All posts tagged UBA

Employer-sponsored health insurance is greatly affected by geographic region, industry, and employer size. While some cost trends have been fairly consistent since the Patient Protection and Affordable Care Act (ACA) was put in place, United Benefit Advisors (UBA) finds several surprises in their 2016 Health Plan Survey.

Based on responses from more than 11,000 employers, UBA announces the top five best and worst states for group health care costs.

Check out this video and contact us to go over the UBA Health Plan Survey.

 

 

 

 

Determining how an employer develops the most effective formulary, while protecting the financial stability of the plan, is certainly the challenge of this decade. Prescription management used to mean monitoring that the right people are taking medications to control their disease while creating strategies to move them from brand name to generic medications. With the dawn of specialty medications, formulary management has become a game of maximizing the pass-through of rebates, creating the best prior authorization strategies and tiering of benefits to create some barrier to more expensive medications, all without becoming too disruptive. As benefits managers know, that is a difficult challenge. The latest UBA Health Plan Survey revealed that 53.6 percent of plans offer four tiers or more, a 21.5 percent increase from last year and nearly a 55.5 percent increase in just two years. Thus, making “tiering” a top strategy to control drug costs. There are many additional opportunities to improve and help control the pharmacy investment, but focusing on the key components of formulary management and working on solutions that decrease the demands for medications are critical to successful plan management.

When developing a formulary, Brenda Motheral, RPh, MBA, Ph.D., CEO of Archimedes, suggests that chasing rebates is not a strategy to optimize your investment. Some of the highest rebates may be from medications that add no better therapeutic value than an inexpensive medication that does not offer a rebate, but net cost is much lower than the brand or specialty medication being offered. Best formulary management will mean that specific medications that do not offer a significant therapeutic value are removed from the formulary, or are covered at a “referenced price” so the member pays the cost difference. Formulary management will need to focus on where the drug is filled and which medications are available.

When setting up parameters on where a drug is to be filled, the decision needs to be made if a plan will promote mail order. Mail order, if used and monitored appropriately, makes it more convenient for a patient to receive their regularly used medications and may provide savings. In fact, the UBA Health Plan Survey finds that more than one-third (36.3 percent) of prescription drug plans provide a 90-day supply at a cost of two times retail copays. But if mail order programs are not monitored, people can continue to receive medications that are no longer required and never used, adding to medical spend waste. Furthermore, in our analysis, we are finding that not all medications are less expensive through mail order, as shown in Figure 1 below. Therefore, examining the cost differential is critical in a decision to promote, or not promote, mail order.

Figure 1

Drug Name Rx Category Mail Order Retail
Zytiga® Malignancies $8,749 $6,027
Sumatriptan Succinate Migrane / Neurologic $575 $308
Ranexa® Cardiovascular $259 $413

 

Another formulary consideration is in monitoring the increase in same drug pricing. The stories surrounding the price increases of EpiPens® has been well-documented, but how well do you understand the impact of price increases on your plan? Monitoring price increases, as shown in Figure 2, may help an employer turn to their pharmacy benefit manager (PBM) to ask for help in controlling these price increases, or help in decisions related to formulary inclusion.

Figure 2

Drug Name Rx Category Plan Paid per
30-day Supply
(SPLY)
Plan Paid per
30-day Supply
Cialis® Genito-Urinary / Acute Minor $287 $442
AndroGel® Endocrine / Chronic Meidcal $471 $523
Viagra® Genito-Urinary / Acute Minor $615 $978

 

Formulary management solutions can become a cat-and-mouse game. The ultimate approach to manage the total spending on medications is by managing the growing demand. There has been significant press related to the opioid overutilization in the U.S., as illustrated in the article “Prescription Addiction.” But that issue is much broader in our society and relates to taking a pill as a quick solution to solve our medical problems. In March 2016, the Department of Health and Human Services (HHS) stated that 30 percent of the growth in spending related to medications was due to an increase in prescriptions per person. Certainly, medications should be used when there are no alternatives to control disease or pain. However, turning to medications as a first option for chronic condition control for issues like hypertension, blood sugar control, cholesterol control versus improving diet and exercise, etc., is just a band-aid solution that, in most cases, does not resolve the root issue. Yet, because this is sold as a quick fix, we see an increase in the number of individuals on medications. In 2012, 34 percent of plan members engaged in Vital Incite were taking four or more (active ingredients) medications, and that has grown to more than 45 percent in 2016. The data also illustrates that in 2012 more than 42 percent of members were not on any medications, but that group size has shrunk to only 27 percent. No formulary can impact this issue.

Active Ingredient Use, All Clients, All Members 21 Years and Older

This increased use could be considered an improvement in care if their disease were more controlled. Appropriate and medically-impactful utilization would mean that a person is working toward improving diet and exercise and is taking the least expensive, yet effective, medication to control his or her disease.

