6 Tips for Benefits Open Enrollment in 2014

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With the changing health insurance and benefits landscape, there is a great deal of confusion occurring in the workforce, and the upcoming open enrollment season will be different than others in the past. Employers will be faced with the need to communicate and educate employees on health care reform and the benefits options available to them. In addition, organizations may be forced to identify alternative health care options or modify existing ones to cope with rising costs.

Here are six (6) tips for benefits open enrollment in 2014.

1. Review and modify your coverage.

Carefully review your health insurance policy changes each year and compare your current benefits package to your new one. Be sure to review all costs for health care services, spousal and dependent coverage options, as well as your premium costs. Consult health insurance related benchmark information from surveys as well as your broker on different options and modify accordingly. Perhaps even gather feedback from your employees on what they like and dislike about different health care/benefits options you are considering.
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6 Answers To Your Health Care Reform Questions

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How are health insurance rates being affected by health care reform? Now that the notices have been sent and exchanges have launched, what's next for employers? Here are six (6) answers to commonly asked questions on health care reform currently.

1. How are health insurance rates being affected by health care reform?

Currently, health insurance rates have been only modestly affected by health care reform, although this trend is not expected to continue. A 2013 survey conducted by Towers Watson reports that the average total cost of health care is projected to rise by 5.2% in 2014, while a survey by PriceWaterhouseCoopers shows an expected 6.5% increase. Most national surveys have been reporting stable costs (if not slightly lower) from 2012, and our surveys of local employers have also seen stable and slightly lower average premium increases from the last few years.
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6 Post-Election Workplace Issues You Need to Know

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The national election results suggest that the overall political landscape will remain largely unchanged in Washington, for at least the next two years until the 2014 midterm election. As a result, HR professionals should expect similar legal trends to persist at the federal level, with President Obama and split control of Congress between the Republicans and Democrats. Here are six (6) workplace issues you need to know:

1. Fiscal Cliff

The fiscal cliff is approaching and could result in numerous spending cuts and large tax increases that will affect both your business and employees on January 1, 2013. Notable taxes set to increase which may apply to your employees include the payroll tax, Bush-era tax cuts, Obama-era tax cuts, AMT patch, and taxes associated with health care reform. In addition, large cuts in defense spending are set to go into effect at the same time. Congress still has time to act before all of these changes go into effect, but no agreements have yet been reached.
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Supreme Court Upholds Health Care Reform Law

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On June 28th, 2012, in a 5-4 decision, the U.S. Supreme Court that the individual mandate portion of the health care reform law (the Patient Protection and Affordable Care Act), which requires that most Americans buy health insurance or pay a fine, is constitutional as a tax.

The Court agreed that while Congress could not use its power to regulate commerce between states to require individuals to buy health insurance, Congress could impose a tax penalty using its tax power for individuals who refuse to buy health insurance.

Because the mandate is constitutional, the Court did not need to determine whether other parts of the law were constitutional, according to the SCOTUS Blog.

The individual mandate was set to be implemented in 2014, however, many provisions of the health care reform law had already gone into effect in 2012. The ruling suggests that employers will still be responsible for the carrying out the provisions of the law which affect their organizations.

For more information about the Supreme Court decision, please visit the links below.

Source: SCOTUS Blog

Health Care Reform Lunch Forum

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The complexities of health care reform and the decisions that will need to be made by legislators, regulators and other policymakers over the next several years are daunting.  Ohio’s policymakers need your insight regarding the important considerations of the employer community regarding how reform will affect the role employers’ play in sponsoring access to health insurance options.

As a result, the State of Ohio has contracted with The Ohio State University’s John Glenn School of Public Affairs to assess the effects of ongoing market forces and federal health reform on Ohio’s trend for employer-sponsored health insurance.  Given the many changes to take place over the next several years, their team cannot simply project future trends based on past experience.  Therefore, they are seeking input from employers to understand what they anticipate doing under different health care reform scenarios, including a lack of change that could occur from the repeal of the legislation.

ERC, the Health Action Council (HAC) and The Council of Smaller Enterprises (COSE), have agreed to co-sponsor an employer forum in Northeast Ohio to solicit employer insights.  This input will assist policymakers better understand the health-related policy actions employers require to support the challenges of offering employer-sponsored health insurance and make Ohio a preferred place to do business.

This forum will take place on May 23rd from 11:30 a.m. to 2:30 p.m. at ERC’s Workplace Center. Please RSVP to Jasmin Denholm at 440-947-1274 or jdenholm@ercnet.org.  There is no cost and seating is limited.

We hope that you can join us for this important discussion—it is an opportunity to directly advise our state’s policymakers on your concerns and ideas related to the implementation of reform.

