Progressive benefits are the lure for new talent
There are many different ways to attracted new talent to your workplace. Take a peek at this freat article from Employee Benefits Advisors about which benefits are best for attracting new talent by Paula Aven Glagych
Live trees indoors, pets at work and an in-office happy hour. Underground Elephant is very forward-thinking when it comes to how it treats its employees and the benefits it offers.
From its fun headquarters space in the east village of San Diego to its outside-the-box thinking on workplace benefits, the digital marketing company “wants to really create an environment where employees want to come to work every day and feel like they are being rewarded,” says Amy Zebrowski, HR business partner at Underground Elephant. “It is a very challenging and fast-paced environment.”
Underground Elephant, which was founded in 2008, provides marketing and technology services to financial service and insurance companies. It offers staffers healthcare and retirement benefits but wanted to show them that it is invested in their education and their family’s education by offering a choice between three non-traditional benefits. People who have worked for the company for one year can choose between a student loan repayment program through Student Loan Genius; a 529 college savings plan through Gradvisor; or $2,000 in company stock options.
If they choose the student loan or college savings plan options, Underground Elephant will contribute $1,500 a year to the program.
Gradvisor founder and CEO Marcos Cordero had wanted to offer a student loan reimbursement program for a couple of years. The company hires many entry-level employees straight out of college, trains them and helps them build their careers at the company.
“We know a lot of employees with student loan debt. We wanted to help them address that and support their financial wellbeing. We didn’t want to exclude employees who don’t have student loans. Our goal was to create a more inclusive program,” Zebrowski says.
Student Loan Genius’ platform allows employees to explore different loan repayment options and to find the one that best fits their situation. Employees can also have their student loan payments taken directly out of their paycheck each month.
The Gradvisor 529 college savings plan helps parents and grandparents save money for future educational expenses.
The cost of college
Cordero says that his 529 platform is popular because recent Gallup data shows that “for employees with children under 18, this is their number one financial concern. It supersedes retirement and unexpected medical bills.”
He added that the cost of college is rising faster than any other expense in the home and millennials, in particular, are feeling the pinch. Many of them left college with huge student loans and they want to make sure their children don’t fall into the same trap. Baby Boomers are also intrigued by the 529 plan because they have “more disposable income to help grandchildren save for college,” Cordero says.
He believes that this benefit will continue to grow over the next decade, but currently “more employers offer pet insurance than college savings.” That is in large part due to the state-by-state complexity of the programs. Each state offers a different 529 plan.
The Gradvisor platform takes into consideration an employee’s risk tolerance, financial situation and household tax filing when determining the best 529 plan for them. The company serves as a fiduciary so it takes “all of those inputs and recommends the most suitable and best fit investment option and asset allocation for the client. We don’t get any commissions or sales charges from the 529 plan. Our advice is 100% objective,” he says. Companies pay to offer the program on a per user per month basis.
“If you look at our stats, our customers tend to save earlier. We’re rolling out this really intuitive step-by-step platform that takes a lot of that fear or intimidation away,” Cordero says.
The average parent who takes advantage of Gradvisor starts saving when their child is five years old, compared to seven in the general population, which adds a couple more years of compounded growth. They also save twice as much as the average person.
Both the student debt repayment and college savings benefits programs were introduced to the company’s employees in January for implementation in March.
“The response has been great. All of our employees are excited about it. It can be a huge help with financial expenses if you are paying toward a student loan it is reducing the overall interest of the life of the loan. Overall it is very positive,” Zebrowski says.
The company’s primary goal in offering these three benefits was to retain good employees and to “show we are invested in their education and their family’s education and financial wellness,” she says.
Based on the company’s younger employee base, there are more participants in the student loan program, but there’s also a lot of interest in the 529 plans.
“I think a lot of people are conscious of the future and saving for families down the line. We’ve had a good response to both,” Zebrowski says.
The company offers a 1% employer match on all employee contributions to its 401(k) plan. The company employs 55 people currently and has been listed as one of the fastest-growing companies in its industry.
The benefit of perks
Underground Elephant wants to be innovative with its benefits because California’s tech industry is very competitive. Many people want to live in San Diego, so “attracting talent, in addition to that retention piece, that certainly factors in,” she says.
The company’s new headquarters building is unique in that it has live trees in the middle of the work space.
“The idea is to make it more open to give people the feeling of being connected to the outdoors,” she says. It has pool, ping pong and is setting up a new game room so employees can get together and have fun. It also has an onsite bar where the company offers regular happy hours.
Employees can bring pets to the office and it has a snack area where the company provides breakfast or lunch once a week.
For the past couple of years, the company has participated in a forum program where the company is divided into groups of eight to 10 employees and these groups participate in challenges throughout the year, including cultural challenges, scavenger hunts, community and charitable events.
“Each year we reevaluate our cultural programs to see what is working and what isn’t working; what people enjoy. The goal is to create as much engagement as possible,” she says.
Underground Elephant offers a full suite of health benefits, including full medical, dental and vision, long and short term disability and voluntary life insurance.
“We want to prepare people for success here or outside the company. Ultimately, the goal is to give people the skills and experience to promote within Underground Elephant or to transfer to other jobs as well,” she says. “Our people tend to be very successful.”
See the original article Here.
