Employers' Greatest Fears: PPACA & Compliance

Original post benefitspro.com

The last few years have put employers in the position of becoming compliance officers. The Department of Labor, Health and Human Services, and the Internal Revenue Service have actively been pursuing small- and mid-size businesses about various issues, from PPACA reporting to wage and hour miscalculations.

It is becoming a full-time job for manager HR representatives to keep up with the requirements of a compliant business.

The average employer cannot tell you what the affordability test is compared to the value test, but they know that it is now a requirement. Most important is the employer's concern for their employees to have the best health insurance available for the least expensive price. The employees are now looking for jobs that will provide them with health insurance in order to not be penalized at tax filing time. Employers are trying to understand what exactly they should be providing under health care reform in order to not pay additional fines for doing it incorrectly.

IRS fines are increasing in 2016 for employees to either $695 or 2.5 percent of adjusted family income per uninsured adult, whichever is greater. Employers will have to pay $2,160 per employee (after the first 30) if not providing health insurance or for an incorrect plan, and $3,240 for each employee getting a subsidy through the marketplace. Penalties for not filing certain documents in time, such as form 5500 or form 1094C, can add up to $1,100 per late day.

Insurance agents are becoming consultants in a very different world than we first began. Employers are asking accounting and legal questions which are requiring research and partnerships with other professionals.

Employers want to know the difference now in using a professional employer organization (PEO) versus outsourcing their HR and payroll departments. If the employer decides to do it themselves, questions they ask are:

  • How long do I keep the necessary paperwork?
  • Should I use the qualifying offer method or the 98 percent offer method?
  • Which Safe Harbor would be best for my situation?

Insurance consultants will be the ones answering these questions with their employers as well as reviewing the documents and procedures.

Education and wisdom are the most important values for an insurance consultant’s job security. Just about the time you learn it, it will change.

How Agents Can Help Comply with PPACA

Original post benefitspro.com

“You can help your employer clients comply with the Patient Protection and Affordable Care Act [PPACA] by becoming their trusted advisors,” Julie L. Hulsey, CLU, LUTCF, president and CEO, Zynia Business Solutions, Amarillo, Texas, told her audience in her presentation, “Employers’ Greatest Fears: PPACA and Compliance.”

As of Jan. 1, 2016, Hulsey reminded the audience, employers of 50 or more full-time equivalent (FTE) employees are required to provide health insurance to at least 95% of their employees or face a penalty. One key issue for employers is that many federal government entities are auditing small businesses with little to no coordination, for example:

1. Department of Labor, including the Wage and Hour Division, the Equal Employment Opportunity Commission and the Occupational Safety and Health Administration

2. Internal Revenue Service

3. Office for Civil Rights

4. Immigration Customs Enforcement

5. Department of Transportation

“Smaller employers, those with less than 50 employees, or 50 to 100 employees, don’t have an HR department or even an HR professional on staff,” Hulsey observed. One way agents and brokers can demonstrate their value is by providing clients with charts showing affordable coverage employee wage calculations for a 40-hour work week and for a 30-hour work week, she explained, showing the charts she had created for her clients.

Penalties 101 for agents and brokers

Hulsey reminded the audience that for 2016 the employer shared responsibility penalty of $2,000 is now $2,160, and the $3,000 penalty is now $3,240. If an employer is considering paying the penalty instead of offering insurance, you can point out that the penalty is not a tax deductible business expense but health insurance premiums are, which may affect the employer’s decision.

“Penalties will be calculated on a monthly basis so if you are out of compliance for just one month, you will only be penalized for that month,” Hulsey pointed out. “Therefore, become compliant as soon as possible to avoid accumulating more monthly penalties.”

If an employer offers a “minimum essential coverage” plan that meets the “affordable” and “minimum value” tests to an employee who declines it, no employer penalty will be owed for that employee. “Tell the employer to keep a copy of the signed waiver of coverage form, and get a signed waiver every year!” Hulsey said.

