How to bridge the health insurance knowledge gap for younger employees
More often times than not, when younger employees are searching for their own health insurance plans, they make common and costly mistakes due to the lack of education in regards to health care plans. Proper education could help the young generation of employees for their health, wellness, and future. Read this blog post to learn more.
With the passage of the Affordable Care Act, young adults were able to stay on their parents health insurance plans until the age of 26. But once they get their own health insurance, many young employees make common and costly mistakes because they don’t have the proper education when choosing their own programs.
This information gap could result in employees being hesitant to seek care, resulting in higher medical expenses for employees and reduced productivity from sick leave.
“It’s a challenge— there’s a fair number of employees that will come off of their parent's insurance at the age of 26,” says Amanda Baethke, director of corporate development at Aeroflow Healthcare. “There's not a lesson that you go through in order to understand insurance.”
How can employers help younger workers avoid health insurance mistakes?
It's beneficial for HR to do a training where they're going over what co-pays, premiums, deductibles and coinsurance are. When signing up for insurance, employees are trying to decide which insurance to pick and may not understand the full impact of that decision. Employees could pick the cheapest one because they want less out of their paycheck. There's just not a lot of discussions happening and employees are left blind.
What mistakes do young workers make when it comes to health insurance?
I’ll get a lot of questions from my team like ‘What’s an HSA and what’s the benefit?’ It's truly a lack of understanding, because nobody teaches it. A lot of mistakes will happen with out-of-network providers. They don't realize that there are insurance networks and then within those networks, there are more narrow networks underneath.
For example, an employee can call a doctor's office and ask if that office is in-network and the receptionist may respond that they are — especially for the national brands like UHC, Aetna, Cigna, Humana. However, many of those plans have narrow networks under them that allow them to better control cost. So the employee would want to ensure their particular group/plan is in-network.
Another thing is making sure employees know that even though they have a deductible, some preventative care is likely covered under their insurance. This will help them choose the right physician so if they do get sick later on, they can see that physician, rather than going to a hospital which would be more costly for them.
What specific role should HR take when it comes to educating younger employees about health insurance?
HR is responsible for making sure that employees understand the benefits that they're offering. HR works incredibly hard to deliver the best benefits possible and advocate for each and every employee. So why not just go the extra step and have a consultation with the insurance company to explain what the benefits mean, what is covered, what may not be covered, how to really navigate through the insurance company and work back with them.
SOURCE: Schiavo, A. (19 October 2020) "How to bridge the health insurance knowledge gap for younger employees" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/how-to-bridge-the-health-insurance-knowledge-gap-for-younger-employees
Just 28% of Americans expect to return to the workplace before 2021
According to a recent study from a Conference Board Survey, only 28 percent of Americans expect that they can return to the workplace before the year 2021. Although that percentage has increased, many are still uneasy about the idea of returning to public spaces. Read this blog post to learn more.
Just 28% of Americans say they already have or expect to return to workplaces before the end of the year, indicating the coronavirus pandemic is making remote work more mainstream, a Conference Board survey showed Thursday.
Nearly one-third of respondents said they would be uncomfortable getting back to offices, shops and factories, while half said their greatest concern was contracting the disease at work, according to the Sept. 16-25 online survey of more than 1,100 workers. Only 17% of employees said they were very comfortable or even wanted to return.
The coronavirus continues to spread across the U.S., with 34 states recording higher seven-day averages of new cases compared with a month ago. While progress is being made on a vaccine, it will be months before it’s available to the general public. Even when it is ready, the Conference Board’s survey showed just 7% expect a return to their workplace.
“For knowledge workers and others where remote working is an option, you’re going to see more of a remote or hybrid working arrangement become the standard way,” said Rebecca Ray, executive vice president of human capital at the Conference Board.
A cultural shift to working from home and the pause or stop in business reopenings have upended the commercial real estate market. Federal Reserve Bank of Boston President Eric Rosengren warned that a resurgence in the virus could lead to troubles in the financial sector via commerical real estate.
The “commercial real estate sector is going to be impacted in the long term as we now need much less space for offices, retail, and probably higher education,” said Gad Levanon, head of the Conference Board Labor Markets Institute.
The Conference Board’s survey echoed with a recent poll of company executives by Cisco Systems. More than half plan to downsize their offices as remote working will become commonplace after the pandemic subsides, according to the Cisco survey.
The Conference Board survey also showed that lower-ranking employees are more concerned about returning. Some 20% of rank-and-file workers and 21% of front-line managers indicated they feel pressure to return in order to keep their jobs, compared with just 4% of executives. Individual contributors are also the least comfortable coming back to job sites.
