On May 24, 2010, the Internal Revenue Service (IRS) issued inflation-adjusted limits for contributions to a health savings account (HSA) for calendar year 2011 (Revenue Procedure 2010-22). Under cost-of-living adjustment rules of Code section 223, the annual limits for 2011 remain unchanged from 2010 because the changes in the consumer price index for the relevant period do not result in changes to the amounts for 2011.

Therefore, for calendar year 2011, the limit on contributions for an individual with self-only coverage under a high-deductible health plan is:

• $3,050 for individual coverage
• $6,150 for family coverage

A high-deductible health plan for calendar year 2011 is defined as a health plan with an annual deductible of not less than $1,200 for self-only coverage ($2,400 for family coverage). The limit on annual out-of-pocket expenses is $5,950 for self-only coverage ($11,900 for family coverage). The limit on catch-up contributions for individuals age 55 or older is $1,000.

Read the full text of Revenue Procedure 2010-22.

Tags: 2011 Health Savings Account Amounts, 2011 HSA Contributions, IRS HSA Limits 2011

Despite the uncertainty surrounding health care reform, most U.S. employers say they are making investments that will improve the long-term health and productivity of their workforce, according to a new survey.

Researchers at Hewitt Associates Inc., Lincolnshire, Ill. (NYSE: HEW), polled about 600 large U.S. employers with a total of about 10 million employees.

About two-thirds of the respondents said they invest in long-term solutions to improve the health and productivity of their workers; only 32% said are primarily focused on controlling annual health care costs. Just 3% reported moving away from directly sponsoring health care.

When asked about their future approach to health care, 80% said they plan to focus on improving health and productivity in the next 3 to 5 years.

Almost 95% of the companies said managing costs is a top business issue, up from 91% in 2009.

Tags: 2010 Hewitt Insurance Survey, Hewitt Associate Health Insurance Survey, Hewitt Survey

The Family and Medical Leave Act of 1993 (“FMLA”), which applies to employer groups with 50 or more employees and all public agencies, has an indirect impact on health insurers and group health plans. FMLA requires employers to provide up to 12 weeks of unpaid leave to its employees to care for a loved one with a serious health condition, among other reasons.

In 2008, Congress enacted legislation, HR4986, to include qualified exigency leave and military caregiver leave to employees with family members on active duty in the Armed Forces (including the National Guard or Reserves).

Last year, Congress enacted new legislation, HR2647, which became effective on October 28, 2009. It applies to all FMLA leave requests submitted on or after that date. Specifically, HR2647 does the following:

• Expands the exigency leave entitlement to include family members of the regular Armed forces, who were not entitled to exigency leave under the prior law;
• Expands the military caregiver leave entitlement to include veterans, who were not covered under prior law; and
• Expands the military caregiver leave entitlement to include leave to care for a service member or veteran whose preexisting serious injury or illness was aggravated by active duty service.

No changes have been made to any of FMLA’s health benefit provisions, including the requirements regarding continuation of health insurance benefits while on leave and reinstatement of coverage upon returning from leave. However, the expanded rights established in HR4968 and amended by HR2647 may result in more employees being eligible for FMLA leave. For that reason, these laws may indirectly affect the administration of group health plans.

Public information on FMLA and HR4986 legislation is available online at http://www.dol.gov/whd/fmla/finalrule.htm. Employer groups requesting more compliance information on FMLA should be referred to their own legal counsel.

Tags: Family Medical Leave Act Expansion, FMLA Military Coverage, FMLA Military Coverage Expansion

Every day, thousands of individuals are rejected by insurance companies because of pre-existing medical conditions such as diabetes, obesity, and heart problems. Now with the Guaranteed Issue Health Insurance offered by AIM Health Plans, people who are uninsurable under traditional health insurance policies can now obtain insurance coverage with no medical exams required, no health questions and possibly no waiting period if you’re eligible. If you are suffering from diabetes, obesity, heart problems, rheumatoid arthritis, and other medical conditions, you can have health coverage when you purchase guaranteed issue health insurance.

Although there are many companies offering this type of insurance product, not all of these companies provide reliable guaranteed health plans. Most options on the internet today are discount cards and should never be mistaken for actual insurance. Faulty guaranteed issue programs have left consumers with millions of dollars worth of unpaid claims and medical debt.

