Seeing beyond size in vision care networks

There are many other factors to consider when it comes to deciding which vision care network best fits the needs of your employees. Read this blog post to learn more.


Most people believe that “size matters” in regards to provider networks, but in the world of vision care there are other important factors to consider when deciding which network matches the needs of employees. Network members usually see their vision provider for routine services just once per year. When an employer changes vision administrators, employee in-network utilization is more than 90% regardless of the new network size. Why? Employees are not concerned about changing providers to access in-network benefits. Plus, the new vision provider network will always provide access to multiple providers wherever the employee lives and works.

But what about the quality of the vision care network? To properly assess this measurement of competing networks, employers and benefit advisers need to ask several different questions.

Determine the network’s quality
The quality of the network is vital. Start asking these questions: How are vision care providers credentialed? Do they follow the National Committee for Quality Assurance (NCQA) guidelines developed to improve healthcare quality? Are there provider audit programs provided on an ongoing basis? Is the vision care provider re-credentialed and how often? How frequently are reviews conducted of the Office of Inspector General and Medicare and Medicaid disbarment lists?

Establish the network’s effectiveness
Once you know you have a quality network, now you must ask how effective the network is. How diverse is the network? Are there ample ophthalmologists, optometrists and optical retailers we can access? Are some private practitioners? You want to make sure that a solid provider mix is available to give employees options when choosing a vision care provider.

It’s critical to know what languages are spoken within the employee population as well as the providers who care for them. If you have a large population who speak a certain language you want to make sure your network gives them access to people who can truly understand them and with whom they feel comfortable.

Finally, look at the hours of operations. With schedules being busier now than ever before, people need flexibility when it comes to visiting hours. Do they offer evening hours? Weekend hours? This is particularly important for single parents who work during the week and need the flexibility to visit an eye care professional with his or her child after work.

Having a diverse, quality vision care provider network with convenient access helps keep employees happy, healthy and in-network.

Other factors to consider
One of the other factors to be cognizant of is network ownership. Today, many managed vision care companies are involved in not only providing coverage for vision care but also in delivering it. This means the vision benefits company you’re considering may own optical laboratories, frame companies or retail locations, which can pose conflicts of interest between you, your employees and the managed vision care company. Their need to produce profits can lead to undo pressure on your employees to purchase expensive and potentially unnecessary lens types, materials and options. Coupled with direct to consumer advertising and the expansion of brands, eyeglasses have become even more expensive.

This leads to another factor for consideration. Does the potential vision benefit administrator provide meaningful information to help your employees make informed decisions about what they really need, when it comes to the myriad of options available for frames, lenses and lens options?

Network matching
Start by remembering two things when matching networks. First, if you’ve changed vision carriers in the past, you selected a network that was not identical to your previous one. Vision networks never match each other. Some have higher proportions of independent providers and lower percentages of large retailer chains. Second, the infrequency with which the vision benefit is available to be used mitigates the impact of changing providers. People don’t have the same attachment to their eye care professional as they do with their physician.

Beyond quality and effectiveness is the important factor of access. The vision industry has grown to a point where there are often many more providers than would ever be necessary to provide convenient access for your membership. The reality is that two networks may be equally sized in an area and yet there may be little overlap, making the selection of the best network with the lowest overall cost a better strategic direction than simply selecting the one with the highest provider match.

The vision industry has long demonstrated that employees are willing to select new providers, especially when costs are more competitive, and services are more convenient.

SOURCE: Moroff, C (22 August 2018) "Seeing beyond size in vision care networks" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/opinion/seeing-beyond-size-in-vision-care-networks?feed=00000152-a2fb-d118-ab57-b3ff6e310000


6 Reasons Self-Funded Plans Are Gaining Popularity

After the establishment of the ACA eight years ago, employers have been re-examining their employee benefits packages. Read on to learn more.


Since the ACA was enacted eight years ago, many employers are re-examining employee benefits in an effort to manage costs, navigate changing regulations, and expand their plan options. Self-funded plans are one way that's happening.