Some 29% of respondents said they had little faith that their colleagues would adhere to safety protocols and guidelines upon return. One-third questioned the wisdom of going back to workplaces because they said productivity has remained high when working remotely, the survey showed.
SOURCE: Ren, H. (15 October 2020) "Just 28% of Americans expect to return to the workplace before 2021" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/articles/just-28-of-americans-expect-to-return-to-the-workplace-before-2021
Every dollar counts in today’s zero-interest-rate environment
It’s no secret that interest rates have been at historically low levels for quite some time, but the recent announcement by Federal Reserve Chairman Jerome Powell indicates that rates will stay near zero for the foreseeable future. Chairman Powell stated in his address last month that the Fed would tolerate above-2% inflation instead of attempting to preemptively control inflation by raising interest rates.
With rates likely to remain low, investors, and especially participants in sponsored 401(k) plans in the U.S. retirement system, need every dollar they can save to achieve their goals in retirement. This is particularly true this year, with the COVID-19 pandemic having inflicted significant disruption, uncertainty, and volatility on our nation’s workforce as well as the financial markets.
Even before the pandemic, low interest rates were already hitting Americans enjoying or nearing retirement very hard, because lower rates for annuities and money market accounts require people to save more when trying to convert savings into income. The indexing of Social Security benefits at lower rates also decreases income in retirement.
Stop automatically cashing out terminated participants’ small-account balances!
Since every dollar counts for plan participants in our pandemic-disrupted, zero-interest-rate environment, why are sponsors (who have a duty to adhere to the fiduciary standard) continuing to cash out small, stranded accounts with less than $1,000?
The Employee Benefit Research Institute (EBRI) estimates that a total of $92 billion in hard-earned savings leaks out of the U.S. retirement system every year because 401(k) plan participants prematurely cash out their accounts when they switch jobs. Conducting automatic cash-outs for terminated participants adds to the already sizable leakage of assets from our nation’s retirement system.
As we have noted in previous articles in this space, the primary driver of cash-out leakage is the lack of seamless plan-to-plan asset portability for participants at the point of job-change — and the resultant costly and time-consuming nature of DIY portability.
Boston College’s Center for Retirement Research has reported that, on average, premature cash-outs decrease participants’ total 401(k) assets for retirement by 25%. Cashing out 401(k) savings early is perhaps the worst blunder that a retirement-saver can make. But when sponsors automatically cash out small accounts, they potentially open themselves up to new fiduciary liability down the road.
After all, if a terminated participant has moved to a new house or apartment in the years since working for a former employer, and the new mailing address has not been updated in the files of the plan sponsor’s recordkeeper, then the check for the cashed-out small balance may not reach the accountholder. If that occurs, and the accountholder finds out the assets in their former-employer 401(k) account were lost, the employer could be sued, or the plan could be the focus of a regulatory inquiry.
Auto portability can eliminate the need for automatic cash-outs and rollovers
By adopting the technology solutions which enable auto portability, sponsors can potentially avoid having to conduct automatic cash-outs and automatic rollovers to keep their average account balances and related metrics at healthy levels.
Auto portability — the routine, standardized, and automated movement of a retirement plan participant’s 401(k) savings account from their former employer’s plan to an active account in their current employer’s plan — is powered by “locate” technology and a “match” algorithm. Together, these innovations locate lost and missing participants, and kick-off the process of moving their savings into 401(k) accounts in their current-employer plans.
Auto portability also has the power to make automatic rollovers of small accounts into safe-harbor IRAs a redundant practice. Placing terminated participants’ assets for retirement into safe-harbor IRAs in a low-interest-rate environment isn’t exactly benefiting them, since the only default investment options allowed in safe-harbor IRAs are principal-protected products. The combination of low yields and high fees in too many safe-harbor IRAs can deplete accountholders’ assets over the long term.
The capability to begin the movement and consolidation of 401(k) assets as participants change jobs, as well as reunite lost and missing participants with their 401(k) savings, can help decrease cash-out leakage — and savings depletion — at a time when every dollar in the U.S. retirement system counts more than ever.
EBRI estimates that the widespread adoption of auto portability by sponsors and recordkeepers would preserve up to $1.5 trillion (measured in today’s dollars) in our nation’s retirement system over the course of a 40-year period, primarily for the benefit of low-income workers. Based on EBRI data, Retirement Clearinghouse estimates that widespread adoption of auto portability would preserve $619 billion in savings for 67 million minority participants in the U.S. retirement system — including $191 billion for 21 million African-Americans.
Fortunately, auto portability has been live for more than three years, and it’s available to help sponsors make every dollar count for participants during these extraordinary times.