With AIM Health Plans, the guaranteed issue health insurance products are not only underwritten by an “A rated” insurance company, but they are HIPAA compliant, meaning if you have credible coverage when applying, your waiting period would be waived. However, Guaranteed Issue Health Insurance should not be looked at as a replacement for major medical insurance. These are defined benefit plans designed solely for people who aren’t able to obtain traditional major medical plans. If you’ve been declined for health insurance, visit http://aimhealthplans.com.

Tags: guaranteed issue health insurance illinois, guaranteed issue health plans, Health Insurance for Uninsurable Illinois, Health insurance for uninsured, Illinois guaranteed issue health insurance, Illinois Health Insurance for Uninsured, Illinois health insurance that covers pre-existing conditions

More than three-quarters of adult Americans who have health insurance say they still worry about paying more for their medical care, and nearly 50 percent say they’re “very” or “extremely” worried about the issue, a new Harris Interactive/HealthDay poll shows.

More than half (57 percent) of those polled said they feared losing their health insurance sometime in the future, which may explain another key finding in the poll — sizeable numbers of Americans said they’re skipping doctor visits or not getting prescriptions filled to save money.

Middle-aged Americans — people too old to be blasé about their health but too young to be covered by Medicare — seemed most worried about paying their health care bills. Among insured individuals aged 45 to 64, a full 84 percent said they were concerned that rising health care costs would exceed their ability to pay.

Only 8 percent of all insured Americans polled were “not at all worried” about getting health care coverage.

“Many are, in fact, not filling prescriptions, skipping a doctor’s visit, not following up on something that was recommended by the doctor, taking a medication less or pill-splitting, doing without dental care,” said Humphrey Taylor, chairman of The Harris Poll.

He added that with the economy in a tailspin and many Americans losing their employer-based health insurance, the problem may only get worse. “If the number of uninsured rises sharply, one would expect to see these numbers increase,” Taylor said.

One consumer advocate wasn’t surprised by the results of the poll, which included 2,078 adults surveyed between Feb. 25 and 27.

“Even for people who have insurance, increasingly, the costs have been shifted to them — and those costs have risen,” said Carol Pryor, policy director at The Access Project, a nonprofit group dedicated to making health care available to more Americans. More and more, she added, insured Americans are paying higher deductibles and co-pays, stretching their ability to get proper medical care.

Pryor agreed with Taylor that the situation is only likely to get worse, since “more people are becoming uninsured as a result of the economic meltdown.”

Some other key findings from the poll:

• 78 percent of adults with health insurance worry about paying more for their medical care.
• Nearly two-thirds (65 percent) of all insured adults say they’re worried about how they can afford to pay for medical care and prescription drugs, with that number rising to 76 percent among people aged 45 to 54. Even among those aged 65 and over — most of whom are eligible for Medicare — 62 percent say they worry about paying for the care they need.
• Over the past year, one in five insured adults skipped filling a prescription because of the cost. That number jumped to 30 percent for those without insurance.
• Similarly, cost concerns led 24 percent of the insured and 51 percent of the uninsured to forgo seeing a doctor for a specific medical problem. Twenty-one percent of the insured and 33 percent of the uninsured didn’t get a recommended follow-up test or treatment for the same reason.
• Trying to cut down on medical expenses, 14 percent of the insured and 19 percent of the uninsured took a medication at a lower dose than that recommended by a doctor.
• Dental care took the biggest hit: 51 percent of the uninsured and 30 percent of the insured skipped necessary dental care over the past year due to financial concerns.

Forgoing care to save costs over the short term may not save costs over the long term, the experts warned. “Some things do go away on their own over time,” Pryor said. “But there are a lot of conditions that get worse if they aren’t treated, and they then require more expensive care later. So it’s definitely a gamble.”

Taylor noted that the statistics on the percentage of Americans skipping needed care have remained about the same since 2007, when Harris first asked these types of questions. That may seem odd given the recent downturn in the economy, he added. But, he noted that even if a few million Americans lose their health insurance, that’s still only 2 percent of the adult population — not enough to show up in this type of survey.

The new poll results come on the heels of a report released Wednesday by the nonprofit advocacy group Families USA. It found that a third of Americans under the age of 65 — nearly 87 million people — went without health care coverage at some point over the past two years.

The most recent U.S. government statistics suggest that 16 percent of all adults (including those 65 and older) have no health insurance. And a Commonwealth Fund report published last June found that the number of “underinsured” — people who have insurance that doesn’t fully meet their health care needs — rose by 60 percent between 2003 and 2007.

