Category Archives: Insurance

10 Killer Reasons to Attend the North East Totally Expat Show

The International HR Forum is proud to be a Partner Organization for the upcoming North East Totally Expat Show on 3 April in New York.  The event is just three weeks away! It will be the largest global mobility event ever held in New York.  So, if you are in the New York Metro area, or if you are able to travel, register now!

Here are 10 killer reasons why you should register today: Continue reading

Five Secrets to Reduce Benefits Cost, Part 5

George Bashaw – Atlas Global Benefits

It is time to unlock the power of hidden benefits.  Each year when preparing to communicate new benefits changes, we tend to get bogged down in the delivery of rising medical costs and medical benefit changes. Understandably, medical hits the company’s bottom line and the employee’s wallet the hardest. This singular focus on medical benefits causes us to neglect the communication of other valuable benefits that may directly or indirectly save money for the company and your employees.  Prior posts in this series include Enrollment and Billing Audit, Dependent Eligibility Audit, Know Your Claims and Duplication of Coverage.

Secret Five:  Hidden Benefits
Hidden benefits are services and benefits that your employees may not fully understand or have no knowledge they exist.  They could be stand alone plans or riders on policies. Either way, they have a purpose and can be very useful.

They key is identify your hidden benefits and communicate them properly. Here is a list of  typical hidden benefits and some additional information about them:

  • International EAP
  • Preferred networks
  • Short term disability
  • Disease management
  • RX discounts
  • Medical evacuation and repatriation

The importance of an international EAP plan could merit several blog pieces on its own.  The obvious benefits of EAP are credit, substance, marital, emotional counseling, and the list continues.  Take anyone one of these common issues and multiply the stress of being a thousand miles from home and your support group and you have a serious problem.  A problem that needs to be addressed by someone who can support the cultural issues, language barriers, and the exponential stress associated of being abroad.  Not utilizing a good EAP plan can create loss of productivity and maybe the loss of your expat.

Some international medical plans come with EAP riders and other useful riders like medical evacuation and repatriation. You have to determine if the rider is adequate for your needs compared to a standalone plan.  Either way, it is important employees understand their benefits and how they can utilize them.

Make sure you take the time to communicate all your benefits each year and not just the changes. Ensure that everyone has a summary of the plan in an easy to follow handbook that can be accessed via the internet.  Additionally, you should issue new cards each year for wallets and purses.

My final recommendation on communication is bit outside the box but I have seen very positive results with my clients.  I recommend you consider inviting spouses to the meetings or at least include them in the communication.  In every home, you have a quarterback on issues like benefits and half the time it is the spouse.  Effectively communication with the spouse may pay off in the long run.

Good luck unlocking the power of your hidden benefits. I would love to hear your thoughts on this issue.

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Five Secrets to Reduce Benefits Cost, Part 4


George Bashaw – Atlas Global Benefits

Need to find some savings without cutting something?  Pull out your bills and perform an enrollment audit.  This blog is part four in a series of simple ways to save money without altering your current benefit design or carrier. Prior posts in this series include Dependent Eligibility Audit, Know Your Claims and Duplication of Coverage.

Secret Four –  Enrollment and Billing Audit

I know it’s not very sexy but a sharp eye can find a few bucks with four simple steps.

Step One: Active Employees

Make sure only active employees are on the bill. When an employee leaves make sure they are immediately removed from your plan.  If they wish to continue coverage, make sure they are enrolled in COBRA (if applicable).

Step Two: Enrollment Errors

Verify that each person is enrolled in the plan they selected during enrollment and the carrier is billing you correctly.  Some plans have more than one medical choice and many plans have various levels of life insurance options where mistakes are easily made.

Step Three: Billing Errors

Once you have determined that everyone is enrolled correctly, make sure you are correctly being charged for every selection.  Despite all you hard efforts to renegotiate your insurance rates, you may find out the changes did not make it to the carrier’s billing system, or they were entered incorrectly.

Step Four: International Employees

You may be getting billed for employees who are not covered for thier specific region. It is important that you understand the contractual provisions of all your plans.  If you are covering local employees on an international plan, make sure the carrier is aware of their locations and they are included in the plan. I have seen many plans (EAP, long term disability, medical, life, and most importantly war risk) that have country specific coverage exclusions.

I hope you four-step your way into some savings.  Please share your thoughts.

