Successfully integrating your health and welfare benefits

The process of integrating health and welfare plans during an M&A is challenging. At the same time, it can be exciting and possibly even desirable for the growth of a benefits plan. An M&A can be the vehicle for ushering in changes that would not be possible under the current employers' plans. It gives additional leverage with vendors. It may supply the momentum to clear up nagging problems or to address underlying benefits concerns.     

Reforming occupational pension schemes: the case of the Netherlands

In many countries, occupational plans are being reformed away from defined-benefit (DB) to defined-contribution (DC) designs. This paper explores the case of the Netherlands, which features a particularly high ratio of occupational pension assets to GDP. Dutch occupational DB plans suffer from a number of serious weaknesses, including ambiguous ownership of assets, back-loading of benefits, and lack of tailor-made risk management. To address these weaknesses, we propose collective individual DC plans that are actuarially fair. These schemes maintain important strengths of collective schemes, such as mandatory saving, collective procurement, and pooling of biometric risks. At the same time, they eliminate intergenerational conflicts about risk management and distribution through transparent individual property rights on financial assets and tailor-made risk profiles in individual accounts. We show how the transitional burden due to phasing out the back-loading of pension benefits can be addressed without a substantial increase in contributions.     

Psychiatric treatment programs: the continuous services model

With the inclusion of behavioral managed care in the design of many benefit plans, the delivery of psychiatric care has changed. The continuous services model offers advantages for both employers and employees who utilize mental health benefits.     

Employee relations and innovation: an empirical analysis using patent data

This paper investigates the relationship between employee relations (ER) as tracked in the environment, social, and governance (ESG) database provided by MSCI Inc., and innovation as measured by patents and patent citations. Some ER policies, such as broadly based profit-sharing plans, stock option plans, and stock ownership, create a direct link between a firm’s performance and employee compensation and might therefore be expected to encourage successful innovation. In addition, some other aspects of ER, including good pension plans, good union relations, and a variety of specific benefits (such as flex time) might improve innovation performance through their effect on employee morale or institutional loyalty, or simply by creating incentives to stay with the firm. We find that both of these categories of ER – financial incentives and non-pecuniary motivations – have a positive effect on innovation as measured by patenting and patent citations.     

Long-term care insurance: an essential employee benefit

Growing numbers of employers are embracing long-term care insurance (LTCI) as an important new addition to their employee benefits package due to aging baby boomers, tax favorable legislation, the need for employee retention and rising costs of care. Even the best retirement plans can be gutted by the high costs of long-term care. The authors identify key components of LTCI and offer guidelines for selecting an LTCI company.     

Analyses of retirement benefits with options

This study applies the contingent claim approach to evaluate retirement benefits with the options of choosing the maximum defined benefit and defined contribution pension plans. A least-squares Monte Carlo simulation values complex retirement benefits that feature the properties of multiple variables, early exercise, stochastic interest rates, and several embedded options. Furthermore, this study examines the impacts of different forms of early decrements of the value of retirement benefits with options.     

WHAT ARE EMPLOYERS DOING TO CREATE A COMPETITIVE MARKET FOR HEALTH CARE IN THE TWIN CITIES?

Employers' willingness to control costs is a critical aspect of pro-competition strategies for the health-care market. Here, we present some of the first quantitative evidence of what employers do to control health-care costs. Our sample is 44 large private and public employers in Minnesota.
We develop a theoretical model in which the employer chooses cost-control "innovations"—along with wages, fringe benefits, and labor-force size—to maximize profits. The role of innovations is to reduce unit costs of offering fringe benefits.
Our data are from a 1982 survey. Eighty percent of the surveyed employers, representing nearly 200,000 employees, responded. Most respondents offer both indemnity insurance plans and health-maintenance organizations (HMOs). Many firms and individual health-insurance plans conduct cost-control activities, but less than half of the firms which offer HMOs have adopted level-dollar premium contributions for their family health-insurance policies. Few plans have increased their coinsurance and deductible requirements in the past five years.
We use probit equations to estimate the probability that a firm or a health plan will adopt cost-control activities. Our analysis suggests that many firms may soon make major plan-design changes to control health-care costs, although they have not yet done so.     

The effects of preferred provider organizations on costs and utilization of hysterectomy

In this study, the costs and service utilization of preferred provider organizations (PPOs) were compared against traditional indemnity plans with similar benefits and utilization review for hysterectomy, a potentially overused procedure. PPOs were associated with significant cost savings, achieved primarily through lower utilization rates.     

Medical coverage for local national employees in the Czech Republic, Hungary, Poland and Russia

Employers that must provide medical benefits for employees in Russia and other Eastern European countries cannot try to match the coverage they provide in the United States. This article, which focuses on the Czech Republic, Hungary, Poland and Russia, summarizes the medical benefits provided by each government's social security system, describes other means of accessing medical care in these countries and outlines the insured supplemental benefit plans that may be available to employers in the local market.     

Impact of alternative information requirements on the coexistence of genetically modified (GM) and non-GM oilseed rape in the EU

We use spatial simulation techniques to estimate both cross pollination damages and net producer benefit from genetically modified (GM) oilseed rape under alternative information requirements about individual farmers' cropping plans. Simulations were carried out for two study regions in Germany. The results suggest that, especially in landscapes with small plots, information requirements implemented in most EU Member States may result in inefficient coexistence to the extent that GM farmers lack important information to adjust their cropping plans to non-GM rape farmers' crop choices. We conclude that, in such fragmented landscapes, more comprehensive information requirements which oblige both GM and non-GM farmers to announce their cropping plans can: (1) substantially increase producer benefits, (2) reduce cross pollination damages and dispute and thus (3) contribute to the local diffusion of GM varieties.     