The issue gained momentum in the nation’s capitol last Thursday, when President Barack Obama convened a long-anticipated White House summit on health care reform. The Associated Press reported that Obama made a point of bringing a wide range of views to the table — voices representing the insurance industry, patient groups, physicians and even those advocating a single-payer system.

“Every voice has to be heard. Every idea must be considered,” Obama said during the summit. “The status quo is the one option that is not on the table.”

According to Pryor, one item that should be up for discussion in Washington is the plight of the underinsured.

“Covering the uninsured is only part of the problem,” she said. “Unless reform includes adequate, comprehensive and affordable coverage, just having insurance will not be protection — either from facing barriers to care or concern over one’s financial stability. And after all, those two things are the function of insurance.”

Tags: health care costs, health care costs poll

According to a report released today by the liberal Center for American Progress and also the group Health Care for America Now, 14,000 Americans are losing health-care insurance every day during this economic crisis.

Since the recession began, the report says, an estimated four million additional Americans have lost their health insurance and two million have become uninsured. “Forty-six million people in America did not have health insurance prior to the recession in 2007,” Judy Feder, a senior fellow at the Center for American Progress, said in a conference call with reporters today. “But with the recession, it got worse. The unemployment rate grew by 0.8 percentage points in December and January alone, implying that just in these two months nearly 900,000 people became uninsured.”

Michael J. Wilson, legislative director for the United Food and Commercial Workers Union, sees the rising number of uninsured Americans impact other parts of the economy. “With 14,000 people losing health care every day, even people who still have health care are affected,” said Wilson. “If people are desperately saving their money to pay for health care, they will not be able to spend money on food or other goods, which adds to the recent turmoil in the market.”

Tags: health insurance study, losing health insurance

You brace for bad news as the pharmacist rings up the charges for your prescription medicines. Even with insurance, you’ve discovered that copayments add up and put a big dent in your budget. If only there were a way to cut costs.

Across the nation, countless thousands of people face the same challenge. With the need to stretch every dollar, some people consider taking half doses of medicine or taking a full dose every other day. Unfortunately, that can put health at risk.

Other people consider filling their prescriptions through pharmacies outside of the United States, a practice discouraged by the Food and Drug Administration (FDA). Virtually all prescription drugs imported for personal use are sold in violation of U.S. laws, according to the FDA. These drugs may not be:

• Approved in the United States
• Labeled correctly

“There’s significant risk,” says FDA spokesperson Christopher C. Kelly. “Sometimes, sellers from outside the [United States] don’t follow our standards in labeling drugs for safe and effective use. Consumers might not be getting proper information about how to take the drug and/or about side effects.”

A better way to save money is to talk with your doctor. He or she can check your insurance plan’s formulary. A formulary is a list of medicines your plan helps you pay for. Two or more equally effective medicines may be on the list, but one may have a lower copay. For example, a generic drug often can replace a brand-name medicine and save you money. Generic drugs contain the same active ingredients as their brand-name counterparts. They’re also just as safe and effective, according to the FDA.

Other tips:

• Shop around. Prices can vary among pharmacies. Make sure you’re comparing the same dosage and quantity.
• Do the splits. Some higher dose pills cost nearly the same as lower dose ones. You can save money by splitting them in half. Ask your doctor if this is an option, and follow his or her directions.
• Search online. If you stay with licensed U.S. pharmacies, you can buy medicines safely over the Internet. Compare prices and look for the Verified Internet Pharmacy Practice Sites (VIPPS) seal from the National Association of Boards of Pharmacy. The VIPPS seal means the online pharmacy meets licensing and inspection standards.
• Ask about discount or assistance programs. Some drug companies, state health departments and pharmacies offer discount programs. Your doctor or pharmacist can point you in the right direction.
• Buy in bulk. Ask if you can save anything by buying a 90-day supply of your medicine.

Tags: prescription drug costs, prescription drugs, prescription drugs savings, save on prescriptons

A new pet health-insurance guide for veterinarians was released at this month’s North American Veterinary Conference, representing the latest push by organized veterinary medicine to get practitioners on board with third-party payment systems.

“A Veterinarian’s Guide to Pet Health Insurance,” put out by Brakke Veterinary Practice Management Group and commissioned by the National Commission on Veterinary Economic Issues (NCVEI), is an eight-page promise that pet health insurance can bridge the gap between ever-increasing veterinary care costs and clients’ ability to pay for expensive treatments. Anecdotally, less than 3 percent of owners carry such policies, but backed by DVMs, a “whopping 41 percent” of owners polled indicated that they would purchase pet insurance if recommended by their veterinarian, the report says.