Source:
Glagych P. (2017 February 28). Progressive benefits are the lure for new talent [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/news/progressive-benefits-are-the-lure-for-new-talent?feed=00000152-1377-d1cc-a5fa-7fff0c920000
CBO estimate of AHCA impact on employer-sponsored benefits is off the mark
Does the implementation of the AHCA have you worried about your employee benefits? Take a look at this great article from Employee Benefit News about what the implementaion of the AHCA will mean for employers by Joel Wood.
In breaking down the Congressional Budget Office’s assessment of the proposed American Health Care Act, let’s look at the impact of the AHCA on employer-sponsored plans. The CBO estimates that 2 million fewer Americans will have employer-sponsored coverage in 2020, growing to seven million by 2027. Here’s CBO’s rationale:
- The mandate penalties are eliminated, and thus many will drop.
- The tax credits are available to people with a broader range of incomes than the Obamacare credits/subsidies
- Some employers will drop coverage and increase compensation in the belief that non-group insurance is a close substitute.
These are valid points. The CBO experts are basing their estimates on sound economics and inside the constraints of their authority, and so of course we worry about any proposal that devolves employer-sponsored care. But, we also have to note that the CBO said much the same about the Affordable Care Act, which largely didn’t happen. And CBO notwithstanding, we at the Council of Insurance Agents & Brokers, too, feared something of a death spiral after the ACA was enacted.
The ACA’s employer penalties were very small in comparison to premiums, and it made sense that many would dump their plans, give their employees cash, and send them to the subsidized exchanges. Also, the subsidies were pretty rich — graduating out at 400% of the poverty line. That’s more than $90,000 for a family of four.
What we didn’t take into account in reference to the ACA were a number of things:
- A core assumption of the ACA was that states would all be forced to expand Medicaid to 138% of the poverty line, and the exchange subsidies would kick in above that amount. The courts struck that down and 19 (all-red) states never adopted the expansion, creating a massive donut hole.
- We underestimated how chaotic would be the rollout of Healthcare.gov.
- We knew the exchanges would be a model of adverse selection, but a “bailout” of insurance carriers through the “risk corridor” program was supposed to keep them in the game. Republicans balked, sued, and the reinsurance payments have been so lacking that most of the exchanges are currently in a “death spiral” (as described by Mark Bertolini, CEO of Aetna).
So employer-sponsored health insurance has, well, thrived since the enactment of the ACA — perhaps in spite of it, not because of it.
If the CBO is correct and seven million people lose ESI over the next decade, that’s problematic. But it ignores other opportunities that are being created through the proposed GOP bill and Trump Administration executive actions.
Employers-sponsored opportunities
Republicans propose significant expansion of HSAs that will compliment higher-deductible ESI plans. They want work-arounds for state mandates on essential health benefits, even though their goal of “buying across state lines” can’t be realized through the tricky budget reconciliation process. And, ultimately, Republicans want to realize the potential for the ACA wellness provisions that have been eviscerated through years of EEOC/ADA/GINA conflicts. That would be a big win for employers.
The most important tradeoff between the “discussion draft” of a few weeks ago and the AHCA is that GOP House leaders junked their plan to tax 10% of employee contributions for ESI plans, in favor of pushing the Cadillac tax out five more years, to 2025.
Personally, I figure I’ve got another decade left in me to lobby for this industry, and that would get me eight years along the way. That’s a terrific tradeoff in my book, especially as Ways & Means Chairman Kevin Brady (R-Texas) emphasized he never intends for that tax to go into effect — it’s purely a budgetary gimmick. And, it’s a ridiculous “score” from CBO anyway. Everybody knows that no employer is going to pay that tax; they’ll work their plan design to get under the numbers.
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My conclusions at this moment in time, thus, are:
- Have we won the war among GOP leaders with respect to “hands off” of ESI while trying to solve the death-spiral problems in the individual/exchange marketplace? Not yet. We won a battle, not a war. Sadly and frustratingly, too many Republican leaders have bought into the elite conservative/libertarian economic intelligentsia that pure consumerism should drive healthcare, and that ESI is an “historic accident.” As our friend Ed Fensholt at Lockton always says, “Penicillin was an historic accident, too, but look how that turned out.”
- Was former Speaker John Boehner right recently when he said that there’s no way you can get to the requisite 51 votes in the Senate right now with this current AHCA construct? You bet he was right. If you do the House plan and defund Planned Parenthood, you lose votes of pro-choice Republicans in the Senate. If Ryan and Trump relent to the Freedom Caucus on hacking the Medicaid expansion in 2018 instead of 2020, they’ll lose votes of Republicans in Medicaid-expanded states. In any event, they probably lose the votes of Ted Cruz (R-Texas) and Ben Sasse (R-Neb.) and a number of other Republicans who view the AHCA as “Obamacare Lite” and demand a more straightforward repeal.
- Was Paul Ryan (R-Wis.) right when he said this on Face the Nation recently? “Look,” he said, “the most important thing for a person like myself who runs for office and tells the people we’re asking to hire us, ‘This is what I’ll do if I get elected.’ And then if you don’t do that, you’re breaking your word.” You bet he’s right. Republicans ran on this. They voted 60 times in the House to repeal the ACA. If they can’t do this, they can’t do tax reform, they can’t do 12 appropriations bills. Their margins for error (21 votes in the House; two in the Senate) are almost impossibly narrow, and the press hates this bill. But I wouldn’t pronounce this effort dead, by a long stretch.
