BY KATIE KUEHNER-HEBERT

The Patient Protection and Affordable Care Act (ACA) has had sweeping impacts across all industries, and the construction industry is no exception. AGC of America members say the health care reform law has caused them to tweak not only their health insurance offerings, but also other employee benefits, including bolstering their wellness programs to keep their employees healthier and hopefully reduce health care costs.

The ACA has also resulted in more fees and reporting requirements, members and benefits experts say, and firms should be mindful of important deadlines coming up. Members should also consider the new AGC Alternative, a private exchange provided by Willis North America that offers a wide range of plan options for health insurance as well as a host of voluntary benefits.

WA Klinger LLC in Sioux City, Iowa, a Master Builders of Iowa member, offers the same basic health care plan that it had before the ACA, but the company made some modifications due to the law’s new compliance requirements and the resulting impact on costs, says Robert J. DeSmidt, chief financial officer.

Prior to the ACA, employees had to be working for seven months to qualify to participate in the health care plan, as many of its workers in two of its units travel to different jobs around the country and are temporary local workers, DeSmidt says. But with the ACA rules, Klinger had to change the eligibility to the first of the month after 60 days, which resulted in 35 percent more employees qualifying for health care.

To mitigate for the "substantial" additional cost, Klinger added a second plan which has a lower premium and a slightly higher deductible and increased out-of- pocket maximums, he says. The company still pays about 75 percent of the cost, but as more employees opt for the second plan, costs should be lower. Moreover, Klinger added a $200 a year higher out-of-pocket $200 maximum for smokers.

Overall, Klinger’s costs due to the implementation of the ACA rose roughly 25 percent, which includes paying several new fees under the new law – the temporary transitional reinsurance fee and the Patient- Centered Outcomes Research Institute Fee, DeSmidt says.

"Our costs also rose due to having to add so many adult children of employees to our plan at no additional premium," he says. Adding an adult child to a family plan incurs no increase in premium dollars, but medical treatment could impact company costs. He adds, "We have been told that some of those adult children are making more money than their parents, as well as higher plan costs due to now insuring people with pre-existing conditions. Claim costs were also increased due to the 2.5 percent medical device tax."

Klinger also lengthened the qualification date for dental insurance, short-term disability and life insurance, from the date employees were eligible for health insurance to after working one year. The company pays 50 percent of dental and 100 percent of disability and life.

The ACA has also added to Klinger’s "administrative burden" of managing the health insurance benefit, DeSmidt says. One example is having to produce an annual 11-page statement "which participants find confusing and not helpful." "When I talk to supervisors on jobsites they tell me that when they hand out the required summary of coverage data, employees don’t read it and many toss it immediately," he says. "The notice is a waste of time in our opinion. Each of these changes in themselves are not horribly burdensome, but when you put them all together, along with the new reporting requirements, it is."

Metro Waterproofing Inc. in Scottdale, Georgia, an AGC Georgia member, added a third health care plan to its menu that lower income employees could more easily afford, in order to comply with the ACA’s poverty threshold provision, says Grady Bland, human resources director. The company is also looking into offering health savings accounts to offset high deductibles, but hasn’t decided how much the firm would contribute to such accounts.

"We don’t currently have a wellness program, but we have to come up with ways to help employees improve their health, such as smoking cessation and lowering their blood pressure," Bland says. "We are looking at what other industries are doing because we have found that the construction industry is lagging in these kinds of programs." For voluntary benefits, Metro Waterproofing’s employees pay 100 percent of the premiums for short and long-term disability, while the company pays 100 percent of the premiums for basic term life insurance, up to $15,000, he says.

Patrick Casinelli, vice president and principal of Cavignac & Associates in San Diego, an AGC San Diego Chapter member, says his firm’s contractor clients have shifted more costs to employees because of the new law, particularly since ACA fees have added between 5 percent to 7 percent in additional costs.

"For a $1 million premium, that’s $50,000 to $70,000 in additional fees," Casinelli says. "Our clients have asked us to explain these fees to their employees during open enrollment so they understand the affects and costs of the law."

