Number Of Uninsured Falls Again In 2015

Interesting article from Kaiser Health News about decreasing uninsured rates by Julie Rovner

The federal health overhaul may still be experiencing implementation problems. But new federal data show it is achieving its main goal — to increase the number of Americans with health insurance coverage.

According to the annual report on health insurance coverage from the Census Bureau, the uninsured rate dropped to 9.1 percent, down from 10.4 percent in 2014. The number of Americans without insurance also dropped, to 29 million from 33 million the year before.

The Census numbers are considered the gold standard for tracking who has insurance and who does not, because its survey samples are so large. It does change methodology from time to time, however (most recently in 2013), so years-long comparisons are not necessarily accurate.

Still, between 2013 and 2015, the first two full years the health law was in effect, the uninsured rate dropped by more than 4 percentage points. The total number of uninsured fell by 12.8 million. Meanwhile, the percentage of Americans with insurance for at least some part of the year climbed to 90.9 percent, by far the highest in recent memory.

“I don’t remember it ever being in the 90s before,” said Paul Fronstin of the Employee Benefit Research Institute, who has been tracking insurance statistics since the early 1990s.

The Obama administration was quick to take credit for the insurance improvements. “The cumulative coverage gains since 2013 have put the uninsured rate at its lowest level ever,” said members of the White House Council of Economic Advisers in a statement.

The 2015 report shows insurance gains across all income levels, ages and types of employment, although some groups did better than others. Young adults — specifically 26-year-olds — remain the most likely to lack coverage. Although the Affordable Care Act guaranteed that young adults could stay on their parents’ plans longer than in the past, that protection ends when they turn 26.

Among states, those that took the health law’s option to expand the Medicaid program for the poor saw greater gains in coverage than those that did not. “The overall decrease in the uninsured rate of 2.4 percentage points in expansion states, compared with 2.1 percentage points in no-expansion states,” said the report. The state with the highest percentage of uninsured residents remained Texas at 17.1 percent; the state with the fewest uninsured remained Massachusetts with an uninsurance rate of 2.8 percent.

The single largest source of health insurance remains plans provided by employers. An estimated 177.5 million Americans had employment-based coverage in 2015, which was up more than 3 million from 2013.

See the original article Here.

Source:

Rovner, J. (2016 September 13). Number of uninsured falls again in 2015. [Web blog post]. Retrieved from address https://khn.org/news/number-of-uninsured-falls-again-in-2015/


Making Sense of the Alphabet Soup of Healthcare Spending Accounts

Original post benefitnews.com

Employers are passing more and more healthcare responsibility to their employees, and in some cases, giving them a greater share of the financial burden. Likewise, businesses are looking for ways to help employees manage healthcare expenses. There are a number of products for that purpose, and while they’re similar, they’re not the same.

With acronyms being used to explain still-new concepts, it can be difficult for employees to understand the difference between them or even to remember which product they use. It’s important to educate them about these products so they get the most out of them.

Health savings account. A health savings account is like a 401(k) retirement account for qualified medical expenses. An HSA helps people pay for medical expenses before they hit their deductible. Employers and employees can both contribute money tax-free, and the money can be rolled over from year to year with only a maximum annual accrual. All contributed funds can be invested once a specific minimum is met (determined by the bank).

HSA-compatible health plans don’t include first-dollar coverage (except for preventive care), which means employees must meet a deductible before benefits will be paid by a health plan. This deductible is set by the IRS each year; in 2016, high-deductible health plans must have a deductible of at least $1,300 for an individual and $2,600 for a family.

Employees and employers can both contribute funds to build an HSA, and all funds count toward the annual maximum. The employee “owns” the HSA and the money that’s in it.

HSA funds can be spent on qualified medical expenses as outlined by section 213(d) of the IRS tax code, dental, vision, Medicare and long-term care premiums, and COBRA (if unemployed). After age 65, health premiums can also be withdrawn, but are subject to income tax.