It’s important to let our clients know what the Department of Labor and the Department of Justice are targeting, Hulsey said. Quoting from a recent presentation by the DOL and DOJ that she attended, Hulsey said that the DOL’s FY 2013 Strategic Plan has a goal to generate $1,172,108,000 in enforcement results through 4,330 reporting compliance reviews. They indicated their enforcement program will use a series of approaches (including national/regional priorities, civil/criminal litigation, and sample Investigation Programs) to achieve this goal. The current strategic plan is under review and that enforcement goal is likely to increase.

Hulsey acknowledged that agents and brokers are losing commissions but you can take some action to limit those losses “Connect with professionals like TPAs and payroll vendors to offer some of those third party services,” she suggested. “Also, be sure you understand your clients’ needs so you can answer their questions.” Employers need answers about PPACA and compliance, and they’ll be calling you or their attorneys. “It’s better if they call you,” she said.

Many Employees Still Unaware of Free Preventive Care Benefits

Original post benefitspro.com

Even employees covered by an employer-sponsored health plan remain confused about the benefits that are free of charge to them under health care reform law. But employers say that they often don’t have the resources or effective communications tools to fully explain these benefits to the workforce.

This finding emerged from a small sample study by the Midwest Business Group  on Health, which surveyed 53 workplaces, more than half of which had 5,000 or more employees in their plans.

The survey indicated that progress is being made: 62 percent said they were aware of all the free services, which include vaccinations, maternity and pregnancy related services, pediatric services and others. But another 36 percent admitted they weren’t aware of the full spectrum of these free benefits. (Just 2 percent pleaded complete ignorance of the benefits.)

The survey said that larger employers that often use participation incentives to increase benefits usage had higher rates of preventive service use  compared to small- to mid-sized employers, with larger ones reporting about 60 percent participation and small-to-mid-sized around 50 percent. Overall, 53 percent said they offer such incentives.

“In addition,” the report said, “outside of the flu vaccination, survey respondents indicated they are not promoting important adult vaccinations, and for those that do, employee use is low.”

Digging deeper into the benefits available to workers, the study found that 58 percent of respondents offered vaccines only to those covered and their dependents. A small number — 42 percent — included retirees in the coverage.

The flu vaccine was far and away the most prevalent benefit for employers with onsite or near-site clinics, offered by 70 percent. Vaccinations for hepatitis B were the second most common, at 41 percent, with hepatitis A found in 39 percent of plans. Vaccinations for diseases such as HPV, shingles, pneumonia, measles and others were in the 27 percent to 37 percent range. Nearly half of plans (43 percent) covered all vaccinations costs.

Increasingly, larger employers, and even some with fewer employees, are turning to onsite service centers to encourage greater use of free preventive benefits. Nearly half reported having an onsite clinic, 21 percent said they use a near-site clinic, and 7 percent reported using a mobile van.

While overall, employers felt their benefits communications strategies were working fairly well, a major area where they are not finding success is in encouraging employees to choose a specific location to receive vaccines. This indicates that the employer-led national effort to attempt to steer workers to centers of excellence, or at least of cost efficiency, is not yet working well.

The MBGH has created a preventive benefits “toolkit” designed to help employers spread the word about free benefits and increase participation in them.

“Employers are the primary purchasers of health care for employees and families, so it’s important that these benefits are effectively understood and appropriately used,” said Larry Boress, MBGH president and CEO. “Otherwise, consumer engagement levels suffer, resulting in millions of benefit dollars being wasted each year. Many employers don’t know where to start or how to effectively communicate available preventive care benefits to their covered population. That’s why we’re launching an employer toolkit to help employers do a more effective job.”

How Employers Should Respond to Increased DOL Audits

Original post benefitnews.com

The Department of Labor says it will be stepping up enforcement efforts and employer audits, which should prompt brokers, who formerly worried little about such regulatory efforts, to prepare to serve as a trusted adviser to clients concerned about such efforts, says Julie Hulsey, president and CEO of Amarillo, Texas-based Zynia Business Solutions.