To mitigate some of the additional ACA costs, many contractors are changing their percentage of contribution, such as from 100 percent to 90 percent or less, he says. Many are also offering a wider menu of plans, including those with higher deductibles and greater out-of-pocket costs. Some are choosing to contribute 100 percent to less costly higher-deductible plans, allowing employees to pay the difference for a richer plan if they choose.

Contractors are also considering whether to offer their employees critical illness, cancer, accident and hospital indemnity plans from companies such as Aflac or Colonial Life that pay cash to cover deductibles in those situations.

"The addition of gap plans is definitely a discussion we are having with all of our clients, as prices continue to go up," Casinelli says.

More employers are also now thinking of self-insuring, but Davis Bacon/government works contractors should understand how self-funding affects fringe benefits. 

"It’s tricky, but doable," he says. "Before considering alternate means of funding the insurance, they have to consider the risks of captives or self-insurance, and they have to know their own employee risk pool."

Because of the ACA, more contractors are now considering wellness programs as a way to mitigate cost increases, Casinelli says. His firm promotes wellness and safety to all of its construction clients to manage risk and lower the overall cost. "One of our clients offers a number of incentive programs, such as a ‘Biggest Loser’ competition in which the winner gets cash and other prizes," he says. "The company also encourages its employees to participate in walks/runs for local charities, and they regularly educate their employees about the benefits of healthy eating and exercising."

There are important reporting requirements starting in January, particularly for companies that have more than 50 employees but up to 99 employees (larger companies had to start reporting this year), says Jason Blomquist, senior vice president, employee benefits practice leader at Assurance Agency in Schaumburg, Illinois, a member of multiple AGC chapters. Companies in this size bracket will have to start reporting how many full-time equivalent (FTE) employees are on their payroll, and if they count their union employees, they could possibly cross the 100-FTE threshold and not be subject to additional insurance costs as a "small group" employer.

Mark Lam, Assurance’s vice president, benefits compliance, says that traditionally unions pay the benefits of union employees, so most contractors don’t consider them as employees for health insurance purposes. "But the reality is that unions are simply membership organizations and the workers employed by contractors still count," Lam says. "That might get contractors out of the small group market, as counting union employees could keep them in the large group market."

This is good news because the federal government is in the process of creating a national uniform definition of small groups to replace all of the varying state rules, under what is being called "small group reform," he says. For those contractors that will be reclassified from a large group to a small group, their insurance carrier will move them to a different risk pool set up to handle expected claims in a completely different manner. As a result, contractors in those risk pools can likely expect around a 30 percent bump in the cost of their insurance premiums.

On the flip side, contractors in large groups this year should have included union employees in their FTE count under the employer mandate, Lam says. They will be held accountable by the Internal Revenue Service to provide appropriate coverage at affordable prices to all FTEs, Lam says. If contractors pay the unions to provide health insurance, that is allowed as long as the provided coverage meets the ACA’s requirements for a minimum value plan.

"Typically this is not a problem because union plans are typically very rich and very inexpensive to members," he says. "But the catch is that the union needs to provide contractors with the required data that the contractors need to report to the IRS and not all unions are prepared to do that."

Contractors need to make sure the unions’ plan sponsors are working on being able to issue this data on the IRS form 1095C, he says.

Assurance is "definitely" seeing more interest from contractors for outcomes-based wellness plans (those that provide incentives if certain biometric targets are met), to cover not only rising health care costs but also rising workers’ compensation costs, Blomquist says. More contractors are incorporating wellness into safety programs, which can help reduce the duration and the extent of worker injuries.

"If the programs can get a person moving more, they’ll have more flexibility, which can lessen the severity of their injury," he says.

Rick Leon, senior vice president, operations at West Coast Group Benefits in San Diego, a San Diego Chapter member, says "the dust is just starting to get kicked up" on many issues related to the ACA, including the implementation of the so-called Cadillac Tax, which "will play a major role in the direction and sustainability of the ACA and employer groups."

Moreover, every business will likely be impacted by the health care industry’s consolidation, including Aetna’s recently announced deal for Humana and Centene’s recently announced deal for Health Net, combined with increasing shortages of providers, Leon says.

