More Perspectives on Health Care Reform

Last week we heard the Supreme Court’s decision on the Affordable Care Act (ACA). I admit to being one of the more than 800,000 people following the SCOTUSblog live coverage of the justices reading their opinions and the follow-up commentary by politicians and pundits.  SCOTUSblog did a phenomenal job of posting accurate information in real time, and I highly recommend this site to anyone interested in the Supreme Court.

In April 2012, right after the arguments before the Supreme Court in the ACA case, I posted on my many perspectives on health care reform – attorney, former benefit plan administrator, corporate executive, consumer, and conservative. All those perspectives came into play again this week as I followed the coverage of the Supreme Court decision.


1. Limits on the Commerce Clause; No Limits on Taxes – Does the “Tax” Label Matter?

In my earlier post, I said that as a conservative I wanted the Commerce Clause to be limited.  Well, five justices of the Supreme Court limited it.  But the ACA survives anyway under the taxing power of Congress.

I always believed that Congress could have passed health care reform using its taxing power, but in 2009-2010 the President Obama and the Democrats in Congress specifically said the ACA’s penalty for not purchasing health insurance was not a tax.  Turns out it was.

This weekend, I argued with supporters of the ACA whether this mischaracterization of the penalty as "not a tax" matters. The President’s supporters claim that, because both the House and Senate properly passed the statute and the President duly signed it into law, it doesn’t matter what label was put on the penalty. But I firmly believe – as do other conservatives I have talked to – that some Democrats who voted for the ACA would not have done so if the penalty had been labeled a tax. In my opinion, labels do matter, because they impact the political process.


2. Uniform Benefit Plan Laws Unlikely

I said in my April post that as a benefit plan administrator, I believe uniform national laws are a huge simplifier for multi-state employers. Although the ACA is a national law, the Supreme Court decision does nothing to help businesses with simplicity.

I have listened to what benefit plan consultants like Aon Hewitt  and Towers Watson are telling their clients about compliance with the ACA. They say that, although the Supreme Court’s decision does mean that employers need to move forward with compliance, the devil will be in the regulatory details.  This 2,700 page act has already spawned more than 12,000 pages of regulations, and reams more regulations will be published before we really know what the law entails.

And different states and different employers will choose different paths to compliance.  Some states will expand Medicaid, others will not.  Some will develop their own healthcare exchanges, others will not.

Some employers will continue to offer group healthcare insurance, others will work with healthcare exchanges in states that adopt the exchanges, and some employers will decide that paying penalties is less costly than providing insurance to their employees. Also, some employers may decide to re-structure their workforces to reduce the number of full-time employees who must be covered.

Change in the employee benefit arena will continue for many years to come, and plan administrators will be dealing with the upheaval for at least a decade.


3. Equitable Taxation of Health Care Expenditures and De-Linking Health Care from Employment

The Supreme Court decision, of course, did nothing to fix the inequities between employer-provided healthcare insurance (premiums paid with pre-tax dollars, and employer contributions not taxed) and individual healthcare insurance (all costs paid with after-tax dollars).  I remain of the opinion that healthcare insurance should be totally separated from employment, and there is no movement in that direction. But at the very least, the tax treatment of employer-provided and individually purchased insurance should be the same.

Republicans have said their version of healthcare reform -- after Obamacare is repealed -- would equalize tax treatment of healthcare insurance.  Whether they will get the opportunity to repeal the ACA and pass  their own legislation won’t be determined until after the November election.


4. Tax Increases Coming; Premium Increases Also Likely

As a result of the ACA, higher income taxpayers face additional taxes, quite apart from the debate over whether the Bush tax rate decreases should be extended.

The Medicare tax on salary and self-employment earnings on individuals making more than $200,000 and couples making more than $250,000 in salary and/or self-employment income will pay an extra .9% above the 1.45% we all pay now.