SOURCE: Williams, S. (07 October 2020) "Every dollar counts in today’s zero-interest-rate environment" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/every-dollar-counts-in-todays-zero-interest-rate-environment
Here's your employee checklist for open enrollment
The COVID-19 pandemic has focused consumer attention on health care, germs and the impact a single illness can have on their lives, livelihoods and loved ones. With the fall open enrollment season almost here, you have the opportunity to think more critically about the specific plans you choose for yourself and your family, as well as any voluntary benefits that may be available to you, including childcare, elder care and critical illness. In a world where it feels like health is out of the individual’s control, we all want, at the very least, to feel control over our coverage.
As we know all too well, there’s a lot to consider when it comes to choosing and using health care benefits. The most important piece of becoming an informed health care consumer is ensuring you have access to — and understand — the benefits information you need to make smart health care choices.
While open enrollment may seem daunting, devoting an hour or two to reviewing your plan options, the programs available to support you and your family physically, mentally and financially, and how to get the most from the coverages you do elect, can go a long way towards providing peace of mind as we face the unknowns of 2021. Here are five tips to keep in mind as you prepare for and participate in open enrollment.
Don’t forget that preventive care is covered by most plans at 100% in-network regardless of where that care is received. Schedule your appointments as soon as possible (and permissible in their area), and research other venues for receiving care, such as pharmacies, retail clinics and urgent care facilities. Most are equipped to provide standard vaccinations and/or routine physicals.
Unfortunately, there are also the long-term implications of COVID-19 to consider. Research suggests that there are serious health impacts that emerge in survivors of COVID-19, such as the onset of diabetes and liver, heart and lung problems. And many who were able to ride out the virus at home are finding it’s taking months, not weeks, to fully recover. As a result, you should prepre for the possibility that you, or a loved one, may be ill and possibly out of work for an extended period of time. Be sure to evaluate all of the plans and programs your employer offers to ensure your family has the financial protections you need. For some, a richer health plan with a lower deductible, voluntary plans such as critical illness or hospital indemnity insurance, and buy-up life and disability insurance may be worth investigating for the first time.
As hospitals reopen, it may be difficult to schedule a procedure due to scheduling requirements and pent up demand. A second opinion may be in order if your condition stabilized, improved or worsened during the delay; there may be other treatment options available.
A delay in scheduling also provides an opportunity to “shop around” for a facility that will provide needed care at an appropriate price — especially if you are choosing to go out-of-network or have a plan without a network. Researching cost is the best way to find the most affordable providers and facilities with the best quality, based on your specific needs.
Many medical plans offer second opinion and transparency services, and there are independent organizations who provide “white glove,” personalized support in these areas. Read over your enrollment materials carefully, or check your plan’s summary plan description, to see what your employer offers. If nothing is available, ask your employer to look into it, and don’t hesitate to do some research on your own. Doing so can often result in substantial cost savings, without compromising on quality of care.
Be sure to check up on your preferred health care providers — especially those you might not see regularly — to confirm they are still in business and still in network (if applicable). If you live in a rural area, you may have to travel farther to reach in-network facilities. If you’re currently covered by an HMO or EPO, you may want to evaluate whether that option still makes sense, if your preferred in-network providers are no longer available.
When was the last time you changed your medical plan? If you’ve been keeping the same coverage for years, it might be time to look at what else is available. Your employer may have introduced new plans, or you may find that a different plan makes more sense financially based on how often you need health care. Don’t forget — the cheapest plan isn’t always the one with the lowest premiums.
You may also want to consider setting aside funds in a health savings account or health care flexible spending account (if available). If your employer offers a wellness program, this might be an opportunity to start adopting better health habits to ensure you’re better equipped physically and mentally to deal with whatever lies ahead.
3 tips to boost your healthcare literacy with technology
Historically, the relationship between consumers and their health plan providers has been a distant and somewhat bumpy one. Some health plan providers get a bad rap for poor communications, leaving consumers on their own to navigate a health care system wrought with confusing language, red tape, and unpredictable costs.
The events of a global pandemic have compounded the complexity of dealing with the healthcare system. A recent J.D. Power Survey found that more than 60% of privately insured U.S. health plan members did not receive any guidance about COVID-19 from their providers. The lack of healthcare literacy — knowing what questions to ask and where to get care — has also created a bigger gap between everyday people and their providers. But the good news is technology can help us get more out of our benefits, making our relationship with health plan providers more connected.
The COVID-19 pandemic has exposed the need for more TLC and attention when it comes to benefits. But technology can help us get the most out of our benefits — strengthening our consumer relationship with health plan providers. By engaging with technology, we can improve our healthcare literacy, identify cost-saving opportunities and be more prepared for the unexpected.