Considering that diabetes medication options have really expanded, an employer would hope that the more expensive medication is providing the best control of disease. But, taking the medication alone will not control the disease and, at times, the progression of the medication cost can be related to progression of the disease due to a lack of disease management. For instance, a diabetic may have progressed from taking metphormin (marketed under the tradename Glucophage® among others), which costs approximately $27 per month, to metphormin ER (Glucophage® XR), which allows a person to take only one pill a day, so it may provide increased compliance, but costs $274 per month. Now, the option of taking Glumetza® is offered, which can be reimbursed at up to $3,620 per month, and is said to provide more stable results. But, if we examine the A1c control values from Vital Incite, do we find the reduction in A1c values as evidence that this additional investment in medication options is providing better control? Figure 3 provides an example of A1c control by prescription status. The goal would be that those on medications will become controlled. But, in our data, we are not seeing a significant improvement in persons with HgA1c levels above 7 percent. Control is achieved from diet, exercise, and appropriate medications. There are theories that people on these more expensive medications are using that as an approach to help them maintain their unhealthy behaviors. Therefore, taking medications alone does not appear to provide an effective solution and, in fact, providing chronic condition medications for free, without requiring any other effort, may not be the best investment for an employer.

Figure 3

HgA1c Level In Treatment Untreated Discontinued
Treatment
Possibly
Untreated
< 5.7 6 1 2 3
5.7 to 6.4 21 2 1 11
6.5 to 7.0 17 7
> 7.0 53 4 5

 

In conclusion, determining which issues are having the most impact on an employer group will allow benefits managers to determine the company’s priorities. This is not an easy task, but with pharmacy spend increasing at a national average of 7.3 percent annually and becoming a higher percentage of the overall medical spend, new strategies need to be considered. Focusing on the key components that balance formulary management with the correct approach to manage the demand on medications can influence total pharmacy spend.

Originally published by www.ubabenefits.com

 

Many employee benefit limits are automatically adjusted each year for inflation (this is often referred to as an “indexed” limit). UBA offers a quick reference chart showing the 2017 cost of living adjustments for health and Section 125 plans, qualified plans, Social Security/Medicare withholding, compensation amounts and more. This at-a-glance resource is a valuable desk tool for employers and HR practitioners.

Here’s a snapshot of a section of the 2017 health plan limits; be sure to request the complete chart from a UBA Partner.

2017 health plan limits

Originally published by www.ubabenefits.com

 

Proposed regulations for revising and greatly expanding the Department of Labor (DOL) Form 5500 reporting are set to take effect in 2019. Currently, the non-retirement plan reporting is limited to those employers that have more than 100 employees enrolled on their benefit plans, or those in a self-funded trust. The filings must be completed on the DOL EFAST2 system within 210 days following the end of the plan year.

What does this expanded number of businesses required to report look like? According to the 2016 United Benefit Advisors (UBA) Health Plan Survey, less than 18 percent of employers offering medical plans are required to report right now. With the expanded requirements of 5500 reporting, this would require the just over 82 percent of employers not reporting now to comply with the new mandate.

While the information reported is not typically difficult to gather, it is a time-intensive task. In addition to the usual information about the carrier’s name, address, total premium, and payments to an agent or broker, employers will now be required to provide detailed benefit plan information such as deductibles, out-of-pocket maximums, coinsurance and copay amounts, among other items. Currently, insurance carriers and third party administrators must produce information needed on scheduled forms. However, an employer’s plan year as filed in their ERISA Summary Plan Description, might not match up to the renewal year with the insurance carrier. There are times when these schedule forms must be requested repeatedly in order to receive the correct dates of the plan year for filing.

In the early 1990s small employers offering a Section 125 plan were required to fill out a 5500 form with a very simple 5500 schedule form. Most small employers did not know about the filing, so noncompliance ran very high. The small employer filings were stopped mainly because the DOL did not have adequate resources to review or tabulate the information.

While electronic filing makes the process easier to tabulate the information received from companies, is it really needed? Likely not, given the expense it will require in additional compliance costs for small employers. With the current information gathered on the forms, the least expensive service is typically $500 annually for one filing. Employers without an ERISA required summary plan description (SPD) in a wrap-style document, would be required to do a separate filing based on each line of coverage. If an employer offers medical, dental, vision and life insurance, it would need to complete four separate filings. Of course, with the expanded information required if the proposed regulations hold, it is anticipated that those offering Form 5500 filing services would need to increase with the additional amount of information to be entered. In order to compensate for the additional information, those fees could more than double. Of course, that also doesn’t account for the time required to gather all the data and make sure it is correct. It is at the very least, an expensive endeavor for a small business to undertake.

