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Authorizing workers to bring camera phones to work can carry hidden legal risks.  

But should you tackle this issue aggressively or trust your employees to do the right thing?  Every business wants to develop an environment where employees feel trusted by management. But there’s also the need to stay protected legally, and it isn’t always easy to balance the two.

The cell phone issue is in particular delicate since most workers carry them nowadays, and improper use at work is a non-issue for the vast majority. But there are always a few bad apples in every bunch.

Growing number of complaints

There has been an explosion of lawsuits – and complaints to management – about staff members taking inappropriate photos at work with their cell phone cameras.

Most cases revolve around embarassing or expliclit photos of coworkers (sometimes but not always posted on the Internet or e-mailed to others in the office). Notwithstanding, a handful of lawsuits have arisen from employees taking photos of confidential documents or other internal information.

As most benefits and HR veterans would tell you, the most valuable benefit an organization can offer its employees is a workplace where they feel trusted and valued. In contrast, it only takes one “joke” gone too far to stir up a hornet’s nest of trouble. and no firm is immune from this risk.

Three options

One step every employer should take is circulating a memo or having a face-to-face meeting with employees about the need to restrict camera phone use at work, says labor lawyer William Hannum.

This is the time to answer questions and make clear that the policy is a matter of a legal concern, not a case of Big Brother watching over employees’ shoulders. for added legal protection, you may want to develop a formal camera phone policy to be written staff member handbooks.

Some employers have gone so far as to take the step of banning camera phone (or personal cell phone) use at work and prohibiting individuals  from posting personal photos or videos from company computers.

However, these policies are difficult to enforce and run the risk of alienating the majority of employees who use the devices responsibly.

As an alternative, a few firms that have not banned camera phones have had staff members sign a policy that gives managers permission to review photos or videos on the phone if there’s a complaint. If you go down either of these routes, remember –

• the policy ought to be enforced consistently

• your policy must detail specific steps for filing and reviewing  a complaint, and

• the policy should obviously detail the disciplinary steps for violations.

The enforcement aspect is specifically tricky. In cases where the phones are business property, employers obviously have the right to control non-work use – which includes requiring staff members to turn over the contents stored on the phone in cases of suspected abuse. Employees have no legal expectation of privacy in such cases.  

However, there’s a slippery slope when the phone is an employee’s property. as a rule of thumb, corporations usually have the right to inspect the contents as they pertain to alleged inappropriate behavior within the workplace.

Where it gets tricky is dealing with behavior that takes places on the employee’s private time, but overlaps with the workplace (e.g., workers go out socializing at a bar after work, and potentially embarassing camera phone photos get spread around the workplace). Legal specialists caution corporations to tread very carefully in these cases.

Where does your organization stand?

Does your organization have – or is considering a policy on employee camera phones? Do you think such policies are workable or even appropriate?

In my conversations with attendees at the SHRM conference in Chicago, HR and benefits managers appear to be divided on the issue.

In a value-based plan, the idea is to reward workers for seeking treatments that promote wellness.

The more clinically viable the treatment, the less an worker compensates out of pocket for it.

Example –  Women over 40 and younger workers with a family history of breast cancer pay less for a annually mammogram than workers for whom the test isn’t as necessary.

Value-based plans often work better than high-deductible plans when used in combination with standard wellness program features such as health risk (assessment|appraisal}s.

Five target areas

According to the May 2008 issue of Simply Well, there are four quality-of-care criteria that have emerged as key benchmarks of the quality of care –  healthcare management, preventive screenings and treatments, member service and access to care.

Areas of care that are of particular concern –

• Employees’ dependents receiving appropriate and timely childhood/adolescent immunizations

• Breast cancer screenings for female medical plan enrollees, ages 52 to 64

• Diabetic staff members receiving hemoglobin A1C and LDL-C testing

• Members receiving proper referrals and treatment for mental health issues (e.g., primary care doctor refers a patient to a specialist to ensure proper prescription and management of an anti-depressant medication)

• Pregnant workers receivig time and appropriate prenatal and postpartum care, and avoidance of antibiotic treatment in adults with acute bronchitis.