Speaking at an industry conference in Hollywood, Fla. last week, Hulsey said employers are feeling pressured by the weight of increased DOL and health care reform regulations and brokers need to stay up to date on regulations, including those related to the Affordable Care Act and ERISA.

The ACA reporting requirements have brought increased scrutiny of employer-sponsored health care plans and the government is largely expected to respond to anomalies or red flags with an employer audit. But industry experts agree the government won’t limit its inquiries to ACA-related information only, and employers should be prepared for full-blown audits of health care plans.

Quoting from a DOL presentation in Austin, Texas, Hulsey says the Department said, “leniency is over; the EBSA has staffed up and is focusing its resources on health and welfare plan ERISA compliance.”

Additionally, in her small Texas town alone, she says she’s heard that the DOL has added 10-12 auditors, who are conducting random audits of employers, mostly on the smaller employee size.

Increased compliance needs can be a strain for small employers, some of which may not even have a designated Human Resources department or manager.

When a DOL audit is announced, an employer’s first phone call will be their broker or an attorney.

Among the topics that brokers should be aware,

  • Variable Employee Testing: Based on employee classifications, an employer can group employees into different groups, such as part-time and seasonal.
  • HR 3236-The Transportation and Veteran Health care Choice Improvement Act of 2016: This Act regulates that employees covered by Tricare can be excluded from counting employee numbers.
  • Cadillac Tax: Although delayed until 2020, it is important to start planning now.
  • Waivers: If employers offer a minimum-essential coverage plan that meets affordable and minimum value test and an employee declines coverage, it is important the employer have a signed waiver. “That waiver is gold,” Hulsey said.
  • Individual Mandate: The period will run from Nov. 1, 2016 to Jan. 31, 2016.
  • Special Enrollment Period: Presenting a sales opportunity to brokers, these enrollment periods take affect when an employee experiences any change that affects income or household size, such as becoming pregnant. Other special enrollments include marriage/divorce, changing place of residence and having a change in disability.

The DOL has the authority to audit for compliance with several laws, including the ACA, HIPAA and the Mental Health Parity and Addiction Equity Act. They also have the authority to audit for minimum loss ratio rebates and PECORI fees.

The Cadillac Tax: Myths & Facts

Original post benefitspro.com

Americans love a good story. From fairy tales to hair-raising films that leave us cowering in our seats, we enjoy when our hearts pound in anticipation. Sometimes, though, we keep ourselves up at night by creating myths about things that shouldn't be worrisome at all. One example: The Affordable Care Act's 40 percent excise tax on high-cost health care plans, commonly referred to as the Cadillac Tax.

Although we are several years away from its implementation, brokers are wondering what these health care changes will mean for their business. The Cadillac Tax is confusing and prompts questions from employers and benefits professionals — especially about when to make changes to benefits plans and whether voluntary insurance is affected.

Let's take some time to distinguish between the myths and facts so when you communicate with your clients about their plans this year — and in years to come — you have the facts to ensure you’re providing clients with accurate information to make effective business decisions regarding benefit offerings.


Myth: Employers should make benefit changes now to avoid the Cadillac tax.
Fact: The Cadillac tax has been delayed until 2020.

  • As part of the Congressional spending bill signed into law in late December 2015, the Cadillac Tax is delayed until 2020.
  • Considering implementation of the tax is several years away and regulations will evolve, employers can wait before considering changes to their policies.


Myth: All voluntary benefits are included in the tax.
Fact: Generally, voluntary insurance products do not count toward the Cadillac Tax calculation.

  • Only two types of voluntary coverage — specified disease and hospital indemnity — are subject to the calculation of the tax, but only if they’re paid for with pretax dollars, such as through a cafeteria plan, or with excludable employer contributions. Otherwise, they are not subject to the calculation of the tax.
  • Voluntary insurance products are defined as HIPAA-excepted benefits.