Even though small employers will likely have fewer items required for their filings, it is an especially undue hardship on many already struggling small businesses that have been hit with rising health insurance premiums and other increasing costs. For those employers in the 50-99 category, they have likely paid out high fees to complete the ACA required 1094 and 1095 forms and now will be saddled with yet another reporting cost and time intensive gathering of data.

Given the noncompliance of the 1990s in the small group arena, this is just one area that a new administration could very simply and easily remove this unwelcome burden from small employers.

Originally published by www.ubabenefits.com

In a few weeks, a second season of shared responsibility reporting will begin. For some of you, last year’s inaugural year of reporting may have felt eerily similar to Lewis Carroll’s famous book. You know the one. It included a little girl falling down a dark hole, a rabbit frantically checking his watch and a lot of other crazy characters. Now that you have the benefit of one year of reporting under your belt, let’s look at the reporting forms and try to make them less confusing by breaking them down.

Background

The Patient Protection and Affordable Care Act (PPACA), commonly called the Affordable Care Act (ACA), included various mandates to ensure all citizens have affordable coverage for health care expenses. There is a mandate at the individual level and then other mandates at the employer level.

  • Individual Shared Responsibility Mandate: This mandate requires all citizens to have minimum essential coverage (MEC). If they do not, they must qualify for an exception or they will be subject to a penalty. Individuals use the 1095 forms, or a similar statement, to document that they have the required coverage.
  • Employer Shared Responsibility Mandates: These mandates apply to group health plans. One requirement is that all plans that provide MEC must report who is covered by their plan. There are also requirements which only apply to employers that are considered to be an applicable large employer (ALE), which is defined as any employer that employed, on average, at least 50 full-time employees. These requirements mandate that all ALEs must provide MEC to their full-time employees and this MEC needs to be affordable. If they do not provide MEC, they could be subject to a penalty (sometimes referred to as the “A” penalty). If the MEC they provide does not meet the definition of affordable, then the ALE could be subject to a different penalty (sometimes referred to as the “B” penalty).

In general, the objective of 1094/1095 reporting is (1) to verify those individuals who had the required MEC; and, (2) to make sure ALEs are offering affordable MEC to their full-time employees. If this isn’t happening, 1094/1095 reporting provides the information necessary for the IRS to know whether a penalty to the individual, or to the ALE, is in order.

1095-B vs. 1095-C, “I don’t understand the difference!”

1095-B

Form 1095-B provides evidence that an individual had MEC. It provides reporting strictly for the individual shared responsibility mandate. It will not trigger any employer shared responsibility penalties. It is used to provide documentation for an individual to preclude them from an individual penalty. The 1095-B is required of employer group health plans in two situations:

Situation 1: the plan is fully-insured. It is the insurance carrier’s responsibility to file the 1094/1095-B with the IRS.

Situation 2: the plan is self-insured and you are not an ALE. It is the employer’s responsibility to file with the IRS.

In these situations, a Form 1095-B is to be generated for all covered individuals regardless of employment status.

When is a Form 1095-B required

1095-C

Form 1095-C provides evidence that an ALE offered, or did not offer, affordable MEC to all full-time employees. In other words, it documents whether an ALE met the employer shared responsibility requirements. For self-insured ALEs, Form 1095-C also provides documentation that an individual had MEC, thereby meeting the individual shared responsibility requirement.

Because, in some situations, this form reports on both the employer and the individual shared responsibility mandates, it can feel nonsensical at times. To make sense, a short history lesson may be helpful.

History of Form 1095-C

When the proposed reporting regulations were first released for comment, the 1095-B was to be used for individual shared responsibility reporting and the 1095-C was to be used exclusively for employer shared responsibility reporting. As such, the 1095-C was only a two-part form with Part I being employer identification information and Part II being information on the offer of coverage that was made to full-time employees.

If the reporting forms had remained as initially proposed, self-insured ALEs would have been required to make two filings (the 1094/1095-B filing and 1094/1095-C filing). Why? Because they have a responsibility to report everyone that has MEC through their plan and they also have a responsibility to report on the offers of coverage they made to full-time employees.

Debate over this double filing requirement ensued and ultimately resulted in change. This change eliminated the double filing requirement for self-insured ALEs by revising the 1095-C. The resulting form still has Parts I and II referenced above, but it now also has Part III where employers can report the individual coverage information that was originally proposed to be reported on the 1095-B.

All ALEs are required to file Form 1095-C. However, which parts of the Form 1095-C you complete will be determined according to three situations as follows:

Situation 1 – Fully-insured Health Plan: You will complete Parts I and II for all individuals that were full-time employees at some point during the year. Part III information will be reported by your insurance company on Form 1095-B.

Situation 2 – Self-insured Health Plan: You will complete Parts I, II and III for all individuals that were full-time employees at some point during the year, as well as for individuals that have MEC through your plan.

