5 myths about millennials and benefits
Originally posted by Lindsey Pollak on https://www.benefitspro.com
Millennials (ages 18-31), also known as Gen Y, are 80 million strong, according to the U.S. Census Bureau. As this generation climbs into leadership roles, they’ll change many aspects of the workplace, including the benefits landscape.
To help better understand this giant generation of consumers and employees, it’s time to dispel five common myths about who millennials are and what they want.
1.) Millennials all live at home and don’t have financial responsibilities.
True, many millennials are living at home today. Three out of 10 parents (27 percent) have at least one adult child, between the ages of 21 and 40, still living with them at home, according to the National Housing Federation. But that doesn’t mean they don’t have financial responsibilities: Mom and Dad might be asking Junior to chip in on rent or expecting him to pay off his student loans they co-signed.
The Hartford 2013 Benefits for Tomorrow Study found two-thirds of workers today have loved ones relying on their paycheck, with 10 percent of millennials reporting that their parents rely on their salary. That’s all the more reason for millennials to protect their paycheck by signing for disability insurance at work.
For many millennials living at home, one of their primary financial responsibilities is dealing with student loan debt. The average debt for students graduating in 2013 is $35,000, according to Fidelity. If parents are co-signers on those student loans, it’s in their best interest to encourage their kids to sign up for disability and life insurance at work. Disability insurance can help keep an income coming in (and the ability to pay back loans) should the millennial worker become ill or injured off the job, while life insurance can help provide funding to pay off student loan debt.
Help the millennials make the connection between benefits and their very real financial responsibilities.
2.) Millennials want all digital communications all the time.
True, millennials are considered “digital natives.” They’ve grown up with technology their entire lives. While they like digital options, many appreciate help in real life, as well. They appreciate an advisor who can provide advice in whatever way they desire — text, email, instant message, phone call, or an in-person meeting.
Help millennials by providing the benefits advisors that they’re looking for. They want to be able to review their benefits options online but have a real-live person available to answer their specific questions. Help your clients make this connection possible.
3.) Millennials all want to start their own companies like Mark Zuckerberg.
True, many millennials think like entrepreneurs. Many even have side projects, like a blog, in addition to their 9-to-5 jobs. But the vast majority of millennials like to work for companies of all sizes — as long as those companies understand them and their needs.
Help the millennials on your team feel like entrepreneurs, by allowing them to express their individuality and effect change around them. And share this advice with your employer clients, as well.
For example, some companies allow millennials to pursue small projects related to their particular interests or participate in occasional community service projects during work hours.
4.) Millennials don’t want baby boomers’ help or advice.
True, millennials enjoy their independence. But in the workplace they actually appreciate theirbaby boomer co-workers’ experience and knowledge. Don’t forget that the millennials are the children of baby boomers, and many raised their kids in their own image. Millennials tend to like and appreciate their baby boomer bosses and colleagues.
The Hartford 2013 Benefits For Tomorrow Study found that 93 percent of baby boomers believe millennials bring new skills and ideas to the workplace, and 89 percent of millennials agree baby boomers in the workplace are a great source of mentorship.
Help millennials by making connections between the two generations — either at your workplace or among your employer clients. Consider the idea of co-mentoring, in which employees of different generations share knowledge and skills with each other.
When you are having discussions around company policies and decisions, make sure to have representative employees present from all generations in your company. This way there will be someone who can offer each generation’s point of view on the items under discussion.
5.) Millennials aren’t serious about being leaders.
True, millennials are often viewed as “entitled” and carefree. Case in point: the YOLO (you only live once) catchphrase. But many are leaders in all aspects of life. In fact, 15 percent of millennials are already in management positions, and there are many young people who want to move into leadership positions soon.
Help millennial leaders to understand that they need to protect their potential. Show them how insurance benefits can keep them on track to meet their professional and personal goals. For example, if they can’t work because they tore a ligament during a 5K, disability insurancemay help them pay bills — and stay on track to buying a house or traveling around the world.
By helping millennials as both consumers and employees, you can better advise your clients and manage your business today — and into the increasingly millennial-dominated future.