In addition, starting in 2013, individuals making more than $200,000 in adjusted gross income and couples making more than $250,000 will be hit with an additional 3.8% "Medicare contribution tax."

Furthermore, everyone’s flexible spending account deductions for healthcare expenditures will be limited to $2,500 per year, limiting a very popular tax shield.

As a result of these changes, expect a flurry of tax-planning activity before January 1, 2013, arrives.

In addition to these tax increases, it is still likely that health care expenses in the form of premiums and medical products and services will consume an ever greater percentage of family and government budgets. Contrary to President Obama’s promise, the ACA does not adequately bend the cost curve. In my opinion, individuals will need to take more responsibility for their life choices and health care decisions before health care costs can be controlled.


5. It’s Still Not Over 

Many more lawsuits will be fought before we know the full ramifications of the ACA -- already litigation is pending over religious exemptions from contraceptives. Other mandated benefit issues will arise, as will disputes over eligibility for subsidies, state and federal arguments over Medicaid, what providers of medical services and devices should be paid, and a host of other issues.

And I still believe, as I did in April when I wrote my earlier post, that there will be amendments to the ACA before it goes into effect, or when the consequences of the act become too onerous.  The 2,700 pages enacted in March 2010 will not remain inviolate, no matter what happens in the November election.

What do you think? 

No One Has It All – We All Make Choices

The Internet this past week has been full of discussion about an article by Anne-Marie Slaughter in the Atlantic, titled “Why Women Still Can’t Have It All?”  Ms. Slaughter writes about the difficulties she experienced in holding a high-level policy position in the State Department, and why she ultimately returned to her role as a dean at Princeton University in large part because she needed to spend more time with her family.

She argues in the piece that women cannot “have it all” in today’s society, for a number of reasons. She says that we tell ourselves half-truths about “having it all,” such as believing we can “have it all” if we are committed enough, or if we marry the right person, or if we sequence our lives right.

But in fact, we cannot have it all.

And here I state my own beliefs, based on having lived most of my professional and family life:

          No one has it all.
          Everyone makes compromises.

I posted in March about women “opting out.” The truth is, we all opt out of some things and opt into other things.

I worked for more than 25 years in demanding positions in corporate America. You would recognize the name of my employer if I named the firm. I worked 60 hours/week, and managed to stay married and raise two children. I had many of the advantages that Ms. Slaughter had, but not all. I probably had other advantages she did not have.

And through it all, I made choices.

• I chose not to take job opportunities that could have separated my family and would have required a long-distance marriage and parenting.

• I chose not to have more than two children.

• I chose to leave work in time to be home for dinner most nights, and chose to quit working at home at  bedtime, rather than pulling all-nighters (though I had many sleepless nights from stress).

• I chose to live in the Midwest, instead of on the East or West Coast, where life seems more frantic.

Along the way, my husband made his choices as well. Some of his choices enabled my career, and some made it more difficult. And my choices had positive and negative impacts on his career and other activities.

Could I have done more at work? Yes. I held several senior positions in my company, but I could have risen higher and had more authority. Some of why I didn’t rise further was probably due to my choices, and some was probably due to how others perceived me, correctly or incorrectly.

But I had a very good career, and I left on my own terms. And I raised two children who are now successful young adults. I look back on these accomplishments with satisfaction, no matter that I could have had more.

I didn’t have it all, but I had most of what I wanted. And I was responsible for my choices.

I hope that my children – son and daughter alike – have more choices than I had. I hope they worry less about the choices they make. But the odds are, their lives will have some of the same difficulties as well as new ones that develop in the 21st century.

Life doesn't permit any of us to "have it all." It's not meant to be easy. Nor even fair.

Favorite Firings – Third in a Series

I’ve received some suggestions from readers on “favorite firings” to feature in this series. Here’s another good one. This story involves a situation that could have been tragic, but ended up being humorous.