Sometimes, when lobbying blank-faced Republican leaders on the importance of ESI, I feel like the old BB King lyric: “Nobody loves me but my mother, and she could be jivin’, too.”
But because of, or in spite of, current legislative efforts that are dominating the headlines, I feel relatively well-poised for ESI to continue to be the means through which a majority of Americans receive the health insurance they like and they want to keep. Our job is for them to keep it. Notwithstanding lots of obstacles, we will.
See the original article Here.
Source:
Wood J. (2017 March 21). CBO estimate of AHCA impact on employer-sponsored benefits is off the mark [Web blog post]. Retrieved from address https://www.benefitnews.com/opinion/cbo-estimate-of-ahca-impact-on-employer-sponsored-benefits-is-off-the-mark
ACA replacement proposal leaked: Some of the finer points for HR
Does the repeal of the ACA have you worried? Checkout this great article about some of the changes that will come with the repeal of the ACA by Jared Bilski.
A draft of the Republicans’ Affordable Care Act (ACA) replacement bill that was leaked to the public is likely to look a lot different when it’s finalized. Still, it gives employers a good indication of how Republicans will start to deliver on their promises to “repeal and replace” Obamacare.
It should come as no surprise to employers that the GOP replacement bill, which was obtained by POLITICO, would scrap a cornerstone of the ACA — the individual mandate — as well as income-based subsidies and all of the laws current taxes (at least one replacement tax is included in the legislation).
According to the discussion draft of the replacement bill, it would offer tax credits for purchasing insurance; however, those credits would be based on age instead of income.
For example, a person under the age of 30 would receive a credit of $2,000. A person over the age of 60, on the other hand, would receive double that amount.
Some of the other highlights of the leaked legislation include:
End of ACA essential health benefits
Obamacare’s essential health benefits mandates require health plans to cover 10 categories of healthcare services, which include:
- Ambulatory patient services
- Emergency services
- Hospitalization
- Maternity and newborn care
- Mental health and substance use disorder services
- Prescription medications
- Rehabilitative and habilitative services and devices
- Lab services
- Preventive and wellness services and chronic disease management, and
- Pediatric services, including oral and vision care.
Under the bill, individual states would make the decisions about what types of services plans must cover — beginning in 2020.
A Medicaid expansion overhaul
The Medicaid expansion under Obamacare that has covered millions of people will be phased out by 2020 under the GOP bill. The replacement proposal: States would receive a set dollar amount for each person.
There would also be variations in the funding amounts based on an individual’s health status. In other words, more money would be allocated for disabled individuals, which is a huge departure from the open-ended entitlement of the current Medicaid program.
Pre-existing conditions, older individuals
One of the most popular elements of the ACA would apparently remain untouched under the GOP bill: the Obamacare provision that prohibits health plans from discriminating against people with pre-existing conditions.
However, the legislation does take aim at older individuals. The GOP would allow insurers to charge older people up to five times more for healthcare than younger individuals. The current ACA limits that difference to three times as much.
The bill does aim to remedy this discrepancy by providing bigger tax credits for older people.
Taxes get axed
There is a slew of taxes built into the ACA — the manufacturer tax, and taxes on medical devices, health plans and even tanning beds — and the Republican bill would repeal those taxes.
But those taxes help cover the cost of the ACA. So to make up for the shortfall that would result in killing those taxes, the GOP is floating the idea of changing the tax treatment of employer-based health insurance. As employers are well aware, employer-sponsored health plan premiums currently aren’t taxed. Under the GOP proposal, this would be changed for some premiums over a certain threshold — although the specifics of such a change remain murky.
Such a move would surely be met by fierce opposition from the business community. In fact, major employer groups are already preparing to fight such a proposition.
See the original article Here.
Source:
Bilski J. (2017 March 01). ACA replacement proposal leaked: some of the finer points for HR [Web blog post]. Retrieved from address https://www.hrmorning.com/aca-replacement-proposal-leaked-some-of-the-finer-points-for-hr/
How are your retirement health care savings stacking up?
Are you properly investing in your health saving account? Take a look at the this article from Benefits Pro about the importance of saving money for your healthcare by Reese Feuerman
For all ages, it's imperative to balance near-term and long-term savings goals, but the makeup of those savings goals has changed dramatically over the past 10 years.
With the continued rise in health care costs, and increased cost sharing between employers and employees, more employees and employers have been migrating to consumer-driven health care (CDH) to provide lower-cost alternatives.
With the increased adoption in these plans for employee cost savings purposes, employers have likewise realized similar cost savings to their bottom line. But what role does CDH play in the long term?
The Greatest Generation was able to rely on their pensions, Social Security, Medicaid, and the like as a means to support them in retirement for both medical and living expenses. However, as the Baby Boomers continue their journey towards retirement, reliance upon future proof retirement funds are fading into the sunset for coming generations. According to a 2015 study from the Government Accountability Office (GAO), 29% of American’s 55 and older do not have money set aside in a pension plan or alternative retirement plan.