The quality of care for a lot of of the aforementioned issues can suffer when workers foot too much of the bill out of their own pockets.

The hope for value-based plans is that employees get some cost relief and obtain treatments that will reduce costs in the long run.

As scary as they seem at first glance, complying with HIPAA’s privacy rules could be relatively painless.

Contrary to common belief, the rules – with a few key exceptions – apply only to a fraction of the health information Benefits handles.

As long as the company remains legally “hands off” of employee’s private medical information, you can dodge most of the HIPAA bullet.

For HIPAA privacy purposes, your firm is considered “hands off” even when you obtain de-identified personal information, aggregate claims data and routine enrollment info.

Bottom line –  If your organization’s health plans are fully insured and the claims administered through a TPA, the insurance corporation – not your firm – bears the brunt of the health insurance portability and accountability act (HIPAA) privacy compliance responsibility.

One major exception –  medical cafeteria plans. In most cases, you’ve two compliance choices –

• Process reimbursement requests first through your TPA, with the TPA making sure the claim qualifies underneath the terms of the cafeteria plan before your firm reimburses it, or

• Develop a written cafeteria plan privacy policy, issue a notice to staff members, appoint a privacy officer and amend your plan documents.

Rarely affects FMLA

Many individuals  - including healthcare providers – misunderstand how HIPAA affects medical certifications for FMLA leave. the key –  HIPAA only applies to personal information that filters through your health plan, not certifications obtained from a doctor.

Under FMLA, you’re allowed to obtain the minimum information you need to approve and administer leave. In like fashion, HIPAA doesn’t apply to most workers’ comp, return-to-work notices or disability claims.

Even so, it pays to be careful how you ask for and use the information. Other state and federal privacy laws often protect the same kinds of info people  assume falls under HIPAA.

Following procedures

The HIPAA privacy rules are heavy on paperwork and procedure.

But since your firm follows  the info-gathering process spelled out in your medical plan documents, the health insurance portability and accountability act (HIPAA) privacy rules should present few major obstacles.

Many firms are still missing an opportunity to trim some medical plan expenses.

Generic versions of high-cholesterol drug Zocor have been on market for two years now, but a fair share of company drug store plans have yet to make the switch.

When your PBM gives generic Zocor favored status on the formulary, now’s a good time to remind employees –

• most individuals  on cholesterol-control meds will get the same therapeutic value from generic Zocor as from the label brand and the more potent – and still patented – Lipitor

•  they are able to save $10 to $50 (or more, depending on your drug plan design) on their co-payment by switching, but

•  they ought to ask their doctor first. People  with cholesterol levels over 200 and/or family histories of  ultra-high cholesterol could  be better off staying on Lipitor.

Reason –  It takes four times the amount of a Zocor-type medication  to equal one dose of Lipitor.

When it comes to health-coverage laws, there’s often a domino effect.

As individual states require insurers – and in some cases, businesss – to cover or offer coverage of specific individuals  and procedures, similar laws can spread rapidly to other states.

The effect on plan sponsors –  Some mandates can increase your costs by 20% to 45%.

Small firms targeted, too

States are no longer targeting  just the Wal-Marts and other giant businesses anymore. the pressure has increased on companys of all sizes.

That’s particularly true for the new “universal coverage” laws passed in Massachusetts and Vermont.

The Massachusetts law requires every firm with 11 or more staff members either to cover or contribute toward everybody’s health coverage, or else pay an annual fee of $295 per employee to a state fund.

Vermont’s similar version sets the annually fee at $365 per full-time equivalent staff member. the Vermont law also requires all uninsured, low-income hourly staff members to have access to a state-subsidized plan (called Catamount Health) sold through private insurance corporations.

It’s up to employers to deduct the monthly premiums – $60 to $135, depending on the person’s wages – and send it to the state.

There are rumblings in at least 10 states about lawmakers pushing for universal-coverage laws. A few have formed committees to study the Massachusetts law and see when a version could be altered to their state.

