Workers Compensation – Out of State Issues

Do your employees travel to states other than where your business is domiciled? Do your employees perform work in other states? Understanding how Workers Compensation laws respond to interstate operations is important to ensure that you are in compliance with state employment laws.

Workers Compensation insurance is regulated at the state level. Benefit schedules for claims, interpretation of laws, rates and requirements will vary from state to state. Considerations for establishing where an employee is domiciled include: Where the employee lives? Where the employee primarily works? In what state was the employee hired?

Extraterritorial coverage issues arise when employees travel and work in a state that is not listed on the Workers Compensation policy. In general, domestic short term business trips to other states should not present a coverage problem. However, a number of states, such as NY and NH, are requiring that they be listed on the Workers Compensation policy even if the work only lasts a few days. Noncompliance with these requirements could open you up to a possible fine.

ND, WA, OH, and WY are “monopolistic” states. Workers Compensation coverage for employees located in one these four states is only available through the respective state agency. For example, a Workers Compensation policy would have to be purchased directly through for an Ohio based employee.

International travel presents additional complications for Workers Compensation. It is likely that your carrier will not have the resources to respond to an employee injured in a foreign location. Traditional Workers Compensation may not apply if the employee was injured during the trip but not engaged in employment related activities. International insurance policies are available to provide 24 hour protection for workers traveling on an overseas business trip.

Understanding how state laws impact your Workers Compensation coverage is important for compliance issues as well as ensuring that your employees are protected. We encourage you to discuss with us any questions you may have regarding your inter-state operations.

At Cleary, we will evaluate your business exposures and work with you to develop a comprehensive plan to safeguard your business. Give us a call today at 617-723-0700.

Client Spotlight: Road To College

Spring is right around the corner. For high school seniors, a lot will take place over the next few months. Between academics, sports, social activities like prom, and graduation looming, you have to make sure to stay on track with your college planning. Our client, Road To College™ , can help!

Road To College™ is a premier college consulting service offering personalized college preparation solutions to students and parents. Their goal is to provide parents and students from all over the world access to quality, affordable college counseling services. They offer senior application services, freshman, sophomore, and junior strategic admission planning as well as graduate school programs.

Please click here to learn more about their services.

Understanding The HHS Rules For Essential Health Benefits

Health and Human Services (HHS) ruled to establish the future of insurance issuer standards and health insurance exchanges for actuarial value and essential health benefits under the Patient Protection and Affordable Care Act (PPACA). The final rule creates a plan for when federal facilitated exchanges should accredit qualified health plans. When the PPACA goes into full effect, insurance plans that were not grandfathered into the small and individual market must provide coverage of services or benefits in 10 categories. They must also show the scope of benefits a typical employer plan covers. Qualified health plans are designed to provide benefits that cover essential health benefits, meet minimum value requirements and include cost-sharing limits.

Essential Health Benefits

Every state is allowed to have a single EHB benchmark plan. This is the plan that defines the standards for health benefits every Qualified Health Plan (QHP) must follow. One of these four options must be selected:

  • A state employee health plan, which comprises the three largest and most available enrollment-based state plans.
  • A small group plan, which is the largest enrollment-based plan in any of the three largest of the small group options.
  • The plan featuring the largest non-Medicaid insured commercial plan with enrollment through an HMO.
  • Any of the nation’s three largest Federal Employees Health Benefits Program choices offering aggregate enrollment.

When states do not decide on a plan, the default benchmark plan is what will be used. If the plan does not offer all of the required coverage in the 10 necessary categories, it must have supplemental provisions using the rule’s outlines. Multi-state plans must adhere to the benchmark standards set forth by the U.S. OPM.

Actuarial Value

The PPACA allows four levels of health plans through exchanges. Each one of these levels or tiers is defined by an actuarial value, which is a percentage of the total allowed benefits costs paid by the health plan. For example, a silver plan would have an actuarial value of 70 percent while a gold plan’s percentage would be 80. Values may vary by a positive or negative two percent. These levels were set in place to help potential enrollees and participants compare their options. To count toward the actuarial value calculation, amounts made available under HRAs and employer contributions to HSAs may only be used for cost sharing. In addition to this, the issuer must be made aware when the plan is purchased. Issues of integrating other types of HRAs will be addressed and amended when necessary.