To make matters worse, some experts are forecasting Social Security funding will be depleted by 2034, leaving even more retirees potentially without a plan. As such, Generation X and beyond must look for more creatives measures for savings to make up the difference.
In 1978, 401(k) plans were introduced to provide the workforce with a secondary means for retirement savings while also providing significant tax benefits. However, even when actively funded, with rising health care costs and a depleted Social Security system—the solution this workforce has paid into for their entire career—will not be enough.
According to Healthview Services, the average retiree couple will spend $288,000 for just health care expenses during retirement. This sum could easily consume one-third of total retiree savings. This is a contributing factor to the rise and rapid adoption of tax-advantage health accounts to supplement retirement savings. Introduced to the market in 2003, Health Savings Accounts (HSA) have provided employees with an option to set aside pre-tax funds to either cover current year health care expenses, like the familiar Flexible Spending Account (FSA), or carry over the funds year-over-year to pay for medical expenses later or during retirement. The pretax money employees are able to set aside in these accounts to cover health care expenses, will over time, be on par with retirement savings contributions, such as a 401(k) and 403(b), because of increasing costs and triple-tax savings.
It is important for consumers to understand these retirement options and how they could be leveraged for greater financial wealth. As a result, the Health Care Stack, an analysis authored by ConnectYourCare, acts as a life savings model and illustrates the amount of pretax money consumers can contribute for both their lifestyle and health expenses in retirement.
For illustrative purposes, according to current IRS guidelines, the average American under the age of 50 could set aside up to $24,750 each year pre-tax for retirement to cover their health care and living expenses. In this example, if a worker in his or her 30s starts to set aside the maximum contributions (based on IRS guidelines) for HSA contributions, assuming a rate of return of 3%, they would have $330,000 saved in their HSA to cover health care expenses once they reach the retirement age of 65. This number could be even greater if President Trump’s administration passes any number of proposed bills to increase the HSA contribution limits to match the maximum out-of-pocket expenses included in high deductible health plans. This allocation would not only cover average medical expenses, but also provide a triple-tax advantage for consumers from now through retirement.
In addition to the long-term retirement goals, the yearly pre-tax savings may be even greater if notional accounts are factored in, with approved IRS limits of a $2,600 per year maximum for Flexible Spending Accounts, $5,000 per year maximum for Dependent Care FSA, and $6,120 per year maximum for commuter plans. This equals $38,470 (or $44,820 if HSA contributions increase) of pre-tax contributions that consumers could save by offsetting the tax burden and could invest towards retirement.
For those consumers over the age of 50, the savings potential is even greater as they can contribute to a post retirement catch-up for their 401K plans equaling a total of $24,000, plus they may take advantage of the $6,750 HSA savings, as well as the additional $1,000 catch up. If certain proposed bills are passed, the increase could be $38,100 a year that they could set aside, in pre-tax assets, for retirement.
Not only will an individual’s expenses be covered, but there are other benefits brought forth by proper planning, including the potential to reach ones retirement savings goals early. Let’s say that after meeting with a licensed financial investor it was determined that an individual needed $1.8 million in order to retire, and according to national averages, close to $288,000 to cover health care costs.
Given the proper investment strategy around contributions to both retirement and HSA plans, an individual could - theoretically -save enough to meet their retirement investment needs by the age of 60 for both lifestyle and health care expense coverage, if they started making careful investments in their 20s (assuming the worker is making $50,000 per year with a 3% annual increase).
In comparison, under current proposals, which include the increased HSA limits, retirement savings could be achieved even earlier with the coverage threshold being at 57 for the average worker. This is a tremendous opportunity to transform retirement investment programs for all American workers who would otherwise be left on their own. Talk about the American dream!
While there is not a one-size fits all strategy, it is important for everyone to understand their options and see how these pretax accounts outlined in the Health Care Stack play an important consideration in ones future retirement planning.
Taking the time now to fully understand tax-favored benefit accounts will provide him or her with the appropriate coverage to enjoy life well into their golden years. Retirement is just around the corner, are you ready?
See the original article Here.
Source:
Feuerman (2017 March 02). How are your retirement health care savings stacking up?[Web blog post]. Retrieved from address https://www.benefitspro.com/2017/03/02/how-are-your-retirement-health-care-savings-stacki?ref=hp-in-depth
Employers embrace new strategies to cut healthcare costs
Are you looking for a new solution for cutting your healthcare cost? Take a look at the great article from Employee Benefits Advisor about what other employers are doing to cut their cost healthcare cost by Phil Albinus
As employers await a new health plan to replace the Affordable Care Act and consensus grows that high deductible health plans (HDHPs) are not the perfect vehicle for cutting healthcare costs, employers are incorporating innovative strategies to achieve greater savings.
Employers are offering HSAs, wellness incentives and price transparency tools at higher rates in an effort to cut the costs of their employee health plans. And when savings appear to plateau, they are implementing innovative reward plans to those who adopt these benefits, according to the 2017 Medical Plan Trends and Observation Report conducted by employee-engagement firm DirectPath and research firm CEB. They examined 975 employee benefit plans to analyze how they functioned in terms of plan design, cost savings measures and options for care.