In 2017, the UBA Health Plan survey revealed that self-funded plans have increased by 12.8% in the past year overall, and just less than two-thirds of all large employers’ plans are self-funded.

Here are six of the reasons why employers are opting for self-funded plans:

1. Lower operating costs frequently save employers money over time.

2. Employers paying their own claims are more likely to incentivize employee health maintenance, and these practices have clear, immediate benefits for everyone.

3. Increased control over plan dynamics often results in better individual fits, and more needs met effectively overall.

4. More flexibility means designing a plan that can ideally empower employees around their own health issues and priorities.

5. Customization allows employers to incorporate wellness programs in the workplace, which often means increased overall health.

6. Risks that might otherwise make self-funded plans less attractive can be managed through quality stop loss contracts.

If you want to know more about why self-funding can keep employers nimble, how risk can be minimized, and how to incorporate wellness programs, contact your local UBA Partner Firm for a copy of the full white paper, "Self-Funded Plans: A Solid Option for Small Businesses."

SOURCE: Olson, B (16 August 2018) "6 Reasons Self-Funded Plans Are Gaining Popularity" (Web Blog Post). Retrieved from http://blog.ubabenefits.com/6-reasons-self-funded-plans-are-gaining-popularity


Retirement ABCs: How employers can help baby boomers prepare

Sixty-six percent of baby boomers are working past the traditional retirement age. There are specific rules and regulations regarding contributions and withdrawals in retirement. Continue reading to learn how employers can help prepare their employers for retirement.


Seventy-four million: That’s the estimated number of baby boomers, according to the U.S. Census Bureau. And 66% of baby boomers are working past traditional retirement ages for a variety of reasons. Some feel they can’t afford to retire, particularly with the looming high costs of healthcare; others may choose to work longer to keep their brains active or because they fear the adjustment to a less structured lifestyle.

Older workers approaching full retirement age (which varies, depending on when they were born) where they can begin receiving 100% of Social Security, face some daunting decisions about Medicare, Social Security and retirement plans such as health savings accounts and 401(k)s — unchartered territory until this point in their lives. There are specific rules about contributions and withdrawals in retirement, and employers should help with the education process. Here are three ways to do so.

Break down the HSA rules from a retiree perspective. If you offer HSAs to your employees, it’s important they understand how HSAs work with Medicare: The IRS dictates that a person can’t contribute to an HSA if they’re enrolled in part of Medicare (Part A, Part D, etc.) However, they can draw on funds already in the account to pay for qualified medical expenses and premiums for Medicare Parts B, C and D (but generally not Medicare supplement plans or Medigap insurance premiums).

Importantly, your employees may be penalized for delaying Medicare, depending on the number of employees you have and whether you have group health insurance. These requirements may not be well known by your employees and should be communicated clearly.

Of course, because Medicare, Social Security and any retirement plans involve several layers of government rules and financial regulations, there are some tricky issues your employees need to know about. One is retirement “back pay.”

When employees sign up for Social Security at least six months beyond the full retirement age, they’ll receive six months of retirement benefit back pay. This is problematic if your employees contributed to their HSAs over the previous six months — they are liable for tax penalties on HSAs. Create an education strategy that includes this information for employees looking to retire, so that they can stop contributing to their HSA six months before retirement and avoid costly mistakes.

Help employees understand how all their benefits work together. Your employees have contributed their knowledge and skills to you; it’s important to help them understand their options as they work toward retirement. For those just a few years out from retirement, your education plan may include helping employees understand eligibility requirements for both Social Security and Medicare, as well as any penalties that might arise from applying late to Medicare.

As your employees age, they are also eligible to contribute “catch-up” funds to HSAs, IRAs and 401(k)s in preparation for retirement. Your 401(k) partners and financial wellness resources can help employees assess their financial situations and prepare for retirement. For example, it’s a good idea to encourage employees who may have multiple 401(k) plans to consolidate them into one — this will make it easier to manage when they retire. They may ultimately roll these into an IRA to access additional investment options.

