Insurance Community University 1 Integrated Disability Management Sponsored By:

Insurance Community University

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Integrated Disability Management

Sponsored By:


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Integrated Disability ManagementThe webinar will begin shortly.

There is no audio at this time.

This presentation is being recorded for your viewing pleasure at a future date.

The attendance and proctor forms are available under ‘Materials’ in the Webinar’s Console to the right.

The PowerPoint presentation is also available under ‘Materials’.

You will receive the course number for your state near the end of class.

Use the ‘chat’ window for questions on the content.

100% Participation in Polling Questions is required to receive credit for this class. Even if you do not intend to receive credit, please participate in the polls.


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Welcome to your Insurance Community University

• All of you are currently on mute – Un-mute your own system– Telephone Option

• Select Telephone on your screen• Dial in the PIN number so that your number becomes active

– Microphone and/or Speaker Option• You can use this option if you have a headset that you use with

your computer

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Audio


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Participation & Chat Window

• You will receive information from the monitor via the ‘Chat’ window. – Please locate window in the control panel

• Q & A is welcomed during the presentation and at the end of the presentation

• You will find the question box on your control panel– Write your question in that box and send it to the presenter/organizer

• The presenter will take those• questions in the order submitted

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DOI Requirements• When you see a slide with the hand up

symbol, touch the “hand” icon on your control panel– Click ONCE only

• If you do not raise your hand, the monitor will be in contact with you in the chat box

• If you are in a group, the designated proctor is responsible to make certain you are all in attendance at all times

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= Hand is down


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Polling

• Throughout the class we will be conducting periodic polls

• We need 100% participation on the polls• The polls are intended to check

participation but also to create discussion topics throughout the presentation

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Forms To Complete for CE

• After class ends– Return attendance form– Proctors – return your form to email

address• Email address is in chat window or in

email sent to you today

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DOI Requirements

• We will file your hours with the DOI after the completion of this webinar and we have received the attendance form.

• You have 48 hours to return the form• You will be sent a Certificate of

Attendance/Completion by email. Please retain this for your records for five years.

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Integrated Disability Management

Your Presenter Today

Diana Henderson, ARM, CPDM, WCCP, WCCAPresident and Founder of The Henderson Group


Diana Henderson is the founder and President of The Henderson Group. Diana has over 25 years of experience

specializing in California workers’ compensation.

Diana is a consultant, expert witness and educator.

Diana has been an instructor in the field of disability management since 1996 and was involved in developing the curriculum for the internationally-recognized Certified

Professional in Disability Management (CPDM) designation.


The Henderson Group consults to both public and private sector employers on a wide range of issues in the workers’ compensation and disability management arenas. Our client base includes both employers as well as insurance brokers who retain our services on behalf of their clients.

The Henderson Group assists in developing cost-effective approaches consistent with our clients’ overall operating philosophy and employee relations objectives.


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Integrated Disability Management:Workshop Goals & Objectives

• Learn about the various types of disability benefits available to employees

• Understand the interplay between voluntary and statutory benefits


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Today’s Business Environment

• Employers are focusing on– Enhanced productivity– Re-engineered HR and Benefit processes– Downsized HR and Administrative Staff

• Nature of work is changing– More service jobs, less manufacturing– More work off-site (telecommuting)– Less obvious causality of injury

• Employee Benefits and Workers’ Compensation– Similar processes (benefits, reporting, return-to-work)– Differences are blurring

• Legislation– ADA– FMLA


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Today’s Employer Needs

• Reduce and manage costs• Have cooperative workers’ compensation and HR

departments• Regulatory compliance• Total absence management

– Coordinated disability and return-to-work programs• Productivity Optimization• Smooth and seamless administration• Increased client/employee/supervisor/provider

satisfaction


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What is Integrated Disability Management (IDM)?

IDM is a coordinated approach to administration, management

information, managed medical and disability services, claim payment, and communication of all benefits

available to employees.


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What Do We Mean by Integrated?

• Administration– Streamlined to reduce costs and free up time for other

important duties• Management of information

– Measure the total cost of absenteeism and inter-related liabilities

• Manage disability and medical services– Managed results

• Coordinate benefit payments– Statutory and voluntary

• Enhance communication– Benefit plans, payment and timing


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Why Care About This?