Most workers worry benefits will fall short
Originally posted October 18, 2013 by Dan Cook on benefitspro.com
The twin promises of “affordable” and “protection” contained in the Patient Protection and Affordable Care Act sound great. But they’re not enough, at least yet, to assuage the health insurance concerns of most employees.
Because most folks still receive health insurance at work, the throw-the-cards-up-in-the-air nature of health care reform has people worried that their employer may not provide coverage that protects them from the vagaries of life.
That’s the major contention of a white paper from Colonial Life & Accident Insurance Co., which advises employers that they need to look at their benefits plan from a holistic viewpoint if they want it to serve as a recruiting and retention tool.
“Although medical insurance is the cornerstone of a good benefits package, we encourage employers to think about their benefits as a whole right now,” intoned Steve Bygott, assistant vice president of core market services at Colonial Life. “Small and large employers face ongoing cost concerns, in addition to new legal requirements, that challenge their ability to remain competitive. Taking their eye off the big picture of employee benefits could be a costly mistake.”
Employers need to reassure their workers that their coverage will protect them and their families from both routine and unforeseen medical costs — if it does. And if not, employers need to address coverage gaps and serve as a resource to employees for filling those gaps in a cost-effective manner.
When Colonial’s researchers delved into whether employees trusted that their coverage would offer enough protection and be affordable, here’s what they found:
- 83 percent of U.S. employees (full-time and/or part-time, with or without coverage) are at least somewhat concerned about their ability to pay for health premiums.
- 82 percent are concerned with expenses no longer covered by their health insurance plan and the addition of or an increase in co-payments and deductible amounts.
- 81 percent express concern about unexpected medical expenses (emergency room visits, major surgery, etc.).
Given this level of concern, Colonial’s white paper emphasized the need to master a way to talk to workers about health coverage so that their concerns could be alleviated.
“Both large and small employers will need to pay more attention to benefits communication in the years ahead to help them attract and retain a strong workforce,” said Bygott. “Workers will look to their employers to provide them with good, reliable information so they can make the best benefits decisions for themselves and their families.”
Colonial suggested that employers that can’t afford to pay for coverage for their workers offer them voluntary benefits combined with a clear education about how those benefits work and what they cost.
"Voluntary benefits and personalized benefits education can be a tremendous asset to employers looking for a cost-effective way to offer a competitive benefits package," says Bygott. "Though health care reform has everyone asking lots of questions now, staying focused on the big picture will help employers stay competitive in the long run."
Aon Hewitt Analysis Shows Lowest U.S. Health Care Cost Increases in More Than a Decade
Originally posted October 17, 2013 on https://www6.lexisnexis.com
In 2013, U.S. companies and their employees saw the lowest health care premium rate increases in more than a decade, according to an analysis by Aon Hewitt, the global talent, retirement and health solutions business of Aon plc (NYSE: AON). After plan design changes and vendor negotiations, the average health care premium rate increase for large employers in 2013 was 3.3 percent, down from 4.9 percent in 2012 and 8.5 percent in 2011. In 2014, however, average health care premium increases are projected to move back to the 6 percent to 7 percent range.
Aon Hewitt's analysis showed the average health care cost per employee was $10,471 in 2013, up from $10,131 in 2012. The portion of the total health care premium that employees were asked to contribute toward this premium cost was $2,303 in 2013, compared to $2,200 in 2012. Meanwhile, average employee out-of-pocket costs, such as copayments, coinsurance and deductibles, increased 12.8 percent ($2,239) in 2013, compared to just 6.2 percent in 2012 ($1,984).
For 2014, average health care costs are projected to increase to $11,176 per employee. Employees will be asked to contribute 22.4 percent of the total health care premium, which equates to $2,499 for 2014. Average employee out-of-pocket costs are expected to increase to $2,470. These projections mean that over the last decade, employees' share of health care costs-including employee contributions and out-of-pocket costs-will have increased almost 150 percent from $2,011 in 2004 to $4,969 in 2014.