Maintain a focus on wellness. If you have a wellness program in place, take measures to boost participation and steer employees, especially older participants, toward healthy habits to help them live well and be productive leading up to retirement.

Wellness may extend outside of physical, emotional and mental wellness to professional development. Help them improve their retirement outlook by keeping job skills up to date so they are better prepared if they need to take on other employment to supplement their retirement.

For anyone nearing retirement age it’s a good idea to become acquainted with “Medicare and You,” the government’s official Medicare handbook. While each employee’s situation will differ, there’s no doubt that planning and education are key to a successful retirement strategy and, as an employer, you can support these efforts.

SOURCE: Metzger, L (14 August 2018) "Retirement ABCs: How employers can help baby boomers prepare" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/how-to-best-educate-baby-boomer-workers-on-retirement


10 Things You Didn’t Know About Life Insurance

Did you know that there are different kinds of life insurance? Many people don’t know much about life insurance. Continue reading to learn more.


Life insurance blah blah blah. Is that what you hear when someone mentions it as part of your new job’s employee benefits round-up or when you see something about it on TV or social media?  Not to worry: we’ve got the low-down on what you need to know. And it’s really not as overwhelming (or underwhelming) as you might think.

1. It’s part of a sound financial plan. You know about savings, you know about retirement. You might know a bit about investments and long-term financial planning for your health and happiness. And life insurance helps with planning for your loved ones’ long-term health and happiness, especially those who depend on your income, in case something were to happen to you.

2. There are different kinds of life insurance. In addition to employment-based life insurance (which typically only lasts as long as your employment at your job), there’s term and permanent life insurance.

Term life insurance: You typically pay lower premiums for term life insurance, but your coverage is just for a specified amount of time, say 20 years, for example. At the end of the term, your insurance coverage ends.

Permanent life insurance: With permanent life insurance (whole, universal, variable) you typically pay higher premiums in the short term, but then these policies generally allow you to accumulate cash value over time. Your coverage is designed to last as long as you continue to pay premiums.

3. Life insurance is surprisingly affordable for most people. Sure, there are forms of life insurance that get pricier the more features you add on to it, and the price goes up if you’re a smoker or dealing with health problems. But most people think life insurance costs about three times as much as it really does, according to the Insurance Barometer Study by Life Happens and LIMRA. Just as a general guide, a healthy nonsmoking 30-year-old man can get a $250,000 20-year level term policy for about $16 a month.

4. Key life events are often the best time to get on board. Getting married? Having kids? Changing jobs? Bought a house? Significant life events are often the time you become most aware of the need for life insurance—and on that note…

5. You can change your life insurance. Perhaps you have a life insurance policy that your parents got for you when you were a baby. Perhaps you have a term policy from when you bought your house but now you have a bigger family and you’re concerned about getting them all through college. Or perhaps you want to bump up your coverage because your overall cost of living has changed. And on *that* note …

6. You may well need more coverage than you think. Sometimes people think life insurance is to pay off their own debts and funeral expenses. But a key advantage of having life insurance is to ensure that the people who depend on you will be OK with their ongoing and future financial needs if something happens to you. Need help figuring this out how much? Go to this online calculator: www.lifehappens.org/howmuch.

7. Life insurance pays out quickly. Because life insurance doesn’t get tangled up in estate claims, it generally pays out quickly, sometimes in days or weeks, usually inside of a month.

8. Life insurance proceeds are generally tax-free. Compare this to, say, crowdfunding options like “GoFundMe” that have become so popular yet create tax consequences for the people they’re meant to help (to say nothing of fees and the lack of guaranteed benefit). It’s also helpful when you’re trying to create an inheritance for a beneficiary.

9. Life insurance protects your family, but only if you let it. Keep your premiums paid up and your beneficiaries up to date, and the door with your agent open so that your loved ones know who to call if they need to. Keep your paperwork with your other vital documents.

