Posts Tagged ‘Insurance’

5 Tips For Implementing A Group Benefits Plan

Tuesday, January 24th, 2017

The post below is a guest blog from Jordan Whichard, IV, GBA who serves as Principal, Health & Welfare Consultant for CAI’s employee benefits partner Hill, Chesson & Woody.

If you operate a startup company, or your established business has recently grown larger than 50 employees, one of the most daunting items on your 2017 to-do list may be implementing a group benefits plan for the first time.  Starting a benefits plan from scratch can be an intimidating – not to mention time-consuming – process, especially without a partner to help you understand the background and minutiae of it all. Here are some tips if you find yourself staring down a brand new group benefit plan in 2017:

  1. Know your timeline and stick to it

Whether you want your benefits plan to begin in June or January, you’ll want to begin the process at least six months in advance of your anticipated start date. That will give you ample time to evaluate different benefit options, plan designs, funding platforms, and other factors that you will need to consider. Medical carriers will generally be able to offer early numbers about three months prior to your effective date.  You’ll want to approach the carriers as close as possible to that date in order to start understanding your potential rates.

  1. Firm up your census

Changes in your workforce are bound to happen, especially if you operate a rapidly growing business.  But beware, medical carriers reserve the right to re-rate your population if your census changes by more than 10% between the date of the quote and the date of final implementation.  If possible, holding your workforce numbers relatively stable for several months before your first open enrollment will help alleviate any stress that a re-rate would generate.

  1. Know your population

All workforces are different, but knowing your employees wants and needs can be a big help when designing your first benefit plan.  A brief employee survey could be a valuable tool in determining what benefits your employees are most interested in.  By the same token, many benefit plans have participation requirements – a percentage required to guarantee rates in the first year.  If you have less than that, the benefits may be more expensive than originally thought.

  1. Beware individual underwriting

Depending on the size of your group, some medical carriers may require individual employees to go through an underwriting process to help the carriers determine the risk associated with your group. If you have a stable workforce and know everyone wants coverage, that may not be a problem; but groups with a geographically or economically diverse workforce will want to think twice before committing to the individual underwriting process. Either way, you should understand that the first numbers a carrier presents may not necessarily be their final proposal!

  1. Tie it all together

Once you have all of your plans in place, you’ll want to make sure that the benefits are working effectively for you and your employees.  Ensure that the appropriate plans are written under Section 125 of the IRS code so that employees are able to pay their premiums before any taxes are deducted from their paychecks.

If these tips sound like things that you’d like explained or explored further, contact a consultant at HCW today.  Implementing the plan is just the beginning – next comes developing your long-term strategy, ensuring regulatory compliance, and managing your costs. We’re ready to help guide you through the process from start to finish.

When Worksite Plans Work

Tuesday, February 23rd, 2016

HCWBenPicThe post below is a guest blog from Rob Krieg who serves as Principal, Health & Welfare Consultant for CAI’s employee benefits partner Hill, Chesson & Woody.

Voluntary benefits or worksite plans refer to the insurance products that can be offered by employers on an individual or group basis to pay individuals for a variety of life events such as getting injured in an accident, being diagnosed with a serious health condition, or being admitted into the hospital. Examples of these plans include critical illness, cancer, accident, hospital indemnity, and permanent life insurance…to name a few of the most popular.

Enrollment in voluntary or worksite plans continues to increase rapidly as more and more employers are offering, and employees are asking, for these benefits.

The number of carriers offering these benefits has also increased drastically. While traditional players in this market space (such as Aflac, Allstate and Colonial) continue to offer quality products, many of the insurance carriers who have previously focused on “core” group benefits such as term life insurance and disability insurance have now started to offer a variety of worksite plans. The growth of new players in the market has created competition where plan premiums are going down while benefits go up. Even more importantly… these carriers are actually paying when a claim is submitted!