If consumers are going to make an informed decision during open enrollment, they’ll need information about the number of visits they paid to the doctor and the costs of their claims to determine if they should change plans. Maybe they’re paying a lot more in premiums, or perhaps they didn’t meet their deductible. Being engaged with your benefits is key to getting the most out of them.
Tip: Avoid going on autopilot with your benefits. Benefits offerings are always changing, and health providers often offer programs that you can opt-in to free. Make sure you’re set up to receive notifications from your benefits administrators and health plan providers. Then take action. Use the preventative care offerings, likes annual wellness check-ups, and enroll in the programs that will serve you now and in the future.
During the pandemic, there has also been an increase in the use of AI to improve communication across the healthcare ecosystem. For example, patient care in the emergency room (ER) is traditionally delivered numerically — first come, first serve. However, AI can help doctors and caregivers at hospitals prioritize the needs of waiting patients. This can lead to a decrease in wait times in crowded hospitals — especially important during the pandemic. In the same vein, AI can help an individual decide if they truly need to visit the ER or if a telehealth option would be more effective and affordable.
Caregiver support platforms, like Cariloop, are using cloud-base technology to improve communication between providers, consumers and their families. This employer-sponsored benefit offers tailored caregiving plans and coaching for families looking for pediatric and senior care. Cariloop, and other caregiver support platforms, use technology to tap into a system of trusted providers and build caregiving scenarios with planning and calculator tools. Users can adjust for different scenarios, review whatresources are available, and receive personal coaching throughout the caregiving journey.
Tip: Viewing benefits as an item to check off a list once a year means you might be overpaying or leaving benefits on the table. Using claims integrations and decision support tools, like planning calculators, can help you and your family fully engage with your benefits and improve your healthcare literacy.
Benefits administrators and health plan providers are beginning to see the importance of supporting the whole person — through mental wellbeing initiatives or by offering online tutoring discounts, streaming virtual fitness programs, and food delivery services.
Tip: Look to the different options that providers use to deliver holistic and preventative care options. For example, year-long access to audio-guided meditation apps like Headspace or programs built around the use of wearable technology that rewards users who meet personalized activity goals. These initiatives go beyond regular patient care and give you tools to support your wellbeing — not just when you’re feeling under the weather.
3 tactics to navigate company culture in a remote world
In many respects, COVID-19 reframed our thinking about worklife balance. While this was already a fatigued concept, the pandemic and resulting quarantine fully demolished the fourth wall that stood between work and the personal lives of our team members.
In the early weeks, given our technology enablement already in place, a near immediate shift to fully virtual didn’t seem like a huge shift for many. As the weeks wore on, working parents and those with different challenges at home felt the effects almost immediately. As a working mom myself, I have first-hand experience around what it means to be a mom and an employee at the same time and in the same space, along with my partner also working from home. In fact, my daughter may or may not have “Zoom bombed” a session with our board. Of course, none of them were bothered by it and it probably embarassed me more personally than anything.
As the chief people officer of SailPoint, I’ve seen how balancing continuing to educate our children from home while working full time has taken a toll on many. Half of our workforce have children under the age of 18 living at home. To move forward as a distributed workforce in a way that is sustainable and productive, HR teams need actionable steps to empower today’s working parents.
By implementing specific guidelines that help employees navigate these waters, HR teams can better instill confidence in their employees and provide them with the resources required to drive successful and productive engagement. Small changes, simply starting with an acknowledgement of this issue, helps teams to get their work done on the terms they’re able to design to best fit their needs.
Give employees the formal gift of time
When the pandemic began earlier this year, SailPoint’s approach was centered on “returning to normal.” It’s clear now that a return to normal is not in the cards, and organizations should look at this time as an opportunity to rebuild and create lasting culture changes through new programs and initiatives.
One strategy we’ve found successful at SailPoint is implementing a 2-hour block twice a week when employees have no meetings and can focus on what is most important to them individually. This could range from taking care of their children to getting a presentation done that they haven’t had time for, or even scheduling personal appointments. Whatever it may be, this block we call ‘Free2Focus’ is about giving our crew space to balance the personal demands with the work demands. So far, the response to this time block has been very positive and it allows SailPoint crew members to use their time during the day how they wish in a flexible but formal way. Some crew members are using this time to focus on helping their children with school work, others have used it to have lunch with loved ones. Given that much of schooling from home may fall to women, we also look at this as an inclusion initiative to ensure that part of our workforce isn’t faced with a choice of one or the other.
Restructure your physical office
One aspect of corporate culture that was long overdue for restructuring is the use of the physical office space. At SailPoint, we’ve always offered our crew members flexibility, and this extends to trusting them to decide where they work. We believe that work is our identity, not our cubicle, and COVID-19 has presented us all an opportunity to rethink the office space.