10. Life insurance can be more than just life insurance. Using “riders,” or an addendum to a life insurance contract, or even a specific kind of policy, life insurance benefits can become “living benefits,” money you can access before you die, or use to pay for long-term care, as two examples.

If you still need help getting a handle on all this, talk to an agent. They can help you understand the ins and outs and the best policy for your budget and needs. Because of course—the most important thing to know about life insurance is that it’s there to help the people you love the most.

SOURCE: Mosher, H. (29 June 2018) "10 things you didn’t know about life insurance" (Web Blog Post). Retrieved from https://www.lifehappens.org/blog/10-things-you-didnt-know-about-life-insurance/


Bringing personal services to work

Are you looking to incorporate onsite benefits in your employee benefits package? Read this blog post from SHRM to learn more about the different onsite benefits employers are offering.


Onsite employee benefits that go beyond big-ticket items like health clinics, gyms and child care centers are now within the reach of many employers.

When Cassandra Lammers, vice president of total rewards at Audible Inc., a publisher of audio books in Newark, N.J., wanted to encourage employees to schedule regular dental visits, she focused on the large percentage of the firm's employees who are part of the Millennial generation. These younger workers tended not to use their dental benefits, claims records showed.

To address the situation, Lammers began researching mobile dental services, looking for a vendor that would provide dental care onsite during the workday. That was not as easy as it sounded. "Most of these services are designed to help the elderly and the disabled who are not able to get to a dentist's office," she noted.

See also: 15 employee benefits on the rise

After many months of looking, Lammers connected with Henry the Dentist, a mobile dental office that parks its trailer at an employer's location for a few days to provide onsite dental services. The trailer offers state-of-the-art dental services and can serve three patients at a time.

The biggest selling points for Audible were the convenience for employees and the fact that all of the dentists were in-network providers for the company's dental plan, so audible does not have to pay for the service.

"We now schedule a few days each quarter to help employees get into a normal cycle for dental visits," Lammers said. The initial visit was scheduled to last only two or three days. However, employee demand for appointments was so great that the visit lasted six full days to serve 189 employees. Lammers expects to schedule five days per quarter going forward.

"The feedback from employees has been fantastic, and they love the convenience," she said.

Alexandria Ketcheson, marketing and brand director at Henry, said that under the company's current employment model "all our dentists are full-time employees of Henry," and that "a large part of our promise to our corporate clients is that their employees will see the same medical staff during every visit."

Fill'er Up

Onsite benefit programs should be designed to save employees time and to make their lives easier. Miami-based Carnival Cruise Line offers a range of onsite benefits to accomplish just that, including dry cleaning, a coffee shop and deliveries from a flower vendor every Friday so that employees can buy fresh flowers for the weekend.

"This is all part of our effort to be an employer of choice," said Tami Blanco, the company's vice president of shoreside human resources. "We focus on providing services that employees use or need regularly. Employees want to spend their time off with family, not running errands."

One of the more popular onsite benefits is access to Neighborhood Fuel, a service that comes to Carnival Cruise employees in South Florida and fills up their gas tanks in the parking lot while they are working.

See also: The Changing Landscape of Employee Benefits

By using a smartphone app, employees can request a fill-up, leaving the gas cap door ajar on their cars. Once the fuel truck completes the fill-up, the app sends an alert with the total cost of the gas.

So far, half of Carnival Cruise's Miami-based employees have signed up to use the service, and 75 percent of those employees say it is of great value to them, Blanco said.

Beware Upselling

When an employer offers any onsite benefit to employees, it comes with an implicit endorsement of the vendor's services, so it's important for employers to proceed with caution when choosing those vendors.

Carnival Cruise Line, for example, often offers new services to one group of employees as a pilot project to see if it is something the company wants to offer to all employees.