Myth: Employers should switch their pretax voluntary insurance products to after-tax versions.
Fact: Only employers with benefits plans considered “high cost” need to consider after-tax strategies.

  • Employers and their workers receive tax advantages for retaining pretax voluntary products.
  • Only two types of voluntary coverage — specified disease and hospital indemnity — are included in tax calculations, and only then if they’re paid with pretax dollars or the employer pays any portion of the premium. Other voluntary insurance benefits won't trigger the Cadillac Tax, regardless of whether they’re offered before or after tax.


Myth: Employers or workers will be responsible for paying the Cadillac Tax when it goes into effect.
Fact: In most cases, the insurance provider will be responsible for paying the tax.

  • Most small businesses are fully insured, meaning the insurance provider sets the premium and pays the claims. When that's the case, the insurer, not the employer, is responsible for paying the Cadillac Tax when it goes into effect in 2020.
  • If an employer is self-insured, meaning the employer sets the premiums and pays the claims, or the coverage offered is a health savings account (HSA) or an Archer medical savings account (MSA), the employer or the plan administrator will be responsible for paying the tax.

The bottom line is that myths and rumors have made the Cadillac Tax seem more confusing than it already is. It isn't even expected to take effect for another four years, so it shouldn't prompt your clients to exclude voluntary insurance from their benefits options. After all, the security voluntary coverage provides can help ensure your clients and their employees sleep well instead of worrying about medical costs that are continuing to rise.

House passes bill offering smaller employers relief from ACA coverage mandate

Originally posted January 7, 2015 by Jerry Geisel on Business Insurance

More small employers would be shielded from a health care reform law provision that requires employers to offer coverage or be liable for a stiff financial penalty under veterans-related legislation approved by the House of Representatives.

Under the Patient Protection and Affordable Care Act, employers with at least 100 full-time employees must offer coverage or be liable for a $2,000 per employee penalty, starting this year. In 2016, the 100-employee threshold for the so-called employer mandate drops to 50 employees and remains at that level in succeeding years.

Under the legislation, H.R. 22, introduced by Rep. Rodney Davis, R-Ill., and passed on a 412-0 vote Tuesday, employees who due to their military service receive health care coverage from the U.S. Department of Veterans Affairs or the federal Tricare program would not be counted in calculating whether their employers hit the employment count threshold that triggers the ACA employer coverage mandate.

Passage of the legislation will give smaller employers an additional incentive to hire veterans, Rep. Davis said in a statement.

A companion bill was introduced in the Senate on Wednesday by Sen. Roy Blunt, R-Mo.

The House last year passed an identical bill, but it was not taken up by the Senate.


IRS Expands Midyear Election Change Rules for Section 125 Plans

Originally posted October 1, 2014 on https://blog.thinkhr.com.

On September 18, 2014, the Internal Revenue Service (IRS) issued Notice 2014-55, Additional Permitted Election Changes for Health Coverage under § 125 Cafeteria Plan, which allows employers to make specific changes to their plans. These changes will make it easier for employees to change their group plan elections and take advantage of individual health plans available to them through the Marketplace exchanges created by the Affordable Care Act (ACA).

Section 125 cafeteria plans generally require participants to make binding elections for an entire plan year, with employers being able to allow employees to make changes only in limited cases (e.g., marriage, birth, or adoption of child). With the issuance of Notice 2014-55, the list of possible exceptions expands somewhat, making it possible for the employer to amend its plan design to allow an employee to drop employer-sponsored group coverage in order to enroll in a state or federally-facilitated Health Insurance Marketplace.

This guidance applies only to health coverage offered through a cafeteria plan that is minimum essential coverage. Thus, it does not apply to stand-alone dental and/or vision coverage or to health flexible spending accounts (FSAs). Further, an employer’s choice to amend its plan to adopt any of these exceptions is voluntary.