The report found that 67% of firms offer HSAs while only 15% offer employee-funded Health Reimbursement Arrangements. As “use of high deductible plans seem to have (at least temporarily) plateaued under the current uncertainty around the future of the ACA, employer contributions to HSAs increased almost 10%,” according to the report.
Wellness programs continue to gain traction. Fifty-eight percent of 2017 plans offer some type of wellness incentive, which is up from 50% in 2016. When it comes to price transparency tools, 51% of employers offer them to help employees choose the best service, and 18% plan to add similar tools in the next three years. When these tools are used, price comparison requests saw an average employee savings of $173 per procedure and average employer savings of $409 per procedure, according to CEB research.
“What was interesting was the level of creativity within these incentives and surcharges. There were paycheck credits, gift cards, points that could be redeemed for rewards,” says Kim Buckey, vice president of client services at DirectPath. “One employer reduced the co-pays for office visits to $20 if you participated in the wellness program. We are seeing a level of creativity that we haven’t seen before.”
Surcharges on tobacco use has gone down while surcharges for non-employees such as spouses has risen. “While the percentage of organizations with spousal surcharges remained static (26% in 2017, as compared to 27% in 2016), average surcharge amounts increased dramatically to $152 per month, a more than 40% increase from 2016,” according to the report.
Tobacco surcharges going down “is reflective of employers putting incentives in, so they are taking a carrot approach instead of the stick,” says Buckey.
Telemedicine adoption appears to be mired in confusion among employees. More than 55% of employees with access to these programs were not aware of their availability, and almost 60% of employees who have telemedicine programs don’t feel they are easy to access, according to a separate CEB survey.
Employers seem to be introducing transparency and wellness programs because the savings from HDHPs appear to have plateaued, says Buckey. She also noted recent research that HSAs only deliver initial savings at the expense of the employee’s health.
“With high deductible plans and HSAs, there has been a lot of noise how they aren’t the silver bullet in controlling costs. Some researchers find that it has a three-year effect on costs because employees delay getting care and by the time they get it, it’s now an acute or chronic condition instead of something that could have been headed off early,” she says.
“And there is a tremendous lack of understanding on how these plans work for lower income employees, [it’s] hard to set aside money for those plans,” she says.
Educating employees to be smarter healthcare consumers is key. “What is becoming really obvious is that there is room to play in all these areas of cost shifting and high deductible plans and wellness but we can no longer put them in place and hope for the best,” she says. We have to focus on educating employees and their families,” she says. “If we are expecting them to act like consumers, we have to arm them with the tools. Most people don’t know where to start.”
She adds, “we know how to shop for a TV or car insurance but 99% of people don’t know where to start to figure out where to shop for prescription drugs or for the hospital where to have your knee surgery. Or if you get different prices from different hospitals, how do you even make the choice?”
When asked if the results of this year’s report surprised her – Buckey has worked on the past five – she said yes and no.
Given that the data is based on information from last summer for plans that would be in effect by 2017, she concedes that given the current political climate “a lot is up in the air.” Most employers were hesitant to make substantive changes to their plans due to the election, she says. We may see the same thing this year as changes are made to the ACA and the Cadillac Tax, she adds.
“What I was interested in were the incremental changes and some of the creativity being applied to longstanding issues of getting costs under control,” she says.
See the original article Here.
Source:
Albinus P. (2017 March 05). Employers embrace new strategies to cut healthcare costs [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/news/employers-embrace-new-strategies-to-cut-healthcare-costs?brief=00000152-1443-d1cc-a5fa-7cfba3c60000
Health Law’s 10 Essential Benefits: A Look At What’s At Risk In GOP Overhaul
Great article from Kaiser Health News about all the changes that could be coming with the ACA overhaul by Michelle Andrews
As Republicans look at ways to replace or repair the health law, many suggest shrinking the list of services insurers are required to offer in individual and small group plans would reduce costs and increase flexibility. That option came to the forefront last week when Seema Verma, who is slated to run the Centers for Medicare & Medicaid Services in the Trump administration, noted at her confirmation hearing that coverage for maternity services should be optional in those health plans.
Maternity coverage is a popular target and one often mentioned by health law critics, but other items also could be watered down or eliminated.
There are some big hurdles, however. The health law requires that insurers who sell policies for individuals and small businesses cover at a minimum 10 “essential health benefits,” including hospitalization, prescription drugs and emergency care, in addition to maternity services. The law also requires that the scope of the services offered be equal to those typically provided in employer coverage.
“It has to look like a typical employer plan, and those are still pretty generous,” said Timothy Jost, an emeritus professor at Washington and Lee University Law School in Virginia who is an expert on the health law.
Since the 10 required benefits are spelled out in the Affordable Care Act, it would require a change in the law to eliminate entire categories or to water them down to such an extent that they’re less generous than typical employer coverage. And since Republicans likely cannot garner 60 votes in the Senate, they will be limited in changes that they can make to the ACA. Still, policy experts say there’s room to “skinny up” the requirements in some areas by changing the regulations that federal officials wrote to implement the law.
Habilitative Services
The law requires that plans cover “rehabilitative and habilitative services and devices.” Many employer plans don’t include habilitative services, which help people with developmental disabilities such as cerebral palsy or autism maintain, learn or improve their functional skills. Federal officials issued a regulation that defined habilitative services and directed plans to set separate limits for the number of covered visits for rehabilitative and habilitative services.