The Facts:  A married female employee (we’ll call her Ursula) was having an affair with a male co-worker (John).  Ursula’s husband (Karl – not employed where Ursula and John worked) found out about the affair.

Karl was drinking one evening at the local pub, and decided he’d had enough of Ursula’s behavior.  He brought his shotgun into Ursula’s workplace and shot the lock off the doors into her department.

When Karl saw John, he aimed at John and fired, but thankfully missed.  Karl's bullets did destroy the soft drink vending machine on the premises, however.

After shooting at John, Karl sobered up slightly and raced out to his pick-up in the parking lot.

By the time Karl left, other employees had called the police. Karl was still drunk enough when he reached his truck that his driving was not of the highest caliber. He drove straight into the police car that had just arrived at the parking lot and still had its siren blaring and lights flashing.  The police easily apprehended Karl after the crash.

The company decided to fire both Ursula and John, because of the disruption and danger their affair had caused.  No, they weren’t fired for the affair itself, but because it led to danger to their co-workers.

John moved on with his life (presumably without Ursula).  But Ursula sued her employer for permitting her to engage in what she called “extracurricular marital affairs.”  In a rare display of prompt justice in employment cases, the judge quickly dismissed the lawsuit.

As a side note, Karl also sued.  He sued the pub for letting him get drunk. His case was also dismissed.

Not much has been heard from Karl or Ursula since.

The Moral:  The point of this story is not to make light of workplace violence, which is a serious problem and often leads to tragedy.  This case could have ended with employees and others dead or wounded.

In this case, the employer incurred some legal risk in firing Ursula and John, because their affair was not work-related behavior.  However, the consequences of them mismanaging their private lives had an impact in their workplace, and endangered their co-workers.

Because the employer treated both employees the same, there was no gender discrimination claim.

Many employees do not take responsibility for their own behavior and deserve to be fired. Ursula’s reaction in filing a lawsuit blaming her employer for her affair clearly fits this category.

* * *

Remember, if you have any ideas for stories to publish, please email me or leave a comment below.  But please disguise the facts to protect the innocent (and not-so-innocent) unless the situation is well-publicized, and then include a link to support your story.  I will only publish verified stories.

Protecting “Works Made for Hire” Under Copyright Laws

Product development is critical to any company’s success. One of the issues in my forthcoming novel about a business in trouble is whether the company's new product was an employee’s own creation or whether it was owned by the company as a “work made for hire.” If the business in my story does not own the product, it is likely doomed to fail. If the company does own the product, and the product is a success, the business might be saved.

What is a “work made for hire”? 

Here is the U.S. Copyright Office’s official definition:

Although the general rule is that the person who creates the work is its author, there is an exception to that principle. The exception is a work made for hire, which is a work prepared by an employee within the scope of his or her employment or a work specially ordered or commissioned in certain specified circumstances. When a work qualifies as a work made for hire, the employer, or commissioning party, is considered to be the author. See Circular 9, Work-Made-For-Hire Under the 1976 Copyright Act.

It is important for companies that have employees engaged in creative endeavors – even those who create presentations and advertisements for the business – to be clear with their employees that the business owns the work, not the employee.

How can an employer protect its intellectual property as “works made for hire”? 

It makes a difference whether the person creating the work is an employee or an independent contractor.  For employees, you can use an individual employment agreement, but a provision in your company policy manual might suffice. For independent contractors, you need a specific contractor agreement with that individual or firm. Otherwise, the contractor may retain rights in work you hired them to create for you!

     1. Individual Employment Agreement

For employees who frequently create works for your company, it would be a good idea to have an employment agreement specifically stating that the company owns the work. The employer should have the employee sign the agreement, and give the employee an opportunity to specifically list all works the employee has previously created that are not “works made for hire.”

In addition, the agreement should state that the employee will let the employer know of any future works created by the employee that are not “works made for hire.” Anything the employee does that is outside the business belongs to the employee. A provision that the employee will tell the employer about such works will help, but will not necessarily guarantee clarity on which works fall into work and non-work categories.

