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Flashcards in Topic 1 Deck (30)
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1
Q

EE Benefits Loss Exposures

A
  1. Loss of income to EE
  2. Medical Expenses for EE
  3. Loss of productivity for ER
2
Q

EE Benefits Perils

A
  1. Injury/Illness/Sickness
  2. Retirement
  3. Death
  4. Layoffs/Unemployment
  5. Personal Issues/Circumstance
  6. EAP: Employee Assistance Program
3
Q

Medical Expenses

A
  1. Pre Retirement (Active EE)

2. Post Retirement

4
Q

Pre Retirement Benefits

A
  1. Health Insurance plans

2. Specialized Coverages for narrowly defined perils

5
Q

Health Insurance Plan Types

A
  1. Indemnity Plan

2. Managed Care Plan: HMP, PPO, CDHP, HDHP

6
Q

Specialized Coverages for Narrowly Defined Perils

A
  1. Vision Insurance
  2. Dental Insurance
  3. Prescription Drug Insurance
7
Q

Post Retirement Benefits

A
  1. Medicare: Required

2. Post Retirement Health Benefits

8
Q

Post Retirement Health Benefits

A
  1. PRHB

2. Medical Supplement

9
Q

Loss of Income Types

A
  1. Disability
  2. Occupational
  3. Unemployment
  4. Death
  5. Retirement
10
Q

Disability Types

A
  1. Occupational

2. Non Occupational

11
Q

Non Occupational Related Loss of Income

A
  1. Sick Leave (PTO): Paid Time Off
  2. Short Term Disability Insurance (STO)
  3. Long Term Disability Insurance (CTD)
  4. AD&D: Accidental Death and Dismemberment
  5. Social Security Disability Benefits; OASDI (Part D)
12
Q

Occupational Related Loss of Income

A
  1. Workers Compensation (Required): Disability Benefits

2. OASDI (Required)

13
Q

Unemployment Loss of Income

A
  1. Unemployment Insurance (Required)

2. Severance Package

14
Q

Death Related Loss of Income

A
  1. Life Insurance, ER provided
    - Term Life Insurance; most common, group based
    - GTLI: Group Term Life Insurance
  2. OASDI: Required
    - Social Security Survivor Benefits
  3. AD&D
  4. Worker’s Compensation: Required, death benefits
  5. Business Travel Accident Insurance
  6. Retirement Plans: Survivor Benefits; must include if offered
15
Q

Retirement Related Loss of Income

A
  1. Pension
    - Technically defined benefit plan: DB
  2. Defined Contribution Plan: DC
  3. 401K or 403(B)
  4. OASDI: “O” for Old Age, Required
16
Q

EE Compensation Broadview

A

Total Compensation View

17
Q

Total Compensation View

A
  • Any form or type of compensation other than direct, current wages paid to EE
  • 18%-70% of payroll
  • On average 40% of payroll
18
Q

Types of Compensation

A
  1. ER share of legally required programs
  2. Private Insurance Plans + Retirement Plans
    - Health, Life, Disability; 401K
  3. Payments for time not worked
    - PTO: Vacation
  4. Extra Cash payments: Bonuses, Tuition Reimbursement
  5. “De Minimus Fringes”
    - Lunches, free coffee, free parking
    - Qualified EE Discounts; can only be so much
    - No additional cost: flight attendant
19
Q

Narrow View

A

An EE benefit plan is sponsored or initiated unilaterally or jointly by ERs and or EEs

20
Q

Jointly Sponsored

A
  • Union/Collectively Bargained
  • Providing Benefits stem from an employment relationship
  • Not underwritten or paid directly from any government
  • Providing Protection against two core loss exposures: Loss of Income, Medical Expenses
21
Q

Factors Contributing to EE Benefits as Method of Compensation

A
  1. Post WWII Wage and Price Controls
  2. Union Demands through collective bargaining
  3. Favorable tax treatment
  4. Changes in Social Economic Make up of US workforce
  5. Social Legislation and Regulation
22
Q

Post WWII Wage and Price Controls

A
  1. Price Inflation
  2. Wage and Price Freezes
  3. Substitute Health Insurance for wages
  4. IRS: not tax on ER Provided Health Insurance
23
Q

Union Demands Through Collective Bargaining

A
  1. Wagner Act (1935)
  2. Inland Steel Case (1948)
  3. Taft Hartley Act (1947)
24
Q

Wagner Act

A
  • 1935

- Gave Unions right to bargain over wages and other conditions of employment

25
Q

Inland Steel Case

A
  • 1948
  • “Wages” under Wagner Act includes EE benefits
  • EE benefits are a bargain-able issue
26
Q

Taft Hartley Act

A
  • 1947
  • AKA Labor Management Relations Act
  • LMRA
  • Multi Employer Plan
  • Single Employer Plan
  • Collectively Bargained
  • Jointly Administered Welfare Funds
  • “Taft Hartley Plans”
  • Trust fund that holds money as intermediary
27
Q

Favorable Tax Treatment

A
  • US Federal Income Tax (IRS)
  • benefits are not taxable as part of compensation to EE
  • Incentive for ERs to offer EE benefits
28
Q

Changes In Social Economic Makeup of US Workforce

A
  1. Childcare Benefits
  2. Flexibility in benefits
  3. Retiree Benefits
  4. Portability in Benefits
29
Q

Social Legislation and Regulation

A
  1. Workers compensation laws
  2. OASDI
  3. ADEA: Discrimination and Employment Act
  4. ADA: Americans with Disabilities Act
  5. COBRA: Consolidated Omnibus Budget Reconciliation Act
  6. TEA: Transportation Equity Act
  7. MHRA: Mental Health Parity Act
    8, FMLA: Family Medical Leave Act
  8. HIPAA: Health Insurance Portability and Accountability Act
  9. ERISA: Employee Retirement Income Security Act
  10. PPACA: Patient Protection and Affordable Care Act
30
Q

Reasons for EE Benefits as Method of Compensation

A
  1. Total Compensation
  2. Favorable Tax Treatment
    3 Take Advantage of Group Insurance vs Individual Insurance
  3. Attract and Retain capable EEs
  4. Concern for welfare of Employees: Corporate Welfare
  5. Productivity or Efficiency
    -Childcare
    -Stock options
    -Part time Health Insurance
    -Mental Health Benefits, EAP