Situation 3 – No Health Plan: If you are an ALE with no health plan, you will complete Parts I and II for all individuals that were full-time employees at some point during the year.

Which parts of Form 1095-C does an ALE need to complete

Let’s recap the 1095-C:

  • The 1095-C is required of all ALEs.
  • The 1095-C is a three-part form.
    Part I captures employer identification information.Part II is the area used to report what offers of coverage were made and whether or not those offers were affordable. This part addresses the employer shared responsibility mandates and determines whether or not employers are at risk for an employer penalty.Part III, which only gets completed if you have a self-insured plan, is the area used to report who had MEC through your plan. This part addresses the individual shared responsibility mandate and determines whether or not an individual is at risk for an individual penalty.

Final Thoughts

Keep in mind, if you have a self-insured plan, a Form 1095-C is required for all full-time employees, as well as anyone who had coverage through your plan, so there may be situations where you are required to produce a 1095-C for individuals that do not meet the ACA full-time employee definition that identifies those employees for whom you have an employer shared responsibility requirement. In these situations, Part II can cause concern, or an initial fear, that a penalty could be assessed because these individuals may not meet the affordability requirement. Remember, these individuals do not meet the full-time definition, therefore, they cannot trigger an employer shared responsibility penalty.

That’s 1095-B and 1095-C in a nutshell, albeit a very large nutshell. Although there are still a lot of crazy characters associated with ACA reporting, perhaps this has shed some light on the dark hole you may feel like you fell into and, hopefully, you can parlay it into a smoother reporting process in the new year. Happy reporting!

Resources

Employers that did not fulfill all of their obligations under the employer shared responsibility provision (play or pay) in regard to the 2015 plan year might owe a penalty to the IRS. In addition, employers will be notified if an employee who either was not offered coverage, or who was not offered affordable, minimum value, or minimum essential coverage, goes to the Exchange and gets a subsidy or “advance premium tax credit.” To understand this “Employer Notice Program” the appeals process, and how affordability must be documented, request UBA’s newest ACA Advisor, “IRS reporting Now What?”

UBA has created a template letter that employers may use to draft written communication to employees regarding what to expect in relation to IRS Forms 1095-B and 1095-C, and what employees should do with a form or forms they receive. The template is meant to be adjustable for each employer, and further information could be added if it is pertinent to the employer or its workforce. Employers can now request this template tool from a local UBA Partner.

Originally published by www.ubabenefits.com

Measuring program value, or return on investment, is critical and imperative in managing a healthy wellness program. Further, clearly identifying and objectively evaluating the impact helps keep the vendor focused on what is critical for the employer. If these programs are not having the impact intended, then the cost of those services is only adding to medical spending waste.

When adding wellness services to any employer benefits package, it is imperative to clearly identify the intended impact and outcome. Outcomes fall into three general categories:

  1. Employee satisfaction with the employer, which adds to recruitment and retention
  2. Reducing biometric risk and improving the health of the population
  3. Reducing medical spending

Employee Satisfaction

In the book, Shared Values, Shared Results by Dee W. Eddington, Ph.D., and Jennifer S. Pitts, Ph.D., the value of employees appreciating the benefits an employer offers is clearly outlined as a win-win strategy. If an employer’s intent in providing wellness services is to improve the support for its employees, then measuring the satisfaction related to those outcomes is critical. Employee surveys are typically the best approach to gather outcomes related to these intended programs. Some key questions to ask may include:

  • Is working at this organization beneficial for my health? (“Strongly Agree” to “Disagree” responses)
  • Do I trust that my organization cares about me? (“Strongly Agree” to “Disagree” responses)
  • Which of the following wellness program initiatives do you find to be valuable? (list all programs offered)

Collecting employee, or spouse, feedback on these programs will provide insight to allow an employer/ consultant to know if programs are appreciated, or if modifications are required in order to achieve the desired outcomes.

Reducing Biometric Risk and Controlling Disease

If the intent of a wellness program is to help improve the health of individuals so that future medical spending will be reduced, then it is critical to determine if the program is engaging the correct members and then measure the impact on their risk. At Vital Incite, we utilize Johns Hopkins’ risk indexing along with biometric risk migration to provide feedback to vendors and employers of the impact of their programs. Some suggested goals may include:

  • Engaging 80 percent of persons with high risk biometrics
  • Reduction in weight of persons overweight or obese by greater than 5 percent in 30 percent of the engaged population
  • Of diabetics with an A1c greater than 7 percent, 80 percent will reduce their A1c by 1 percent in one year
  • Of persons with blood pressure in the high-risk range, 40 percent will have achieved controlled blood pressure without adding medications in one year
  • Of persons who take fewer than 10,000 steps per day, 70 percent will increase their average step count by 20 percent or more

These goals need to be very specific and targeted to address the exact needs of your population, measuring what is most likely to have an impact on a person’s long-term health. This provides specific direction for your wellness providers, but allows an employer/consultant to monitor the impact throughout the year to continue to redirect communication and services to help provide the best outcomes.