Before offering onsite dental care, Lammers not only read the reviews of the dental providers working for Henry the Dentist but also asked pointed questions about how the service ensures the safety of employees while they are walking to and from the mobile facility and while they are inside receiving treatment. "We also wanted to understand how they operate [and] how they interface with employees, ensure confidentiality, et cetera," said Lammers, who inspected the mobile dental facility personally.

See also: How millennials are shaping employee benefits

Once employees begin using any onsite service, employers should check in periodically to make sure employees are happy with the service and comfortable using it. For example, if employees feel a vendor is putting pressure on them to buy more or to upgrade, that's something an employer may want to address directly with the vendor so that employees don't feel pressured.

SOURCE: Sammer, J (5 July 2018) “Bringing personal services to work” (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/bringing-personal-services-to-work.aspx


15 employee benefits on the rise

Retirement plans and employer-sponsored health insurance are two vital employee benefits, but there are numerous others that are on the rise. Continue reading to learn more.


Employer-sponsored health insurance and retirement plans are always a vital part of the employee benefits conversation. But a number of other benefits — think wellness and perks that promote work-life balance — are becoming table stakes as employers look to attract and retain talent in a tightened labor market. Here are 15 of the employee benefits that are on the rise, according to the Society for Human Resource Management’s recently released annual benefits survey.

Health savings accounts

Health savings accounts continue to rise in popularity. The number of employers offering HSAs — which offer triple tax benefits for employees — rose just one percentage point from 2017 to 2018 (from 55% to 56%), but has increased by 11% in the last five years.

Paid parental leave

The availability of paid parental leave increased significantly between 2016 and 2018 for every type of parental leave, according to SHRM. Paid maternity leave increased from 26% in 2016 to 35% in 2018, and paid paternity increased from 21% to 29%. Meanwhile, adoption (20% to 28%), foster child (13% to 21%) and surrogacy (6% to 12%) leave also increased in the last two years.

A number of large employers have added or enhanced paid parental leave programs in the last year. Dollar GeneralTD Bank and Unum are among the companies that added parental leave benefits for employees, while IBMTIAA and Walmart are among those that expanded their programs.

Company-organized fitness competitions/challenges

The last year has seen a substantial uptick in employers targeting employee wellness through company-organized fitness competitions and challenges. The percentage of employers offering the perk increased from 28% in 2017 to 38% in 2018.

Standing desks

Standing desks are one of the fastest-growing employee benefits: The percentage of employers offering standing desks to workers increased from 20% in 2014 to 53% in 2018. In the last year alone, the benefit increased 8 percentage points.

Research indicates long hours of sitting are linked to obesity, diabetes, heart disease and cancer, so employers are looking for benefits to help combat the problem.

Critical illness insurance

One in four employers now offer critical illness insurance to their employees, according to SHRM. That’s an 8% increase from 2017 and a 10% increase from 2014. As healthcare costs continue to mount for both employers and employees, voluntary benefits offer workers some additional protections for financial emergencies at a low cost, benefit experts say.

Telecommuting

Flexible working benefits, such as telecommuting, flextime and compressed workweeks, encourage work-life balance and can result in higher productivity and more engaged employees, SHRM reports. That’s likely the reason that more than two-thirds (70%) of organizations offer some type of telecommuting, either on a full-time, part-time or ad-hoc basis, up from 62% last year and 59% in 2014.

CPR/first aid training

A growing number of employers are getting serious about safety: The prevalence of CPR/first aid training increased 7 percentage points (47% to 54%) in the past year.

Acupressure/acupuncture medical coverage

Nearly half of employers (47%) now provide acupressure/acupuncture medical coverage, according to SHRM. The benefit experienced significant growth over just the last year: 38% of employers offered the coverage in 2017.

Onsite stress management programs

A growing number of employees report they are stressed out — and the effects are showing at work. So employers are increasingly taking action. The number of employers offering workplace stress management programs is on the rise, with 12% of companies offering these programs. That’s up from 7% last year, and just 3% in 2014.

Lactation rooms

More employers are offering benefits that help new mothers adjust to getting back to work after having a baby. Nearly half (49%) of organizations now offer onsite lactation rooms, according to SHRM, up seven percentage points since 2017 and almost doubling since 2014 (28%).

