5 companies that dropped part-time employee health care
Originally posted on https://ebn.benefitnews.com.
Just 25% of companies that offered employee health insurance made coverage available to part-time workers in 2013, according to the Kaiser Family Foundation. That percentage will decline further with Walmart Stores Inc.’s announcement that it is dropping health insurance for part-time employees. Walmart joins a growing list of major retailers that have done the same.
Target announced in January 2014 that it was dropping coverage for part-time employees. The company said in a blog post that less than 10% of its total employee population participated in that plan.
The world’s largest home improvement retailer said in September 2013 that it was ending coverage for 20,000 part-time employees. Employees with fewer than 30 hours a week were no longer offered limited liability medical coverage, Bloomberg reported. At the time, 5% of the company’s 34,000 employees were enrolled in that plan.
In August 2013, the retailer sent a memo to staff that it was dropping coverage for part-timers, but giving them a check for $500 to find coverage through the public exchanges.
In August 2013, the retailer announced it was cutting some employees’ hours to 29.5 hours, or just under the 30 hour threshold at which the Affordable Care Act mandates coverage be provided. Forever 21 does not provide coverage to part-time employees. In a Facebook note, the company said the decision was made “independent of the Affordable Care Act” and that the change impacted less than 1% of all U.S. store employees.
On Oct. 7, the world’s largest retail chain said it plans to stop offering health benefits to employees who work less than 30 hours a week, or about 2% of its U.S. staff.
Taking an unconventional approach to wellness planning
Benefits managers often find themselves stranded in no-man’s land when it comes to bringing wellness to a workplace. As a concept, wellness is a thriving and transformative experience for many employers, but justifying those costs – or adopting a wait-and-see attitude to measuring a wellness program’s success – is a difficult case to make with a company’s financial decision-makers.
In tracing the wellness success story of Elkay Manufacturing – whose wellness program saw a 76% reduction in major health issues among staff most likely to incur substantial health care costs, not to mention a projected increase in 2015 health care premiums limited to just 1.8% - some of the secret may lie in the unconventional approach taken by the company’s wellness champion.
Carol Partington, corporate manager of compensation and benefits with the 3,000-employee maker of sinks and water coolers – speaking at last week’s EBN Benefits Forum and Expo – said her company’s unimpressive early results with wellness required her to take a more straight-forward tack.
“You need to get leadership support to create an effective program, but you also don’t want to scare the hell out of senior management,” Partington says. “My approach was, ‘I know where I’m going, I’m just not telling everyone where we’re going yet.’ You also can’t be too aggressive; you need to put disciplined steps in place, and be willing to be flexible.”
And while most company executives need to be shown the hard facts before committing to any additional wellness spend, Partington says she simply admitted to her company’s leaders – a business founded in 1920 – that return on investment is often impossible to demonstrate in a wellness effort, opting to emphasize value of the investment instead. Rogue as that may seem, Elkay’s current wellness results – and its low anticipated health care cost increases – earned her the respect of her managerial team.
“We have a company that’s 70% manufacturing workers, in 15 locations across the country, two of which are unionized, and I don’t get a lot of time with people,” she notes. “But my job is to remove distractions from our employees’ lives – we work in a setting where people can lose body parts if they’re worried about their own health, their parents, their sick kids. How can I give them a solution that works?”
Elkay first adopted biometric testing-based wellness in 1994, offering a $25 incentive to employees to participant, but Partington says that the company so almost no results after 12 years, with the company still paying approximately $23 million a year on its employee health care plan. Partington said a high-deductible plan never fit into Elkay’s culture, and costs continued to escalate. Evan a $700 premium differential for employees who demonstrated better health results wasn’t the answer, she says.
“We asked our employees why they took part in the health screenings, and most said they were doing it just to get the premium. I realized we’d failed in our mission,” she notes. “And with no dedicated wellness staff at our company, wellness is only 15% of what I can pay attention to – it’s one of my many responsibilities.”
Partington opted to join forces with Interactive Health to introduce an evidence-based program that could seriously improve her employees’ health, especially those with the most potential health risks, as well as actively addressing those escalating health plan costs. The use of aggregated health data was instrumental in finding some customized solutions for workers.
She says it was also critical to match any incentive programs to company culture, a task somewhat more difficult as Elkay has manufacturing sites in more than a dozen very different and often remote parts of the country. In some rural sites, hunting and fishing licenses were seen as extremely valuable commodities, or even Jiffy Lube coupons for oil changes.