The first step in any program is to engage the intended audience. UBA’s Health Plan Survey finds that 54.6 percent of employers with wellness programs use components such as on-site or telephone coaching for high-risk employees, an increase of 7.5 percent from last year. Once you target the intended audience, engagement of those at risk is critical. Monitoring this subset of data can make sure the vendor resources are directed appropriately and, many times, identify areas where the employer may be able to help.

Engagement of High Risk Individuals in CoachingOf course, engagement is only the first step and the intended outcome is to reduce risk or slow down the progression of risk increasing, that is really the final outcome desired. The following illustration allows employers and the vendor solution to monitor the true impact of the program by reviewing the risk control, or improvement based on program participation.

Participant vs non-participant results

Reducing Medical Spending

Although many employers are interested in helping their employees become healthier, the reality is these efforts have to help reduce medical costs or increase productivity so these efforts are sustainable. Since, to date, few employers have data on productivity, the analysis then is focused on reducing medical spending. The correct analysis depends on the size of your population and the targeted audience, but a general analysis to determine if those engaged are costing less than persons who have similar risk on your plan would look something like the analysis below.

participant engagement chart

If your program is targeted specifically on a disease state, then the impact on the cost to care for that disease state may be more appropriate. In the example below, the employer instituted a program to help asthmatics, and therefore, the analysis is related to the total cost to care for asthma comparing the year prior to the program to the year of the program. In this analysis, the impact is very clear.

Impact of Program on Cost for all ID-Asthma

The employer anticipated first year savings due to high emergency room (ER) utilization for persons with asthma and the report proved that along with ER utilization declining, the total cost of care for asthma significantly declined.

Summary

In summary, having a clear understanding of the expectation and desired outcomes and monitoring that impact throughout the year, we believe, drives better outcomes. When we first started analyzing outcomes of programs, the impact of many programs were far less impressive than vendor reports would allow us to believe. That false sense of security is not because they were trying to falsify information, but the reports did not provide enough detail to fully illustrate the impact. Most vendor partners don’t have access to all of the data to provide a full analysis and others will only show what makes them look good. But, if you identify the impact you need in order to achieve success, all parties involved focus on that priority and continually work to improve that impact. We believe that wellness programs can have an impact on a population culture, health and cost of care if appropriately managed.

Originally published by www.ubabenefits.com

Recently, the U.S. Department of the Treasury, Department of Labor (DOL), and Department of Health and Human Services (HHS) (collectively the Departments) issued final regulations regarding the definition of short-term, limited-duration insurance, standards for travel insurance and supplemental health insurance coverage to be considered excepted benefits, and an amendment relating to the prohibition on lifetime and annual dollar limits.

Effective Date and Applicability Date

These final regulations are effective on December 30, 2016. These final regulations apply beginning on the first day of the first plan or policy year beginning on or after January 1, 2017.

Short-Term, Limited-Duration Insurance

Short-term, limited-duration insurance is a type of health insurance coverage designed to fill temporary gaps in coverage when an individual is transitioning from one plan or coverage to another plan or coverage. Although short-term, limited-duration insurance is not an excepted benefit, it is exempt from Public Health Service Act (PHS Act) requirements because it is not individual health insurance coverage. The PHS Act provides that the term ‘‘individual health insurance coverage’’ means health insurance coverage offered to individuals in the individual market, but does not include short-term, limited-duration insurance.

On June 10, 2016, the Departments proposed regulations to address the issue of short-term, limited-duration insurance being sold as a type of primary coverage.

The Departments have finalized the proposed regulations without change. The final regulations define short-term, limited-duration insurance so that the coverage must be less than three months in duration, including any period for which the policy may be renewed. The permitted coverage period takes into account extensions made by the policyholder ‘‘with or without the issuer’s consent.’’ A notice must be prominently displayed in the contract and in any application materials provided in connection with enrollment in such coverage with the following language:

THIS IS NOT QUALIFYING HEALTH COVERAGE (‘‘MINIMUM ESSENTIAL COVERAGE’’) THAT SATISFIES THE HEALTH COVERAGE REQUIREMENT OF THE AFFORDABLE CARE ACT. IF YOU DON’T HAVE MINIMUM ESSENTIAL COVERAGE, YOU MAY OWE AN ADDITIONAL PAYMENT WITH YOUR TAXES.

The revised definition of short-term, limited-duration insurance applies for policy years beginning on or after January 1, 2017.