Casual dress benefits

Dressing down is going up: More employers are embracing casual dress benefits, according to SHRM statistics. The most common practice is to allow employees to “dress down” one day per week, up six percentage points since 2014 (to 62%) and three percentage points since 2017. Half of employers say they allow casual dress every day, up six percentage points since 2017 and 18 percentage points since 2014. And about one-third (34%) of organizations offer the perk on a seasonal basis, up seven percentage points since 2017 and 15 percentage points since 2014.

Service anniversary awards

The percentage of employers offering service anniversary awards, the most common type of compensation benefit, rose by nine percentage points — to 63% — since 2017, SHRM reports.

Spot bonuses

Nearly half (48%) of employers told SHRM they offer employees spot bonuses/awards. That’s a 3% increase from 2017 and a 7% increase since 2014. A number of employers, including Comerica BankHostessLowe’s and McCormick, have announced bonuses for employees in the last six months as a result of financial savings from the GOP tax law.

Life insurance

Company-paid group life insurance is offered by 85% of organizations, and 80% of organizations offer supplemental life insurance for employees, a four-percentage-point increase from 2017, SHRM reports. A substantial increase was seen for life insurance for dependents with more than two-thirds of organizations (70%) offering this benefit in 2018, an increase of 13 percentage points since 2017 and 16 percentage points since 2014.

Paid time off to volunteer

An increasing number of employees are interested in volunteer opportunities — and employers are listening. SHRM reports that 24% of employers now offer employees paid time off to volunteer, up from 22% in 2017 and 16% in 2014.
SOURCE: Mayer, K (6 August 2018) "15 employee benefits on the rise" (Web Blog Post). Retrieved from https://www.benefitnews.com/slideshow/telecommuting-life-insurance-trending-employee-benefits

One sure-fire way to engage employees in voluntary benefits

Employers are trying to help employees by offering voluntary benefits. Continue reading to learn how to engage employees in voluntary benefits.


Whether your employees are 22 or 62, they need to plan for the unexpected. A sudden injury or illness can dramatically derail their financial well-being and retirement readiness. As the responsibility for healthcare costs shifts to employees, employers are taking steps to help their employees by offering voluntary benefits, like critical illness and accident insurance.

The hitch, however, is that many employees aren’t taking advantage of these benefits.

There are many reasons for this: Employees may not have much appetite for voluntary insurance benefits after choosing medical benefits. They may not understand what’s being offered or how it is relevant to their lives. Further, if they haven’t been close to someone who has dealt with a catastrophic health issue, they may not grasp how destabilizing that is and how voluntary benefits can help at a difficult time.

So how do employers keep employees from hitting the snooze button on voluntary insurance benefits, and wake them up to how these benefits can help with their overall financial wellbeing?

One way is to understand what employees might need given their life stage, family situation or other variables. To help employees sort this out, here are few scenarios of how voluntary benefits could help employees — with fictional people based on a combination of our experiences with customers.

Leaving nothing to chance

Scott tends to be a worrier. His friends joke that he’s a 45-year-old man in a 25-year-old body. He is in the “adulting” stage of life — getting settled in a career, figuring out his personal life, and living on a salary that’s just a few steps up from entry-level. Scott worries about what might happen if he gets sick or injured and can’t meet his portion of his high-deductible plan. He’s also open about the fact that he doesn’t want to move back in with his parents. Unlike most of his friends, he’s also thinking decades ahead and is already contributing to a 401(k).

Scott wants it all — financial protection now and for the future. Based on what he’s seen happen to friends and colleagues close to his age, he chose critical care and accident insurance coverage during benefits enrollment at work. These options will help cover unexpected costs if an unexpected covered event does happen, and the cost won’t take a big chunk out of his paycheck thanks to his employer’s group rate. What’s more, the benefit is tax-free if he ever needs to use it, and can help keep him independent, and out of his parents’ house.