Just like a 401(k), the account is portable. If the owner of the HSA changes jobs, the money can still be used for medical expenses, but the employee can no longer contribute to it.

Health reimbursement accounts. HRAs help employees pay for medical expenses before a deductible is met. But unlike an HSA, employees cannot contribute to an HRA, only employers. The money an employer places in an HRA can be used for medical expenses not covered by a health plan, such as deductibles and copays for qualified medical expenses as outlined by section 213(d) of the IRS tax code, dental, vision, Medicare and long-term care premiums. The associated health plan can have any deductible amount — there are no minimums and the plan does not have to be a high-deductible health plan. Unlike an HSA, an HRA is not portable, and funds can’t be used for non-medical reasons, even with a penalty. Funds also don’t typically earn interest and are not invested.

Employers must be more involved with HRA accounts since they are the only party who can deposit money; they also determine if funds can be rolled over from one year to the next.

Flexible spending accounts. FSAs allow employees to defer part of their income to pay for medical expenses tax free as part of a Section 125 cafeteria plan. Allowable expenses include those outlined by section 213(d) of the IRS tax code as well as dental and vision expenses. Both employers and employees can contribute to an FSA; however, the amount employees plan to contribute at the beginning of the year can’t be changed mid-year. FSA funds can’t be invested and fees associated with the plan are normally paid by the employer. There are no underlying plan restrictions and these accounts can be maintained alongside traditional health plans. The employer owns the account and is responsible for the management.

Funds in an FSA can be rolled over only if there is a carryover provision; in this case, $500 can be carried to the next year.

With an FSA, individuals must substantiate need for a reimbursement at the time of service by keeping receipts and filling out a form. Some FSAs include “smart” debit cards that automatically pay certain copays and don’t require documentation.

Determining which is best

HSAs, HRAs and FSAs serve slightly different purposes and can even co-exist in some circumstances. For example, those enrolled in an HSA can contribute to a limited-used FSA. Those enrolled in an HRA can also contribute to an FSA without limitations.

HSAs work well for employers who don’t want to add to administrative burdens or additional costs. And they’re a great way to give employees a way to offset the costs of qualified high-deductible health plans and save for post-retirement health expenses. However, employers may want to stray from an HSA or refrain from fully funding the account early in the year if there’s high turnover at a company; the money deposited goes with the employee when they leave.

For employees, HSAs provide investment opportunity and are portable; they also encourage consumerism and are cost-effective to administer. But one of the biggest advantages is that the employee doesn’t have to pre-determine expenses since unused funds carry over.

HRAs can work well for an employer that is not offering a qualified high-deductible health plan but wants to promote consumerism while self-funding a portion of the risk. The funds contributed are immediately available and completely funded by the employer, which is an advantage to the employee. However, there is no tax advantage to employees and the fund can’t be transferred.

FSAs are the most appropriate for employers offering traditional health plans. Employees benefit because they can contribute pre-tax dollars and the funds are immediately available. But the “use it or lose it” provision is a definite disadvantage for employees.

There are pros and cons to all three funds. It’s best to review them carefully to determine which ones will work for your business, and make sure to communicate the funds’ features and restrictions to your employees.


Most Consumers Value Integrated Benefits for Time and Cost Savings

 

Originally posted December 11, 2014 on Insurance Broadcasting

Whether it’s dental insurance or the smartphone, consumers want products that offer simplification and savings. In a new survey, Anthem Blue Cross and Blue Shield asked Americans what products make their lives easier and the findings revealed that integrated products and services are highly valued – for example, the smartphone (74 percent), printer/copier/scanner (64 percent) and the toaster oven (36 percent). And, when it comes to insurance, consumers overwhelmingly (81 percent) said it would be extremely helpful to trust the same carrier to provide their dental, vision and health coverage.

“We’re meeting the needs of both employer and employee by providing affordable and comprehensive coverage benefits, which helps save time and money every step of the way.”