Partington also shied away from gamification efforts, given employees’ limited access to email and smartphones, and also did not establish fitness challenges as a company-wide initiative. She says she also had to be mindful of other cultural differences: Championing the company’s successful tobacco-cessation efforts at a manufacturing site in the middle of tobacco-growing country, where employees’ spouses and families were often employed in that business, required a bit of extra sensitivity.
In the end, by personalizing the incentives and communication, Elkay has created an almost $1,200 differential in its better-health insurance rates, resulting in a 20% savings. Of 636 employees tracked with a litany of five serious current or potential health indicators, Elkay produced a 76% reduction in those health issues. And 77% of employees taking part in more personalized health tracking met their personal health goal in the second year of the enhanced program.
“Change is hard,” Partington says. “So you gotta talk a lot.”
The components that will make or break a wellness plan
Originally posted October 1, 2014 by Elizabeth Galentine on https://ebn.benefitnews.com.
When shopping around for a wellness program partner, it’s the details that matter. All comprehensive wellness platforms should consist of four core programs — wellness, disease management, EAP and work life components — says Yale Mallinger of wellness company HMC-HealthWorks, but it’s what makes up those components that will make or break a plan. Therefore, advisers must do their due diligence when choosing a wellness provider to work with, he says.
For example, most reputable wellness companies will offer two types of diagnostic questionnaires, behavioral and medical, but advisers should request to sample those tests themselves, Mallinger says. “You should be able to go to their portal and participate, get a score, test it out,” he told attendees during a breakout session Tuesday at EBA’s Workplace Benefits Summit.
Mallinger also recommended breaking down the diagnostic testing process itself. For medical testing, ask the vendor if blood tests are done intravenously, through a finger prick, or both and what the benefits of each method are for a particular employer client. Some employers will want the instant results that a finger prick can provide, while others will be willing to wait a week or two for more comprehensive results from lab, says Mallinger, project director at HMC-HealthWorks.
Then, for clients interested in the lab testing route and submitting the testing to their insurance carrier as a preventative health measure, Mallinger recommends going even further by having their insurance company do a trial run with that billing code to ensure it works.
The whole package
As you look at potential wellness partners, consider whether or not the company offers unbundled plans, Mallinger continues. Although he says “it does no good to put a wellness program in place if you don’t take care of all the problem [areas] for employees,” such as debt management and legal assistance, not every employer will want the top-tier package.
Presenting the benefits of a wellness plan in an unbundled format allows the clients to pick and choose for themselves, he says. Such benefits include:
- A personal health and wellness portal;
- A health library;
- Health risk assessments;
- Mobile app capabilities;
- Reporting capabilities;
- Diabetic supplies;
- Concierge services;
- Coaching services;
- Disease management;
- Biometric screenings;
- Employee assistance programs, and more.
Additionally, as far as mobile technology, every wellness company has an app — “it’s what they do with it and what you can do with it” that counts, Mallinger says.
Some apps have the ability to report a range of statistics to employers, such as what people are reading or if they take a health assessment, he explains, adding that such reports are beneficial not only on an annual basis but also quarterly.
In turn, Mallinger says some wellness companies are primarily software-focused, so advisers should be sure to analyze the type and quality of any wellness coaches they provide. What kind of training do they have? How are they certified? “Take the time to break it down,” he says, and never be afraid to ask for credentials.
There are currently at least three lawsuits related to wellness plans going through the U.S. court system, Mallinger points out, so advisers should also be cautious that plans are in compliance with the Affordable Care Act, Americans with Disabilities Act and others.
7 ways to keep your sanity during open enrollment
Originally posted on https://ebn.benefitnews.com.
‘Tis the open enrollment season in the benefits world. For many benefit managers, that means stress, panic and very long days (and nights). But there are ways to make this time of year less frantic and more productive.
HR cannot run open enrollment in a vacuum. So lean on consultants and communication pros to craft your messaging. Turn to senior leaders for top-down messaging on why changes are happening. Bring in your benefit vendors to explain the impact of changes and walk employees through the enrollment process. Like many things, open enrollment takes a village, so use yours.
Few things can set off a fire drill like systems crashing and just plain misbehaving – especially with online enrollment. Get ahead of the game by partnering with IT to determine how people will enroll, how data will be handled and how it needs to flow between departments (like HR and payroll). Map out contingency plans and decide who will be on point if things go awry.
Be straight-up with employees about what’s changing, why and what they need to do. No spin. No sugar. If you’re making significant plan changes this year, use personas to help people understand how this will affect them. And provide decision guides that walk them through all the variables (particularly deductibles, co-payments, HSA contributions, covered services and provider network details) so they can make the best choice for themselves and their families.