Those rules could be changed. “There is real room for weakening the requirements” for habilitative services, said Dania Palanker, an assistant research professor at Georgetown University’s Center on Health Insurance Reforms who has reviewed the essential health benefits coverage requirements.
Oral And Vision Care For Kids
Pediatric oral and vision care requirements, another essential health benefit that’s not particularly common in employer plans, could also be weakened, said Caroline Pearson, a senior vice president at Avalere Health, a consulting firm.
Mental Health And Substance Use Disorder Services
The health law requires all individual and small group plans cover mental health and substance use disorder services. In the regulations the administration said that means those services have to be provided at “parity” with medical and surgical services, meaning plans can’t be more restrictive with one type of coverage than the other regarding cost sharing, treatment and care management.
“They could back off of parity,” Palanker said.
Prescription Drugs
Prescription drug coverage could be tinkered with as well. The rules currently require that plans cover at least one drug in every drug class, a standard that isn’t particularly robust to start with, said Katie Keith, a health policy consultant and adjunct professor at Georgetown Law School. That standard could be relaxed further, she said, and the list of required covered drugs could shrink.
Preventive And Wellness Services And Chronic Disease Management
Republicans have discussed trimming or eliminating some of the preventive services that are required to be offered without cost sharing. Among those requirements is providing birth control without charging women anything out of pocket. But, Palanker said, “if they just wanted to omit them, I expect that would end up in court.”
Pregnancy, Maternity And Newborn Care
Before the health law passed, just 12 percent of health policies available to a 30-year-old woman on the individual market offered maternity benefits, according to research by the National Women’s Law Center. Those that did often charged extra for the coverage and required a waiting period of a year or more. The essential health benefits package plugged that hole very cleanly, said Adam Sonfield, a senior policy manager at the Guttmacher Institute, a reproductive health research and advocacy organization.
“Having it in the law makes it more difficult to either exclude it entirely or charge an arm and a leg for it,” Sonfield said.
Maternity coverage is often offered as an example of a benefit that should be optional, as Verma advocated. If you’re a man or too old to get pregnant, why should you have to pay for that coverage?
That a la carte approach is not the way insurance should work, some experts argue. Women don’t need prostate cancer screening, they counter, but they pay for the coverage anyway.
“We buy insurance for uncertainty, and to spread the costs of care across a broad population so that when something comes up that person has adequate coverage to meet their needs,” said Linda Blumberg, a senior fellow at the Health Policy Center at the Urban Institute.
See the original article Here.
Source:
Andrews M. (2017 February 21). Health law's 10 essential benefits: a look at what's at risk in GOP overhaul [Web blog post]. Retrieved from address https://khn.org/news/health-laws-10-essential-benefits-a-look-at-whats-at-risk-in-gop-overhaul/
Employees desperately need more information on health plans, study says
Did you know that a lot of your employees may be unaware of the health care options your company offers? Take a peek at this great article from HR Morning on how to improve your employees knowledge of their healthcare options by Jared Bilski
As an increasing number of employees are being asked to make smarter healthcare spending decisions, communication is more important than ever. Unfortunately, it looks like many firms have a lot of room for improvement.
That’s one of the alarming takeaways from healthcare administrator Alegeus’ recent “State of Denial” study.
A number of the stats from the study point to a major employee healthcare problem that’s only getting worse. That problem: While employees’ health options are becoming increasingly complex, most workers don’t have the knowledge and/or accountability to make wise decisions involving those options.
Unaware and overwhelmed
Here are some of the most alarming stats from the study:
- 63% of employees said they don’t know the benefit of an HSA
- 50% don’t know how to predict current or future out-of-pocket healthcare expenditures and can’t select the best savings vehicle or rate
- 26% of HSA accountholders don’t know they can use HSA funds beyond the immediate plan year, and
- 41% of HSA accountholders were unaware they could invest HSA funds.
The study also highlighted some of the contradictions between what employees said they wanted or needed, and how they acted.
For example, although 70% of employees said they’d like to take a more active role in their healthcare decisions, just 50% intend to conduct more due diligence when purchasing healthcare in 2017.
The importance of one on one
One of the most effective ways to improve employees’ benefits understanding is through one-on-one communications.
To help ensure this is effective, here are three things HR pros should keep in mind, according to Winston Benefits, a voluntary benefits plan provider:
1. Prepare the right materials
When you’re doing a large-scale benefits presentation, you generally just hand out the materials, and employees look through and use those materials as they see fit.
But with individual sessions, benefits pros have to be prepared to explain those materials in any way an employee requests.
Example: Walking a worker through a tool or calculator in a step-by-step manner.
2. Look to your broker
In many cases, benefits brokers are willing to go on site for one-on-one sessions, and companies should take advantage whenever possible.
Employees will be comfortable knowing there’s an in-house HR or benefits pro at the broker, and a broker’s expertise can really improve workers’ overall understanding.
3. Allot enough time
The point of these meetings is to give employees all the time they need to understand their options and make informed decisions.
Rushing workers through these meetings will ensure the one-on-one education falls flat.
See the original article Here.