So, what specifically are consumers looking for when it comes to selecting an insurance plan? Survey respondents said a range of factors are important to consider, but they most frequently point to cost as being an extremely important aspect (67 percent), followed by comprehensiveness of coverage (61 percent), customer service (60 percent) and ease of use (58 percent). Additionally, 86 percent would expect to save time, save money or receive improved care if they had the same carrier integrate dental with their vision and medical benefits.

In the current health care environment, employers are looking for products that offer their employees exceptional valuei. The good news is that simpler processes, vast networks and deep discounts offered by multiline carriers like Anthem can provide employers and employees with the exceptional value they are seeking.

“For example, we offer a vast choice of dental benefits that employees want, along with large, reliable provider networks that make it easy and affordable for consumers to maintain good oral health,” said Erin Hoeflinger, President of Anthem in Ohio. “We’ve built strong relationships with the dentists in our network and we have negotiated rates, which saves members on average 25 to 32 percent on their covered dental services.”

In addition to seeing a cost savings, consumers can expect to save time when they select a multiline carrier. Half of the consumers surveyed (50 percent) say that figuring out costs is the most time consuming aspect of health management. Two-in-five also say it’s time-consuming to find health care providers that accept their insurance (41 percent) and to get their doctors to talk with each other to coordinate care (39 percent).

“With all of the advantages available to consumers and employers who get their benefits from a multiline carrier, there’s no reason to settle for the inefficiencies of having multiple benefit providers," said Hoeflinger. “We’re meeting the needs of both employer and employee by providing affordable and comprehensive coverage benefits, which helps save time and money every step of the way.”

This report presents the findings of a telephone survey conducted among 1,005 adults, 503 men and 502 women 18 years of age and older, living in the continental United States. Interviewing for this ORC International CARAVAN® Survey was completed on July 10-13, 2014. 605 interviews were from the landline sample and 400 interviews from the cell phone sample.

The margin of error for the total sample is ±3.0 percent at the 95% confidence level. This means that if we were to replicate the study, we would expect to get the same results within 3.0 percentage points 95 times out of 100.

 


Officials Extend Deadline for Submitting Reinsurance Contribution Form

Originally posted November 15th, 2014 on www.thinkhr.com.​

Late Friday, federal officials responded to requests for an extension of the deadline for contributing entities to submit their 2014 enrollment counts in connection with Transitional Reinsurance Program contributions. The deadline has now been extended until 11:59 p.m. on December 5, 2014. The January 15, 2015 and November 15, 2015 payment deadlines remain unchanged.


Read why flexible benefits don’t always have to be online

By Steve Hemsley

Whether it is reading books on a Kindle or buying groceries online, the technology industry has long proclaimed we are heading for a paperless society.

When it comes to communicating and then administering something as important as flexible benefits, HR directors can find it hard to resist the temptation to switch to an online solution.

From a time-saving point of view, changing to a web-based system should make perfect sense, because one of the reasons for dumping paper is to shift some of the back office admin work onto the employee. And why wouldn't someone want to spend some of their free time looking at an online benefits portal? After all, 85% of employees rate benefits as 'important' or 'very important', according to the CIPD.

Yet any benefits program is only successful if it engages staff by making it clear what is being given, why, how benefits will work and when new ones will be introduced.

Charles Cotton, adviser for performance and reward at the CIPD, says at first glance technology may appear to make schemes easier to administer and communicate - and in some cases cheaper. But, he argues, HRDs must think carefully before committing to what could be a hefty, long-term investment.

"Ultimately, an employer must consider how having flexible benefits supports what it is trying to achieve and what it needs from its employees," says Cotton. "If the benefits scheme is relatively simple, then paper is perfectly fine and the HR team will not gain anything from switching to online. In fact, data can go missing or be incorrectly inputted and the HRD must decide if he or she is happy for the information sent electronically to be accessed by a third party." Even when paper folders are consigned to history, there still remains an administrative burden. The HR team must study and respond to the data reports being generated, for example.