We all put a ton of blood, sweat and tears into benefit planning and open enrollment communications – so much so, that it can become a bit of a one-way street. Keep in mind that this is a time when employees are sitting up straight and paying attention. Ask for their feedback. How do they feel about what’s changing? The benefits overall? Why? What could be done differently? Whether you’re talking with employees at a town hall, engaging with them over social media or asking for their honest responses to a survey, really listen to what they have to say, thoughtfully respond and act on their feedback as much as you can.
We know – right now, it’s all you can do to stay focused on the enrollment at hand. But it’s less daunting than it sounds: what we’re suggesting is that you take employee feedback and lessons learned from this enrollment period and start compiling them for next year. That might be possible benefit changes, new benefits to add or ways to communicate differently. You know what they say about the early bird … and in this case, the sooner you nail down what 12 months from now looks like, the more proactive (and effective) you’ll be when it comes to next year’s systems and communications.
Why not make open enrollment fun – and an opportunity to earn points and prizes? Launch an Open Enrollment Challenge and reward employees for taking various actions, like attending an open enrollment info session, updating beneficiary details and enrolling by a certain date. Or plan an Open Enrollment Walk, where people can head out for a stroll with HR and colleagues, giving them an opportunity to ask benefit questions along the way (and make time afterward too).
Although you may feel like you just don’t have time to take a break, right now you need it more than ever. Along with those enrollment meetings, town halls, social media replies and survey reviews, block time for yourself on the calendar. Go for a run, head out for a relaxing healthy lunch, read a great book, meditate, take a yoga class – whatever makes you happy and keeps you sane.
8 tips to share with employees to ensure a successful open enrollment
Originally posted on https://ebn.benefitnews.com.
As open enrollment season approaches, benefit managers are moving into high gear as they prepare to answer employee questions and concerns about their 2015 benefits. And as employees take on more responsibility for their health care, it’s more important than ever for them to understand how they can make the most of the programs and benefits their employers are offering.
Here are eight tips from benefits consulting firm Aon Hewitt that benefit managers can share with employees to help ensure open enrollment runs smoothly.
Employers are taking steps to make enrollment quicker and easier. “Many companies are designing the process so it is similar to an online retail shopping experience, where employees can access decision support tools and other resources that can help them narrow down their choices and weigh them against their specific needs,” says Joann Hall Swenson, health engagement leader at Aon Hewitt. “Employers are also stepping up their efforts to clearly communicate what is changing from previous years, using a variety of communication methods.” Encourage employees to take advantage of the resources you provide.
Understanding their past needs and estimating their future needs will help employees determine what adjustments they may need to make in their benefits selections for 2015. Encourage employees to start by reviewing how much they’ve spent in the past year out-of-pocket, the costs of their regular prescriptions and the number of doctor visits they’ve had. If they are participating in a flexible spending account, encourage them to re-evaluate their contribution levels based on their actual and anticipated expenses for 2015. It’s also important to think about any life changes that may impact their decisions, such as an addition to the family or the development of a new medical condition that may impact health care expenses.
Over the past few years, there have been many changes taking place in the provider community, including doctor’s groups joining together and hospitals and health systems re-contracting with insurers. As a result, health plan options may include vastly different combinations of doctors and hospitals than in the past. Most employers and health plans offer a number of tools and resources that can help employees assess the cost impact and quality of different providers as they make their enrollment decisions.
CDHPs often have lower premiums, which make them an attractive option for individuals who want to reduce the costs taken out of their paychecks each month. While employees may have a higher deductible to meet, many employers couple these plans with health reimbursement accounts or health savings accounts, which employees can use to help pay for eligible out-of-pocket health care costs. HSAs are the most common, and allow employees to save money by contributing, on a pre-tax basis, up to $3,350 in 2015 or $6,650 if they have family coverage, with no use-it-or-lose-it rule. In addition, employers may also contribute to the HSA. It’s important for employees to understand how the employer’s contributions work so they can maximize this subsidy.
If an employee’s spouse, partner or adult children have access to health coverage elsewhere, including through their employer, it may be more cost effective for them to enroll in this coverage instead of being covered by you. Encourage employees to carefully review and compare these plans to ensure they are choosing the coverage they need at the most favorable cost.
Many employers offer a wide range of health and wellness programs, such as health assessments, weight loss programs and health coaching, to help employees get and stay healthy. Taking part in these programs can help employees understand their current health status, and they might even be able to take advantage of a financial incentive for doing so.
2015 will be the second year of coverage available to Americans through the marketplaces, commonly referred to as “public exchanges.” In most cases, individuals with coverage through their employer will not be eligible for federal tax credits for purchase of insurance through the marketplaces. Employees can visit healthcare.gov to learn more about the marketplaces.