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Five Secrets to Reduce Benefits Cost, Part 3

George Bashaw – Atlas Global Benefits

I didn’t know you have kids.  Seriously, aren’t you single? I need to see some documentation.

Ok, that is a bit overboard. However, if you want to get serious about saving money on benefits, a dependent audit may be a bumpy but lucrative road.   This blog is the third in a series of five techniques to lowering your benefits cost without changing your plan design or carrier.  Prior posts in this series include Know Your Claims and Duplication of Coverage.

Secret Three:  Dependent Eligibility Audit
The intention of a dependent eligibility audit is to ferret out those who are ineligible for benefits.  Examples of ineligibles may include non-resident step children, college grads who may feel like dependents but technically are not, or the classic unemployed ex-husbands who will not get off the couch, but like an old hound, you feel sorry for them.  Joking aside, these people add up quickly. Finding one ineligible participant in your plan can save up to $6,000 per year.  Finding a slew of them will have a noticeable impact and go straight to the bottom line.

Communication is Key
Caution!  People get a pit in their stomach when they hear the word audit. Second, they do not like sharing personal information. Therefore, the way you deliver the message about the audit is key. In other words, you do not want to blast out an email today saying “proof of your dependent status is due by the close of business Friday.”

Sell the benefits of an audit to the participant.  The participants’ costs are going up and their benefits are getting cut, too.  Explain, as an employer and plan sponsor, you have a fiduciary responsibility to make sure all dependents are eligible, and to misrepresent is fraud.  Therefore, it is necessary to make sure the plans are in compliance.

Steps to Successful Audit

  1. Positive Communication
  2. Communicate at least a month before you start your audit to set expectations
  3. Create a plan and review with your employment attorney
  4. Communicate “the plan” (don’t call it an audit)
    • The definition of eligibility requirements
    • Methods to prove eligibility
    • Halo period where the participant may change status without penalty or embarrassment
    • Final deadline (here is where you may decide to define the nature of fraud)

Please share any stories you have about your experience with employee dependent audits.  If you happen to try one and you do not find any ineligibles, I may respond, “Look closer, the employees committing fraud may have left the building out of embarrassment.”

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Five Secrets to Reduce Benefits Cost, Part 2

George Bashaw – Atlas Global Benefits

I developed five secrets to lowering your benefits cost without changing your plan design or carrier. Out of the five, I am confident at least one will help you. I posted the first one last week.  Here is number two:

Secret Two:  Duplication of Coverage
Every year, I find a new plan that has duplication of coverage, where a company is  paying for a benefit more than once.  This is most common in very large companies, and ones that that have experienced multiple mergers.

Case Study: Duplication of Coverage
Last year I discovered that a new client had three  Employee Assistance Plans (EAPs).  Of the three, they only knew about two of them, and communicated only one to the employees.  One EAP plan was a rider attached to a long term disability contract.  Another was a rider attached to the international expatriate medical coverage.  The third was a standalone EAP plan.

We decided to scrap the standalone plan and keep the two riders.  We felt the rider on the expat plan served the international employees needs far better than the other two plans.  Further, we decided to keep the rider on the LTD plan.  Even thought it was a rider, it was a good plan and it was less expensive than the standalone plan.

Financial Impact
Cleaning up the duplication of benefits in the scenario above took about two hours to analyze and saved my client about $50,000.  Even though the savings was insignificant in comparison their total benefits cost, we would not have reached our goal ($500,000 of total savings) without eliminating the duplication of coverage.

Scour Your Plan Designs
Have someone take the time to look at all your plans and see if you can find a duplication of coverage.  Who knows, you may be paying for something two or three times.

I would love to here where you have found duplication of coverage.

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Five Secrets to Reduce Benefit Cost, Part 1

George Bashaw – Atlas Global Benefits

There are only a few ways to negotiate with an insurance carrier on fully insured plans.  For most carriers, claims history is the most important factor in determining pricing.  Therefore, you better know your claims if you wish to negotiate with its leverage.   Over the next few months, I am going to share five simple ideas to help you save money on your benefits.  Out of the five, I hope you find at least one of them useful.

Here’s the first one:  Know Your Claims!

Fully Insured and Self Insured
Insurance plans are fully insured or self insured. Most large companies have both. Typically, large multinational companies have self insured medical plans and fully insured non-medical plans.  Medium and smaller companies tend to have a majority of fully insured plans.  Therefore, it is likely that your company has at least a few fully insured plans.  Only fully insured plans will be discussed in this blog.