Reduction in Hours

Under the new exceptions, if an employee experiences a reduction in work hours to less than 30 hours per week, the employee may revoke coverage in the cafeteria plan if he or she plans to enroll in coverage through the Marketplace or another health plan.

This new opportunity for exemption could allow an employee who is changing to part-time status to benefit from subsidies available through the Marketplace. This is likely to be the case if an employee expects to experience lower household income after a change in status.

Previously, participant elections were irrevocable during the plan year unless the employee experienced certain family status changes, or unless the plan sponsor made significant changes to coverage or cost. For instance, under the ACA’s employer shared responsibility (play or pay) rules, a variable-hours employee may be covered for an entire “stability period” although the employee’s work schedule and earnings may change dramatically. The existing cafeteria plan rules would not allow the employee to revoke coverage in that case. The new exceptions, however, permit the employer to amend the cafeteria plan so an employee in that circumstance would be able to drop the coverage before the end of the stability period.

If a plan intends to adopt this exception, the following requirements must be met:

An employee must have been expected to average at least 30 hours per week prior to an actual change in the employee’s status that results in the expectation that the employee will average less than 30 hours per week. It does not matter if the employee will actually lose health plan eligibility due to hours — the expectation of averaging 30 hours per week is the test.
The change must correspond to the employee — including dependents experiencing a resulting change in coverage — intending to enroll in another plan providing minimum essential coverage.
The new coverage must be effective by the first day of the second month following the month in which the original coverage is revoked.

“Intending to enroll” in other coverage is determined by the statement of the employee experiencing a change in status. The employer may rely on such an employee’s reasonable representation of intentions. This reasonable representation applies to the employee and any related individuals impacted by the change.

Changes in Connection with Marketplace Enrollment

The IRS Notice also provides for another exception so employees can make midyear election changes. This new exception may be beneficial to employees who are covered by non-calendar year cafeteria plans, or who are finding Marketplace plans more attractive after a change in family status, to resolve the gap between an employer’s cafeteria plan year and the Marketplace open enrollment January 1st effective date. The current cafeteria plan rules do not allow employees to drop coverage at work midyear in order to enroll in a Marketplace plan. The Marketplace offers open enrollment for new policies starting January 1; however, many employer plans do not operate on a calendar-year basis.

Employers are now able to adopt provisions allowing an employee to revoke an enrollment election in order to obtain coverage through the Marketplace. The following conditions must be met for this exception to be allowed:

The employee must be seeking to enroll in the Marketplace during annual open enrollment or during a special enrollment period.
Enrollment in the Marketplace plan must be effective immediately following loss of coverage from the employer-sponsored plan.
Any related individuals who were dependent on the employee’s previous enrollment must also be enrolled in the new plan.

In this case, the employer is not required to prove that other coverage is actually elected. Rather, the employer is allowed to rely on the reasonable representation of an employee that he or she is intending to enroll in Marketplace coverage immediately after the change to enrollment in the employer’s plan is effective. Thus, there should be no gap in coverage if an employee is allowed to exercise this option.

Adopting the New Optional Provisions

Employers may adopt one or both of the new exceptions for midyear election changes by amending the cafeteria plan. For convenience, the IRS is allowing employers to amend their plans for the 2014 plan year by adopting the amendment at any time on or before the last day of the plan year that begins in 2015. Although the employer has extra time to adopt the formal amendment, the employer must take the following steps before allowing the exceptions:

Operate the cafeteria plan in accordance with the guidance outlined in IRS Notice 20144-55; and Notify all plan participants of the changes.

For complete details, read IRS Notice 2014-55.

Conflicting Views Of Supreme Court’s Contraception Decision Cloud Other Cases

Originally posted July 8, 2014 by Julie Rovner on https://www.kaiserhealthnews.org.

The Supreme Court’s decision last week that some for-profit corporations don’t have to comply with the contraceptive coverage mandate under the Affordable Care Act may have raised more questions than it answered. Expect confusion – and arguments – as lower court judges and the Supreme Court itself apply the decision to other cases.

