War creates personnel problems

When it became clear a few months ago that the approaching conflict in Iraq might endanger some Anteon International Corp. employees working for government customers overseas, Pat Dawson started investigating how those employees' insurance coverage would be affected by war. Dawson, senior vice president of administration at the Fairfax, Va., company, found the employees' medical and dental insurance coverage would not be affected, but they would not be covered for disability, death or dismemberment because their policies had war exclusion clauses. With his insurance broker, Dawson learned about Defense Base Act coverage, which is worker's compensation insurance for contractors working overseas for the military or for the U.S. government on public works projects. He got the coverage, and also business travel accident insurance, for Anteon employees who needed it. Anteon has 200 people stationed internationally, and another 90 to 100 employees traveling in support of customers, Dawson said. Dawson found many of his colleagues at other Washington-area defense contractors had questions about insurance similar to his. "Everyone is concerned about it," Dawson said. Dawson shared what he knew with other companies through the HR Coalition, a group of executives working for about 35 government contractors. The coalition executives query each other frequently, often via e-mail surveys, sometimes via phone or in meetings. They discuss issues ranging from health insurance coverage to pay differentials for employees recalled to the military reserves.Kay Curling, director of work-life solutions at SRA International Inc. of Fairfax, Va., said the coalition helped her grapple with war-risk exclusions in insurance policies for employees working overseas."There were weekly conference calls and very valuable information flying back and forth [via e-mail] about war-risk life insurance and accidental death insurance. If I had to go out and search for this information, I would have spent hours or days," she said.[IMGCAP(2)]The company is now working on supplementing its insurance coverage for injury or illness as a result of war, said Ann Denison, vice president of human resources for SRA, which typically has 15 or fewer employees overseas at a time. The HR Coalition as it exists today first met in January 2000. It grew out of an effort started by Curling, who founded a group of human resources executives in the Fair Lakes area of Fairfax, Va. In late 1999, Curling contacted Sharon Bohlman, then with Litton PRC, with some questions about prescription drug plans. Bohlman was so helpful, Curling said, that the idea for a broader coalition was born. Today, the coalition members represent about 150,000 employees, said Bohlman, now a consultant who runs the coalition at no charge to its members. "All of us, as HR leaders, have to help our companies be as efficiently competitive as possible. The whole impetus behind the consortium was to help each other do a good job," said Bohlman, who has started her own firm, Strategic Benefits Solutions LLC, in Vienna, Va.The coalition members had a few emergency teleconferences to make sure their companies had full complements of insurance coverage for employees working overseas. "A lot of policies are written with war exclusions. Once you accelerate to war, a lot of these coverages stop, and that's the time when you most need them," Bohlman said. "We were helping everybody go through their policies and see if they had coverage in place -- do you have accidental death and dismemberment, medical coverage, long-term disability, worker's compensation. ... We were all working on a unified checklist."Once the companies identified the gaps in their benefits, they identified solutions, distributing names of companies providing war-risk insurance, life insurance without war exclusion clauses and the like. "It's a more comprehensive list [of resources] than we could have had alone," Bohlman said.The additional insurance coverage that Anteon bought was very expensive, Dawson said, but company officials decided it was important to make the employees' benefits equal to what they would have if they were not in harm's way. Veridian Corp. officials saw their insurance costs spike as well, as they increased the amount of business travel insurance and ensured that their employees would be covered in war-torn areas. Even before the war in Iraq, the cost of insuring one person sent there for a week was about $6,200, said Joan Kelly, vice president of corporate human resources. About 45 employees are working overseas, she said. The Arlington, Va., company has seen an increase in employees sent overseas in hazardous areas, and in many cases it's not known exactly where they are going or how long they will be gone, she said. Those factors make getting insurance coverage a challenge. "We don't know that cost up front in a lot of cases," said Janet Pryor, senior benefits manager. "We pay a set premium, and we have to give [the insurance firm] an accounting of how long people have been gone and where they went, the best we can tell them, and they derive additional premium from that information."Since the coalition formed in 2000, members have been surveyed more than 40 times on issues from prescription co-payments to 401(k) retirement plans to sending employees overseas. Typically, a consortium member will query the group via e-mail about a single issue. That member will compile the responses, use the information and then send the information back to the group. "It's a really useful business tool. Within less than a week, we are able to find out what our colleagues are doing," Curling said. The coalition has proved so helpful for getting good information quickly and inexpensively that at SRA, "we don't take a solution forward to senior management anymore without finding out what our competitors do," Denison said.The insurance questions are new in part because the changing nature of the military is putting contractors closer to the battlefield. "If you look at what's happened to the military, downsizing has increased its use of contractors to provide functions that were heretofore handled by the military," Dawson said. Eleven years ago, during the Desert Storm conflict in Iraq and Kuwait, "we didn't have any people actually in harm's way," he said. *Staff Writer Gail Repsher Emery can be reached at gemery@postnewsweektech.com.