As of September, we have allowed crew members to voluntarily return to the office if they wish at 25% capacity. Moving forward, we’re asking the crew to think of our offices like they would a college library. In college, you would likely go to the library for a place to focus or a place to meet with otehrs. This is how we want the SailPoint offices to operate because we know our crew makes the most impact when they have the autonomy to make their own decisions that work for the individual, their family and their work. There is not a one-size-fits-all when it comes to working styles and personal situations, which is why we want our physical office space to be as flexible as our remote office space.
Commit to community
While this time may have brought us closer to our families, it can be isolating from an employee culture perspective. Some of us are lucky enough to have family support at home, but many do not. It’s crucial that those looking for companionship and emotional support are able to find it, within our community.
Having a strong culture in place is not only invaluable for the individual’s well-being but also vital in keeping employees engaged and motivated. One strategy to achieve this is taking advantage of the technology that connects us. At SailPoint, we have several Slack channels that aren’t related to work to keep our community connected. We have channels for parents, pet lovers, beauty gurus, Texas Longhorns and more, but we also have a channel called SAIL ON. This particular channel is a place for people to post supportive messages, or to just have fun and connect with their community of crew members. So far, this initiative take on a life of its own, as we’ve seen our crew organize fitness competitions, build standing desks for each other’s homes, share their thoughts on "Feel Good Fridays.”
SOURCE: Payne, A. (23 October 2020) "3 tactics to navigate company culture in a remote world" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/list/3-tactics-to-navigate-company-culture-in-a-remote-world
Top 10 year-end tax planning tips
Another year is coming to a close, which only means a season of taxes is slowly approaching. Tax time can often be one of the most stressful times of the year for businesses, employees, and even clients, but that just means helping clients with a less stressful year-end planning session more crucial than ever. Read this blog post for helpful tips.
Between the upcoming presidential election and the COVID-19 pandemic and its attendant stimulus packages, this year has seen more than its share of uncertainty around tax — which makes helping clients with year-end planning all the more crucial.
“Year-end tax planning is more important than ever this year,” said Renato Zanichelli, national managing partner of tax services at Grant Thornton, in a statement. “Businesses both large and small have been dealt a tough hand. Having the right tax strategy will help businesses navigate this time of historic disruption and put them on the right track as a new year begins.”
“Lawmakers dedicated trillions of dollars to keep families and businesses afloat, but those provisions may also require quick action, in many cases by the end of this year,” added Dustin Stamper, managing director in the firm’s Washington National Tax Office. “The government wants to get money in the hands of those who need it, and many of the most generous provisions are tax changes that provide welcome liquidity for businesses and timely relief for individuals.”
With that in mind, the Top Eight Firm has put together a list of 10 key tax considerations for year-end planning for both individuals and businesses (below); for more see their year-end tax planning guides.
Accounting method changes are among the most powerful ways to accelerate deductions, but remember any non-automatic changes a company wants to make effective for the 2020 calendar year must be made by the end of the year. C corporations make NOL refund claims themselves, but passthrough businesses like partnerships and S corporations pass losses onto to owners, who will make claims.
The fastest way to obtain a refund is generally by filing a tentative refund claim, but these must be filed by Dec. 31, 2020, for the 2019 calendar year. If losses will be in 2020, the business should start preparing to file early, because they cannot claim an NOL carryback refund until they file their tax return for the year.
Tax rules allow businesses to claim certain losses attributable to a disaster on a prior-year tax return. This is meant to provide quicker refunds. President Donald Trump’s COVID-19 disaster declaration was unprecedented in scope, designating all 50 states, the District of Columbia and five territories as disaster areas. This means essentially every U.S. business is in the covered disaster area and may be eligible for refunds from certain types of losses. Under this provision, a business could claim a COVID-19 related disaster loss occurring in 2020 on a 2019 amended return for a quicker refund. The provision may potentially affect losses arising in a variety of circumstances, including the loss of inventory or supplies or the closure of offices, stores or plants. To qualify, the loss must actually be attributable to or caused by COVID-19 and satisfy several other requirements.
3 small business leaders on what it takes to survive the pandemic economy
Now more than ever, business leaders are having to take the roads less traveled when it comes to allowing their businesses to succeed. The pandemic economy has caused many to struggle, and many are stepping out to talk about what they've learned. Read this blog post to learn more.
Building a business is never easy, but 2020 has been a unique calamity. In the U.S., which has suffered more COVID-19 deaths than any other nation, the economy entered its worst downturn in generations. Although central bank stimulus and government programs such as the Paycheck Protection Program have helped cushion the blow, a return to growth will depend on the creativity and resilience of millions of entrepreneurs and business managers.