This became apparent soon after the Hobby Lobby ruling when the court granted a temporary injunction to Wheaton College, a Christian school in Illinois. The college argued in a lawsuit that the special provisions provided by the Obama administration allowing it to escape the mandate are still insufficient.

But the order for the college, citing the Hobby Lobby ruling earlier in the week, created some confusion over whether Wheaton employees would still get access to contraceptives under the law. And the order provoked a blistering dissent from Justice Sonia Sotomayor, joined by the court’s two other female members, Justices Ruth Bader Ginsburg and Elena Kagan. They argued that the majority was already breaking with the precedent it established only days earlier.

Here are some of the questions raised by the Hobby Lobby case and the remaining cases also challenging the contraceptive coverage mandate.

What is the contraceptive mandate?      

As part of the Affordable Care Act, most health insurance plans are required to cover, with no cost-sharing beyond premiums, a wide array of preventive health benefits. For women, that includes all contraceptives approved by the Food and Drug Administration, as well as sterilization procedures and patient education and counseling.

The mandate does not include coverage of RU-486 (mifepristone), the drug used for medical abortions after a pregnancy has been established. But it does require coverage of emergency contraceptives and intrauterine devices, which some believe can prevent the implantation of a fertilized egg. (Newer research suggests that is probably not the case, by the way.)

Who has sued to try to block the mandate?

There have been two separate sets of court cases challenging the contraceptive coverage requirements.

The first set comes from for-profit corporations that, under the law and accompanying federal regulations, are required to provide the benefits as part of their insurance plans. According to the National Women’s Law Center, there have been 50 cases filed by for-profit firms, while the Becket Fund for Religious Justice, which is representing many of those suing, counts 49. Most of those companies charged that the requirement to provide some or all of the contraceptives in question violated their rights under a 1993 federal law, the Religious Freedom Restoration Act (RFRA.)

The cases filed by Hobby Lobby, a nationwide arts-and-crafts chain, and Conestoga Wood Specialties, a Pennsylvania cabinet-making firm, were the first of those to reach the Supreme Court for a full hearing.

Religious nonprofit entities, mostly religious colleges and universities and health facilities, filed the second set of cases. The NWLC counts 59 nonprofit cases; the Becket fund, 51.

The Obama administration, under regulations issued by the Department of Health and Human Services in 2013, is not requiring those organizations to directly “contract, arrange, pay for, or refer” employees to contraceptive coverage. But the organizations say the process by which they can opt out of providing the coverage, which involves filling out a form and sending it to their insurance company or third-party administrator, still violates their religious beliefs by making them “complicit” in providing something they consider sinful.

What did the Supreme Court rule in the Hobby Lobby case?

The majority opinion written by Justice Samuel Alito said that “closely held corporations,” including those like Hobby Lobby and Conestoga Wood Specialties, can exercise religious rights under RFRA. Further, because the Obama administration was requiring those firms to directly provide the coverage, rather than offer them the same accommodation it was offering religious nonprofit groups, the requirement was not “the least restrictive means” of ensuring that women can get contraception and thus a violation of the law.

In making the case for Hobby Lobby and Conestoga Wood, Justice Alito went out of his way to praise the accommodation for religious nonprofits, saying it “does not impinge on the plaintiffs’ religious beliefs that providing insurance coverage for the contraceptives at issue here violates their religion and it still serves HHS’ stated interests.”

What impact has the Hobby Lobby decision had on pending nonprofit cases?

A fairly substantial one. Later that same day the Hobby Lobby decision was handed down, a federal appeals court in Atlanta cited it in issuing an injunction against enforcing the mandate against the Eternal Word Television Network.

But the real fireworks erupted on July 3, when the Supreme Court granted its own injunction in the case filed by Wheaton College.