Research shows that veterinarians aren’t promoting insurance the way they might other products and therapies, Brakke senior consultant John Volk says.

“I don’t think a lot of veterinarians have been convinced that they have a stake in it because they can’t sell it, it has to be sold by an insurance company,” he says. “But insurance does have a material impact on people’s receptiveness to seek and pay for care. We think this is an opportunity for veterinarians looking for ways to strengthen their practices.”

After all, dental patients with insurance spend 70 percent more than their uninsured counterparts, and the “parallels between dentistry and veterinary medicine are obvious,” the report contends.

Yet while NCEVI and Brakke boast of pet insurance’s benefits to the profession, critics remain wary of such deals, especially in light of human medicine’s battle with the cost-control system of managed care. To that, the report states: “Pet insurance is not true medical insurance. It is similar to your auto or homeowner policies. …Insurance companies have no financial leverage in the veterinary community.”

That might not be true for organized veterinary medicine, where groups such as the American Veterinary Medical Association’s (AVMA) indemnity arm, the Group Health and Life Insurance Trust (GHLIT) stand to gain if pet insurance spikes in popularity.

Last July, GHLIT unveiled a partnership with Pets Best Insurance during AVMA’s annual convention. Since then, leaders have taken heat from veterinarians and competitive insurance companies who criticize the deal, characterizing it as a wildly inappropriate use of a membership body to promote a private insurance agency. AVMA and GHLIT officials respond that their respective bodies operate autonomously and clarify that the deal involves the trust, Pets Best and their mutual underwriter, Aetna Inc. — not the AVMA membership group. GHLIT, according to the agreement, will receive a percentage of royalties from Pets Best policies, which leaders say will pay for additional staff needed to market the program.

But what really has critics clamoring is GHLIT CEO Libby Wallace’s familial tie to former AVMA Executive Vice President Dr. Bruce Little, who sits on Pets Best’s board of directors. To that, Wallace, Little’s daughter, explains that she was hired months after the GHLIT-Pets Best deal already was underway (see related timeline, attached). She issued the VIN News Service the following statement:

“Libby Wallace went through the interview process with several other interested candidates for the position of CEO. As the former vice president of national accounts with Coventry Health Care, her many years of service in the health-insurance industry made her a qualified candidate for this position.”

“Many members of the AVMA are aware of her family heritage,” the statement adds.

Still, questions remain concerning whether pet health insurance is good for the profession and whether alleged ethical issues stemming from GHLIT-Pets Best deal tarnish the reputation of AVMA, and by extension, veterinary medicine. To date, AVMA, GHLIT and Pets Best officials point to the transparency of the partnership, which they hope will raise the bar for pet insurance industry standards.

AVMA-approved standards for pet insurance were issued last July in a white paper, just as GHLIT announced the Pets Best arrangement. Yet in November, the Executive Board rescinded its support of the paper, based on advice from the group’s Council on Veterinary Service.

While AVMA still endorses a third-party payment system that “provides coverage to help defray the cost of veterinary medical care,” the white paper was more prescriptive and specific than an AVMA policy should be, according to an article in the Dec. 15 issue of the Journal of the American Veterinary Medical Association.

“Also, the council believed that the provision calling for veterinarians to educate clients about pet insurance implied it was the practitioners’ responsibility to help owners decide how to pay for services,” the article states.

Is the move an attempt by AVMA to distance the association from the GHLIT-Pets Best arrangement? AVMA officials did not respond to VIN News Service requests by press time to answer that question. But in a VIN message board post directed at quelling members’ dissension, Executive Vice President Dr. Ron DeHaven, spells out the AVMA/GHLIT connection, stating that “while AVMA GHLIT is a separate entity from the AVMA, the AVMA Executive Board has some control and responsibility. The GHLIT charter is issued and amended by the AVMA and the AVMA Executive Board appoints the GHLIT trustees. However, the GHLIT trustees operate independently and are accountable to the members of GHLIT, not the AVMA.”

He continues by adding that while AVMA “is supportive of the GHLIT’s involvement with pet insurance … AVMA does not endorse any individual pet insurance company.”

Tags: pet insurance, Pets Best Insurance

As employers nationwide struggle with rising health care costs, many have implemented a variety of cost saving initiatives. A recent health care survey found the majority of public sector employers are working to control costs by implementing disease management and wellness programs, instead of introducing consumer-driven health plans (CDHPs).