Minimum Value

If the percentage of all allowed costs of benefits offered by an employer-sponsored plan equals less than 60 percent, the plan is said to provide minimum value. To determine their values, employers can use the minimum value calculator offered by the IRS and HHS. This calculator is similar to their actuarial value calculator. However, it is based on claims data that shows regular employer-sponsored plans.

Yearly Limits And Deductible Limitations

The HHS requires all group health plans to meet the annual cost-sharing limitation. However, only issuers and plans in the small group market must comply with the deductible limits. When the PPACA goes into effect, the limit for self coverage is set at $2,000. For those with insurance beyond self coverage, the limit is $4,000. Small group health coverage may exceed deductible limits if it is not able to reach a certain tier.

Cost Sharing

For annual out-of-pocket limits, the HHS says that self-insured plans and non-grandfathered group plans must meet the annual limit for the maximums defined in the ACA’s in §1302(c)(1). However, the Employee Benefits Security Administration (EBSA) guidance says that plans may have multiple service providers for administration purposes. If a plan’s annual out-of-pocket maximum limits meet the following, it may be considered satisfied:

The plan includes out-of-pocket maximum coverage that is not completely reliant on major medical coverage.

The plan meets all of the requirements for major medical coverage.

In relation to a specific time frame, the new rule says that exchanges in the future must create a uniform period for a QHP issuer that is not accredited but must gain accreditation. For answers to questions about these issues, discuss concerns with an agent.

At Cleary, we know how important a comprehensive benefits package can be to your continued success. Give us a call today at 617-723-0700 and we will work with you to create a plan that meets your business objectives, takes into account state and federal laws, and capitalizes on incentives and innovative solutions now being offered.

Spring Cleaning Safety

Ah, springtime. That glorious time of year when you suddenly realize the lawn needs mowing, the garden needs weeding and the house could use a fresh coat of paint. But with many families’ budgets a little tighter this year, buying new spring-cleaning tools isn’t always possible.

Using last season’s tools is a good idea, provided they’re in good condition and can be used safely. The last thing you want to do is take a trip to the emergency room. Yet that’s exactly where more than 350,000 people end up every year, thanks to injuries from improperly used ladders, lawn mowers and power garden tools. So before you get too ambitious, take a few precautions to help keep your family safer.

  • If you’re reusing last season’s lawn and garden power tools, inspect them for frayed power cords and cracked or broken casings. If the item is damaged, have it repaired by a qualified technician or replace it.
  • Never carry a power tool by the cord or yank a power cord from a receptacle. When disconnecting the cord, always grasp the plug, not the wire. Keep cords away from heat, oil and sharp edges.
  • When pulling out the lawn mower for the first time this year, refresh your memory by reading the owner’s manual. Be sure you know how to stop the machine in case of an emergency.
  • If you have a gasoline-powered mower, store the gas in a UL Classified safety can.
  • Always start your mower outdoors. Never operate it where carbon monoxide can collect, such as in a closed garage, storage shed or basement.
  • Don’t operate an electric or gas-powered lawn mower on wet grass.
  • When you’re through with power tools and garden appliances, store them away from water sources to avoid electric shock. Never use them in the rain.
  • Whether your ladder is brand new or it has seen a few spring cleanings, read the instructions and warning labels before using it. They’ll help you choose the right ladder for the job and describe ladder weight and height limits.
  • Remember the 4-to-1 rule. For every four feet of ladder height, the bottom of the ladder should be one foot away from the wall or object it is leaning against.
  • Use a fiberglass ladder if you’re working near electricity or overhead power lines.
  • If you purchase new tools this spring, look for the UL Mark, which means representative samples of the product have been tested against stringent safety standards for fire, electric shock and other safety hazards.

