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Insurance Community University 1 Integrated Disability Management Sponsored By:

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1 Insurance Community University 1 Integrated Disability Management Sponsored By:

2 Insurance Community University 2 Integrated Disability Management The 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 Webinars 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.

3 Insurance Community University 3 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 3 Audio

4 Insurance Community University 4 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 4

5 Insurance Community University 5 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 5 = Hand is down

6 Insurance Community University 6 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 6

7 Insurance Community University 7 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 7

8 Insurance Community University 8 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. 8

9 Insurance Community University 9 Integrated Disability Management Your Presenter Today Diana Henderson, ARM, CPDM, WCCP, WCCA President and Founder of The Henderson Group

10 Insurance Community University 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.

11 Insurance Community University 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.

12 Insurance Community University 12 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

13 Insurance Community University 13 Todays 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

14 Insurance Community University 14 Todays 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

15 Insurance Community University 15 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.

16 Insurance Community University 16 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

17 Insurance Community University 17 Why Care About This? Managing one part of the system in isolation creates potential for unexpected, unplanned, and potentially expensive outcomes in other areas

18 Insurance Community University 18 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

19 Insurance Community University 19 Most Companies Current Fragmentation of Disability Benefits Sick Days SSDIB Workers Comp LTD FMLA/CFRA STD SDI Disability Retirement

20 Insurance Community University 20 Fragmentation of Disability Benefits

21 Insurance Community University 21 Lets Start with the Voluntary Benefits

22 Insurance Community University 22 Voluntary Disability Benefits Sick Leave Short Term Disability Insurance Long Term Disability Insurance Life Insurance – Disability Provisions Disability Pension and Retirement

23 Insurance Community University 23 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

24 Insurance Community University 24 Lets Discuss Moms Bakery Sick Pay Benefits (see separate handout)

25 Insurance Community University 25 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.

26 Insurance Community University 26 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 Doc_Nov_2011_Final.pdf?docID=1922

27 Insurance Community University 27 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

28 Insurance Community University 28 Lets Discuss Moms Bakery Short Term Disability Plan (see separate handout)

29 Insurance Community University 29 A Comparison of Sample Short Term Disability Plans (see separate handout)

30 Insurance Community University 30 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

31 Insurance Community University 31 Lets Discuss Moms Bakery Long Term Disability Plan (see separate handout)

32 Insurance Community University 32 A Comparison of Sample Long Term Disability Plans (see separate handout)

33 Insurance Community University 33 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

34 Insurance Community University 34 Lets Discuss Moms Bakery Group Life Insurance (see separate handout)

35 Insurance Community University 35 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.

36 Insurance Community University 36 Lets Discuss Moms Bakery Disability Pension & Retirement Plan (see separate handout)

37 Insurance Community University 37 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, employees must include any benefit received as regular income for tax purposes Death Benefits – Proceeds are considered life insurance and not subject to income tax

38 Insurance Community University 38 Now for the Statutory Benefits

39 Insurance Community University 39 Polling Question #1 True Or False

40 Insurance Community University 40 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 (FEPAs)

41 Insurance Community University 41 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

42 Insurance Community University 42 Lets Take a Look at Californias Temporary Disability Rates (see separate handout)

43 Insurance Community University 43 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

44 Insurance Community University 44 Lets Take a Look at the 2012 State Disability Insurance (SDI) Schedules (see separate handout)

45 Insurance Community University 45 A Closer Look at Californias 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

46 Insurance Community University 46 Polling Question #2 True Or False

47 Insurance Community University 47 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

48 Insurance Community University 48 Lets Look at a SSDIB Case Study (see separate handout)

49 Insurance Community University 49 Polling Question #3 True Or False

50 Insurance Community University 50 Alice & Moms 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

51 Insurance Community University 51 Americans with Disabilities Act Protection afforded Employer size Employee covered – Disabled – Otherwise qualified General obligations – Reasonable accommodation Penalties

52 Insurance Community University 52 Protection Afforded... Employers are prohibited from discriminating against employees who are disabled Employers must provide reasonable accommodations

53 Insurance Community University 53 Employer Size... Public entity Private employer

54 Insurance Community University 54 Employee Covered... Disabled – A physical or mental condition that substantially limits an individuals ability to perform a major life activity.

55 Insurance Community University 55 General Obligations... Reasonable accommodation – Interactive process – Good faith Transfer Eliminate essential job function Assistive device

56 Insurance Community University 56 Penalties... ADA penalty caps – Less than 100 employees – 100 to 200 employees – 201 to 500 employees – More than 500 employees

57 Insurance Community University 57 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

58 Insurance Community University 58 Polling Question #4 True Or False

59 Insurance Community University 59 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

60 Insurance Community University 60 More Managed Results Maximizes employees functional capacity Optimizes an employers productive work force Manages and reduces total claim and medical costs Simplifies administration and improves information to disabled employee Reduces administrative costs

61 Insurance Community University 61 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 whats happening – Consistent case and claim management – Focus on access to appropriate providers – Focus on return-to-work – Increased satisfaction and utilization

62 Insurance Community University 62 Polling Question #5 True Or False

63 Insurance Community University 63 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 todays environment

64 Insurance Community University 64

65 Insurance Community University 65 Upcoming CE Classes FREE Community Class 11/6 & 7Insight on Ethics and the Insurance Industry 11/11&12Insight on Errors and Omissions 11/14Cyber Liability 11/28Crop Insurance 10/23 Business Income Claims in a Bad Economy 11/15 Preparing for 2013 & Join the Community TODAY at:

66 Insurance Community University 66 2030 Main Street, Suite 1300 Irvine, CA 92614 Direct: 949.417.5722 Fax: 714.963.2024

67 Insurance Community University 67 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 © Laurie: 714.803.5830 67

68 Insurance Community University 68 Upcoming CE Classes FREE Community Class 11/6 & 7Ethics 11/12 & 13Errors & Omissions 11/14Cyber Liability 10/23 Business Income Claims in a Bad Economy 11/15 Preparing for 2013 & an Overview of Annuities 12/4 Construction Defect – Understanding State Statutes Join the Community TODAY at:

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