Source:
Bilski J. (2017 February 17). Employees desperately need more information on health plans, study says [Web blog post]. Retrieved from address https://www.hrmorning.com/employees-desperately-need-more-information-on-health-plans-study-says/
Where exactly are we in the ACA repeal process?
Worried about the ACA repeal process? Check out this informative article from HR Morning about the status of the ACA's repeal by Christian Schappel,
President Trump, along with other Republican lawmakers, have promised to “repeal and replace” the Affordable Care Act (ACA). But it hasn’t happened yet. Here’s why, as well as a timeline for what’s to come.
In his “Contract with the American Voter,” Donald Trump promised to repeal Obamacare within his first 100 days in office. But the reality is he can’t do it on his own. He needs votes to get it repealed outright — and he doesn’t have enough of them.
What’s the hold up?
Broad legislation that would repeal the ACA would require 60 votes in the Senate, and the GOP doesn’t control enough seats to make that a reality — or avoid a filibuster by the Democrats.
Still, that hasn’t stopped Trump from declaring war on the healthcare reform law. In one of his first acts as president, Trump issued an executive order that directs federal agencies to waive some of the requirements of the law that could impose a burden on individuals and certain businesses.
It was a clear sign from Trump that his administration plans to attack the ACA by any means necessary.
So what’s the plan now?
Congressional Republicans are now preparing to dismantle portions of the ACA using a process known as reconciliation. It will allow the GOP to vote on budgetary pieces of the health law, without giving the Democrats a chance to filibuster.
The problem for Republicans is reconciliation limits the extent to which they can reshape the law.
Parts of the law it appears they can roll back through reconciliation:
- The individual mandate (which is imposed through a tax)
- The employer mandate (which imposed through a tax), and
- The subsidies to help individuals purchase coverage (which require government funding).
The Republicans believe that through reconciliation they can knock the legs out from under the ACA and begin to implement their own health reforms.
Some of the things members of the GOP have indicated they want to do:
- Go to a more free-market approach, in which individuals would have greater ability to purchase health insurance across state lines
- Expand health savings accounts
- Allow individuals to deduct the cost of health insurance premiums from their income taxes, and
- Let states manage Medicaid funds.
Two popular ACA provisions Republicans said they plan to keep in health plans:
- The prohibition on denying coverage to those with pre-existing conditions, and
- The ability for children to stay on their parents’ plans until age 26.
So when is it all going to happen?
When it comes to a timeline for when the GOP hopes to initiate reforms, things are a little murky. The problem is, due to the reconciliation process — and complaints from insurers about what the requirement to provide coverage to those with pre-existing conditions will do to risk pools and pricing — things aren’t as cut and dried as employers would like them to be.
But here’s what we know:
- In late January, at its annual retreat, the GOP said it wants to bring a final reconciliation package to the floor of the House by late February or early March
- In a pre-Super Bowl interview with Fox News’ Bill O’Reilly, President Trump said the repeal and replace process is “complicated” and could take until “sometime next year,” and
- Just a few days after Trump’s statements to O’Reilly, House Speak Paul Ryan (R-WI) said the president’s remarks won’t alter the timeline for the House GOP to introduce significant repeal and replace legislation by the end of 2017. Still, Ryan did indicate that even if such legislation is passed, it could take some time for it to be fully implemented.
Bottom line: Employers are likely looking at a long legislative process, and an even longer implementation period.
Bills that could chip away at law
While Congress mulls larger-scale changes to the ACA, a few bills have been introduced for lawmakers to chew on.
The following could chip away at certain elements of reform:
- The Middle Class Health Benefits Tax Repeal Act (H.R. 173) would kill the 40% deductible excise tax (a.k.a., “the Cadillac tax”) on high-cost employer health plans
- The Health Savings Account Expansion Act (H.R. 247 and S. 28) would permit the reimbursement of health insurance premiums and increase the maximum allowable contribution, and
- The Healthcare Tax Relief and Mandate Repeal Act (H.R. 285) would kill both the individual and the employer health insurance mandates.
See the original article Here.
Source:
Schappel C. (2017 February 10). Where exactly are we in the ACA repeal process? [Web blog post]. Retrieved from address https://www.hrmorning.com/where-are-we-aca-obamacare-repeal-trump/
How Obama’s last healthcare legislation is further hurting the ACA’s chances of survival
Due to the most recent changes President Obama made to the ACA before leaving office, ACA repeal is looking more and more like a possibility. Take a look at this great article from Employee Benefits Advisors to see how the changes will affect the ACA repeal process by Craig Hasday
President Trump is delivering on what many had viewed as an unrealistic campaign promise: The repeal of Obamacare is right on track. In finalizing the budget, the GOP can now line out any ACA items with a fiscal impact, thanks to an executive order issued by Trump on his first day in office. By lining out the individual and employer penalty and eliminating some of the ACA taxes – voila – the ACA is gone.
The market reforms will stay, however (no pre-existing conditions, guaranteed issue coverage and dependents covered to age 26). But there is an enormous “if.” If the insurance carriers stay in the market.
One of the reasons the ACA is not working is the adverse selection issue. Insurance carriers must take all comers, and since the individual penalty for not obtaining coverage is full of loopholes, and not large enough to dissuade the young and healthy from rolling the dice, the risk pool has performed horrifically. That should be no surprise – I have been writing about it for years; a few examples here, here, here and here.