"Compliance alone continues to impact costs for most companies, from reporting mandates to the cost of navigating existing, changing and upcoming regulations," he says. "I think time will provide a better barometer for how the ACA will affect employers and their bottom line."

To mitigate ACA impacts, members can consider The AGC Alternative, a private-labeled version of the Willis Private Exchange that has a few unique features exclusive for members, says Christi Reimer, director, private insurance exchange, AGC of America. The exchange is being rolled out in phases, due to varying ways that states handle small group health benefits.

Currently, the program is available exclusively to AGC member firms with 100-plus employees in all states and for firms with 10 or more employees that are located in Arizona, Connecticut, Florida, Georgia, Illinois, Maine, Maryland, Minnesota, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas, Virginia and Wisconsin. "With a private exchange, members will be able to give their employees greater choice, with up to six plan options for major medical," Reimer says. "There are also voluntary benefit offerings available, including dental, vision, short- and long- term disability, life and legal services. Plus, the state-of-the-art online exchange provides employees with step-by-step guidance needed to choose a benefits portfolio tailored to their individual needs."

Jim Perrin, senior vice president, human capital practice at Willis North America in Washington, D.C., says that the AGC Alternative allows members to comply with the requirements to cover eligible FTE employees in a way that will have as minimum of an impact as possible to their business. Employees can choose plans that are designed to be just slightly above the ACA’s affordability requirements or use part of their defined contribution dollars to help buy richer plans. "We are learning that member firms still want to do the right thing and take care of their employees, but they are looking for ways to gain better control over their employee benefits budget," Reimer says. "So, instead of making a traditional defined benefit commitment and paying a percentage of current and future premiums, the AGC Alternative allows them to simply pay a flat dollar amount by setting a defined contribution. This helps members better predict their employee benefits budget as they work to control the increasing cost of health care."

The AGC Alternative also has wellness program offerings, Perrin says. "The only way to really impact long-term costs on an ongoing basis is to emphasize wellness," he says.

The Occupational Safety and Health Administration (OSHA) recently issued a Notice of Proposed Rulemaking that clarifies an employer’s continuing obligation to make and maintain an accurate record of each recordable injury and illness throughout the five-year period during which the employer is required to keep the records.   

"Accurate records are not simply paperwork, but have an important, in fact life-saving purpose," said Assistant Secretary of Labor for Occupational Safety and Health Dr. David Michaels. "They will enable employers, employees, researchers and the government to identify and eliminate the most serious workplace hazards - ones that have already caused injuries and illnesses to occur."

OSHA is issuing this proposed rule in light of the decision of the U.S. Court of Appeals for the D.C. Circuit in AKM LLC v. Secretary of Labor (Volks)*to clarify its long-standing position that the duty to record an injury or illness continues for as long as the employer must keep records of the recordable injury or illness. The proposed amendments add no new compliance obligations; the proposal would not require employers to make records of any injuries or illnesses for which records are not already required.

The proposed rule was published in the July 29, 2015, issue of the Federal Register. Members of the public can submit written comments on the proposed rule at http://www.regulations.gov, the Federal e-Rulemaking Portal. See the Federal Register notice for submission details. Comments must be submitted by Sept. 28, 2015. 

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing safe and healthful workplaces for their employees. OSHA’s role is to ensure these conditions for America’s working men and women by setting and enforcing standards, and providing training, education and assistance. For more information, visit www.osha.gov.

October 7-9, 2015 
St. Louis, Missouri
The AGC Safety Management Training Course (SMTC) provides attendees three days of training on the basic skills needed to manage a company safety program in the construction industry. The program builds on Focus Four training and prepares attendees to manage key safety issues on the jobsite and provides techniques for delivering basic safety training to field personnel. Participants will receive intensive instruction and training that will allow them to return to their firms with readily applicable new skills to positively impact their company’s safety and health program.

Stress is a natural part of life, but if you fail to manage your stress levels, the effects can be cumulative. High levels combined with poor management can lead to severe health problems and affect your performance, relationships and life quality. As you and your employees work to meet strict deadlines, it is vital to ensure that the quality of work is not compromised in the process.