"There are many factors that contributed to the lower rate of premium increases we saw over the past two years that we don't expect to continue in the long-term. These include the lagged effect from the economic recession on health care spending and continued adjustments as employers and insurers phase out the conservatism that was reflected in earlier premiums due to uncertainty around economic conditions and health care reform. Additionally, employers and insurers will now be subject to new transitional reinsurance fees and health insurance industry fees," said Tim Nimmer, fellow of the Society of Actuaries, member of the American Academy of Actuaries and chief health care actuary at Aon Hewitt. "While we are seeing pockets of promising innovation in the health care industry, we expect to see 2014 premium increases shift back towards the 6 percent to 7 percent range overall."
Costs by Plan Type
On average, Aon Hewitt forecasts that companies will see 2014 cost increases of 7.5 percent for health maintenance organization (HMOs) plans, 6.5 percent for preferred provider organization (PPOs) plans and 6.5 percent for point-of-service (POS) plans. That means that from 2013 to 2014, the average cost per person for major companies is estimated to increase from $10,880 to $11,696 for HMOs, $10,222 to $10,887 for PPOs and $11,450 to $12,194 for POS plans.
| Year | HMO | POS | PPO | National |
| 2014* | $11,696 | $12,194 | $10,887 | $11,176 |
| 2013 | $10,880 | $11,450 | $10,222 | $10,471 |
| 2012 | $10,375 | $10,955 | $9,955 | $10,131 |
| 2011 | $9,833 | $10,553 | $9,508 | $9,662 |
| 2010 | $9,103 | $9,464 | $8,790 | $8,903 |
| 2009 | $8,461 | $8,778 | $8,363 | $8,380 |
| 2008 | $7,975 | $8,321 | $8,004 | $7,983 |
*Projections
Costs are plan costs (premium or budget rate) on a per employee basis. They include employee contributions, but not their out-of-pocket costs (i.e., co-payments, coinsurance).
2013 Cost Increases by Major Metropolitan Area
In 2013, major U.S. markets that experienced rate increases higher than the national average included Los Angeles (6.9 percent), Orange County (6.9 percent), Washington DC (5.3 percent) and San Francisco/Oakland/San Jose (4.8 percent). Conversely, New York City (1.6 percent), Milwaukee (2.1 percent) and Atlanta (2.4 percent) experienced lower-than-average rate increases in 2013. Of note, Minneapolis saw a decrease in rate increases at -0.1 percent.
Employer Actions to Mitigate Trend
"Health care remains a top priority for U.S. employers, and most are taking action to prepare for increasing cost, risk and change," said Jim Winkler, chief innovation officer for the U.S. Health & Benefits practice at Aon Hewitt. "As the health care industry continues to evolve, employers realize that a traditional 'managed trend' approach will be less effective in mitigating costs increases over time. Instead, they are exploring innovative new delivery approaches, requiring participants to take a more active role in their own health care planning, and holding health care providers more accountable to reduce unnecessary expenses and create more efficiency in the way health care is purchased."
Recent Aon Hewitt research shows that 72 percent of employers focus their health care strategy primarily on programs that improve health risk and reduce medical costs. As the health care landscape continues to evolve, employers will look to reduce costs using a mix of traditional and non-traditional approaches. These include:
Innovative Approaches to Providing Employer-Sponsored Coverage - Private health exchanges are becoming increasingly attractive to organizations that want to offer employees health care choice while lowering future cost trends and lessening the administrative burden associated with sponsoring a health plan.
In this model, employers continue to financially support health insurance, but allow employees to choose from multiple group plan options and insurance carriers via a competitive, health insurance marketplace.
According to Aon Hewitt research, about 28 percent plan to move into a private health care exchange over the next three-to-five years. Eighteen large employers, includingWalgreensand 2013 participantsSears Holdings,Darden Restaurantsand Aon plc, are offering health benefits this fall through theAon Hewitt Corporate Health Exchange, the nation's largest multi-carrier private health care exchange.
Plan Design Strategies - Aon Hewitt's research shows that consumer-driven health plans (CDHPs) have surpassed health maintenance organizations (HMOs) as the second most popular plan option offered by employers. A growing number ofemployers are offering CDHPs as the only plan option. While just 10 percent of companies do so today, another 44 percent are considering it in the next three to five years[1].