Here are three proactive steps to consider now. These could potentially save money, time and compliance headaches later –

• look into offering mini-med or similar lower-cost programs to satisfy minimum coverage requirements for uninsured workers. Monthly premiums range from about $25 to $200

• educate low-income employees about the earned income-tax (EIT) credit the federal government offers. This may make a mini-med plan free or almost free to eligible employees, and

• use flexible spending accounts to create a tax savings on premiums for other employees and your firm.

Required procedures

The universal-coverage laws draw national headlines, but far more businesss are currently affected by state laws requiring coverage for certain types of procedures. Three of the biggies –

• diabetes self-management. Nineteen states require your health plan to cover all the steps employees with diabetes take to control their condition, including nutritional therapy (if prescribed by a physician)

• in vitro fertilization. This large ticket service adds 3% to 5% to your premiums, and is now a required benefit in 15 states, and

• cervical cancer screenings. In the last year, four more states have required all company plans to cover each year cervical cancer screenings for all covered female staff members, spouses and dependents age 18 and older. That brings the total to 24 states.

The good news about the diabetes management and cervical cancer mandates is they can reduce your  long-term costs, even when they increase them in the short-term.

Here’s a good resource  for keeping abreast of mandatory coverage trends around the United States.  The site also features  state-by-state breakdowns of changes in insurance laws  mandating the coverage of different treatments and conditions.

For example, this report from 2006 is the most extensive coverage-mandate study that I’ve ever seen.

Who worries more about healthcare costs –  lower-paid or higher paid employees?

Answer –  Both groups worry equally about their out-of-pocket health costs, as reported by a PNC Services Group survey of 1,485 staff members. Almost 52 percent of all respondents – regardless of income -cited the unpredictability of health expenses as their No. 1 financial-planning concern.

Other common financial-planning fears that affect employees of all salary levels –

• eldercare. Over half the respondents with children were afraid their offspring can be forced to pay for the parents’ long-term care, and

• financial stability. 47% of mid- to high-salary employees said they were concerned about sustaining or increasing wealth.

It might be easier than you think to eliminate a major reason employees sue.

How? Well, roughly 75% of staff member lawsuits happen because of accidental disconnects between an employer’s internal policies and procedures, and what’s written in the plan documents.

Here are two areas where some the costliest errors lurk, and three steps your fim can take to catch and correct the mistakes before you’re ever sued.

1. Policy/coverage discrepancies

A lot of firms’ written benefits policies and plan documents are like siblings who start to drift apart as they grow up.

In the benefits realm, notwithstanding, the plan sponsor has the “parental” power – and legal responsibility – to make sure written policies and plan documents remain close as they grow and change.

As a routine practice, firms should be sure changes in their benefits policies are also written into the formal plan documents, according to benefits attorney William Wright.

When push comes to shove in court, any inconsistency with plan documents can prove fatal for the business. Example –  Executive management passes a new rule that workers must work 30 hours a week to be eligible for the health plan.

Benefits and HR then write the new coverage policy into employees’ benefits  handbooks and hold meetings with staff members to explain the change.

Now suppose an staff member drops to part-time status. Are you legally protected if the staff member challenges the loss of benefits?

Not necessarily. for the policy in  the handbook to stand up in court, the plan documents must also say there’s a 30-hour-a-week eligibility requirement.

Same thing goes for disputes over run-out coverage.  Suppose it’s your firm’s policy to carry over coverage for a terminated staff member during the COBRA election period, but the requirement was never written into the plan document.

A few weeks later, the employee has a major health claim. the TPA denies it, saying coverage had expired. Reason –  the plan document says “active employees” are covered, but doesn’t specify that the insurer pay claims until the end of the month.

The likely result –  the ex-employee sues, saying the business is liable for the mistake.

2. Coordination of benefits

Watch out for cases where an employee’s claim could  be covered under two or more policies (e.g., your firm’s plan and one from a spouse’s company).