The unsigned order required the college to write to the Secretary of Health and Human Services, stating “that it is a nonprofit organization that holds itself out as religious and has religious objections to providing coverage for contraceptive services.” The order specifically said the college “need not use the form prescribed by the government, EBSA Form 700, and need not send copies to health insurance issuers or third party administrators.”

Justices Sotomayor, Ginsburg, and Kagan were furious.

“Those who are bound by our decisions usually believe they can take us at our word. Not so today,” Sotomayor wrote. “After expressly relying on the availability of the religious nonprofit accommodation to hold that that the contraceptive coverage requirement violates RFRA as applies to closely-held for-profit corporations, the court now, as the dissent in Hobby Lobby feared it might…retreats from that position.”

What happens now?

The court made clear that in granting Wheaton College its injunction (as it did earlier this year in a case filed by the Denver-based Little Sisters of the Poor), it was not prejudging the case. “This order should not be viewed as an expression of the Court’s views on the merits,” it said.

But what is less clear is whether people covered by the health plans of those nonprofit organizations that are still in litigation will have access to no-copay contraceptive coverage.

The Supreme Court majority appears to think they can be covered. “Nothing in this interim order affects the ability of the applicant’s employees and students to obtain, without cost, the full range of FDA approved contraceptives,” the order said. “The government contends the applicant’s health issuer and third-party administrator are required by federal law to provide full contraceptive coverage regardless whether the applicant completes EBSA Form 700.”

The Obama administration, however, seems not so sure that will happen. “An injunction pending appeal would deprive hundreds of employees and students and their dependents of coverage for these important services,” the Justice Department wrote in its memorandum to the court.

One thing that is clear: Many more of these cases are yet to be decided by many more courts.

Hobby Lobby ruling spilling over to corporate world

Originally posted July 10, 2014 by Alan Goforth on https://www.benefitspro.com.

Both proponents and opponents of the recent ruling by the U.S. Supreme Court in the Hobby Lobby contraception case agree on at least one thing: The case may be settled, but how it will play out in the workplace is far from certain.

The court ruled that the 1993 Religious Freedom Restoration Act prevents certain employers from being forced to pay for contraceptives they oppose for religious reasons. However, the definition of which types of corporations are excluded remains murky.

"Nobody really knows where it is going to go," said Richard Primus, professor of constitutional law at the University of Michigan. "I assume that many more businesses will seek exemptions, not just from the [Patient Protection and] Affordable Care Act, but from all sorts of things they want to be exempt from, and it will put courts in a difficult position of having to decide what is a compelling government interest."

About 50 lawsuits filed by corporations nationwide, which were put on hold during the Hobby Lobby appeal, must now be resolved or re-evaluated. "We don't know ... how the courts will apply that standard," Primus said.

The decision also has ramifications beyond the courtroom. Even closely held companies with sincere religious beliefs must carefully consider the potential marketplace ramifications of crafting health-care coverage according to religious beliefs.

"Many owners of companies don't want to distinguish the difference between what's good for them personally and what's good for their business," said John Stanton, professor of food marketing at Saint Joseph University in Philadelphia. "I believe that if a business owner believes something is the right thing to do — more power to them. That's his business. However, he's got to be ready for the negative repercussions."

Eden Foods of Clinton, Mich., a natural-foods manufacturer, has filed a lawsuit and is balancing religious beliefs and business concerns. Since Eden initially filed its lawsuit last year over mandates to cover birth control in PPACA, some customers have taken to social media to express disapproval and outrage, even threatening a social boycott. However, the corporation also has gained new customers who support its stance.

"It's very conceivable they could lose business," said Michael Layne, president of Marx Lane, a public relations firm in Farmington Hills, Mich. "And they could lose employees, too."

Experts agree that the myriad issues raised by the Hobby Lobby decision could take a while to play out. "I think there will be a rush of litigation in the next year or two," Primus said. "I think that the exemptions are likely to get broader before they are limited."