Managing Dependent Eligibility and Subsidies - Many employers are reassessing the way they offer and subsidize health coverage for dependents. Specifically, they are:
Reducing the employer subsidy for covered dependents. Aon Hewitt's research shows that 54 percent of employers are considering reducing subsidies across all dependent tiers in the next three-to-five years. Implementing or increasing surcharges for adult dependents with access to coverage elsewhere. Aon Hewitt's research shows 69 percent of employers have implemented or plan to implement surcharges for adult dependents. Adopting a unitized pricing approach, where employerscharge per dependent. While just 4 percent of employers currently adopt this approach, another 47 percent are considering it in the future. Assessing the eligibility of covered dependents in their plans. A recent Aon Hewitt survey shows that two-thirds ofemployers have completed a program audit of covered dependents to ensure only those who are eligible will remain on the plan.
Increased Cost Sharing - As health care costs increase overall, the amount of money employees will need to contribute out of their paychecks-both in premiums and out-of-pocket costs-is continuing to climb. Today, employees' share of the overall health care premium is 22 percent, compared to just 18.6 percent a decade ago. Additionally, Aon Hewitt's research shows that 47 percent ofemployers have increased participants' deductibles and/or copays in the past year, and another 43 percent are considering doing so in the next three-to-five years.
According to Aon Hewitt, employers are increasing cost sharing through:
Altering plan designs, including shifting from fixed dollar copayments to coinsurance models, where employees pay a percentage of the out-of-pocket costs for each health care service. Increasing deductibles out of pocket limits and cost sharing for use of non-network providers.
Wellness and Health Programs - With employers facing the impacts of rising health care costs and declining health of the population, employees can expect to see more employers offering programs that encourage them to take a more active role in managing their health. For example, 75 percent of employers offer health risk questionnaires (HRQs) and 71 percent offer biometric screenings such as blood pressure and cholesterol.
New Provider Payment Strategies - A growing number of employers want to ensure that the health care services they are paying for are actually leading to improved patient outcomes and are seeking to hold providers more accountable. According to Aon Hewitt's research, 53 percent of employers said that moving toward provider payment models that promote cost effective, high quality health care results will be a part of their future health care strategy, and one in five identified it as one of their three highest priorities.
About the Data
Aon Hewitt's data is derived from the Aon Hewitt Health Value Initiative database, which captures health care cost and benefit data for 516 large U.S. employers representing 12.8 million participants, more than 1,200 plans and $61.2 billion in 2013 health care spending.
Flex your benefits
Originally posted October 16, 2013 by Kathryn Layer on benefitspro.com
In case you missed it, this week marked an interesting — and totally great — holiday called National Flex Day.
Haven’t heard of it? Well, it’s new. Yesterday marked the first official National Flex Day ever, as the brainchild of Working Mother Media.
The premise? To help promote the power of flexible work arrangements.
“Flexible work is important to every single employee, whether to help them accommodate child care responsibilities, elder care needs or a marathon training schedule,” says Carol Evans, president of Working Mother Media. “It’s time for people and companies to step out from the shadows and embrace workplace flexibility as a core business strategy that will enable employees and employers to compete and succeed in an increasingly competitive global economy — while also ensuring a healthy, productive and profitable workforce in the long run.”
In a video, Evans calls the benefit a “lifesaver,” and says that publicizing — and promoting — flexible work arrangements this year is especially important because the benefit has been “under attack.”
That’s in part thanks to people like Yahoo! CEO Marissa Mayer, who earlier this year took back employees’ work-from-home benefits, and Hewlett-Packard’s Meg Whitman who just followed suit.
Groups like Working Mother Media will tell you the problem with these examples is they’re setting a poor example for other employers — when powerhouse companies do it, won’t others follow? And these decisions reflect poorly on the executives, as well — are they really that untrusting of the people they work with? Do they not value their employees’ home lives?
Don’t get me wrong: Individual employers have to make the right decision for their company. They don’t have to allow everyone to hang out at home in their pajamas day after day, but being flexible about work schedules and understanding the ever-important work-life balance is another matter.