For employers, these kinds of benefits can help mitigate employees’ financial stressors so they can focus on wellness and getting back to work if an unexpected health issue strikes.

Weekend warriors and thrill-seeking hobbies

Catherine is a marketing manager who is married with two children. She is 44 and in the “balancing” stage of life, between “adulting” and “planning.” Her main concern when looking at voluntary insurance benefits was her husband, who likes high-thrill, risky sports. While Catherine tends to shy away from motorcycles and extreme sports, she is a bit of a weekend warrior since it’s hard to find time to exercise during the week. Her kids are also active and perpetually on the go, whether playing sports or just running around with the neighborhood kids.

Once Catherine learned about voluntary benefits, it was a no-brainer to choose accident insurance for her entire family. While she hopes that her family will only have fun — and avoid injury — doing what they all enjoy, she knows they have to be prepared for anything.

Employers can help employees choose the right benefits by encouraging them to think about how they and their families spend their leisure time, including sports, hobbies, adventure travel or any other activities.

Taking account of a family history of cancer

Meet Justin. He’s 55, married, and has a daughter. He is at the “planning” stage of life — following “adulting” and “balancing.” While Justin is healthy, his family history of cancer is a concern when he considers his future. He’s seen family, friends and colleagues struggle with the costs of a serious illness. He also is acutely aware of saving enough for retirement as he has only 10-15 more years in the workplace, during which he can save.

For Justin, his life stage, family history of cancer and concern for his family’s physical and financial well-being led to his purchasing decisions. To help mitigate financial setbacks if he should become ill, Justin purchased critical illness insurance. He also purchased critical illness and accident coverage for his wife and daughter.

From an employer point of view, emphasizing that employees should consider their family and individual medical history — and how an adverse event could impact them and their families — is a compelling way to make voluntary benefits relevant.

Making it real for employees

Many employers want to help their employees choose the right benefits for their specific needs to protect their financial well-being now and for the future. Showing how needs change with age and lifestyle sheds more light on how voluntary insurance can provide benefits for covered events that will help mitigate financial losses and reduce stress.

Digital technology is making it easier than ever to engage employees across channels with easily digestible but important information. Employers can set up “decision tools” that help employees make choices, offer videos that bring different situations to life, develop app-based calculators, and tell stories about how voluntary benefits can help them and their families during an unexpected illness or injury.

Employees have a lot on their minds. The key to making voluntary benefits real is to show employees why they matter and how to choose the right products. What many employees don’t know is that employers are working hard behind the scenes to offer benefits tailored to their workforce. This is an opportunity for employers to personalize the experience and demonstrate to employees that they truly care.

Grubka, R. (27 June 2018) "One sure-fire way to engage employees in voluntary benefits" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/opinion/engaging-employees-in-voluntary-benefits?tag=00000151-16d0-def7-a1db-97f024870001


Everything benefits managers need to know about Generation Z

Say hello to Generation Z. Yes, they have some similarities to Millennials, but they have they own thoughts and attitudes when it comes to work and benefits. Read this blog post to learn more.


Just when you thought you had finally figured out the millennial generation, there’s another young cohort of professionals entering the workforce. Sure, they’ve got some similarities to tech-focused millennials, but they have plenty of their own attitudes and opinions about money, relationships and, of course, work and benefits. Meet Generation Z.

Generation Z was raised in a post-9/11 world, following the dot-com boom and bust and during the midst of the Great Recession. There’s no doubt that these world events have colored the way they think and the way they work. Generation Z is a large cohort of about 72.8 million people and about 25% of the population. It’s a generation that employers will need to understand to create meaningful relationships. Here’s what you need to know.

They’re true digital natives. Generation Z was born between the 1995 and 2010, which makes them the first truly digital native generation. By the time they were heading off to Kindergarten, the internet had reached mainstream popularity and Mark Zuckerberg had already launched Facebook across college campuses.