• Managing one part of the system in isolation creates potential for unexpected, unplanned, and potentially expensive outcomes in other areas


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An Example of Unplanned or Unintended Outcome

• Theresa Dillon v. City of Moorpark (California)– Workers’ compensation claim– Labor Code Section 132(a) Petition for

Penalties– ADA/FEHA claim with six figure outcome


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Most Companies’ Current Fragmentation of Disability Benefits

Sick Days

SSDIB

Workers’ Comp

LTDFMLA/CFRA

STD

SDI

Disability Retirement


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Fragmentation of Disability Benefits

Type of Benefit Governing Law Who Administers the Program

Sick Days Personnel Policy Employer

SDI Varies by state Varies by state

STD ERISA Employer

WC Labor Code WC Carrier or TPA

LTD ERISA LTD Carrier or TPA

SSDIB Title II of SSA Act Social Security Administration


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Let’s Start with the Voluntary Benefits


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Voluntary Disability Benefits

• Sick Leave• Short Term Disability Insurance• Long Term Disability Insurance• Life Insurance – Disability Provisions• Disability Pension and Retirement


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Sick Leave

• Time off for personal (and sometimes family) illness

• Normally accrues based upon length of employment

• Usually cannot be carried over into following years

• Supplements State Disability Insurance and Workers’ Compensation waiting periods

• Often can be used for dental and doctor appointments


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Let’s Discuss Mom’s Bakery Sick Pay Benefits

(see separate handout)


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Who Has Mandated Paid Sick Leave?

• City of San Francisco, California– Regulation passed

in 2006 and implemented in 2007.

• District of Columbia and Milwaukee– Passed paid sick

days in 2008 that included paid “safe” days for victims of domestic violence, sexual assault and stalking.

• Connecticut– Passed a statewide

paid sick days law in 2011.


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States with Current 2012 Active Sick Leave Campaigns

• Arizona• California• Colorado• District of Columbia• Hawaii• Illinois• Iowa• Maine• Massachusetts• Miami

• New Jersey• New York City• New York• North Carolina• Oregon• Pennsylvania• Philadelphia• Vermont• Washington • Wisconsin

http://www.nationalpartnership.org/site/DocServer/PSD_Tracking_Doc_Nov_2011_Final.pdf?docID=1922


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Short Term Disability Insurance

• Critical terms are defined• Effective date of benefits may vary (following a

specified waiting period)• Maximum benefit period typically based upon

length of employment• Benefit reductions may apply• There may be specific exclusions• Benefit amount is normally a percentage of salary

(40% to 80%) to a maximum dollar cap• Can be non-contributory or contributory


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Let’s Discuss Mom’s Bakery

Short Term Disability Plan



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A Comparison of Sample Short Term Disability Plans



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Long Term Disability Insurance

• Critical terms are defined• Benefit amount equal to a percentage of salary (40 to

80%) and subject to a maximum amount• Elimination period can vary• Proof of disability requirements• Benefit duration specified• Offsets for other disability benefits outlined• Application for Social Security Disability Insurance

Benefits typically required• Exclusions may apply• May be contributory or non-contributory


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Long Term Disability Plan



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A Comparison of Sample Long Term Disability Plans



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Life Insurance

• Provisions related to disability– Continuation of Coverage while on FMLA leave– Coverage during Disability

• Subject to specific qualifications/requirements– Accelerated Benefit

• Advance payment of part of a life insurance benefit• Terminal illness requirement• Subject to minimums and maximums• Reduces benefit by amount of advance payment plus

interest– Accidental Death and Dismemberment


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Group Life Insurance



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Disability Pension & Retirement

• Subject to eligibility based upon length of service

• Subject to specified type and duration of disability

• May be excluded based upon receipt of other retirement benefits

• May be subject to reductions based upon receipt of other benefits.


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Disability Pension & Retirement Plan



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Tax Implications for Disability Benefits

• Employer-provided disability income benefits– After-tax contributions are income tax free– Before-tax contributions (by way of salary deduction) are

considered employer contributions and subject to taxation

• Long-Term Care Insurance– If employer-sponsored, employee’s must include any

benefit received as regular income for tax purposes• Death Benefits

– Proceeds are considered life insurance and not subject to income tax


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Now for the Statutory Benefits


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Polling Question #1

TrueOr

False


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Statutory Disability Benefits & Protections

• Workers’ compensation• State Disability Insurance

– States that require some form of insurance– Employer options

• Social Security Disability Insurance Benefits (SSDIB)• Family Medical Leave Act (FMLA)

– States with similar family and medical leave laws– States with expanded protections for pregnancy-related

disabilities – States with paid family leaves

• Americans with Disabilities Act– States with Fair Employment Practice Agencies (FEPA’s)


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Workers’ Compensation

• Must meet the test of AOE/COE• Provides temporary disability

benefits• Provides permanent disability

benefits• May provides vocational

rehabilitation in some form dependent upon the state

• Provides medical benefits• Not reduced by other disability

benefits yet other benefits may “carve out”