PENSION WEALTH AT MIDLIFE:COMPARING SELF-REPORTS WITH PROVIDER DATA

This paper evaluates the accuracy of estimates of pension wealth based on self-reports by comparing them to estimates based on provider data. Using data from the Health and Retirement Study, we found that few workers are well informed about their future pension benefits. Self-reports were often incomplete and typically varied widely from those based on information from providers. In defined benefit (DB) plans, discrepancies were greatest for workers who had limited education, earned low wages, and did not expect to retire soon. Differences in median pension wealth were smaller at the aggregate level than the individual level, because individual differences tended to offset each other when aggregated. Provider data appear better than self-reports for DB plans, but not for defined contribution (DC) plans. Where both are available, the best method of computing pension wealth may be to estimate DB wealth from provider data and to estimate DC wealth from self-reports.     

Retirement plan technology delivers big benefits to small business

Retirement plan technology has made it possible for small businesses to be "competitive" in the benefits they offer employees. Small firms that have upgraded their plans have found they are able to offer programs that are less expensive for them and richer for their employees. Integration and Web-based technology have also facilitated employees' retirement planning.     

Potential effects of scaling-up infrastructure in Peru: a general equilibrium model-based analysis

ABSTRACT

This study assesses and compares the potential economic impacts of different investment plans dedicated to filling infrastructure gaps in Peru. Using a national database at the firm level, we start by estimating empirically the positive externalities of Peruvian infrastructure, such as energy, telecommunications, and transportation facilities, on the output of private activities. In the second step, these estimates are introduced in a dynamic computable general equilibrium model used to conduct counterfactual simulations of various investment plans in infrastructure over a 15-year period. These simulations show first to what extent scaling-up infrastructure could be a worthwhile strategy to achieve economic growth in Peru; however, they also show that these benefits depend on the choice of funding schemes related to such public spending.     

Protecting the subrogation rights of self-insured group health plans

As a means of controlling costs, self-insured group health plans often contain subrogation provisions that give the plan a right to recoup benefits paid to a plan participant or beneficiary who recovers damages from a third party. Such subrogation claims are frequently contested, so it is important that a plan's subrogation provisions are properly drafted.     

THE LABOUR SUPPLY AND SAVINGS EFFECTS OF SUPERANNUATION TAX CHANGES*

This paper investigates the effects on labour supply, consumption and savings of a change in the superannuation tax structure, involving the taxation of contributions to a fund, pre‐retirement earnings of the fund, and the benefits received from the fund during retirement. The effects on lifetime plans of tax changes are investigated using a simple three‐period model in which the final period is retirement. The effects of unanticipated changes, requiring revisions to plans, are examined. Although the partial effects of particular tax changes are unambiguous, the effects of allowing for a government budget constraint mean that it is difficult to predict a priori how labour supply is likely to be affected. However, private savings unambiguously fall.     

Residential location: A comparative econometric analysis

This paper deals with the interaction between procurement and production management. The production costs crucially depend on the materials, components and subassemblies purchased by the procurement department, and on the effort expended by the production department. An agency model is utilized based on the scanlon-Atkinson plans which share gains from production cost improvement after attaining pre-specified cost standard. The materials' quality is used to adjust the cost standards for the prodcution department. It is shown that in both the first-best and second-best cases, profit-sharing compensation is always preferred to fixed salary by the risk-averse principal. Comparing with the first-best case, the principal has to provide a greater sharing pool in order to induce the managers' efforts, and each manager, in fact, works less hard in the second-best case. The agents' compensations are tied to their positions as well as their risk attitudes when all principal lacks a costless benefits the most from such a circumstances. Agency cost is then considered as the expected value of getting a perfect monitoring mechanism. detailed comparative statics are provided to suggest the principal ways of modifying existing compensation plans due to the changes of structural parameters.     

GASB proposes new standards for financial reporting of postemployment benefits by state and local governments

GASB has proposed new standards that will affect the way in which governments report postemployment health care benefits in audited external financial statements, resulting in more complete and transparent reporting by employers and plans and more relevant and useful information for the users of governmental financial reports. This article provides an overview of current financial reporting standards and practice, the financial reporting objectives of the project, the proposed measurement approach, noteworthy specific proposals, and the projected timetable for completion of the project and implementation of the new standards.     

Health care trends in today's marketplace

As the year 2000 approaches, it is apparent that employer-sponsored health plans will again begin to experience high rate increases. Employers will need to utilize an up-to-date benefits philosophy and health plan purchasing strategy coupled with monitoring tools and vendor performance guarantees to deal with the situation. While many of the cost drivers are beyond an employer's control, taking a preemptive strike at health care inflation through design, cost sharing and other focused initiatives will minimize its impact.     

推行BOT、BT融资破解重庆市“十二五”期间公益性重点水利工程资金难题

由于项目收益性差,重庆市计划的“十二五”期间的公益性大中型水利工程建设面临着严重的资金困难,常规融资方式无法解决资金瓶颈,完成工程建设。但是,财政资金和土地储备收益会形成业主单位重庆市水投集团未来稳定的现金流,采用BOT和BT方式组织项目的投融资可以把未来的现金流提前到当期使用,解决当前的资金困难,保证水利工程顺利建设。