersection of ADA, FMLA and workers’ comp issues the “‘Bermuda Triangle’ of employee health-related statutes.”
Leave and benefits provided by workers’ compensation can overlap with what employees may be entitled to under the ADA and FMLA; carriers can benefit from more open communication with administrators of health plans and wellness and safety programs to ensure the right program responds to a request for accommodation or benefits.
One issue they all have in common is “the potential for claims of discrimination or retaliation,” Muskovitz wrote. “An employer must be sure the employee does not suffer any adverse employment action as a result of the leave of absence or condition necessitating the leave.”
“Integration is the only way to go with all these regulations coming at employers,” said Tamara Blow, principal consultant at TYB Global Business Consultants, LLC. “You need all the key players involved.”
That includes human resources, safety managers, risk managers, and legal counsel, as well as the payroll department or others in charge of tracking attendance.
With multiple perspectives weighing in on decisions, it should be easier to identify where clashes with different statutes could occur.
Take for example the case of Peggy Young, a female UPS delivery worker who sued the company in 2007.
When Young became pregnant in 2006, her doctor ordered her not to lift more than 20 pounds; UPS delivery workers sometimes have to lift packages of up to 70 pounds.
Young brought the doctor’s note to her supervisor and requested a temporary reassignment, which was denied because pregnancy is not covered under the ADA.
She was placed on unpaid leave for the duration of her pregnancy.
Young, whose case is currently being heard by the Supreme Court, argued that UPS violated the PDA, which states that pregnant women must be treated the same, in terms of receipt of benefits, as “others not so affected but similar in their ability or inability to work.”
In other words, if UPS provides accommodations for an injured worker with the same physical limitations as Young, she should also receive benefits even though she is not technically disabled.
Could an integrated approach have helped UPS avoid this regulatory tangle?
“Absolutely,” Blow said. “Any HR professional who’s worth their salt knows that the Pregnancy Discrimination Act would be the first to come into play with a pregnant employee.” A cross-functional team that included the legal department might have been able to anticipate potential violations.
“If their system was integrated, they would see that impairments that arise out of being pregnant would qualify as temporary disability covered under the ADA and FMLA,” she said.
For larger employers, though, there are structural hurdles blocking integration. Health care, disability management and workers’ comp tend be viewed as separate programs, so decision-making around them also remains separate.
“Workers’ comp is handled by risk management, which report up to either treasury or general counsel,” said Russell Johnston, casualty president for the Americas at AIG.
“Disability benefits and medical tend to be human resources or the administration side. So within larger employers, in terms of their governance model, there are structural disconnects.”
Bringing everyone together from different departments is a time-consuming effort that can also be constrained by office politics, Blow said. “Some departments want to be in charge. They may bash heads over who wants to take this initiative, especially with senior management’s eyes on it.”
Another structural hurdle Johnston pointed to was the way in which companies access these products on the market.
“Larger employers access the workers’ comp market through agents and brokers,” he said. “On the benefits and medical side, agents and brokers tend to be very different from the P/C side. They tend to operate completely separately. And in some cases it’s provided directly by the medical providers to employers.”
For these reasons, smaller employers have an easier time implementing an integrated approach to employee health. “They don’t have the luxury of having large infrastructure, so decisions are made across the totality of their business,” Johnston said.
Despite the obstacles, larger companies can still benefit in the long run from a unified employee health front because of cost savings. However, Johnston believes it won’t necessarily ease compliance issues.
“I struggle to see where it will make a material impact on the compliance side,” he said. “But is there a compelling reason for employers to look at this and try to implement it? Absolutely.”