Over half of the public employers who responded to the survey indicate they have implemented a disease management (69%) or a wellness program (65%). A much smaller percentage, only 17%, have a consumer-driven health plan in place.

“Although CDHPs have become common in the corporate environment, many public sector plans do not see CDHPs as a good fit for their organization – perhaps because the greater out-of-pocket costs associated with CDHPs could result in employees delaying needed care,” said Sally Natchek, Senior Director of Research at the International Foundation of Employee Benefit Plans. “Instead, public employers are working to control costs by implementing wellness and disease management programs and building a foundation for individual responsibility.”

Conducted by the International Foundation of Employee Benefit Plans, the study titled Health Care Cost Control: Industry Approaches and Attitudes, reports responses from 1,054 U.S. benefit plans sponsors, trustees, and others who serve in the employee benefits industry. Survey results break down respondents answers based on four unique employee benefit sectors: corporate plans, public/governmental plans, multiemployer benefit plans, and professional service firms serving the employee benefits industry.

The survey found that 64 percent of public employers are taking an incremental approach to overall cost-management, with only a small minority, 5 percent, indicating they are making significant, dramatic changes. Public employers identified promoting individual responsibility for health as the major factor shaping their health care strategies.

In comparison to the other employment sectors, public employers were significantly less likely to offer CDHPs. Corporate respondents stated they offer CDHPs at more than double the rate of the public sector (39%), while professional service firms are more than three times as likely to have a consumer-driven plan in place (59%).

The main reasons stated by public employers for not offering a CDHP include: poor fit for organization (35%), don’t favor shifting costs to employers (20%), waiting until CDHPs are proven effective (18%), and expect low participation (18%). In addition, nearly three-quarters, 74 percent, believe that there is a lack of good data about the cost-effectiveness of CDHPs and 79 percent stated that wide acceptance of CDHPs is unlikely until they become simpler to navigate.

“Public sector respondents are implementing disease management programs not only to improve health care costs, but also to improve the quality of health care,” said Natchek. “A majority, 81 percent, believe offering a disease management programs improves the quality of health care for their plan participants.”

Public employer respondents were the most likely to state that helping workers enjoy better overall physical health was a reason they offered a wellness program. The most common wellness initiatives they offer include health screenings, health risk assessments/appraisals, flu shots, smoking cessation programs, health fairs, and wellness education.

Interestingly, public employers appear to be among the first to offer disease management and wellness programs with 26 percent stating they had had a disease management program in place for more than five years and 39 percent stating their wellness program has been in place five or more years.

Tags: health care costs, wellness programs

Like most companies, RedPeg Marketing offers perks to its employees. The Alexandria, Virginia, experiential marketing firm hands out trophies for good performance and provides breakfast at staff meetings. Employees can compete in an annual Connect Four tournament as well as participate in lunchtime training sessions. Open the company fridge, and you’ll find cold beer.

RedPeg co-founder Brad Nierenberg, however, has been known to go above and beyond with company perks. He shells out $17,000 a year to rent a three-bedroom house in Dewey Beach, Delaware, that the company’s 48 employees can sign up for year round. “That’s one of the perks I’ve kept even in the downturn,” says Nierenberg, 42.

He once walked into the office carrying a briefcase containing $38,000 in cold, hard cash and presented each employee–38 of them at the time–with $1,000 for meeting company goals. “I thought, ‘I’ve got to make a big deal out of this; I can’t just put it in their checking account because that’s not as fun,’” says Nierenberg, who saw sales of $18.5 million last year. “I thought it would be cool for them to see $38,000 in cash.”

But Nierenberg has also taken perks away. He ditched employee use of a Mercedes for a whole month, free gas included, because he felt it was an expense that wasn’t necessary. He also stopped a company program that allowed employees to take off a certain number of Fridays during the summer because business was picking up and the company needed to make up ground after a few slow quarters. “You definitely can take a perk away,” Nierenberg says, “and you should if it’s affecting your business.”

But wait a minute: Conventional wisdom says it’s a bad idea to pull a perk once it’s out there. Yank away something employees have come to expect, and you’re setting yourself up for rampant conspiracy theories and angry employees. Google learned that the hard way last spring when it announced it would charge employees 75 percent more for its in-house day-care program. Employees with children didn’t take the news well, and some reportedly started to cry. Google has since reduced the price and will take more than a year to phase in the cost adjustment, but at what cost to morale? “Anytime somebody is receiving something and then, all of the sudden, they’re not, clearly they’re going to be upset,” says Deb Cohen, chief knowledge officer at the Society for Human Resource Management, an HR membership organization.