Traditionally, HR has worked closely with the payroll and the internal communications teams to communicate flexible benefits.

A switch to online can complicate the working relationship, because the IT department and a third party technology provider become involved.

HRDs can also underestimate how long it will take to implement a technology solution (up to six months) and the ongoing costs involved during the length of a web-based contract (often three years or more).

Claire St Louis, HRD at digital marketing agency Essence, whose clients include Google and eBay, agrees with the CIPD and urges HRDs not to rush into technology for technology's sake.

She says technology can be a barrier to some staff understanding and engaging with the benefits on offer, especially in companies where employees do not work in front of computers, are on the road, on the shop floor or in various manual roles.

"Many companies wrap themselves up in HR processes, ultimately forgetting the reason why they are doing them," says St Louis. "Benefits are there to retain, motivate, attract and maintain competiveness and, in many cases, people-based internal communications and paper administration is still the right way to go."

Kuljit Kaur, head of business development at the Voucher Shop, says organizations must certainly not ignore the importance of internal communications and the power of having HR staff and specialists available to explain how and why particular benefits exist.

"People are naturally cynical and think there must be a catch when it comes to benefits. A more 'people-based' approach allows you to communicate why this is not the case," says Kaur. "Using real people as advocates of particular benefits to talk to other staff face-to-face works better than just sending an email telling people to log on to a website to view benefits. Technology assumes people will make the effort to find out more."

Even Matt Waller, CEO at online provider Benefex, accepts that for some organizations a paper system can be cheaper, remove reliance on involving third parties and enable more control internally. But, he points out that an online option allows data to be centralized and makes it easier to communicate benefits to large numbers of employees.

"For businesses that want a flexible benefit or total reward scheme to reach as many people as possible in the most time- and cost-efficient way, technology has to be the way forward," he says. "Benefit selection errors can be corrected more quickly and paper document hell is avoided when informing payroll and benefit providers."

Matt Duffy, head of online benefits at Lorica Consulting, backs him up, although he agrees that technology is not right for every organization. "Online is a simpler solution for an increasing number of companies, although when setting up a flex scheme there is less of a build phase with paper," he says. "However, what actually takes the time is devising the rules and working out who is eligible and what the rules are. Companies still have to do this, even with a paper system."

In reality, this is not a black and white issue between paper and internal communications or online. Most organizations now adopt a multi-channel approach, supporting an online system with various forms of offline communication.

Even at technology giant Telefónica O2, paper has not been abandoned completely. It supports its tailored online benefits system with leaflets posted to an employee's home address. There are also benefits roadshows.

Telefónica rewards manager Kirsty Read says offline communication uses simple messaging to draw people into the website, where they can discover more detailed information on complex areas such as salary sacrifice and tax.

"We have actually re-introduced the paper leaflet after a five years' absence," says Read. "Staff told us they wanted a range of different communications relating to benefits. If they receive a leaflet at home, they can start to think about their benefits and discuss them with their family."

A multi-channel approach is supported by Thomsons Online Benefits' MD, Chris Bruce. "This is about ensuring that even with an online solution, staff can still talk to real people at workshops and clinics and read paper benefit guides alongside the online content," he says.

While it can make sense for larger employers to move online, many SMEs are concerned about the cost of the technology and perceive it as complex."

Julia Turney, head of benefits management at Jelf Group, says a flexible benefits system can certainly work without technology, particularly in small companies that have simple salary exchange benefits without complicated calculations.

"The administration side of things tends to be the deciding factor for companies moving to an online system, but technology alone will not engage staff with benefits, even if it makes the HR department's job easier," says Turney.

Benefits consultancy Mercer has teamed up with software firm Sage Employee Benefits to develop packages for organizations with fewer than 100 staff. SMEs are offered an online portal, but employers still have access to Mercer's specialist advisers.