With benefits apparently not as important as they once were, and with many companies dropping employer-sponsored coverage, asking employees to pay a higher share of the cost, or cutting sick or vacation days — flex time is an easy, cheap and productive benefit for employers to implement.
It’s amazing people still don’t get it: When employees feel valued, appreciated and trusted, their work ethic improves, their happiness improves, they stay healthier and they’re much more likely to stick with the company. Wins all around!
According to research by Working Mother Media, a typical business saves half a million dollars in facilities costs for every 100 employees who telecommute full-time. By contrast, they spend 50 percent more in health care costs on stressed-out workers. (And flexible work lowers employee stress by 30 percent.)
Appropriately enough today is also Boss’s Day. Perhaps it’s a good time to tell your supervisor you’ll only wish him a happy Boss’s Day if he wishes you a happy Flex Day — and means it.
With debt ceiling near, employee benefits in the crosshairs
Originally posted October 16, 2013 by Gillian Roberts on https://ebn.benefitnews.com
Wednesday's last-minute negotiations on raising the nation’s borrowing limit could impact 401(k)s, Roth retirement vehicles and more, if similar past showdowns give any indication. Bob Christenson, partner at Fisher & Phillips LLP, says he’s seen these debates on the Hill before and past lessons show that employee benefits could be impacted when the conversation turns to raising revenue through taxes.
“There may be more of a restriction on 401(k) plan contributions because they’ve done that in the past,” says Christenson, of the firm’s Atlanta office. “Everyone talks about limits on Roth contributions and the secret behind all that was — that was a revenue raising measure, too.” He also says he wouldn’t be surprised if lawmakers “tinker” with ways to make distributions on retirement savings vehicles easier because again, that would be a tax increase.
“From an employee benefits policy perspective, it’s not smart … but it’s what’s been done in the past and I wouldn’t be surprised to see it again,” he says.
Bill Sweetnam, principal at Groom Law Group in Washington, agrees that revenue raisers may be part of the equation, but nothing on a large scale. “Early on I would have said if they had done a grand bargain over the summer they could have done something with tax reform, but they don’t have the time for tax reform, so I think the employee benefits world is not going to be impacted unless they’re used as a revenue raiser that people want,” he says.
Sweetnam thinks two things could be on the table for employee benefits at this point:
1) Extending the relief that defined benefit plan sponsors get from MAP-21 interest rates — in other words, “requiring people to make higher funding contributions and thus raise revenue for the government,” he says.
2) Provide relief to multi-employer pension plans, which has been a heavily lobbied topic recently and could be a positive gesture towards benefits in all this.
Christenson says he suspects that with fewer personnel at the Internal Revenue Service, the voluntary compliance program “that a lot of qualified programs use to correct errors” will probably be down. “They’re not going to advertise that they don’t have the usual personnel,” he says. And that also goes for IRS and DOL audits and Employee Benefits Securities Administration investigations as well.
Christenson points out that there was a time when both parties discussed necessary “tweaks” to the Affordable Care Act, but with the polarization in Washington at this point, “the legislative activity of those potential changes that everyone agrees on could get changed,” he says.
Time for Open Enrollment
Originally posted by Susan M. Heathfield October 15, 2013 on https://humanresources.about.com
Open enrollment season is upon us, and as employers, we have an obligation to educate our employees about their benefits. Not just a "nice to," to help employees make good choices for their families, this education also lets employees know what their employer is spending for their benefits above and beyond their base salary. This helps employees understand and appreciate their complete compensation package.
How confused are employees about their benefits?According to Forbes, "How confusing is it? Three-quarters of Americans admit to making mistakes during open enrollment, according to a 2011 Aflac WorkForces Report. Just 40% of employees feel well-informed about the benefits their companies offer, and less than half (46%) feel their HR departments are extremely or very knowledgeable about those benefits, Aflac found."
This is why I have written about how educating employees is critical for their understanding and so they make good choices about coverage for themselves and their family. But, benefits are definitely misunderstood. In one recent study, employees estimated that benefits added 30% to their employer's costs to employ them. In fact, the figure was 43%.
I recommend an annual evening benefits review event, so spouses can attend, that emphasizes the cost of the benefits and how employees can best take advantage of the benefits they have for themselves and their families. You want to promote employee appreciation of their benefits.