Of course, there’s a difference between the perks employees structure their lives around, like insurance, day care and flextime, and the frivolous perks, like bagels on Monday. And it’s these types of perks Google has also trimmed down to cut costs without affecting employees significantly: In October, the New York City division instituted limits on cafeteria hours and food selections. “No one is going to quit because they can’t get free coffee or pastries,” says Bob Nelson, an employee motivation and management consultant and author of 1001 Ways to Reward Employees. But the risk you run, he says, “is a panic that if the company can no longer afford coffee, it must be headed for disaster.”

It’s this perception that entrepreneurs want to avoid. Last Year, Expedite Group, a 7-year-old Cary, North Carolina, concierge company, debated whether to decrease the 401(k) matching contribution it offers its 17 employees. “We’ve struggled with matching it at times,” admits founder Nancy Piepho, 39.

She decided to leave the match alone, however, because lowering it might create doubt in employees’ minds. “We want the employees to have confidence in what we’re doing,” Piepho says. “That was one of the reasons I was like, ‘It’s not going to be easy, but it’s not a lot [of money] and it’s the right thing to do.’”

A Tough Year

Next Level Café, a St. Paul, Minnesota, technology management firm, saw 2007 as a great year. But 2008, not so much. “It’s been a tough year,” says CEO and co-founder Rich Anderson, 38. “We haven’t been growing as much.” Morale was falling, so last autumn, Anderson began tracking morale through a weekly survey that he plotted on a graph. He met with the company’s 25 employees and told them the truth: The company wasn’t at risk of failing by any means, but it wasn’t a great year and that meant fewer bonuses and perks.

Anderson, who co-founded the 7-year-old company with Stephen Weiler, 43, also started sharing some information about the company’s budget. He revealed that 75 percent of the service company’s expenses are salary-related, and he explained how a drop in clientele affects the expense side. An enlightening moment came when Anderson asked employees to guess how many clients the company had won and lost to date in 2008. “Every single person on the team underestimated,” he says. Now the company posts the names and revenue of new and former customers on a wall–a daily reminder of where the company stands. Morale is on an upswing, and the company closed 2008 with $2 million in sales.

Entrepreneurs shouldn’t fear pulling a perk, but they should fear doing it without employee involvement, Anderson warns. “As soon as you do it without having employees involved in the process, they’re going to resent it and fight back. They’re going to use it as a reason to leave if they’re looking to leave,” he adds. “If you get them involved, they’ll support the decision. They’ll embrace the world that they helped create.”

Central to a good communication plan is anticipating how employees will react when a perk is taken away and who will be most affected. You’ll also have to decide what kinds of low-cost perks could replace what’s gone. “Think about how you can offer the same or similar kinds of benefits in a different fashion that won’t cost you so much money,” says Cohen.

PerkSpot, a perks management company that creates customized portals where employees can go for discounts on a wide range of consumer goods, is seeing large companies implement its service to offset other benefit cuts they’re making, including insurance coverage. In one case, a national retailer rolled out PerkSpot when it announced it wasn’t giving anyone a raise. Says founder and CEO Christopher Hill, “They wanted to introduce PerkSpot to help soften the blow.”
Linking perks to performance

Cohen sees companies moving toward flexibility and other unique benefits that promote work-life balance. “That’s really been dictated by the work force,” she says.

Nelson, however, thinks now is the time for companies to link perks to performance. This way, companies don’t create cultures of entitlement where employees feel the company owes them just for showing up. “Smart companies are offering perks to the performers who have earned those perks,” he says.

Expedite Group has its share of softer perks, from Wii nights to beach trips to potlucks. Piepho, however, is most concerned with keeping her best performers happy, so she tailors perks to them. She’s letting one employee with an infant work flexible hours from home, while a rising star in the company is getting greater responsibilities. “What do pivotal employees need to thrive? That’s what you should focus on,” she says. “I know who my stars are, and I’m going to focus on them.”

There are still high expectations, however, particularly from the company’s Gen Y employees experiencing a recession for the first time. “It’s not their fault; they haven’t had the different experiences that us hugely older people have had,” Piepho says, laughing. “Recently, [we said], ‘This is what the pay range is, and if you’re not happy with it, go forth and be happy.’” Employers in a lackluster economy could find that sharing their blues is better than sinking into the red.