Concerned about your personal insurance coverage? At Cleary, our experienced Personal Lines department will work with you to evaluate your insurance needs, identify exposures, and create a customized insurance portfolio. Give us a call today at 617-723-0700.

DOL Finalizes Executive Order and Summarizes SCA Audits

DOL Finalizes Executive Order # 13495

Executive order # 13495 pertaining to “ Nondisplacement of Qualified Workers” was finalized on January 18, 2013. The ruling ensures qualified workers on a Federal Service Contract who would otherwise lose their jobs as a result of the completion or expiration of a contract will be given the right of first refusal for employment, with the successor contractor. Generally, a successor contractor may not hire any new employees under the contract until the right of first refusal has been provided. This order applies to a successor for the performance of the same or similar services at the same location.

This order defines service contracts or contract to mean any contract or subcontract for services entered into by the Federal Government or its contractors that is covered by the McNamara-O’Hara Service contract Act.

You can review FAR 52.222-17 for more comprehensive details about this new executive order. Also, look at Fact Sheet # 67A: Nondisplacement of Qualified Workers on that provides a more detailed explanation about the order and whom to contact if you have more questions.

DOL Audit Statistics for FY 2012

In Fiscal Year 2012, the Wage and Hour Division (WHD) in Washington DC collected more than $32 million dollars in back wages for underpaid Davis Bacon workers as the result of more than 50 project investigations. The Branch’s work exceeded the overall strategic plans call for an increase in enforcement of the Service Contract Act.

The coordination of this goal resulted in resolving 858 SCA cases and collecting $44,888,935 in back wages for approximately 15.6 million service employees. Of the 858 cases, 634 were found in violation under SCA. In addition there were 19 SCA debarments processed in FY 2012.

Having knowledgeable personnel capable of handling a DOL audit can protect you from wage settlements and possible debarment. For more information contact MARAL, LLC ( and set up a one-day SCA/DBA training seminar for your employees.

At Cleary, we know how important a comprehensive benefits package can be to your continued success. Give us a call today at 617-723-0700 and we will work with you to create a plan that meets your fringe-benefit obligations and provides your employees with valuable benefits.

New Financial Reporting Option for Small Private Businesses

Private, for profit businesses have few choices when it comes to financial reporting for purposes of securing a loan or a surety credit. These entities must adhere to the U.S. Generally Accepted Accounting Principal (GAAP) statements or they will run the risk of not qualifying for credit. However, GAAP often requires a great deal more information than is actually needed to understand the performance of their business.

The Sarbanes Oxley Act and other mandated financial reporting regulations for large and publicly traded companies have trickled down and started to hamper the ability of Small and Medium Sized (SME) entities to provide financial reports that are truly meaningful to their owners, lenders and sureties.

The American Institute of Certified Public Accountants (AICPA) has come up with a new Financial Reporting Framework (FRF) that will be a less complicated and therefore a less costly reporting option for these SME’s.

In the past, my suggestion to clients looking for surety credit was that they use a CPA, not a tax accountant or tax preparer for their financial presentation to a surety. However, under the suggested new framework for SME’s they would have the option to use these other “non-certified” practitioners. Will the sureties or lenders embrace this change after pushing for GAAP CPA statements for so long? Time will tell.

At Cleary, we will evaluate your business exposures and work with you to develop a comprehensive plan to safeguard your business. Give us a call today at 617-723-0700.

Improving Your Financial Health in 2013

Presented by John B. Steiger

As a New Year begins, many people make resolutions to better themselves and their lives—lose weight, volunteer, spend more time with the kids or grandkids . . . nearly everyone has something they hope to change. Why not add one more important item to your list this year?

Throughout the last few months, the media has focused on the fiscal cliff—those sweeping tax increases and spending cuts that are due to go into effect on January 1, 2013, unless Congress acts to change them. But that discussion shouldn’t overshadow positive developments in the U.S., nor should it stop you from making improvements to your financial health in 2013.

Consumer Markets Look Good

Consumer sentiment is as high as it has been since 2007; this can be attributed to three main areas: unemployment, consumer debt, and housing.