As employees assess their health plan options for 2015, it’s important for them to look holistically at their health and financial well-being, including health care, income protection (e.g., life and disability insurance) and retirement planning. Does their spending reflect their needs and priorities? For example, if they aren’t contributing to your 401(k) plan, remind them that now might be a good time to start. Beginning to save earlier in their careers will help ensure they’re on track to meet their long-term savings goals.
Leading CEOs partner to inspire wellness programs across all U.S. employers
Half of all Americans have at least one chronic disease, says Jason Grumet, president of the BPC and moderator at the event. Grumet says that the major employers taking part in the CEO Council represent a unique combination of good ideas with great people who have the ability to get things done, he said.
Lowell McAdam, chairman and CEO of Verizon Communications, says technology and wearable devices are going to be some of the biggest wellness tools of the future. McAdam says the company is already using technology-enabled, mobile health clinics to connect children with quality health care, as well as employing remote monitoring tools to enable seniors with chronic conditions.
Brian Moynihan, CEO of Bank of America, says his company uses incentivizing measures to help employees maintain their health. The bank provides additional funding for biometric screenings, and each year, if an employee remains at or below their numbers, health care costs will remain flat the following year.
Along with issuing a joint report, BPC launched an interactive Web site containing a slew of resources to support implementation of new programs among other employers.
What are the 4 types of private exchanges?
Private exchanges are an ever-popular option for employers to provide health insurance to both their active and retiree populations. Estimates put the number of private exchanges at around 150, but according to PricewaterHouseCoopers Health Research Institute, they can be broken into four types. Barbara Gniewek, principal and private exchange lead with PwC in New York City, explains these are grouped based on their genesis, or their beginnings.
- Technology: This includes such companies as bSwift and Benefitfocus; many developed public exchanges in states that built their own, PwC says. Others are known for providing benefits administration as either an outsourced solution or enrollment for insurers. “They are like the vending machines [of private exchanges]; they provide infrastructure and you decide what products you want and what brands to have,” Gniewek says. “They are highly flexible.”
- Pure Play: These are very new technology infused and highly flexible systems that include such companies as Liazon. They are like a pre-stocked vending machine as they come with products on the shelves, including medical plans with certain carriers, Gniewek adds.
- Broker/Consultant: Calling these “really interesting,” Gniewek says they are built on technology platforms. They include such companies as Aon Hewitt and Arthur J. Gallagher & Co. Some of these are built in-house by the broker or consultant, but in many cases, are the result of partnering with a technology company
- Insurer: Including such companies as Cigna and Aetna, their strategy was to build their own private exchange to protect market share and separate themselves from the competition. The insurers, Gniewek adds, may also have relationships with networks and have clients they want to protect. Many of these also use technology developed by others.
So how does an employer pick which model to choose? Employers often rely on their advisers, including brokers and consultants – many of whom have their own exchanges. Gniewek says when PwC helps a client they do two main things as an evaluation:
First, an understanding what the employer is looking for, including making their own plan design or enhancing a strategy they already have. “Depending on what they are looking for, exchanges that meet their needs can differ greatly,” she says.
PwC also helps employers understand the different models and which plays to their employee size. “Which ones can best meet [employer’s] needs?” she asks. “That is what the consultant needs to do.”
Employers create game plan for expected health care cost increases
Originially posted on August 22, 2014 by Michael Giardina on https://ebn.benefitnews.com
Employers across the country predict that their health care costs will increase by 5.2% in 2015 if they decide to maintain their current health plan structures. With modest changes, this increase drops down to 4%, according to a recent Towers Watson’s survey of nearly 400 employee benefit professionals from midsize and large companies.
Meanwhile, Towers Watson finds that the rising tide of health care costs has become a main focus of executives, with two-thirds of chief financial officers and chief executive officers holding a key place in health benefit strategy discussions. It’s coming down to wire for many employers to get costs down as the ACA’s excise tax takes effect in 2018.
Randall Abbott, senior consultant with Towers Watson, says that many employers are approaching the cost conversation “as a balance of shareholder responsibility and social responsibility.” But it’s not a surprise that three-quarters of employers are worried about the excise tax, commonly referred to as the Cadillac tax.
“There is this impression that employers are just raising costs up,” Abbott explains, but highlights “they are doing it out of necessity.”
“They are trying to do it as thoughtfully and as responsibly as they can, and that’s a constant battle,” Abbott continues.
This battle, according to Towers Watson’s survey, is becoming a reality for many. More and more employers are planning to incorporate consumer-driven health plans, and other high-deductible health plans, into their coverage umbrella. By 2017, more than half of respondents expect to make this plan the only option, eliminating other plans.