What better time to offer such an event as during open enrollment when employees are making changes? Employers are already making insurance representatives available to talk to employees - or they should be - as employers are not benefits experts and should trust professionals that they have vetted. Why not extend an educational opportunity?
To provide the basics about open enrollment and to emphasize some must do areas for employers, I email interviewed Erich Sternberg, president of AlwaysCare Benefits of Baton Rouge, Louisiana. Take a look at our interview for a concise overview of open enrollment. Additionally, Erich supplies a list of steps he recommends every employee take during open enrollment.
Additional information about open enrollment is available from About.com's Michael Bihari, MD.
56% of employers offer CDHP, 44% may make it the only choice: Aon Hewitt
Originally posted October 09, 2013 by Jerry Geisel on businessinsurance.com
Once a rarity, consumer-driven health care plans have become a mainstream design among large employers.
Fifty-six percent of midsize to large employers responding to an Aon Hewitt survey released Wednesday said they now offer CDHPs. Such high-deductible plans are linked to health reimbursement arrangements or health savings accounts, which employees can use to pay for a portion of uncovered health care expenses.
The prevalence of CDHPs is expected to grow, as 30% of respondents said they are considering offering a CDHP in three next three to five years.
Because of their high-deductible feature, CDHPs are much less expensive than other plan designs, according to several studies. For example, a Kaiser Family Foundation survey released in August found that the average cost of family coverage through CDHPs was nearly $1,500 less per employee than coverage through a preferred provider organization.
“Employers are increasingly embracing plan designs that are cost-effective, promote consumer choice and accountability, and encourage employees to be more deliberate in how they spend their health care dollars,” Maureen Fay, an Aon Hewitt senior vice president in Norwalk, Conn., said in a statement.
Only health care option for some
In addition, many employers are considering making a CDHP their only health plan choice.
While just 10% of employers now offer CDHPs as their only plan, 44% said they are they are considering doing so in the next three to five years, according to the survey.
The findings are based on the responses of 837 employers, 57% of which had more than 2,500 employees.
HR align benefits with business objectives
Originally posted September 24, 2013 by Jennifer Paterson on https://www.employeebenefits.co.uk
Reward and HR professionals are taking steps to ensure that the benefits they offer support the objectives of their organisation, according to research by the Chartered Institute of Personnel and Development (CIPD).
Its Aligning strategy and benefits survey, which is based on responses from 444 organisations, found there is also a strong correlation between workplace outcomes and transparency in employee benefits.
Organizations that prefer to be more transparent about their benefits schemes are more likely to have good employee relations, increased productivity rates, lower absenteeism, good employee retention and low pay discontent.
The research also found that, where respondents’ workforce comprised mostly graduates, there is a higher level of membership in defined contribution pension plans.
Charles Cotton (pictured), reward adviser at the CIPD, said: “HR professionals continually have to ensure that the reward provisions they offer in the workplace are in keeping with the shifting nature of work, and are aligned to both the needs of business and employees and integrated with other aspects of people management strategy.
“Failure to do so will result in inappropriate achievements, skills and behaviours being rewarded and recognised.
“What our research helps to illustrate is that HR [professionals] are not adopting benefits for the sake of it, but are choosing those that match what the firm is trying to achieve. It also shows the impact that employee benefits can have in the workplace in terms of employee retention, absence, productivity and relations.”
A faster, cheaper way to wellness programs that work
Originally posted September 6, 2013 by Vlad Gyster on https://ebn.benefitnews.com
The debate over whether wellness programs "work" is becoming increasingly heated. Many question the validity of research demonstrating that wellness programs reduce health care costs. At the same time, others swear by their wellness provider. So, who's the liar?
As with most things, the truth is in the eye of the beholder. Wellness is a business, and it would serve us well - no pun intended - to consider this business formula as we attempt to determine where the truth lies and understand why this debate is so heated: Value = Benefits/Cost.