But if the individual penalty is repealed, it is going to get even worse. The healthy are going to leave and the risk pools will be left with a lot of expensive sick people who love the idea of guaranteed coverage, premiums and unlimited maximums.
The problem with QSEHRAs
The prior Congress and former President Obama didn't help matters with the passage of the 21st Century Cures Act, which was signed into law in December 2016. This law allows small employers who don't offer a group health plan to create a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA). Employers can provide money to employees on a tax-free basis to pay for individual health insurance policies and to reimburse employees for certain medical expenses. This is going to make the small group pools worse and, my guess is, increase adverse selection even more.
Given the losses incurred to date and the additional selection being imposed on the healthcare system, the big question is will the health insurance carriers stay in the marketplace? If mainstream carriers refuse to offer policies – BOOM – the system implodes.
To quote the best show on Broadway, “Hamilton,” I would love “to be in the room where it happens.” This is going to be interesting to watch.
See the original article Here.
Source:
Hasday C. (2017 February 06). How Obama's last healthcare legislation is further hurting the ACA's chances of survival [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/opinion/how-obamas-last-healthcare-legislation-is-further-hurting-the-acas-chances-of-survival
9 questions employees have about ACA – and how to answer them
Have your employees been asking more questions about the ACA? Check out this great article from HR Morning about some of the question your employees might ask and how to answer them by Christian Schappel
Even under the Trump administration, the Affordable Care Act (ACA) is still a real, enforceable law. You already know this. But do all of your employees?
Chances are, once employees start getting their ACA-mandated 1095 forms from you in the next few weeks, some of them are going to have questions — à la: What is this? I thought Trump did away with Obamacare.
Here are some of the questions employees are asking — and are bound to ask — along with how HR can answer them:
1. Didn’t Trump repeal Obamacare?
No. While he has promised to “repeal and replace” the ACA, all he has done so far is sign an executive order that directs federal agencies to grant certain exemptions from the law, as well as waive any requirements that they’re able to by law.
Surely, the executive order will eventually weaken some parts of the ACA — and maybe even lead to some repeals — but nothing concrete has happened yet. As a result, employers still have to comply with the “play or pay” mandates, and individuals still have to carry health insurance or risk penalties.
2. Didn’t Republicans in Congress start repealing the law?
No. Republicans in Congress don’t have the votes they need to repeal the ACA outright. They can’t avoid a Democratic filibuster.
As a result, what they have done is state their intention to attack the law through a process known as reconciliation. It’ll allow Republicans to vote on budgetary pieces of the law — like the individual mandate (which is imposed with a tax) and healthcare subsidies — without giving the Democrats a chance to filibuster.
The problem for Republicans, though, is that reconciliation limits how they can reshape (or repeal) Obamacare.
3. Then when will Obamacare be repealed?
All you can tell employees right now is that it hasn’t happened, and there is no clear answer on when (or even if) it will happen in its entirety.
However, Republicans recently made two things clear at its recent annual retreat in Philadelphia:
- They plans to use the reconciliation process to “repeal and replace” parts of the law.
- The GOP will bring a final reconciliation package to the floor of the House of Representatives by late February or early March.
Chances are, we’ll find out more once Trump’s cabinet picks — specifically his pick to lead the Department of Health and Human Services — have been confirmed.
4. If I have a pre-existing condition, will I have trouble finding a health plan?
President Trump, as well as Republicans in Congress, have stated their intentions to attempt to keep two popular requirements of the ACA in place:
- The need for insurance companies to offer coverage to individuals with pre-existing conditions.
- The ability for children to be able to stay on their parents’ health plans until age 26.
Form 1095 questions
5. What is this form?
Form 1095 is a little like Form W-2: The employer or insurer sends one copy to the Internal Revenue Service (IRS) and one copy to the employee. It describes whether the person obtained the minimum required level of health insurance under the ACA in 2016.
It also informs the IRS, and the employee, if the person was eligible for a premium tax credit in 2016.
6. If Obamacare is going to be repealed, do I still need this form?
Yes. The reason is because the ACA was in effect for all of 2016, and this form is for reporting information that reflects what happened in 2016.
7. What do I have to do with it?
In most cases, no action will be necessary. When filing taxes for 2016, individuals will be asked if they obtained minimum insurance coverage. This form will help individuals answer that question.
8. Do I have to wait to receive the form to file my taxes?
Again, in most cases, the answer is no. Only those who received insurance via an exchange or the “marketplace” will have to wait for their 1095 to file their taxes.
If a person received insurance through an employer, that person doesn’t have to wait for Form 1095 to file his or her taxes, assuming the person already knows whether or not they had minimum coverage throughout the year. In that case, the person can just keep the form for their records.
If a person’s unsure whether he or she had minimum coverage for the entire year, that person can wait for the form to file their taxes or ask their employer whether he or she had minimum coverage.
9. How will I receive the form(s)?
Individuals may receive their form(s) in one of three ways:
- hand delivery, or
- electronically (if they have consented to receive it electronically).
See the original article Here.
Source:
Schappel C. (2017 February 1). 9 questions employees have about ACA- and how to answer them [Web blog post]. Retrieved from address https://www.hrmorning.com/employee-questions-aca-obamacare-repeal-answers/