Studies have shown that stress costs United States employers nearly $200 billion each year through absenteeism, medical insurance, workers’ compensation, and other expenses related to stress, which cause staff turnover and reduced productivity. Nearly 75 percent of employees quit their jobs due to work pressures. Stress is a major factor that leads to work-related injuries and disease, absenteeism, illnesses (nearly 80 percent), and nearly half of all sick days taken. One of the most common reasons for quitting a job is stress due to being overworked and having a work-life imbalance.

• More than 40 percent of Americans say their jobs are extremely stressful;
• 70 percent say they don’t have a healthy work-life balance; and
• 60 percent would give up some pay in exchange for more personal or family time.

It is important for your company to provide your employees with a stress management program that will keep everyone healthy, happy and on staff.

With the proper training, your employees will be well equipped to manage their stress levels to avoid getting fried. A good stress management training program should educate employees about the sources and nature of stress, effects it has on their health, and skills on how to reduce and manage the stress. Some of the skills that employees should be taught include relaxation exercises, time management, and how to handle difficult situations effectively. Employee assistance programs can also be offered to counsel employees who are struggling through personal or work problems. Companies that implement stress management programs will quickly see the benefits, and over time also see the cost-effective benefits. They will see healthier and happier employees, more productivity, and ultimately much less turnover.

The best stress management technique is to eliminate the cause of stress. Changing a few factors in the work place is an effective approach that can help make the workplace stress free. Consultants can help develop ways to enhance and improve working conditions. This involves identifying some of the aspects leading to stress at work such as conflicting expectations and excess workload. Consultants assist in designing stress management strategies to eliminate or reduce the stressors identified. The major benefit of this approach is that it focuses on the major causes of stress unique to your company. However, as a manager, you need to note that this approach may involve changes in production schedules, routines and organizational structure. This tactic can be combined with stress management training to effectively maximize stress reduction.

Employees need more input. Providing them with the proper resources will help them manage their stress levels. By utilizing a comprehensive stress management approach, companies can focus on different areas that need to be improved. Jobs should provide stimulation, meaning and opportunities for employees to effectively use their skills as they undertake their daily roles. Some of the strategies that can be implemented include:

• matching workloads to employee capabilities;
• providing resources to become more efficient;
• giving employees opportunities to take part in actions and decisions that affect their jobs;
• enhancing communication to minimize future employment and career uncertainties;
• making work schedules compatible with responsibilities and demands outside the job;
• providing opportunities for social interactions; and
• implementing a zero-tolerance policy for harassment.

This comprehensive approach will go a long way to help employees manage their stress so they can live a balanced and fulfilled life. Happy employees will want to stay with your company and won’t even think about needing more input elsewhere.

One of the best ways to show employees they are appreciated is to give them rewards. If employees realize their efforts are appreciated by managers, their chances of becoming stressed out are much lower. Encourage team building by creating a reward system as part of your stress management program. For instance, the human resource manager can develop certificates that employees can give each other for demonstrating qualities encouraged by the company culture. Whatever culture you decide on should be incorporated into meetings, activities and training sessions. Anecdotes, fun training materials, and humorous activities can make the work environment more enjoyable, which will go a long way in helping employees reduce and manage stress. They might even go so far as to say, "I am satisfied with my care."

By offering employees a wellness program as part of a well-rounded stress management program, you will empower employees to develop a healthy lifestyle and a positive attitude toward their job, leading to reduced stress. Wellness programs can include yoga classes, running groups, or a company sports team. Companies can offer to pay for family health costs, inviting families to company events, paying for childcare, or providing free or reduced gym memberships. Incorporating your company’s values and showcasing employees’ strengths will go a long way in reducing stress sick days, and injuries. When employees are healthier, they will enjoy increased job satisfaction and more positive relationships at work, which in turn will have them more apt to want to shine and show you what they’re made of.

As a manager, it is important to utilize some of these stress management strategies to ensure your employees remain productive and happy. Your employees are the greatest assets you have, and they need to be in tip-top shape if a company is to succeed.