"Technology is not always the answer," says Matthew Forrest, head of services at Sage UK. "Many SMEs want to offer benefits and can do so with paper-based and telephone support. This product allows owners of small businesses to manage a flexible benefits package at an affordable price, shaped to their needs."

The technology providers' message that online is best does seem to be winning over SMEs, with an increasing number ditching their paper systems. This trend is likely to accelerate as benefits packages become more complex and employers prepare for the phased introduction of auto-enrolment pensions this year.

Law firm D Young has 180 staff in London and Southampton and switched from paper to a predominantly online system in June 2011, with the help of Thomsons Online Benefits. An employee survey in December revealed staff are more aware of the benefits available to them now than they were under the paper system.

"In the first year, we used paper-based marketing to communicate the online benefits system, but in year two we will do this online with an e-brochure," says D Young HR manager, Jennifer Mead.

One company in the process of switching to online is Sumitomo Electric Wiring Systems, based in Staffordshire. Its HR manager, Liz Brown, says the move from paper will take place on 1 April.

"We are introducing flex benefits and felt online was a more efficient and flexible option, as we wanted something people at our different UK sites could access easily," she says. "Until now, a paper system has been adequate for the salary sacrifice and other benefits we offered our 230 staff, because there was not much data to deal with."

The technology companies will vigorously fight their corner to demonstrate that organizations running benefits programs can miss out by not moving online. Savvy HRDs, however, will only switch from paper when the time is right.

Northern Rail: paper trail

Should Northern Rail retain the franchise to run train services across the north of England, it will look to move from a voluntary to a flexible benefits system, but it won't ditch paper.

This 50:50 joint venture between Serco Group and Abellio, formed in 2004, has 4,800 staff scattered across the north, and most employees are drivers, conductors or engineers and do not have access to company computers.

An employee survey in 2009 discovered a low satisfaction rate regarding its benefits scheme, which is a combination of voluntary benefits and an employee assistance plan (EAP), as well as salary sacrifice, free travel and a final salary pension.

Northern Rail compensations and benefits manager Paul Stephens(pictured left) says communication was an issue, so the company introduced a benefits booklet and increased coverage of the scheme in its staff magazine, Your Northern, sent to every worker's home address. There is a telephone helpline and benefits roadshows are held at different depots.

"The culture of our business is paper-based and people still like to receive hard paper copies of anything to do with their job," says Stephens. "The difficulty with a booklet is that things can change and the content can become out of date quickly, but staff like to get paper copies of their total rewards statements, for instance."

Despite its traditions, Northern Rail appreciates the advantages of moving some of the administration online when the flex scheme is introduced and it is working with benefits provider, Personal Group.

Stephens wants to encourage staff to check the internet at home, but many paper aspects - such as the magazine coverage as well as the telephone helpline - will remain.

"We fear we will lose the engagement levels we have generated since 2009 if we move everything online - and we cannot afford to do that," Stephens says.

Hilton Worldwide: engagement online

Sean Thomas, cluster HR director at hotelier Hilton Worldwide, says he could not run the company's benefits scheme without technology. In fact, he says it would be "a nightmare".

He is convinced paper-based schemes will die out within a few years and everything relating to employee benefits will be online, especially in large organizations.

Many of Hilton's thousands of staff globally are young and have an expectation of a technology solution. For the HR team, it makes administration simpler and the reports the online platform generates mean the scheme is more effective, according to Thomas.

"We can see from the click through rates what things people are interested in and what is not so popular and react to that in a timely fashion.

"I believe that without technology, communicating when the benefits window is open would be harder. We send regular emails, although we do support this with posters around the offices."

He says that, as a US-centric organization, the whole group has to adapt to ideas and technology coming out of the US designed to help the business.

"Without this technology, I do believe it would be much harder to communicate our benefits to staff and they would be much less engaged with them."