It would be best to have your agreement drafted by an attorney with experience in intellectual property.  But for an overview of these agreements, see this article.

     2. Company Policy Manual

Since most employers have employees sign an acknowledgement of the company policy manual, this is another way you can put employees on notice of their “work made for hire” obligations. However, because employees often claim they didn’t read everything in the manual, this method is usually better when “works made for hire” are not a frequent issue in your workplace.

The manual should at least inform employees that documents and other works prepared by an employee within the scope of his/her employment are owned by the employer as “works made for hire,” and should instruct employees to contact their supervisor or HR if they want to use any work materials outside the workplace.

Supervisors and HR should be told to contact the company’s lawyers if any issues arise.  For more, see this article.

     3. Specific Agreement with Contractors

If your business hires a contractor to create a written work or a product that could be copyrighted, you should enter into a written contract with the contractor before the work is done.

The contract should state that the commissioned work is a “work made for hire,” and define what the work is. If the work is later changed or expanded, then amend the agreement to describe the broader work. Be up front with the contractor that you want your business to own the work and to be able to use it and variations and derivatives of the work in the future. You don’t want to have someone draft a technical training manual, for example, then not be able to use segments of it later on, or not be able to update it for future product versions without the consent of the contractor.

For more on independent contractors and works made for hire, see this article or this one.

Have any readers had experiences with issues around “works made for hire” going badly?


NOTE: None of the foregoing is intended as legal advice. Consult an attorney regarding your particular circumstances before relying on any agreement or policy or if you have any questions.

Make Your Work/Life Balance a Conscious Choice

Some family events this past weekend caused me to reflect again on work/life choices -- this time on the choices of three generations in my family.

Like most in their generation, my parents had a traditional marriage, in which the husband worked for pay and the wife worked at home. My father was a workaholic, leaving for the office before dawn each day. He was usually home for dinner, but worked a lot on evenings and weekends, and traveled frequently for his job. My mother took care of house and kids, by herself when she had to.

My husband’s parents had a situation like my parents, except they lived in a smaller town and my father-in-law could come home for lunch each day. But the realms of husband’s and wife’s responsibilities were as separate as in my family.

Like many in our generation, my husband and I struggled to find a path where we both worked and both cared for the household.  We had professional jobs in the same field, and each stayed with our firms for an entire career.

We divided childcare and home responsibilities in ways that made sense to us. We argued over who worked more, or didn’t do their share of chores. We scrambled to find time for everything, and often our time together was the first thing to go. But somehow managed to stay married till our children were grown and life returned to some semblance of sanity.

Our young adult children are now launched in their careers. I see each of them working long hours.  They have jobs they like, but they aren’t wedded to them. Each talks about moving on in a few years; whether they will or not, remains to be seen. And neither as yet has a spouse or children, nor prospects of changing marital status soon.

Three generations, three models, three sets of choices. The models don’t separate by generations – people in each generation have chosen each model. There is no right way to manage work and life.  After more than thirty years of trying to balance work and life, I don’t even think of it as work and life anymore; it’s simply life.

What I encourage my children to do – and what I encouraged younger employees that I mentored to do – is to make their choices consciously, and to re-think those choices regularly.

And so I encourage you, too, to make conscious choices.  Whatever you choose, make it a life that suits your values and leaves room for the discretionary things in life that are important to you.

A few months ago, Dr. Donald E. Wetmore published a post on AMA Net that listed seven things NOT to ignore in your work life balance: 

• your health

• your family time

• your financial health

• your intellectual development

• your social contacts

• your career path

• your spirituality

That’s a pretty good list, and fits well with the areas mentioned in the book Standing at the Crossroads: Next Steps for High-Achieving Women, by Marian N. Ruderman and Patricia J. Ohlott, which I have found helpful for self-assessment.

Where in your life do you need more balance?