Because state regulators may have approved short-term, limited-duration insurance products for sale in 2017 that met the definition in effect prior to January 1, 2017, HHS will not take enforcement action against an issuer with respect to the issuer’s sale of a short-term, limited-duration insurance product before April 1, 2017, on the ground that the coverage period is three months or more, provided that the coverage ends on or before December 31, 2017, and otherwise complies with the definition of short-term, limited-duration insurance in effect under the regulations. States may also elect not to take enforcement actions against issuers with respect to such coverage sold before April 1, 2017.

For information on final regulations regarding excepted benefits, specifically similar supplemental coverage and travel insurance—as well as information on the definition of essential health benefits for purposes of the prohibition on lifetime and annual limits, view UBA’s ACA Advisor, “Regulations Regarding Short-Term Limited-Duration Insurance, Excepted Benefits, and Lifetime/Annual Limits.”

Originally published by www.ubabenefits.com

Most Partners of United Benefit Advisors (UBA) and their clients have benefits enrollment down pat. They know what to communicate to employees, and when. Employees, too, are usually familiar with the process. For example, they know what to expect when they start comparing their medical plan options to their 401(k) contributions. But not all benefits are created equally. Some require more communication, understanding, and detail. Long-term care insurance (LTCi) is one of those products. More than any other benefit, it calls for well-thought-out employee education.

LTCi education is critical to employees for the following reasons:

Underwriting concessions are available for a limited time only and an employee’s health determines approval. Employers are able to offer LTCi with reduced underwriting, but the employees can only take advantage of this offer during initial enrollment. It will not be available at any other time – including during future open-enrollment periods – so it’s essential that employees understand the advantages of this benefit at a time when they will receive their best opportunity for approval.
LTCi isn’t just another voluntary benefit, it’s an important component of any employee’s retirement plan. Long-term care can be a huge financial burden for many Americans. Those who buy LTCi are doing so to protect their savings and assets down the road. As a result, LTCi becomes a critical aspect of an overall retirement plan. Employees will want guidance on which coverage options best suit their financial needs.
LTCi is often a one-time purchase and employees may face closed plans and rate increases. Unlike other benefits where providers may change from year-to-year, the majority of LTCi purchasers will hold on to their original plan for life. As the market evolves and carriers develop new products, an employer may be administering multiple LTCi programs to employees. Employees will be curious how their plan stacks up – especially if they have a plan with MetLife, John Hancock, Prudential, or CNA since those carriers no longer offer new LTCi plans. Employees may also be impacted by rate increases with these carriers and will need education-based support on what decisions to make regarding their increased premium. Helping employees compare programs will allow them to make an informed decision about their plan.

What Employees Need to Know

Employees need focused time, separate from other benefits education, to learn about LTCi. It is important to communicate with them, both in writings and through in-person or Web meetings, so that they can learn:

What long-term care is, how likely it is they will need it, how it’s delivered, and the costs associated with it
What LTCi covers and how it differs from other benefits
The risks associated with not having LTCi
Myths about long-term care coverage (for example, that it’s only needed by the elderly or that it only covers nursing home care)
An overview of options and an understanding of all possible solutions for long-term care
Tax incentives available for LTCi
The right time to buy LTCi and the risks associated with waiting
Decision-making tools to help select the best coverage levels for their needs

We’ve had a great reception from UBA Partners and clients who are interested in LTCi for their employees. One of the primary themes we continue to hear is that LTCi is on the to-do list for many brokers and employers. When employees have all of this information laid out in an accessible, easy-to-understand way, they will be able to make informed decisions about this valuable benefit.

Originally published by www.ubabenefits.com

Historically, employers have utilized health risk assessments (HRAs) as one measurement tool in wellness program design. The main goals of an HRA are to assess individual health status and risk and provide feedback to participants on how to manage risk. Employers have traditionally relied on this type of assessment to evaluate the overall health risk of their population in order to develop appropriate wellness strategies.

Recently, there has been a shift away from the use of HRAs. According to the 2016 UBA Health Plan Survey, there has been a 4 percent decline in the percentage of employer wellness programs using HRAs. In contrast, the percentage of wellness programs offering biometric screens or physical exams remains unchanged – 68 percent of plans where employers provide wellness offer a physical exam or biometric screening.

One explanation for this shift away from HRAs is an increased focus on helping employees improve or maintain their health status through outcome-based wellness programs, which often require quantifiable and objective data. The main issue with an HRA is that it relies on self-reported data, which may not give an accurate picture of individual or population health due to the fact that people tend to be more optimistic or biased when thinking about their own health risk. A biometric screening or physical exam, on the other hand, allows for the collection of real-time, objective data at both the individual and population level.