To begin with, we don't truly know the value of a wellness program. This formula helps quantify the importance of knowing value. When making a purchase, all of us have some understanding of a product's benefits, and in return we pay a cost. Together, those two factors create a value. If the benefits and costs are generally understood, then value is pretty predictable. But if there's a lack of agreement about the benefits, it's tough to come to consensus on value and cost. The result is very different calculations and a big debate about whether something is really worth it. This is what we're experiencing with wellness programs. The reality is that we don't really know all the benefits a wellness program provides, and, as a result, their value is up for debate.
This debate will eventually be resolved in one of two ways:
1. We come to a consensus that wellness programs deliver the stated benefits and continue to pay the current cost; or
2. We conclude the benefits are lower than initially thought, and adjust the cost accordingly.
I've got my money on option 2. Here's why:
Gartner - a research advisory firm that's been evaluating technology for more than 30 years - discovered a funny pattern: Every few years, a new technology emerges that gets a lot of people really excited. There's a lot of enthusiasm and promises, but, given limited use, no real data about the technology's actual benefits. This is the "peak of inflated expectations"; i.e., when we make statements like "This is going to change the world."
After a while, though, people realize that their perception of the technology's benefits are unrealistic; they feel they received bad value, get disgruntled and criticize the technology as worthless. This is the "trough of disillusionment." It occurs when the benefits are lower than originally assumed, and the cost is experienced as too high relative to the perceived lesser value.
It's reasonable to assume we are in the midst of a sober re-evaluation of the benefits of wellness programs, somewhere in the "trough of disillusionment." The good news is, as history has proven, that over time, the market comes to understand the technology's actual benefits, accepts them and broad adoption can occur. For this to happen, there needs to be a consensus about the benefits (aka ROI) and the price adjusted accordingly. This doesn't mean wellness programs are worthless, just that they may be worth less than the benefits declared during the "peak of inflated expectations."
Minimize cost
In a scenario where the value of something is unclear, it's wise to minimize - rather than wait for the market to drive down - cost, as cost is the variable you have control over. Traditional approaches to launching wellness initiatives come with huge overhead - strategy, vendor selection, implementation and vendor fees can easily run into the hundreds of thousands of dollars - and can take years before having any real impact on even a single employee. Cut as much of this overhead as possible. Vendor selections should come in the form of free trials with groups of employees. Vendor fees should be contract-free and have monthly options for easy exit. Strategy work should turn into small experiments with employees to identify what works and what doesn't.
In other words, spend less. But how do you drive a high level of engagement in wellness with limited resources? We suggest using the Lean Startup methodology used by startups to drive engagement in new products using limited resources. This approach advocates using small, inexpensive steps that lead to quick wins and continuous improvement. Its use could help HR quickly and cheaply differentiate what works from what doesn't, so HR can focus time and dollars on what's actually effective.
Four steps
Here's our version of the Lean Startup methodology adapted for HR:
Step 1: Think in terms of a "Minimum Viable Product". MVP is the smallest thing you can do to learn how to make progress toward your objective. For most employers, the objective of their wellness programs will be somehow tied to employee participation. Instead of spending limited resources on building business cases and other costly activities, pick something to do that is small and will help you learn what works to gain employee participation.
Step 2: Build something that's "good enough". Start with something easy, like an employee video testimonial about a benefit that's already available (but likely underappreciated), such as gym reimbursement. Upload the video to a video hosting tool for businesses so you can track how many people click the link and view your video. Send an email to employees inviting them to watch the video. Explain that this is a "beta" and you're testing concepts for a potential wellness initiative. Distribute it to a small group first to ensure everything is working.
Step 3: Measure. Measuring is essential. If you don't measure results you can't test your assumption about how a particular strategy will work or learn from it. Once the email is sent, you'll know how many people clicked the link and how many people viewed the video and for how long. These key performance indicators - KPIs - provide a baseline for identifying progress and future improvements.
Step 4: Learn. This is the most important step. By this point, you should have gained some idea of what's working well and what's not, and the data necessary to improve key metrics. These are the types of tangible outcomes necessary to propel any wellness initiative forward. What can you do to increase those numbers? The faster you can repeat this process and improve your KPIs, the more momentum you'll gain - and the sooner you can determine the potential effectiveness of wellness initiatives without a huge expenditure of scarce resources.
