Quick Hits - October 20, 2021 - American Society of Employers - ASE Staff

Quick Hits - October 20, 2021

OSHA ETS submitted to OIRA for review:  On October 12, 2021, OSHA submitted to the White House’s Office of Information and Regulatory Affairs (“OIRA”) an emergency temporary standard requiring private employers with more than 100 employees to implement vaccine mandates or testing. The emergency temporary standard seeks to implement President Biden’s directive, a piece of his COVID-19 Action Plan announced on September 9, 2021, for OSHA to issue a regulation requiring businesses with at least 100 employees to mandate workers receive the COVID-19 vaccine or be tested weekly. President Biden’s Plan indicated that the ETS will “provide paid time off for the time it takes for workers to get vaccinated or to recover if they are under the weather post-vaccination.”  For additional information on the proposed contents of the ETS, see our prior article on the President’s Plan.  OIRA’s regulatory reviews can take months, as it’s agency policy to meet with interested stakeholders in public meetings; OIRA held more than 40 such meetings when considering OSHA’s healthcare ETS published in June 2021.  However, we anticipate the OIRA will limit stakeholder input, if any.  Once OIRA approves the vaccine ETS, OSHA likely will post an unofficial version of the text on its website, before the Federal Register publishes the final standard.  Under this new ETS, employers may implement a “hard” vaccine mandate with no testing option. Source:  Seyfarth Shaw 10/13/21

Federal government approves healthcare incentives for vaccinations:  The Departments of Labor, Treasury, and Health and Human Services (the "Departments") newly released FAQs state that employers can provide incentives under a group health plan (either in the form of premium discounts or surcharges) to encourage employees to receive COVID-19 vaccines. Such premium discounts or surcharges are permissible if offered through a wellness program as described under the Affordable Care Act ("ACA") final wellness program regulations. The FAQs confirm that vaccination status is considered an activity-based health contingent wellness program. The FAQs further clarify that employers may not discriminate in eligibility for benefits or coverage under a health plan based on whether an individual obtains a COVID-19 vaccination. The FAQs also remind employers that vaccine incentives that relate to the receipt of COVID-19 vaccinations are treated as "not earned" for purposes of determining whether employer-sponsored health coverage is affordable. Thus, for example, if the plan has a 25% reduction in premium for vaccinated participants, the discount is disregarded for purposes of determining whether the offer of that coverage is affordable (regardless of whether the participant is vaccinated). Conversely, if the plan has a 25% surcharge for non-vaccinated participants, the higher premium is used for all plan participants in measuring affordability.  Source:  Winston & Strawn LLP 10/8/21

OSHA electronic filing expected to resume:  OSHA proposes to amend its recordkeeping regulation to restore the requirement to electronically submit the employer’s OSHA Form 300 (Log of Work-Related Injuries and Illnesses) and OSHA Form 301s (Injury and Illness Incident Report) for establishments with 250 or more employees which are required to routinely keep injury and illness records on an annual basis. OSHA State Plan states will be required to follow suit. Under the current regulation, these establishments are only required to electronically submit information from the OSHA Form 300A (Summary of Work-Related Injuries and Illnesses) annually. This enhanced submission rule will create a tremendous administrative burden on employers, and the fluid requirements will create additional confusion and unintentional noncompliance. OSHA likely will use the information to send out warning letters, conduct inspections, and target employers who properly record injuries and illnesses if they happen to have injury and illness rates above their industry average. It should be noted that the Injury Tracking Application data is also available online, accessible to competitors, labor unions, and employees. Employee-centered interest groups are also likely to weaponize the publication of work injury and illness data for use in organizing campaigns or to submit complaints to OSHA. Source:  Seyfarth 10/11/21

U.S. healthcare costs expected to increase 5.2% for 2022:  According to the recently released findings from the Willis Towers Watson 2021 Best Practices in Health Care Survey, which was conducted during June and July 2021, employers expect their costs for medical and pharmacy benefit expenses to increase 5.2% in 2022, even after taking cost management initiatives into account. Respondents were asked to identify their key priorities over the next two years:  achieve affordable and sustainable costs for organization-90%, achieve affordable costs for employees, especially lower wage employees-86%, enhance employee wellbeing-85%, and identify programs that support diversity, equity and inclusion goals and social determinants of health-78%.  As for activities to lower costs, the survey found among other things that around 22% of respondents currently structure employee contributions based on pay levels or job grades, and another 8% are planning or considering doing so in the next two years.  Spousal surcharges will be used by more organizations from 25% currently to another 9% (34%).  And concierge services with integrated care management programs will increase from 31% currently to a potential of 56% in two years. Source:  Willis Towers Watson 10/6/21

Global healthcare costs expected to rise 7.4%:   The costs of employer medical benefits across the world are forecasted to rise 7.4% in 2022 up from 7.2% in 2021, outpacing general inflation by 5%, according to the 2022 Global Medical Trend Rates Report released by Aon plc. Costs are expected to increase the most in Middle East/Africa regions, with average medical trend rates forecasted at 11.1%. In contrast, Europe is projected to see the lowest average medical premium rate increase, at 5.6%. Medical utilization is expected to return to pre-COVID-19 pandemic levels, with increased chronic disease, expanded benefits and higher unit costs for medical services.  For the U.S., utilization is expected to increase from 4.1% to 6.5%.  More specifically, claim activity during 2021 will still remain slightly below expected pre-COVID-19, despite no reported material impact on prescription drug claims and the added direct costs of COVID-19.  Source:  Aon plc 9/29/21

Social Security payments to rise 5.9% in 2022; salary taxable amount rises to $147,000:  Social Security and Supplemental Security Income (SSI) benefits for approximately 70 million Americans will increase 5.9% in 2022, the Social Security Administration.  The 5.9% cost-of-living adjustment (COLA) will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022. Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021. (Note: some people receive both Social Security and SSI benefits). The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics.  Any increase in Medicare may offset the social security increase.  Some other adjustments that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $147,000 from $142,800.  Source:  Social Security 10/13/21

Include ASE in your Michigan Going Pro Talent Fund Application – deadline is approaching: Michigan’s Going Pro Talent Fund 2022 application deadline has been extended to next Thursday, October 28th. The Going PRO Talent Fund makes awards to employers to assist in training, developing, and retaining current and newly hired employees. ASE is an eligible private training provider that offers training in the areas of leadership and management that meet Going PRO funding requirements. For more information on qualifying ASE courses, contact Michael Burns, EVP, ASE at (248) 223-8039 or mburns@aseonline.org.  To learn more about the Going Pro Talen Fund, visit the State of Michigan’s Going Pro Fund web page.

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