Make certain there’s a clear-cut coordination-of-benefits policy in all your plan documents. Usually, if a plan contains no instructions for coordination of benefits, it’s expected to pay first. Two key areas to check –

1. Make sure there’s a statement that says only the amount actually compensated by each plan will be charged against the maximum benefit, and

2. Be sure that the order of benefits determination spells out which plan compensates first for a covered child when the worker is divorced from his or her spouse.

In like fashion, when your firm offers domestic partner coverage, be certain there’s a coordination-of-benefits statement for dependent and non-dependent partners.

Three best practices

On an ongoing basis, you can cut your lawsuit risk by 75 percent if you –

• gather all materials related to specific plans into a binder, including renewal letters from vendors and materials distributed to employees

• perform a yearly self-audit, checking to see if plan-document wording matches your current policies, and

• pay special attention to keeping benefits descriptions up to date.

Reminder –  When you don’t have a formal plan document, your contract with the vendor legally serves as the “control document” for the plan. By law, all workers must’ve access to the plan document and be notified in writing of any alterations, including minor ones.

Nine of 10 HR managers polled by Colonial Life feel that employees have at least a vague notion that benefits are a valuable part of working at a company.

Nonetheless, the same study found that only 21% of those companys believed their workers had a strong understanding of the workings of their own benefits.  and 5% believed that their workers didn’t know anything about their benefit options.

Implication –  the greater emphasis placed on employee education, the more likely employees understand the role of benefits in sum compensation.

Incorrect billing from health insurance carriers is more common than you might think. the average plan sponsor can get overcharged by 5% a year, as reported by brokerage and consulting firm Corporate Synergies Group.

Like most organizations, insurance carriers rarely keep perfectly up-to-date records on their customers. as a result, plan sponsors often get charged for individuals  who shouldn’t be covered on the health plan. Here are two areas to watch –

Claims versus enrollment

It’s common to have terminated workers still in the carrier’s claims eligibility system – even after they’ve been taken off your enrollment list.

Reason –  Many carriers use separate computer systems for tracking enrollment and claims – and the two systems use different technologies that don’t “talk” to each another.

Carriers have no incentive to upgrade their systems, as reported by CSG president Eric Raymond, because doing so would cost the insurers money.

Leaving things as is, carriers simply charge patrons when they put through claims for ineligible employees and dependents.

That’s why an annual claims audit is a must –  That way, you won’t get charged fees for claims the carrier accidentally put through.

Even if your firm outsources the work (it’s a rather time-consuming task when performed in-house), you’ll typically see a few percentage points of savings on your total medical costs.

Dependent eligibility

Poor carrier record-keeping also could be the cause for employees’ ineligible dependents not being taken off the enrollment files.

Few carriers have systems that automatically integrate with your Payroll department and your current enrollment forms (including the electronic “employee self-service” kind). Instead, data entry people  employed by the carriers input the information in the vendors’ system.

Human error by the carriers’ employees costs plan sponsors another several percentage points. Solution –  annual dependent audits.

With the downturn in the economy, it seems like most organizations are shifting their focus when it comes to employee benefits and compensation. the current situation is also very stressful on benefits managers.

In times like these, it’s vital for coworkers to share their concerns, experiences suggestions. Several weeks ago, HRBenefitsAlert.com ran a special report on calming employees’ 401(k) fears.

The reader comments revealed that many benefits pros were just as afraid as employees, and individuals ’s frustration led to some unfortunate carping back and forth between a few readers.

The purpose of the comments section, apart from giving people  the opportunity to react to the story, is to provide a forum for benefits managers to interact.

It’s my hope that we can generate an exchange ideas that have (and have not) been working at readers’ corporations during the current situation. Namely –

• What are you doing to manage health benefits costs as budgets are either frozen or shrink?

• Have you noticed a dip in morale or productivity with all the doom-and-gloom in the news?

• How’s your business trying to calm employees’ fears about salary freezes or layoffs, 401(k) losses, healthcare cost shifting and other issues that get a lot of mainstream media focus?

• What are you saying to staff members to deliver the news they need to know but also keep morale high?

Thank you in advance for your willingness to share your expertise and personal experiences. Everybody benefits in the long run.