What’s Inside a Premium?
Premium can be broken down in two parts, claims and retention.  When an insurance company prices a new premium, they estimate future claims by looking at your claims history.  Estimated Claims + Retention = Premium.  Retention is approximately 20%-25% of the premium cost and consists of the following:  premium tax, overhead/administration, margin/profit, and commission/fees.

A Happy Insurance Carrier
Insurance carriers want claims to be around 75%-80% of premium.  If claims are over 80%, the carrier starts to lose money; if they are below 75%, they start raking in the profits. 

Claims Analysis:

Do a thorough analysis of your claims.  If your claims history is running less than 75%-80%, demand a decrease in premium.  If you do not get it, there is some reason why the carrier does not want to insure your risk.  For example, a carrier may not want to cover offshore drillers, so they jack up the price to reduce that demographic in their pool.

If you claims are over 80% you are getting a good deal. However, there are some carriers that may want your group and will offer you a better deal, even if you are running over 90% claims.

Please tell me your thoughts and share your experiences.  Know your claims!

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Creating A Global Benefits Strategy

David Bryan – Norfolk Mobility Benefits

Editor’s Note: We are pleased to welcome David Bryan as a Guest Author.  David has extensive experience in international employee benefits, and is currently a Marketing Consultant for Norfolk Mobility Benefits in Naperville, IL.

Change is constant, particularly in the realm of international employee benefits. There is a social time bomb ticking — the number of employees paying into various social security systems around the world is diminishing while the number of recipients is increasing. To defuse this situation, many governments are reducing benefits while raising taxes, thereby shifting the burden to the employer.

Today’s multinational employer is evolving into the transnational of tomorrow as corporations do away with defined headquarters and instead move to regional centers of operations. To meet these and other changes, benefits professionals are implementing global benefits strategies (GBS).  Yet, in recent surveys in which I have participated, nearly 78% of multinational firms have no formal international employee benefits strategy!

Designing Your Strategy
There appears to be more centralization of core corporate functions in light of the global economy.  While authority for certain functions may be retained on a local or regional level, strategy setting is still at HQ.  In the end, as long as the global corporate benefit strategy is being deployed, certain aspects, for example the selection of vendors/contracts, can be left to the local operations.

A Global Benefits Strategy will provide for some of the following benefits:

  • A blueprint of your company’s decisions describing what employee benefit strategies should be deployed for the enterprise.  It is a living, breathing document that needs to be adaptable to change.
  • Agreed-upon policies to create universal understanding and, hopefully, support from the local subsidiaries.
  • A framework for future benefits changes and enhancements.
  • A written strategy which allows employees to see how certain benefits decisions were made, and is very helpful when new stakeholders are brought into the process.
  • Strategies to manage costs; global benefit costs are substantial.
  • An organization-wide reference when trying to understand or drive employee benefits decisions and planning.

Key Elements of a Global Benefits Strategy
Global benefits strategies can take many forms, and range in length and depth, but most successful strategies will include many of the following elements:

  • Global Benefits Committee – This team should consist of representatives from HR, legal, treasury/finance, risk management and, when possible, various global business units. Initially, the committee should meet frequently and agree upon a system of review and evaluation for the work as it progresses. Remember: the more senior the committee representation, the stronger the strategy’s influence on upper management.
  • Statement of Objectives – The team should develop a written, agreed-upon statement or set of statements that defines the overall objectives of the GBS. Some statements try to benchmark by using outside data from consultants (e.g., having benefits at or above the 50th percentile). While data may be readily available in some countries, it may not be in others. Benchmarking can be a useful measurement tool, but benefits professionals need to be aware of the need to obtain consistent criteria across countries.
  • Policy Guidelines – Policy guidelines provide specifics about the various benefits and levels of benefits that support and are tied to the GBS statements. For example, life, accident, disability, medical, retirement and savings plans are outlined with target levels of coverage; and integration with social plans is detailed. Keep in mind, though, that too much detail can lead to guidelines that cannot be applied globally. With medical plans, for example, specific co-insurance percentages may not apply when a supplemental medical plan in a particular country is based on a schedule of fees.
  • Implementation and Review – After agreeing on its strategies and supporting guidelines, the GBS committee must put certain processes in place to activate the plan. Typically, an announcement from a senior-level executive to key, local employees helps gain attention and buy-in. Local buy-in should be targeted to management, HR and, in many countries, should include the Works Councils or unions. This step is critical to successful implementation of any global benefits strategy.