Lindsay Gibson, COO, TextNow
Over a decade, TextNow built its business, an app that allows users to send and receive calls and text messages for free, by hosting ads for hotels and airlines and the like. Within weeks of the COVID-19 pandemic hitting the U.S. and Canada, one-quarter of TextNow’s revenue disappeared. The company closed its Waterloo headquarters, as well as offices in Portland, Ore., and San Francisco. All employees started working from home.
Lindsay Gibson, the chief operating officer, stayed relatively calm. A 16-year career at cellphone maker BlackBerry taught her how to navigate an organization on “a downward slope,” as she puts it. At BlackBerry, she once had to cut 250 jobs on her first day in a new role. She remembers it as the beginning of five years of doing more with less.
Her strategy then, and now, was to make plans. Plan A at TextNow was to slash revenue targets and cut expenses. The company eliminated 19 jobs, froze hiring, and ended employee perks such as personal trainers and free lunches. Biweekly companywide Zoom meetings were instituted to keep staff up to date and fortify plunging morale. For three months the mood became “very conservative, very heads down, and very focused,” Gibson says.
The company quickly found opportunities for growth. With so many people unable to visit friends or relatives, TextNow started testing a video chat function. Amid the economic downturn, hundreds of thousands of people could no longer afford to pay their AT&T or Verizon bills, so TextNow’s appeal increased. As school moved online, teachers began using TextNow to communicate with parents and students.
By July, TextNow was growing again. It lifted the hiring freeze and recruited a chief growth officer to beef up marketing and help win customers. TextNow is on track to meet or exceed its new revenue targets, Gibson says.
Brian Butler, president and CEO, Vistra Communications
Brian Butler is used to dealing with disaster. The Gulf War veteran — who still suffers from injuries and hearing loss sustained during his Army service — oversaw a munitions plant in Virginia at the time of the Sept. 11 attacks, helped coordinate Hurricane Katrina relief from the Pentagon, and started his marketing and communications business just before the 2008 financial crisis.
So in January, when he first read about a virus sweeping China, he started to prepare. In February he ordered five laptops for a core group of employees and by March had purchased 35. When other companies found themselves struggling to find equipment, his staff was settled and working from home. “I was a planner in the military,” Butler says. “I heavily rely on my ability to think and plan before I do.”
Still, in just a few months, Vistra lost two clients and three major contracts, including a hospital, a large beverage company, and a tourism agency that canceled events, contracts, or big projects. The company responded with an online campaign it called “V Positive.”
“We put up positive messages on a weekly basis,” Butler says. “That generated more good leads for us, just by doing that. So while in some areas we lost a few customers, in some areas we gained a few.”
In late May, the video of George Floyd’s death led to worldwide protests against police killings of Black Americans. Butler is Black, and 48% of his employees are people of color. Vistra started a new business line that offers tailor-made diversity training to customers.
As the months of working from home passed, Butler says he focused more on his staff’s well-being. He gave each employee $150 to “buy something that will help them work better.” The company, which already holds weekly and monthly video calls for staff, started including more informal Thursday morning coffees and Friday afternoon sessions with his father, a chaplain. Butler says the idea stemmed from his experience in the Army, where every battalion has its own chaplain. “And I thought, Hmm, why does it have to be different in the workplace?”
By late August, most of the clients the company had lost in the early days of the pandemic were back on Vistra’s roster. Butler says he’s working from his home for the foreseeable future, just a few miles from the office — and a few feet from the bedroom where he founded his company 13 years ago.
Melissa Wirt, founder, Latched Mama
Melissa Wirt thought she knew about juggling responsibilities. She founded Latched Mama to provide affordable, functional clothing for nursing mothers six years ago, when she had just two children. Today she’s the mother of five.
Then in February, the coronavirus shut down the factories of some of Latched Mama’s suppliers in China. It took a few more weeks before it hit her team — most of them working mothers — in Virginia. “So many moms’ lives, within a 24-hour period, were turned upside down,” she recalls. “Kids stopped going to school on a Friday and didn’t go back on a Monday.”
Wirt’s mother came up from Florida to help take care of her kids. Another mom couldn’t come to the office anymore when school and day care closed. “So her husband is now coming into work” and is on Latched Mama’s payroll, Wirt says, and the woman is doing social media work for the company from home.
In other ways, the work-from-home lifestyle proved a boon to Latched Mama’s business. Women are treating themselves to more comfortable clothes, boosting sales from last year, Wirt says.
Her staff, many at home or working half-shifts, weren’t able to pack and ship fast enough to meet the elevated demand. One of her employees got COVID-19 during the summer, and fear of the virus remained high.