Including a biometric screening or physical exam as part of a comprehensive wellness program can be beneficial for both the employer and employees. Through a biometric screening or physical exam, key health indicators related to chronic disease can be measured and tracked over time, including blood pressure, cholesterol levels, blood sugar, hemoglobin, or body mass index (BMI). For employees, this type of data can provide real insight into current or potential health risks and provide motivation to engage in programs or resources available through the wellness program. Beyond that, aggregate data collected from these types of screenings can help employers make informed decisions about the type of wellness programs that will provide the greatest value to their company, both from a population health and financial perspective.

One success story of including a physical exam as part of a wellness program comes from one of our small manufacturing clients. From the initial population health report, the company learned that there was a large percentage of its population with little to no health data, resulting in the inability to assign a risk score to those individuals. It is important to note that when a population is not utilizing health care, it can result in late-stage diagnoses, resulting in greater costs and a burden for both the employee and employer. In addition, there was low physical compliance and a high percentage of adults with no primary care provider. In order to capture more information on its population and better understand the current health risks, the company shifted its wellness plan to include annual physicals as a method for collecting biometric data for the 2016 benefit year. Employees and spouses covered on the plan were required to complete an annual physical and submit biometric data in order to earn additional incentive dollars.

By including annual physicals in its wellness program, positive results were seen for employees and spouses and the company was able to make an informed decision about next steps for its wellness program. After the first physical collection period, the percentage of individuals with little to no information was reduced from 31 percent to 16 percent (Figure A). Annual physical compliance increased from 36 percent in 2015 to over 80 percent in 2016 (Figure B), which means more individuals were seeing a primary care provider. As a result of increased biometric data collection and one year of Vital Incite reporting, the company was able to determine next steps, which included addressing chronic condition management, specifically hypertension and diabetes, with health coaching or a disease management nurse.

Figure A – RUB Distribution 2014 – 2016

RUB Distribution 2014-2016

Figure B – Preventive Screening Compliance

Preventive Screening Compliance

Employers that are still interested in collecting additional information from employees may consider including alternatives to the HRA, such as culture or satisfaction surveys. These tools can allow employers the opportunity to evaluate program engagement and further understand the needs and wants of their employee population.

Originally published by www.ubabenefits.com

 

Following the November 2016 election, Donald Trump (R) will be sworn in as the next President of the United States on January 20, 2017. The Republicans will also have the majority in the Senate (51 Republican, 47 Democrat) and in the House of Representatives (238 Republicans, 191 Democrat). As a result, the political atmosphere is favorable for the Trump Administration to begin implementing its healthcare policy objectives. Representative Paul Ryan (R-Wis.) will likely remain the Speaker of the House. Known as an individual who is experienced in policy, it is expected that the Republican House will work to pass legislation that follows the health care policies in Speaker Ryan’s “A Better Way” proposals. The success of any of these proposals remains to be seen.

Employers should be aware of the main tenets of President-elect Trump’s proposals, as well as the policies outlined in Speaker Ryan’s white paper. These proposals are likely to have an impact on employer sponsored health and welfare benefits. Repeal of the Patient Protection and Affordable Care Act (ACA) and capping the employer-sponsored insurance (ESI) exclusion for individuals would have a significant effect on employer sponsored group health plans.

Trump Policy Proposals

President-elect Trump’s policy initiatives have seven main components:

  • Repeal the ACA. President-elect Trump has vowed to completely repeal the ACA as his first order of Presidential business.
  • Allow health insurance to be purchased across state lines.
  • Allow individuals to fully deduct health insurance premium payments from their tax returns.
  • Allow individuals to use health savings accounts (HSAs) in a more robust way than regulation currently allows. President-elect Trump’s proposal specifically mentions allowing HSAs to be part of an individual’s estate and allowing HSA funds to be spent by any member of the account owner’s family.
  • Require price transparency from all healthcare providers.
  • Block-grant Medicaid to the states. This would remove federal provisions on how Medicaid dollars can and should be spent by the states.
  • Remove barriers to entry into the free market for the pharmaceutical industry. This includes allowing American consumers access to imported drugs.

President-elect Trump’s proposal also notes that his immigration reform proposals would assist in lowering healthcare costs, due to the current amount of spending on healthcare for illegal immigrants. His proposal also states that the mental health programs and institutions in the United States are in need of reform, and that by providing more jobs to Americans we will reduce the reliance of Medicaid and the Children’s Health Insurance Program (CHIP).