At 7.7 percent, as of November 2012, the unemployment rate is well below its peak, and analysts expect slow but steady increases in employment in 2013. Estimates from the National Association for Business Economics suggest that, at this time next year, the economy will be adding an average of 173,000 new jobs per month; the current average is 151,000.

A second bright spot is consumer debt. Low borrowing rates have helped consumers reduce their obligations significantly, bringing debt to its lowest level since the start of the recession.

For most people, their home is their biggest asset, so positive developments in the real estate market are especially promising. Demand for houses has risen, resulting in increased prices and leading both sellers and buyers to take action. Demand should stay high if the Federal Reserve continues its bond-buying program, which will keep mortgage rates low.

Uncertainty Abroad

Although there are signs of optimism on the home front, there are many international concerns that could spill over into our economy in 2013:

  • If the euro continues to rebound, it could signal a potential end to the European debt crisis.
  • It remains to be seen, however, whether or not Spain will be too proud to accept the European Central Bank’s offer to buy its bonds.
  • Elections taking place in Germany and Italy in 2013 are expected to have a significant impact on the future of the eurozone as well.
  • A current feud between China and Japan over ownership of several islands in the South China Sea could restrain growth in this booming region.
  • The euro is not the only currency to face struggles—the yen is very weak as well.

Your Personal Financial Health

These, of course, are all macroeconomic issues that are beyond our control, and we often have to accept a degree of uncertainty and unpredictability when it comes to the financial outlook both at home and abroad. That doesn’t mean that you should leave your personal financial future to chance, however. You can always make positive adjustments to help ensure that you are better prepared for whatever the future might bring. Here are some simple suggestions:

Pay down debt. Although it’s normal to have some debt, too much can quickly become overwhelming—and debt often piles up after the holiday shopping season. Make a plan to pay off debt starting with credit cards that have the highest interest rates, and, whenever possible, pay more than the monthly minimum to pay off debt more quickly.

Increase your savings. As you pay off your debt, keep an eye to your savings as well. No matter what your goal is—maybe a vacation or an emergency fund—create a timeline and action strategy to help you get there.

Develop a budget. A budget is an extremely valuable tool for people of all income levels. Outline your monthly and yearly expenditures so you can see exactly where your money goes, as well as how much discretionary income you have left to work with.

Review your credit report. Everyone is entitled to one free report a year from each of the three major credit reporting agencies—Equifax, TransUnion, and Experian. Use a website such as to request your reports and find out where you stand. Be sure to check for any errors or suspicious activity.

Start a college fund. Many students are now paying more than $60,000 per year for college, and this number is continuing to rise. There are many options for creating an effective college savings plan, and it is never too soon to start discussing them with your financial advisor.

Assess life changes. Even the smallest life changes can affect your financial situation. As each year passes, it is a good idea to review your insurance coverage, retirement plan, will, and estate plan to ensure that they continue to meet your needs.

Protect your identity. With the wonders of technology comes the risk of identity theft. Be sure to review monthly statements for suspicious activity, avoid using your social security number—and don’t carry your card with you—make online purchases only on secure websites (which have addresses that begin with https), and don’t open e-mails from unknown senders.

Further your financial knowledge. Your financial advisor is here to help you through any financial obstacles, but it never hurts to learn something new. There are countless websites, TV shows, and books that can help you further your knowledge.

No matter what 2013 brings, your financial advisor can help navigate your way to your goals. Please do not hesitate to contact our office with any questions you may have. Most important, best wishes for a happy and healthy New Year!

John B. Steiger is a financial consultant located at Wealth Planning Resources 460 Totten Pond Road Suite 600 Waltham, MA 02451. John offers securities as a Registered Representative of Commonwealth Financial Network®, Member FINRA/SIPC. John can be reached at 781.547.5621 or at

© 2012 Commonwealth Financial Network®

At Cleary, we are committed to a holistic approach of protecting and preserving our clients’ financial assets. Give us a call today at 617-723-0700 and let us know how we can help you.