So Wirt recruited teenagers, including a 16-year-old neighbor, to work part time. She also hired two people to manage shipments and warehousing, scooping them up from a nearby distribution company that went bust during the pandemic. “In some ways it’s an amazing problem to have,” Wirt says. “But it’s also hard as a small business because you also have to keep your employees safe. It’s just a lot of balls in the air at the same time.”
Productivity has ticked down. But Wirt says she feels that’s a small sacrifice in an unprecedented year.
“If we need to cut some profit to be able to make sure that people can relax and take a deep breath and be there for their kids and get through this pandemic together, then that’s what we’re going to do.”
SOURCE: Dmitrieva, K.; Kazakina, K.; Greenfield, R. (07 October 2020) "3 small business leaders on what it takes to survive the pandemic economy" (Web Blog Post). Retrieved from https://www.benefitnews.com/articles/3-small-business-leaders-on-what-it-takes-to-survive-the-pandemic-economy
Tackle growing healthcare costs with earned wage access
As open enrollment begins to trickle in, advisors are looking for new and improved ways to help employees to leverage out of pocket costs on the year that is upon them. For both and employers and employees, healthcare strategies are an integral part of workforce management. Read this blog post to learn more.
It’s that time of year when we all learn that health care costs are going up (again).
As the nonprofit Business Group on Health reported, the average employee will be hit with $15,500 in out-of-pocket costs next year, and the average employer will pick up about two-thirds of that tab. Even with shared responsibility, those are big hits for both employer and worker, which is why health care strategy must be integral part of workforce management.
However, benefits managers may not be aware of a tool that may help keep health care costs down for both employers and workers, and which lets employees more fully participate in the economy they helped create.
Earned Wage Access (EWA), sometimes known as on-demand pay, is a revolutionary benefit that I wrote about back in May. It comes at no cost to employers, and is available to workers at little or even no cost, depending on the provider.
Earned Wage Access allows workers to access a portion of their earned wages that they have not yet been paid on. Depending on the provider, those wages can be immediately accessed on the provider’s payroll card, or just about any debit card.
What does on-demand pay have to do with health care?
When employees receive medical services, payment is often required up front. If employees only get their paycheck every two weeks, they may not have access to liquidity to pay for those services. The result is that an employee may be forced to delay a necessary visit or procedure, and if they are suffering from an acute condition, their health may be severely compromised.
However, with immediate access to the money employees have earned, but not yet been paid on, they have access to health care in the moment. Waiting rooms are bad enough. Waiting periods for basic health care are unnecessary and harmful.
There’s another reason why on-demand pay is critical to your health care strategy. There is a stealth health care crisis brewing in America. Millions have delayed preventative and necessary care due to the COVID-19 situation.
Every delayed preventative screening, test or check-up can result in a failure to discover a serious medical condition that requires treatment. That raises treatment costs down the line for both company health plan and employee.
By wrapping earned wage access into your health care strategy, you can encourage workers to utilize preventative and maintenance care at any time — not just on payday. Doing so also eliminates a common impediment: some people just don’t like to go to the doctor. If they have the excuse not to go, they’ll use it. EWA removes that psychological obstacle.
The same goes for access to medications. High cholesterol, high blood pressure, anxiety/depression, and many other chronic conditions require regular doses of prescribed drugs. Missing even a single day of some of these medications can significantly increase risk of adverse consequences in patients.
Earned wage access allows employees to refill medications when they need to. Waiting can be deadly. Some EWA providers even offer prescription discounts with their smartphone app.
Physicians encourage timely health care for obvious reasons. Employers should encourage it as well, not only out of concern for workers, but because timely health care can result in lower health care costs. However, it’s one thing to encourage timely health care visits. It’s another to offer timely pay to workers so they can meet that request. Earned wage access creates immediate health care access.
On-demand pay usually comes at no cost to employers. Some providers are already integrated with the largest payroll services, and others are integrated with dozens of them. The cost of earned wage access varies by provider, but certain ones offer the service at no cost for employees who use the provider’s payroll card. Other services have costs that are extremely low.
Adding earned wage access to your benefit plan will benefit your overall health care strategy, and your employees.
SOURCE: Meyers, L. (05 October 2020) "Views: Tackle growing healthcare costs with earned wage access" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/opinion/tackle-growing-healthcare-costs-with-earned-wage-access
Pandemic Causing Many to Lose Employer-Sponsored Health Coverage
Many small businesses have suffered due to the implications that the coronavirus pandemic has placed on them. Many of those struggles are rooted in financial instability during this time which has caused many to stop paying health insurance premiums. Read this blog post to learn more.