Reaping the Rewards
After the announcement of the new global benefits strategy, a benefits audit is often conducted to educate the central benefits staff about what plans are in place.  For a new company, implementing a GBS is easier than for a well-established firm that must harmonize many plans to create a unified and consistent global benefits strategy. The benefits professional’s role is essential at this stage. Many consultants and insurers offer software packages to assist in this process, although many corporations devise their own audit form to meet their specific needs.

Set procedures need to be in place to implement, review and enhance local plans. Usually, one individual has a certain dollar amount of approval authority to exercise any latitude permitted by HQ (for new and/or enhanced benefits). The more senior the individual, the more authority. Local benefit needs — and wants — must be measured against predetermined criteria. This authority can be with corporate, local or both, as set forth in the GBS.

Along with these approval procedures, established communication chains must be followed. In cases of mergers, acquisitions and divestitures, reliable benefits data (pension reserve, for example) must be readily available. Pre-established lines of communication will help in this type of scenario.

In most instances, resources are scarce, resulting in a decentralized approach.  In spite of this, there have been more than a few “ideal” GBS roll-outs.  An announcement, then an audit, followed by site visits from benefits staff to bring the local plans into compliance with the new philosophy is a typical, effective approach.

Taking the First Step
While global benefits strategies can be similar, each company must tailor one to fit within its industry and corporate HR philosophy. The first step in this process is creating a shared vision for a GBS that is flexible, simple, legal and tax compliant. Further, it should integrate governmental social plans with new or existing supplemental plans provided by the company.

A multinational enterprise must look after its global employee benefit plans.  We all are under the budget microscope.  However, a well-articulated global benefits strategy will enable HR to manage benefits resources globally and ensure a compliant and competitive benefits approach in every country.

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Preparing Your Company for a Global Pandemic

Mariana Villa da Costa – Littler Mendelson

Over the last decades, we have seen new infectious diseases appear, some of which could kill millions of people within days: mad cow disease, bird flu, SARS, Hantavirus, Ebola, dengue fever, and most recently, spread of the H1N1 “swine” flu.  In 2009, the World Health Organization declared H1N1 a pandemic.  As of November 15, WHO reports that H1N1 is present in over 206 countries and territories globally, and over 500,000 cases have been documented.  The pandemic raises many HR issues, especially for global employers.  Why?

The workplace is an ideal place for spreading disease, from the common cold to the serious swine flu, as people are in a close daily contact, sharing printers, telephones, eating together in the office’s kitchen, and, most of the time, breathing the same, re-circulating air.  Every company strives to keep its employees healthy and safe, not only for their own benefit, but also to ensure its operations continue full force.  Let’s highlight a few of the issues companies need consider when preparing a plan to address a global pandemic:

Go global, but do not forget local!

Companies can draft a global, standard pandemic plan, but you still need to account for different laws and regulations in the specific countries or regions where you operate. So make sure your company reviews any local employment and health laws before implementing the plan, in order to avoid potential legal issues and liabilities.

What’s in the plan?

Every global pandemic plan must address at least these issues:

  • Communication – Procedures on how an employee must inform their employer of a disease and steps the company needs to take to ensure immediate safety for the sick employee and the other employees.
  • Discipline – How the company should deal with employees who refuse to go to work for fear of getting sick, and measures for abusive and unfounded absences.
  • Privacy – How the information about a sick employee or a sick family member must be managed, including required government reporting.
  • Shut Down – If a shutdown of the company facility becomes necessary because of the spread of a contagious disease, the company needs to define, according to domestic laws, how employees will be paid and alternative ways to keep the employees working.
  • Travel issues – Your plan should address issues related to employees traveling for work to risky locations.  The plan should cover the conditions when travel should be deferred or suspended. It should also address how employees traveling for personal reasons should deal with a potential contagious disease in order to protect the rest of your workforce.

Adapt, adapt and adapt!

Once you have your broad global pandemic plan, consult a local or international lawyer to draft specific provisions and re-write any conflicting ones, just like most companies do for their other global policies, such as Codes of Conduct, discrimination and harassment policies.

Tell your employees!

Communication is key.  Make employees aware of the implementation of a global plan by preparing presentations and/or training on the issues addressed by the plan. Use simple, common language to make sure employees understand the plan and are not alarmed by it.  Be sure to communicate the plan in all the common local languages in each country.  Encourage employees to take the information home and share it with their families.