“Inaction is not an option here,” Abbott explains, while noting that account-based health options such as health savings accounts can help all interested parties realize the costs at point-of-care.
Tom Meier, vice president of product development for Health Care Service Corporation, the nation’s largest customer-owned health insurer, agrees that CDHPs have been growing at record rates. Trade group America’s Health Insurance Plans reports that 15.5 million Americans were covered in HSA-eligible plans – a number that has tripled in the last six years.
“We’re seeing employers go all in on CDHPs, and I don’t see that slowing anytime soon,” Meier explains to EBN. “Employers are going to have to revisit their plan design and likely move out of those high cost benefit designs in order to comply and get under [the ACA’s excise tax] that threshold.”
Currently, HCSC has more than 2 million members enrolled in CDHPs under the insurer’s offering, which includes five Blue Cross and Blue Shield states. Meier adds that moving from $250 preferred provider organization health plan to a full-replacement $5,000 deductible CDHP is not something that employers should rush into. He adds that HR and benefit managers can also help to alleviate some of the expected employee unrest from the change by offering resources.
“As you’re asking them [employees] to be the consumers of care, you have to give them the tools to survive and thrive, or else you are kind of throwing them out into the wilderness,” Meier says.
Another growing trend for employees, which has been tabbed for movement in 2016 and 2017 by a third of Towers Watson survey respondents, is reducing company subsidies for spousal and dependent coverage. Also, 26% indicate they are considering excluding spousal coverage all together should they have coverage elsewhere.
Last summer, it was reported that UPS planned to stop providing coverage to a portion of employees’ spouses who were able to opt into medical coverage through their own employers. First reported by Kaiser Health News, it was disclosed that more cost associated with the landmark health care law was forcing the move. Of the more than 33,000 spouses being covered, UPS said that about 15,000 could gain coverage from their current employers.
UPS said in a memo to employees that “limiting plan eligibility is one way to manage ongoing health care costs, now and into the future, so that we can continue to provide affordable coverage for our employees.”
While UPS declined to comment on the past spousal health plan coverage change, Paul Fronstin, director of the Employee Benefit Research Institute’s health research and education program, notes that re-examining spousal coverage, as well as looking at HSA-eligible plans and health exchanges, are areas where employer interest is growing.
Fronstin adds that “everything is on the table,” however.
Why do companies bother with wellness programs?
Originally posted August 6, 2014 by Dan Cook on https://www.benefitspro.com
Communicating about the company wellness program is directly correlated to significant cost savings associated with those programs, a survey from Buck Consultants of Xerox found.
Another striking finding: U.S. employers said their primary motivation for offering wellness plans was to cut health care costs; respondents from outside the U.S. said their No. 1 reason was to improve employee morale and to reduce sick days and presenteeism – the phenomenon described as workers being on the job but not able to perform at the expected level.
The survey “shows an evolution in employer thinking to a much more holistic and measurable approach,” said Dave Ratcliffe, principal, Buck Consultants at Xerox. “Workers' wellness is now viewed as a state of well-being across the spectrum of health, wealth and career. Wellness is part of the employee value proposition. Social media, gamification, mobile technology, automated coaching and personalized communication are all part of the mix."
The big-picture results offered yet more evidence that wellness programs are becoming a standard component of benefits package design around the globe. More than three-quarters of respondents said they “are strongly committed to creating a workplace culture of health, to boost individual engagement and organizational performance.” More than two-thirds of these employers told Buck wellness plans “are extremely or very important to attract and retain workers.”
Employers are taking wellness investments seriously, the survey showed. While in 2012, 36 percent said they measured wellness outcomes, in the latest survey, 52 percent were measuring the outcomes. To encourage participation, 52 percent of employers said they rely on a very simple tactic: offer reduced insurance premiums to those who participate.
And, as wellness programs continue to gain advocates, employers are committing marketing dollars to them, developing brands for their programs and communicating regularly with employees about their programs.
Buck said the finding about communicating regularly with employees about aspects of a wellness plan was a common theme among every U.S. company that reported “a lower health care cost trend of 6 or more percentage points.” These employers send out targeted email messages and often mail wellness news to their homes to underscore the company commitment to wellness. The number branding their wellness programs is rising: 43 percent of respondents internationally said they created a brand identity for their plans.
But employers still have work to do to achieve the participation numbers they'd like to see.
“Participation rates indicate that employers are still struggling to find effective approaches to motivate workers. And there is a significant gap between employers' stated desire to create a culture of health and their current progress in achieving this goal,” Buck said. Buck's sixth global wellness survey analyzed responses from more than 1,000 organizations in 37 countries.