The COVID-19 pandemic forced many small businesses to stop paying health insurance premiums to insurers, leaving their employees without group health care coverage. Even more workers could find themselves without health insurance if businesses can't afford to renew their group plans for 2021, when premiums are expected to trend slightly higher.
If the coronavirus spikes again across the U.S. and a "second wave" further restricts business operations, more employees could find themselves uninsured.
We've rounded up articles from trusted news sources on the loss of employer-sponsored health insurance and what might be coming.
Employers No Longer Able to Afford Coverage
Health insurance coverage is a major expense for employers, especially for small businesses. As they struggle with the economic fallout of the pandemic, many may face end-of-year renewal deadlines that are harder to afford.
Thousands of small businesses that had always expressed difficulty in providing employee health insurance under the Affordable Care Act are now in far worse trouble because of the pandemic.
While estimates vary, a recent Urban Institute analysis of census data says at least 3 million Americans have already lost job-based coverage, and a separate analysis from Avalere Health predicts some 12 million will lose it by the end of this year. Both studies highlight the disproportionate effect on Black and Hispanic workers.
"The odds are we are on track to have the largest coverage losses in our history," said Stan Dorn, the director of the National Center for Coverage Innovation at Families USA, a Washington, D.C., consumer group.
(New York Times)
Race-Based Disparities in Coverage Loss
Overall, 8 percent of Americans reported in September that they had lost their health insurance specifically due to the pandemic, according to a series of surveys conducted by data research firm Civis Analytics and global communications firm Finn Partners. That figure was higher among Black Americans, with 10.4 percent reporting they had lost their health insurance because of the pandemic. In contrast, 6.8 percent of white Americans said in September they had lost their health insurance because of the coronavirus outbreak.
Overall, among Black Americans, 26 percent were uninsured in September, up from 17 percent in February. Among white Americans, 12 percent were uninsured in September, up from 11 percent in February.
(ValuePenguin)
Small Businesses Under Pressure
Small businesses, defined as those employing fewer than 500 workers, are under extreme pressure to cut costs. But in spite of across-the-board cost-cutting, a survey of small U.S. businesses in late June found only 5 percent had resorted to cutting health insurance benefits for their employees.
However, nearly one-third of survey respondents indicated they were not sure they could keep up with premium payments beyond Aug. 15.
To examine whether federal financial assistance enabled businesses to maintain health insurance coverage, researchers compared health care offer rates to employees by businesses reporting they had been approved for federal Paycheck Protection Program (PPP) funds with rates for those not approved, as of June 15. The firms that received PPP funds were much less likely to drop coverage than firms that did not.
The PPP stopped accepting loan application requests in early August.
(NEJM Catalyst)
Indiana's Experience
In April, Indiana saw about 560,000 residents losing employment, according to Mark Fairchild, director of public policy at the nonprofit Covering Kids & Families of Indiana. At the start of September, the number had fallen below 400,000 and is trending downward.
"We've recovered dramatically, but that still is going to leave over 10 percent of Hoosiers without a job," Fairchild said. "And related to that, of course, the insurance that goes with that impacts not just them, but their family members, too."
Counting the spouses and children who may have been covered by family plans, he estimates that upwards of a million Indiana residents may have lost employer-sponsored health coverage during the pandemic.
The loss of health insurance doesn't fall equally on everyone, as some sectors of the economy, like hospitality and service jobs, have been hit harder than others.
(Side Effects/WFYI Indianapolis Public Media)
DOL Temporarily Extends COBRA Sign-Up Deadlines
In response to the COVID-19 pandemic, the U.S. Department of Labor (DOL) temporarily extended the period in which eligible employees can elect COBRA health insurance continuation coverage and the deadline for them to begin making COBRA premium payments.
The final rule extended most COBRA deadlines to beyond the "outbreak period," defined as from March 1, 2020, to 60 days after the end of the declared COVID-19 national emergency, or another date if provided in future guidance.
"Any COBRA premiums due during the outbreak period will not be considered delinquent if the COBRA premiums are paid within 30 days following the end of the outbreak period," said Paul Yenerall, a Pittsburgh-based attorney with Eckert Seamans Cherin & Mellott.
Employers may require individuals to pay for COBRA continuation coverage. The premium that is charged cannot exceed the full cost of the coverage, plus a 2 percent administration charge. That cost is not affordable for many newly unemployed workers.
During the pandemic, however, some employers are choosing to pay for a former employee's COBRA coverage if the person has been laid off, or to do so for current employees who lost group health plan coverage when they were furloughed or had their hours reduced.
(SHRM Online)
SOURCE: Miller, S. (01 October 2020) "Pandemic Causing Many to Lose Employer-Sponsored Health Coverage" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/pandemic-causing-many-to-lose-employer-sponsored-health-coverage.aspx