There can be confusion among employers about whether a flexible or voluntary benefits scheme is right for their organization. A flexible scheme lets employees choose the benefits package that best suits their lifestyle and personal circumstances. They may prefer tax-efficient benefits such as childcare vouchers or to make salary sacrifices to boost their pension.

Flexible or voluntary?

Flex is a good way to bring consistency across a group of companies, as part of a harmonization process, or to tailor benefits to staff if a workforce is diverse.

Staff can usually change their core benefits once a year, during what is known as a 'benefits window' and, whether it is a paper or an online solution, employees can see a menu of benefits and the price of each. They usually receive a 'total rewards statement' outlining their total remuneration.

An employer can make a scheme as flexible as it wants to, so staff feel valued. Ultimately, a well thought out flexible benefits package can help to retain and attract talent.

Companies often add additional voluntary benefits, which are products and services staff can buy, at a discount. The main difference between voluntary benefits - such as retail discounts or gym membership - and flexible benefits is that they are paid for by an employer allowance or benefits pot, or their own salary, through payroll.

Many employers use the tax and national insurance savings gained from introducing salary sacrifice benefits to fund the cost of administering a voluntary benefits discount program.

 


Younger buyers buying asset-based LTC

By Marli D. Riggs

The sale of asset-based long-term care insurance protection continues to grow significantly, reveals research by the American Association for Long-Term Care Insurance.

More than half (53%) of male LTC buyers were under age 65, up from 48% in a prior year’s study, while women buyers under age 65 also increased to 50%, up from 44%, according to data gathered from  insurers.

Meanwhile, premiums increased nearly 20% and the number of covered lives increased 13.5%.

"We expect the sale of asset-based or linked LTC products will continue to grow as they offer some highly attractive benefits to a category of buyers looking to protect their retirement savings," says Jesse Slome, AALTCI's director. "The growth of sales will only continue as more large players enter the marketplace.”

In 2011 the study finds that the initial single premium face amount of policies purchased was $100,000 or greater for 73% of new policies. Meanwhile, 96% of new life and LTC policies issued did not include a benefit increase option that bumped up available benefits to keep pace with inflationary growth of costs. Additionally the study of traditional individual LTC insurance policy sales finds that in 2011 some 96% included a growth option.

“At a time when long-term care is increasingly top of mind, these life insurance-based solutions avoid the ‘use it or lose it’ risk associated with traditional long term care insurance,” says Chris Coudret, vice president of OneAmerica. “In most cases, people make a single payment, effectively removing the risk of future premium increases.”


Confidence in Voluntary Benefits Rises

Profitability outlook increases over 2011 estimates

More brokers are confident about the voluntary employee benefits industry, a new survey shows. Results from Eastbridge Consulting Group’s Voluntary Industry Confidence Index finds confidence increased to 99.7 at year-end, up from 98.4 in a mid-year 2011 survey.

The index is calculated using three key expectation measures about the voluntary industry: sales growth, profitability of the industry, and employee enthusiasm about voluntary products.

“Feelings about the profitability of the industry rebounded the most,” says Gil Lowerre, president of Eastbridge. The percentage expecting lower profitability declined to just eight percent (down from 18 percent last time) and the percentage expecting increased profitability was up to 54 percent. “The percentage expecting sales growth for 2012 also improved nicely, with 95 percent expecting more sales,” Lowerre says.

The only measure that showed a decrease was employee enthusiasm about voluntary products. The mean was down from 3.82 to 3.80 primarily because more people said there would be “no change” in employee enthusiasm, explains Eastbridge vice president Bonnie Brazzell.

Eastbridge conducts the survey semi-annually and includes responses from individuals active in the market, among them carriers, brokers, vendors and employees. Like other confidence indices, the index is a single number that compares the current results to a baseline measure. The first Confidence Index survey was completed in December of 2005; the results from that survey serve as the “base” year (meaning the index was at 100 for that year).

By Kathryn Mayer