12 Implications of Health Care Reform

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In response to the 2011 health reform, insurance carriers increase premiums. As employers start dealing with the law’s new requirements, there is a heightened focus on providing better education and communication to employees, on negotiating and investigating alternative options, making smarter benefits decisions, and enhancing wellness programs. Here are 12 ways in which health care reform impacts how we do business now and in the future.

1. Increased cost-sharing

Cost-sharing between employers and their employees for health insurance continues to increase. This is one of the easiest ways to manage health insurance costs, but naturally has effects on employee engagement and morale that employers need to consider. The average cost-sharing arrangement has steadily increased in the years preceding 2011.

2. Education about health benefits

Education about how employees can be better health care consumers is becoming more imperative. Often employees do not understand how usage affects costs and need to be educated buyers when using their health insurance plans. Ideas for education efforts other employers have initiated include:

  • Explain the costs associated with health care decisions (i.e. going to the emergency room vs. their primary care physician).
  • Show employees the drivers of health care costs at the organization.
  • Communicate what employees can and need to do in order to maintain or reduce their current costs. Specific actions steps are recommended.
  • Expand education to spouses who are also users of the plan.
  • Provide employees with key questions to ask their doctor.
  • Make health insurance an on-going conversation and communication effort with quarterly meetings to discuss trends, employee forums to discuss suggestions, and other media to disseminate wellness and health insurance information.

3. Use of benefit statements

Benefit or total rewards statements are a widespread and important communication tool that show employees how much the organization is investing in their benefits, and particularly their health insurance. Showing employees actual dollar amounts and levels of coverage your organization has been shown to enhance satisfaction and improve understanding.

4. Review of plan design

Reviews of plan design are increasingly occurring. Plan design should be reviewed carefully and different scenarios should be run and analyzed. Raising deductibles or co-pays to offset other costs or providing a health savings account (HSA) or health reimbursement account (HRA) are options to consider. But it’s also important to pay attention to the level of benefits that other employers are providing. Conducting an annual benefits analysis can help determine where employer benefits could be modified without compromising competitiveness.

5. Negotiation of options

Taking responsibility for your health care costs and seeking additional bids from other carriers is a necessity. Inquire about other options from your broker that reduce costs and provide greater wellness resources to help employees better manage their health. Your broker may not freely offer this information, so take initiative and ask.

6. Implementation of restrictions or penalties

Increasingly, organizations are implementing more restrictions in their health insurance plans such as spousal carve-out provisions and higher premiums for smokers. Shifting additional costs or penalties to unhealthy workers, although not widespread, is becoming more popular and may help reduce or manage health care costs.

7. Offering of incentives

Incentive use for wellness program participation is expanding. A chief reason that wellness programs may not reduce your organization’s health care costs is lack of participation. Studies continue to show, however, that employees are more likely to participate in programs when meaningful incentives are offered, such as discounts on health insurance premiums.

8. Health risk assessments

Usage of these assessments is becoming very common as they can be valuable data-gathering tools for both organizations and employees. Employees can attain greater insight into health risk areas and organizations can receive an aggregate report of areas where employees need wellness assistance. Wellness programs can then be targeted to those needs. 

9. Free prevention services

Services like flu shots, health screenings, cholesterol and blood pressure checks, vaccinations, and other yearly screenings are increasingly offered in the workplace.  By providing free wellness services on-site, you can decrease usage thereby managing costs better. Also, educate employees to take advantage of the new provision of health care reform which provides free annual preventative services.

10. Wellness initiatives tied to health insurance costs

Wellness initiatives are obviously one of the best ways to reduce health care costs and the majority of employers either have one in place or are planning on initiating one. When planning wellness initiatives, be sure to not only emphasize how your organization is supporting employees’ well-being, but also how these programs are intended to assist employees in better managing and maintaining their health care costs. Employees need to see the connection.

11. Promotion of healthy habits

Recently, we’ve found that more organizations are promoting healthy habits to deal with increasing health care costs through internal nutritional standards, on-site fitness activities, and educational efforts like seminars, paper materials, and online information. Create the “norm” of healthy behavior in your workplace to manage health care costs.

12. Make it a team effort

Involving employees in solving health insurance problems can be effective. Encourage them to get involved in suggesting or implementing wellness activities and to provide their feedback on health insurance options. Collaborating and creating a conversation with your staff can help generate greater buy-in about health care decisions and limit negative perceptions of change.

Navigating health care reform and its effects won’t be easy, but we’re seeing many employers taking a proactive approach and implementing a variety of initiatives to cope, educate, and manage the law’s changes and effects on their businesses. 

Additional Resources

ERC Health
Visit www.erchealth.com to learn about our health insurance offerings for small and mid-sized businesses.

HR Help Desk
For more information and guidance pertaining to any of the content in this article, please contact hrhelp@yourerc.com.