Speaker Ryan’s “A Better Way” Proposal

In June 2016, Speaker Ryan released a series of white papers on national issues under the banner “A Better Way.” With Republican control of the House and Senate, it would be plausible that elected officials will begin working to implement some, if not all, of the ideas proposed. The core tenants of Speaker Ryan’s proposal are:

  • Repeal the ACA in full.
  • Expand consumer choice through consumer-directed health care. Speaker Ryan’s proposal includes specific means for this expansion, namely by allowing spouses to make catch-up contributions to HSA accounts, allow qualified medical expenses incurred up to 60 days prior to the HSA-qualified coverage began to be reimbursed, set the maximum contribution of HSA accounts at the maximum combined and allowed annual high deductible health plan (HDHP) deductible and out-of-pocket expenses limits, and expand HSA access for groups such as those with TRICARE coverage. The proposal also recommends allowing individuals to use employer provided health reimbursement account (HRA) funds to purchase individual coverage.
  • Support portable coverage. Speaker Ryan supports access to financial support for an insurance plan chosen by an individual through an advanceable, refundable tax credit for individuals and families, available at the beginning of every month and adjusted for age. The credit would be available to those without job-based coverage, Medicare, or Medicaid. It would be large enough to purchase a pre-ACA insurance policy. If the individual selected a plan that cost less than the financial support, the difference would be deposited into an “HSA-like” account and used toward other health care expenses.
  • Cap the employer-sponsored insurance (ESI) exclusion for individuals. Speaker Ryan’s proposal argues that the ESI exclusion raises premiums for employer-based coverage by 10 to 15 percent and holds down wages as workers substitute tax-free benefits for taxable income. Employee contributions to HSAs would not count toward the cost of coverage on the ESI cap.
  • Allow health insurance to be purchased across state lines.
  • Allow small businesses to band together an offer “association health plans” or AHPs. This would allow alumni organizations, trade associations, and other groups to pool together and improve bargaining power.
  • Preserve employer wellness programs. Speaker Ryan’s proposal would limit the Equal Employment Opportunity Commission (EEOC) oversight over wellness programs by finding that voluntary wellness programs do not violate the Americans with Disabilities Act of 1990 (ADA) and the collection of information would not violate the Genetic Information Nondiscrimination Act of 2008 (GINA).
  • Ensure self-insured employer sponsored group health coverage has robust access to stop-loss coverage by ensuring stop-loss coverage is not classified as group health insurance. This provision would also remove the ACA’s Cadillac tax.
  • Enact medical liability reform by implementing caps on non-economic damages in medical malpractice lawsuits and limiting contingency fees charged by plaintiff’s attorneys.
  • Address competition in insurance markets by charging the Government Accountability Office (GAO) to study the advantages and disadvantages of removing the limited McCarran-Ferguson antitrust exemption for health insurance carriers to increase competition and lower prices. The exemption allows insurers to pool historic loss information so they can project future losses and jointly develop policy.
  • Provide for patient protections by continuing pre-existing condition protections, allow dependents to stay on their parents’ plans until age 26, continue the prohibitions on rescissions of coverage, allow cost limitations on older Americans’ plans to be based on a five to one ratio (currently the ratio is three to one under the ACA), provide for state innovation grants, and dedicate funding to high risk pools.

Speaker Ryan’s white paper also addresses more robust protection of life by enforcing the Hyde Amendment (which prohibits federal taxpayer dollars from being used to pay for abortion or abortion coverage) and improved conscience protections for health care providers by enacting and expanding the Weldon Amendment.

Speaker Ryan also proposes other initiatives including robust Medicaid reforms, strengthening Medicare Advantage, repealing the Independent Payment Advisory Board (IPAB) that was once referred to as “death panels,” combine Medicare Part A and Part B, repealing the ban on physician-owned hospitals, and repealing the “Bay State Boondoggle.”

Process of Repeal

Generally speaking, the process of repealing a law is the same as creating a law. A repeal can be a simple repeal, or legislators can try to pass legislation to repeal and replace. Bills can begin in the House of Representatives, and if passed by the House, they are referred to the Senate. If it passes the Senate, it is sent to the President for signature or veto. Bills that begin in the Senate and pass the Senate are sent to the House of Representatives, which can pass (and if they wish, amend) the bill. If the Senate agrees with the bill as it is received from the House, or after conference with the House regarding amendments, they enroll the bill and it is sent to the White House for signature or veto.

Although Republicans hold the majority in the Senate, they do not have enough party votes to allow them to overcome a potential filibuster. A filibuster is when debate over a proposed piece of legislation is extended, allowing a delay or completely preventing the legislation from coming to a vote. Filibusters can continue until “three-fifths of the Senators duly chosen and sworn” close the debate by invoking cloture, or a parliamentary procedure that brings a debate to an end. Three-fifths of the Senate is 60 votes.

There is potential to dismantle the ACA by using a budget tool known as reconciliation, which cannot be filibustered. If Congress can draft a reconciliation bill that meets the complex requirements of our budget rules, it would only need a simple majority of the Senate (51 votes) to pass.

Neither President-elect Trump nor Speaker Ryan has given any indication as to whether a full repeal, or a repeal and replace, would be their preferred method of action.

The viability of any of these initiatives remains to be seen, but with a Republican President and a Republican-controlled House and Senate, if lawmakers are able to reach agreeable terms across the executive and legislative branches, some level of change is to be expected.