Get Involved Now!

HR staff plays a key role in creating and implementing a plan to respond to a pandemic.  In addition to helping draft the plan and organizing implementation of it, Global HR must also focus on:

  • Education – Develop plans to educate employees in the prevention and spread of contagious and potential pandemic diseases in the workplace – signs, training, providing hand sanitizing, etc.
  • Partnership with the Community – Work closely with local health departments and other officials to take advantage of their resources, and secure a role for your company in community prevention efforts.
  • Awareness Make employees aware of the resources available to them for prevention and cure under the company’s health care plan or clinic, national health insurance, and other resources.
  • Policy Updates – Review and update sick leave policies to address a pandemic situation (for the employee and to take care of sick family members).

As you can see, there are many things to consider in developing a plan to address a global pandemic.  I hope this article provides you with a good start in developing a plan for your company.  Don’t forget that any global plan must be carefully prepared and reviewed by local or international counsel to avoid any liabilities for the company and risks for the employees.

Have you already developed a plan for responding to a pandemic?  Share your comments to enrich the information in this post!

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Littler Mendelson

Medical Tourism: Saving Money on Global Benefits, Part 3

George Bashaw

George Bashaw – Atlas Global Benefits

Medical tourism is a hot topic, but can it save money for your company?  And if the answer is yes, should you adapt your health plan to incent certain employees to go overseas for medical procedures because it is less expensive?  This is a complex issue and requires that you do your due diligence before deciding anything.  This blog on medical tourism is part 3 in a series to help companies save money on international benefits.

Medical Tourism
If you are unaware, medical tourism is exactly what it sounds like, people traveling abroad for medical procedures.  According to McKinsey and Company, the industry is expected to reach over $100 million by 2012.  With medical cost skyrocketing in developed countries like the US, people are traveling to places like India, Singapore, and Thailand for savings up to 90% on certain procedures. For example, a heart bypass in the US can cost around $150,000 compared to $15,000 in India, which includes air fare and a brief vacation. Therefore, self insured corporations with and without global operations are taking notice and beginning to investigate.

Multinational Companies
If you already have a multinational employee base with a true global benefits plan, medical tourism is a viable option for your employees covered under the existing plan.  Typically, under these plans your employees can seek medical attention from the provider network.  However, it is also typical to find the domicile country of your company to be excluded from these plans.

If you have a true global benefits plan, ask your broker or your carrier about the possibility of medical tourism within this population.

Self-Insured Plans
Perhaps the greatest potential savings can be realized by self-insured plans in developed countries like the US where medical cost are high.  Unfortunately, I am unaware of a clear solution you can implement.  However, large medical carriers like CIGNA will help you explore the opportunity.

I recommend performing a utilization study going back 3-5 years to determine the occurrences of planned medical procedures which are good candidates for large savings like heart bypass, hip replacement, or knee replacement.  Armed with this data, you can compare those costs with alternatives in other counties.  Then, create an incentive plan that may appeal to a segment of your employees.

Sounds great for the wallet but India for Heart Surgery?
The thought of traveling thousands of miles to a distant country, where you may be unfamiliar with the culture and customs, and sometimes even the language, may sound like a big step, and it is.  However, you may find the quality of care equal or better than you are receiving now.  I live in Tulsa, OK and going to Cleveland Clinic sounds appealing if faced with a medical procedure.  Did you know that the Cleveland Clinic has a joint venture with the UAE and a clinic in Dubai?  Did you know that the Harvard Medical School has a joint venture with Wockhardt in India?

In Summary
There are many additional aspects to explore with medical tourism: cost, quality of care, cultural, legal, liability, and more.  Unfortunately, it would take a novel to address them all and I cannot in a blog piece.  However, if you are serious about saving money the potential is there.  Just be sure you do your due diligence.  Please leave a comment to let me know your thoughts or experience with this topic.

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Update! Employer Mandated Health Coverage in Dubai

George BashawAuthor:
George Bashaw – Atlas Global Benefits

In early May, I wrote a blog on the Dubai Health Authority’s (DHA) efforts to implement employer mandatory health insurance.  Since my blog, the Director-General of the DHA has put the funding scheme on hold until 2010.

Instead of paraphrasing a nice article in the Khaleej Times, you may find it here if you would like more information on the topic.

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