The value of these worksite plans and the hassle-free payment of claims was something I was skeptical of until I received a firsthand experience in their benefits. This past April, HCW offered a critical illness/cancer policy as well as an accident plan for employees to purchase. Who knew that taking ten minutes out of my day to meet with an individual enrollment specialist ended up being worth over $12,500 to my family this year?

Our enrollment specialist educated me that the critical illness and accident plans both offered an annual wellness screening benefit that if submitted each year would almost entirely cover the cost of my annual insurance premium. Since I was interested in experiencing first hand why so many employees throughout the country were purchasing these plans I decided to sign up, thinking I would have no use for the benefits but at least my premiums could be offset by the wellness reimbursement.

Unfortunately, just two months after purchasing these products I sustained an injury while playing basketball with my children which required surgery, a lengthy stint on crutches, and physical therapy. Then less than two months after my accident, my wife was diagnosed with a condition that also required surgery and treatment. The money received from our policies helped pay for childcare, out-of-pocket medical care, and even had a little left over to pay for a family trip to celebrate our recoveries.

While both my wife and I would prefer to go back in time, give the money back, and not have these events happen, having the financial payments from the accident and critical illness plans certainly helped ease the burden during this time. I am thankful that my employer decided to offer these benefits, and required that I spent a few minutes meeting with an individual enrollment specialist to better understand the benefits being offered.

If you have questions about worksite plans, and if they might be a good option for you, contact HCW’s Enrollment Services & Voluntary Benefit Solutions Team.

 

Future Effects of Healthcare Reform

Friday, July 23rd, 2010

We are covered in webinars and seminars about the Patient Protection and Affordable Care Act.  I attended several in recent weeks, and the most common answer to audience questions was “We don’t know yet.”  True  as that may be only months after passage, employers will need to make key decisions soon.  Consider these “big picture” predictions by medical industry observers as you think about the future of your group health plan:

  • Higher healthcare costs for employers and most patients, well beyond the additional risk from new enrollees
  • Better access for the previously uninsured with new access impediments for the insured
  • More employers will convert employees to part time to avoid mandates . . .
  • . . .  but watch for regulations complicating the exclusion of part-time workers from plans (remember, the goal is 100% coverage)
  • Much improved data collection and sharing; better use of evidence-based medicine
  • Higher medical equipment and drug costs
  • A rise in concierge medicine, private pay and direct reimbursement plans
  • Breaches in security of electronic personal health data housed in the “cloud”
  • Increased taxes from value added/national sales taxes and such
  • More outcome-based payment schedules
  • Penalties to hospitals for readmissions and hospital-acquired illnesses
  • Increased financial stress at community hospitals
  • “The end of self-insurance” in small- and medium-sized plans due to blunting or deleting its advantages over time
  • Increased subsidization of Exchanges
  • Eventual domination of Insurance Exchanges and Medicare; impractical to remain a “grandfathered” plan under new rules
  • Application of IRC Section 105(h) to non-grandfathered insured plans (discrimination testing and daily excise taxes) making it difficult to exclude categories of full-time employees
  • Micro-networks of physicians providing deeper discounts and limited choices
  • Fewer viable commercial domestic providers over time; more medical tourism overseas
  • Commoditization of healthcare and diminished professional status/pay for office-based physicians
  • Greater use of mid-level practitioners such as Physician Assistants and Nurse Practitioners

Sure, some of these predictions will turn out wrong and others will come into play.  We are taking today’s loose and complex system of doctors, insurers, pharmaceutical and equipment makers, hospitals, network pricing secrecy, etc. and adding significant central direction, data, light-of-day, penalties, incentives, limitations, minimum plan standards, new taxes and regulations.  Yes, the old loose system became unaffordable, but is the regulated one more efficient?  No one ever lost money betting on unintended consequences from large regulatory programs, so let’s hope some of them are good!

Next week I will share my predictions for healthcare reform and some advice for employers on how to prepare.

Note: I am grateful to all the seminar speakers and area professionals for their help, including Todd Yates of Hill, Chesson & Woody, Joel Daniel of Ogletree Deakins and Dr. David Marcinko.

Photo Source: Oldmaison