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CEO Daily Brief – Nov. 23, 2010

Business Complaints about Bare Bones Health Insurance Regs Lead to New Rules Some CEOs have gotten short-term regulatory relief for …

Business Complaints about Bare Bones Health Insurance Regs Lead to New Rules

Some CEOs have gotten short-term regulatory relief for their companies on limited health insurance policies which cover many employees. Amid pressure from businesses, the Obama administration has loosened rules for these bare-bones health-insurance policies.

McDonald’s Corp. had warned it might have to drop its health-insurance plans for 30,000 hourly workers unless it got an exemption for these policies, which have low premiums but also limit payments for medical costs.

The administration’s move underscores how businesses, after complaining loudly about the health insurance overhaul in the run-up to its passage, are now winning a handful of modifications.

About 1.4 million Americans are covered under these “mini-med” plans. They’re typically offered by low-wage employers, who have high employee turnover and end up paying out little money in medical claims.

Under the rules disclosed Monday, mini-med policies won a reprieve for 2011 that allows them to spend half as much of their premiums on medical care as most other insurers.

The basic McDonald’s plan for newer store workers now charges a single employee $13.09 a week for a plan that tops out at $2,000 a year in benefit payments.

By 2014, mini-med plans will effectively disappear when the new insurance exchanges open for business, and the looser rules are meant as a bridge between now and then. Lower earners will qualify for new insurance tax credits.

It is just not McDonald’s which is happy with the new rules. The National Retail Federation praised the new rules and said they would help retailers and others that offer limited-benefit plans keep them in place.

For more about the changed regulations, as reported by The Wall Street Journal, please click here.

Workers in Japan Give Bosses Low Marks Compared to Managers in China and India

During a recent survey, only 35 percent of employees in Japan rated their company’s senior management highly on a set of five attributes—such as their commitment to high-quality products and their people management skills. This is in sharp contrast to the 1980s, when Japanese managers drew world-wide admiration for quality-improvement techniques. But Japan has been stuck in economic stagnation for nearly two decades, noted Columbia Business School management professor Michael Morris. “In Japan, there used to be a sense that ‘We can do anything,'” he said. “Now, the pessimism is unbelievable.”

The highest-rated leaders were in India and China, where more than 70 percent of employees believed their senior managers were effective. “The high-growth economies of China and India have given employees there confidence in their leaders,” said Jack Wiley, executive director of the Kenexa Research Institute. Employees at rapidly growing companies in China and India also have a strong sense of upward mobility, which boosts their perception of their bosses, Wiley said.

Globally, 55 percent of employees rated their senior managers highly, and in the United States, 56 percent of employees did.

For more about the survey, conducted by the Kenexa Research Institute, and reported by The Wall Street Journal, please click here.

Human Resources Departments May Be Misunderstood, but Need to Do Their Jobs

Often times, it is not clear what Human Resources Departments are supposed to do in an organization. HR is not in the job of leading people, says Armin Trost. It’s the managers’ responsibility to lead their employees, manage performance, and provide guidance. Still, HR is expected to play a leading role on how managers deal with their subordinates and how they perform HR-related activities. HR is a function that provides frameworks and supports internal clients just as corporate IT and accounting departments do.

In addition, line managers can’t execute HR-related actions, like running interviews or performance appraisals, by nature. And making sure HR standards meet business needs does not mean HR should take a back seat. A strong HR function will always take into consideration opinions addressed by major stakeholders throughout the business. Most companies need a strong HR department. The more direction and expertise HR shows, the more acceptance and acknowledgment it will gain. For more about HR, as reported by The Harvard Business Review, please click here.

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