Ancillary Plans Get a New Spin

Originally posted June 9, 2014 by Amber Taufen on https://www.benefitspro.com

Employers struggling with new mandates for basic health care programs probably don’t even want to think about offering their employees ancillary benefits like vision and dental insurance.

However, as many experts have noted, these two particular ancillary benefits can save employers money in the long run because regular dental and vision screenings can detect some chronic health conditions early.

Employer-provided flexible spending accounts and health savings accounts can be one alternative option to traditional health and dental insurance, but sometimes employees have difficulty understanding the parameters of these programs, or can’t find affordable out-of-pocket care on their own. So many employers are turning to alternative ways to provide vision and dental coverage to their employees – new, innovative methods of coverage that provide both flexibility and cost-savings. And the biggest trends all revolve around cost transparency and empowering employees to make educated care decisions.

Jason Szczuka, general manager of Brighter PRO, says that his tech company has helped fill a need for more cost-effective employee dental coverage – a need he says will definitely continue to grow.

“Traditional dental insurance does not work for employers and employees as a cost-effective benefit offering,” Szczuka says. “And there’s been zero innovation in this industry for the past 20 years. However, by leveraging newer technologies, our platform aligns the interests of patients, providers, and payers alike to lower claims costs through new efficiencies in benefits payments, network fee schedules, utilization review and group plan designs.”

Although the Brighter PRO set-up looks somewhat similar to a traditional preferred provider organization insurance plan, it’s actually a cost-transparency technology resource that creates new efficiencies to create lower overall dental costs.

Brighter PRO maximizes the savings it generates through a transparent online marketplace so members can easily shop for providers based on price and quality, while participating providers can compete for more patients by improving their prices and quality scores, and payers can lower their claims by optimizing how and where members use their benefits.

“We’ve built the technology that helps transform health care consumers into health care shoppers,” Szczuka says. “They can compare dentists side-by-side on cost, quality and convenience. Schedule their appointment online 24/7. And when the appointment is over, the user’s electronic dental record is updated so they can more easily and affordable maintain their oral health.”

Derek Moore, a senior benefits consultant with Leavitt Group, says his clients have appreciated the addition of Brighter PRO to his portfolio of benefit offerings.

“Some of my clients are saving 70 percent on their premiums for something they can do online – if you have a computer or a phone, you can use this service,” he notes. “Everything in today’s market seems to be quick, so it was only a matter of time before these technological innovations made its way into health care.”

Gene Erdman, director of human resources for the Southern California Pizza Co., likes the program because he’s able to offer a dental benefit for all of his employees – including his part-time workers.

“The adjustability and flexibility offered with a service like this fits our employee base very well,” he notes. “Our workforce skews toward millennials, and the concept of them being able to shop and price and make a decision about a care provider from data they can access from their iPad or phone or computer and really individualize that decision is significant for us.”

A clearer vision

And while companies like Brighter PRO look at new ways to provide dental coverage options for employers, other companies like Careington address the vision component of ancillary benefits.

“We’re a discount plan, and we’ve developed a somewhat exclusive network with vision carriers,” explains Greg Rudisill, senior vice president of strategic partnerships at Careington. “Many times, we can go into a big group and bundle all of these carrier networks together so that our members have the broadest access available.”

Rudisill notes that many Careington clients use the service in conjunction with FSAs or HSAs to help their employees manage their vision needs.

“Everything is very transparent, so the member can see what it would cost them for different services before they go in. If they know what it’s going to cost them in advance, they can set aside that specific aside of money in their FSA. And there are no claims to file, so providers love it because they don’t have to do a lot of administrative work like they would with an insurance plan.”

“The Patient Protection and Affordable Care Act is building our market for us,” Szczuka says, “because, although the need for dental coverage has been around for a while, the adult dental gap is going to continue to grow as the premium-to-benefit value of traditional dental insurance erodes even more quickly than it already has been.”

And if those trends continue in the ancillary world, employers will increasingly seek new, innovative methods to provide health care value to their employees.