Debate will continue
Whether the results achieved with wellness programs are worth their cost is a debate that will likely continue. That said, there's little doubt that a key ingredient to achieving ROI on wellness programs - or any HR initiative - is employee participation. The HR-adapted Lean Startup approach lets you know whether you've got this key ingredient - before you've spent a lot of time and money hoping to get it.
All Legal Same-Sex Marriages Will Be Recognized for Federal Tax Purposes
Originally published on https://www.treasury.gov
Ruling Provides Certainty, Benefits and Protections Under Federal Tax Law for Same-Sex Married Couples
WASHINGTON — The U.S. Department of the Treasury and the Internal Revenue Service (IRS) today ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. The ruling applies regardless of whether the couple lives in a jurisdiction that recognizes same-sex marriage or a jurisdiction that does not recognize same-sex marriage.
The ruling implements federal tax aspects of the June 26th Supreme Court decision invalidating a key provision of the 1996 Defense of Marriage Act.
“Today’s ruling provides certainty and clear, coherent tax filing guidance for all legally married same-sex couples nationwide. It provides access to benefits, responsibilities and protections under federal tax law that all Americans deserve,” said Secretary Jacob J. Lew. “This ruling also assures legally married same-sex couples that they can move freely throughout the country knowing that their federal filing status will not change.”
Under the ruling, same sex couples will be treated as married for all federal tax purposes, including income and gift and estate taxes. The ruling applies to all federal tax provisions where marriage is a factor, including filing status, claiming personal and dependency exemptions, taking the standard deduction, employee benefits, contributing to an IRA, and claiming the earned income tax credit or child tax credit.
Any same-sex marriage legally entered into in one of the 50 states, the District of Columbia, a U.S. territory, or a foreign country will be covered by the ruling. However, the ruling does not apply to registered domestic partnerships, civil unions, or similar formal relationships recognized under state law.
Legally-married same-sex couples generally must file their 2013 federal income tax return using either the “married filing jointly” or “married filing separately” filing status.
Individuals who were in same-sex marriages may, but are not required to, file original or amended returns choosing to be treated as married for federal tax purposes for one or more prior tax years still open under the statute of limitations.
Generally, the statute of limitations for filing a refund claim is three years from the date the return was filed or two years from the date the tax was paid, whichever is later. As a result, refund claims can still be filed for tax years 2010, 2011, and 2012. Some taxpayers may have special circumstances (such as signing an agreement with the IRS to keep the statute of limitations open) that permit them to file refund claims for tax years 2009 and earlier.
Additionally, employees who purchased same-sex spouse health insurance coverage from their employers on an after-tax basis may treat the amounts paid for that coverage as pre-tax and excludable from income.
How to File a Claim for Refund
Taxpayers who wish to file a refund claim for income taxes should use Form 1040X, Amended U.S. Individual Income Tax Return.
Taxpayers who wish to file a refund claim for gift or estate taxes should file Form 843, Claim for Refund and Request for Abatement.
For information on filing an amended return, go to Tax Topic 308, Amended Returns athttps://www.irs.gov/taxtopics/tc308.html or the Instructions to Forms 1040X and 843. Information on where to file your amended returns is available in the instructions to the form.
Future Guidance
Treasury and the IRS intend to issue streamlined procedures for employers who wish to file refund claims for payroll taxes paid on previously-taxed health insurance and fringe benefits provided to same-sex spouses. Treasury and IRS also intend to issue further guidance on cafeteria plans and on how qualified retirement plans and other tax-favored arrangements should treat same-sex spouses for periods before the effective date of this Revenue Ruling.
Other agencies may provide guidance on other federal programs that they administer that are affected by the Code.
For Revenue Ruling 2013-17, click here.
For Frequently Asked Questions, click here.
For registered domestic partners who live in community property states, click here for Publication 555, Community Property.
Treasury and the IRS will begin applying the terms of Revenue Ruling 2013-17 on September 16, 2013, but taxpayers who wish to rely on the terms of the Revenue Ruling for earlier periods may choose to do so (as long as the statute of limitations for the earlier period has not expired).