Month: April 2018

It appears that cost management is of increasing importance to employers, with employers being willing to experiment with new ways of stemming expenses. There has been a growth of group captives in recent years, whereby employers keep their self-funded plans with group stop-loss insurance. This stems the risk and allows the self-funding of smaller groups.

Although the interest in self-insured captive insurance has grown, there remains to be confusion surrounding the arrangements. The president and founder of Roundstone LLC, Mike Schroeder, outlined 5 common misconceptions in an EBA article recently. Among the misconceptions, it is commonly believed that these captives result in higher costs than fully insured renewals; self-funding them is too complex; and that some businesses are too small to see any real benefits to them.

Mick Rodgers, EBA’s 2017 Adviser of the Year, also reshaped health insurance for his firm, which has a dozen employees serving 256 employers group with 16,530 lives. Rodgers then made 4 healthcare purchasing coalitions, consisting of more than 11,000 members from 64 middle-market employers. The employers had headcounts from 100 to 500 employees, hailing from 35 different states. At a mere $7,065 PEPY as of 2016, their health benefits were 41% less than the US average of $11,990 PEPY.
Healthcare reform efforts go on

Healthcare reform shows no signs of slowing down, with a constant “will they won’t they” situation seeming to surround healthcare reform all through 2017. The Senate didn’t pass GOP legislation, though the industry is still searching for an alternative to the Affordable Care Act’s requirements regarding reporting.

President Trump’s tax reform bill includes a repeal of the individual mandate. This has made employers rather worried if healthy employees decide not to purchase health coverage, as the employers may see potentially adverse selections. The individual mandate’s repeal has worried many business groups, with business groups worrying that it may cause the health insurance marketplace to become volatile and unstable. It may also move costs towards stable health insurance customers and employers too.

Trump signed an executive order in October which ordered federal agencies to take certain actions as a result of federal rule-making. Association health plans could potentially be created by small employers grouping together, allowing them to buy insurance together, rather than via Obamacare. Trump’s executive order also encourages the expansion of low-cost, short-term, limited insurance plans, in addition to using tax-advantaged accounts to pay off healthcare-related expenses.

Employer groups continued to call for the repeal of supposedly harmful ACA taxes throughout 2017. The US Chamber of Commerce and the ERISA Industry Committee wish to see the repeal of the Cadillac tax and the Health Insurance Tax, as these are two notoriously disliked provisions of the Affordable Care Act.

As governments change and power is constantly shifted back and forth in the White House, healthcare plans can inevitably hang in the balance. If you wish to remain abreast of the latest situations (and get great advice) then get in touch with us!

Employee benefits can be costly for a small business, often increasing an employee’s base salary by as much as 40%. Despite the costs involved, these benefits are often required in order to keep employees happy and to stop them from working for your competitors.

Many business owners, however, forget about the fees and fines which can be issued when common mistakes occur with their employee benefits. Here we’ve outlined 5 ways of eliminating costly employee benefit mistakes, allowing you to save money and rest assured that you’re doing the right thing.

1. Don’t give them all away for free

If employee benefits are free, the vast majority of people will simply take them. Why? Because they’re free, so they might as well – it’s not coming at any cost to them. However, if you provide benefits which the employee has to pay for or subsidize with their salary, they may think twice about how much they want that benefit. This is a good way of ascertaining how much your employees “actually” want certain benefits.

2.Covering unqualified employees or non-employees

Some (though not many) employees cover relatives or friends by purchasing group health plans. Claim denials, investigations and cancellations can easily come as a result of this. To easily see who is eligible for insurance, check your employee’s working hours via their WR-30.

3. Give them benefits that they actually want

Consider how much your employees are actually benefitting from the benefits you are providing them. For example, if you’ve got a workforce full of Millennials and Gen-Z-ers who are largely 30 and under, they’re probably not too concerned with life insurance coverage or pension plans at this stage in their lives; they’d probably rather have a pay rise!

4. Misinforming your employees about their benefits

Many employees will expect that you, as their employer, are providing them with adequate insurance coverage. If this is not true, however, you need to inform them. You could get yourself in a lot of trouble if you misinform your employees about their benefits, or even if you fail to inform them at all. Consider drafting an annual or quarterly statement for all your employees, informing them of the full scope of their employee benefits.

5. Not filing paperwork correctly

It can be very difficult to file insurance plans for different employees’ specific jobs if you aren’t completely familiar with their duties. Assuming you aren’t micromanaging your employees 24/7, you may find it difficult to detail their duties correctly. You can also run into similar paperwork problems for group health plans, as there is only a small window of time in which to enroll new employees onto the plan. Filing paperwork incorrectly can inevitably lead to costly legal fees should issues arise.

Providing employee benefits allows any businesses to build employee morale and thrive among their competitors. Nonetheless, it can be easy to make mistakes which will cost your business money down the road. Looking for more information and advice on employee benefits and insurance? Get in touch with us now!