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Let’s Take a Look at California’s Temporary Disability Rates



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State Disability Insurance (SDI)

• Mandatory states– California– Hawaii– New Jersey– New York– Puerto Rico– Rhode Island

• Employers required to have plans• How coverage is provided• Contribution rates• Statutory benefit levels• Commencement of benefits• Maximum benefit period


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Let’s Take a Look at the 2012 State Disability Insurance

(SDI) Schedules



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A Closer Look at California’s Voluntary Plan Opt-Out for SDI

• Must be voted in by employees• Must provide richer benefits than California SDI• Can either insure or self-insure• Can either utilize TPA or self-administer• Advantages

– Retains financial control of funds– Readily coordinates with self-insured workers’ compensation

• Disadvantages– May not be financially feasible based upon employee

demographics


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Polling Question #2

TrueOr

False


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Social Security Disability Insurance Benefits (SSDIB)

• Administered by an independent federal agency

• Applications for benefits handled as administrative proceedings

• Definition of disability• Other statutory and voluntary disability

benefits may be offset against SSDIB• Family benefits• Trial work


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Let’s Look at a SSDIB Case Study



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Polling Question #3

TrueOr

False


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Alice & Mom’s Bakery – A Case Study

• Read case scenario (separate handout) • Discuss federal/state considerations and

pitfalls– ADA– FMLA– Workers’ Compensation

• Vocational rehabilitation• Labor Code Section 132A


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Americans with Disabilities Act

• Protection afforded• Employer size• Employee covered

– Disabled– Otherwise qualified

• General obligations– Reasonable accommodation

• Penalties


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Protection Afforded . . .

• Employers are prohibited from discriminating against employees who are disabled

• Employers must provide reasonable accommodations


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Employer Size . . .

• Public entity• Private employer


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Employee Covered . . .

• Disabled– A physical or mental condition that substantially

limits an individual’s ability to perform a major life activity.


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General Obligations . . .

• Reasonable accommodation– Interactive process– Good faith

• Transfer• Eliminate essential job function• Assistive device


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Penalties . . .

• ADA penalty caps– Less than 100 employees– 100 to 200 employees– 201 to 500 employees– More than 500 employees


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Workers’ Compensation & Moorpark Decision Implications

• Theresa Dillon v. City of Moorpark• Exclusive remedy

– Damages limited

• Labor Code Section 132A• Companion civil law suit under ADA/CFEHA


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Polling Question #4

TrueOr

False


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So Why Integrated Disability Management?

• Managed Results– Manages disability and medical benefits

regardless of the cause– Integrates all disability benefit programs from

the vantage point of employee-centered systems

– Controls medical costs consistent with a managed care model

– Focuses on early return-to-work consistent with a workers’ compensation model


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More Managed Results

• Maximizes employee’s functional capacity

• Optimizes an employer’s productive work force

• Manages and reduces total claim and medical costs

• Simplifies administration and improves information to disabled employee

• Reduces administrative costs


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The Benefits

• Employers– Single process, administrative

savings– Timely reporting and data

analysis– Employee communications

support– Reduced lost work days– Increased workforce

productivity– Simplified reporting– Consistent case and claim

management– Focus on access to

appropriate care

• Employees– Simplified reporting– Improved understanding of

“what’s happening”– Consistent case and claim

management– Focus on access to appropriate

providers– Focus on return-to-work– Increased satisfaction and

utilization


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Polling Question #5

TrueOr

False


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Conclusion

• Voluntary and statutory disability benefits need to be coordinated

• Employers need to be aware of the many pitfalls associated with the various types of disability leaves and their statutory guidelines

• The case for integrated disability management strongly exists in today’s environment


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2030 Main Street, Suite 1300Irvine, CA 92614

Direct: 949.417.5722 Fax: 714.963.2024

www.thehendersongroup.net


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Disclaimer

Insurance forms and endorsements vary based on insurance company; changes in edition dates; regulations; court decisions;

and state jurisdiction. This instructional materials provided by Insight is intended as a general guideline and any interpretations

provided by Insight do not modify or revise insurance policy language. The authors of these materials, Insight Insurance

Consultants is a division of Insight Consulting and Management Inc. In providing these materials, Insight assumes neither liability nor responsibility to any person or business with respect to any loss that is alleged to be caused directly or indirectly as a result

of the instructional materials provided. Copyright 2010 – 2012 All Rights Reserved

Insight Insurance Consulting ©www.insurancecommunitycenter.com

Laurie: 714.803.5830 [email protected]

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Insurance Community University 1 Integrated Disability Management Sponsored By:

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