Like many of us, Generation Z is rarely without their phones. But unlike your older colleagues, Generation Z may be more connected than ever — documenting their days on Instagram Stories and Snapchat, and messaging friends by text and other messaging platforms.

However, they’re also a relatively private bunch. Rather than broadcasting their lives on Facebook (like their parents, aunts, uncles and grandparents), they favor networks that allow for privacy. Snapchat snaps disappear, as do Instagram Stories. Gen Z also gravitates toward apps like Whisper, an anonymous social network for sharing secrets.

Here’s the takeaway for HR pros: Rather than seeing this as a barrier to communication, look at it as an opportunity. Try using text message reminders for open enrollment deadlines or creating a Slack channel for benefits communication, in addition to email and paper updates.

They’re seeking financial security. Generation Z grew up during the Great Recession, during which they may have seen their parents lose their jobs or deal with serious financial hardships. Because of this, Generation Z is focused on financial stability.

Unfortunately, many Gen Zers may join your company drowning in student loan debt from college. Consider offering benefits that help them get out of debt and begin saving for the future. Student loan debt repayment benefits with platforms like SoFi or Gradifi provide appealing avenues to pay off debt faster. You can also promote tax-deferred savings programs such as a 401(k) or health savings accounts to minimize their tax liability and maximize savings opportunities. These benefits may also appeal to millennials struggling with student loan debt and the prospect of saving for retirement — all while they start families.

Financial wellness benefits are attractive to all of your employees — Gen Z included. Consider partnering with local banks or credit unions to provide other savings options and financial education. Make this education appealing to everyone by providing it in different formats — in-person for anyone to attend, as well as on-demand webinars or Skype meetings for those who appreciate a more interactive experience.

Gen Z wants to actively participate. Generation Z is the most connected generation yet; they’re used to Googling an answer before you can finish your question or chatting with their friends throughout each day.

This hyper-connectedness lends itself to more interactive workplace meetings. Keep your Gen Z employees engaged and garner feedback by incorporating polls into your meetings, or creating recordings and presenting to computers and smartphones using a platform like ZeetingsPresentain or Mentimeter.

Whereas millennials were known for their interest in collaborating with each other, Gen Z wants to own their work a little bit more and compete against colleagues. Use this to your advantage to introduce gamification into your programs. Platforms such as Kahoot cannot only help you create some fun competition, but it can improve information retention.

They have a surprising communication preference. We’ve established that Generation Z is a hyper-connected cohort. But research uncovered one surprise about this generation’s preference for feedback: they prefer to be in-person. Use this knowledge to mentor your managers who will deliver feedback, and use it to make your benefits more appealing, too. For example, a confidential advocacy program with phone, email and chat options can be a great source for Gen Zers who want more information on their benefits.

While not everyone in this age group will conform to these attitudes and feelings, it can be helpful to pull back the curtain and understand how this generation could be different from millennials, Gen Xers and baby boomers.


A Look at Drug Spending in the U.S.

Spending on prescription drugs in the U.S. is projected to overtake other sectors of healthcare in 2018. Continue reading this blog post to learn more.


This fact sheet was updated on April 26, 2018, to reflect newly published data.

Overview

Spending on prescription drugs in the United States is on the rise and is projected to outpace growth in other parts of the healthcare sector in 2018.1 Limited public data on how much various payers and supply chain intermediaries pay for prescription drugs, as well as a lack of consensus on a single metric for drug expenditures, presents methodological challenges in measuring drug spending.

See also: Specialty Drugs and Health Care Costs

Nevertheless, a number of public and private organizations have published drug spending estimates over the past several years, including the share of health spending attributed to drugs. Historical estimates and spending projections from the Department of Health and Human Services’ Assistant Secretary for Planning and Evaluation (ASPE), the Centers for Medicare & Medicaid Services’ (CMS’) National Health Expenditure Accounts (NHEA), the Altarum Institute, and IQVIA are explored in Figures 1 and 2.

Figure 1 illustrates estimates and projections of U.S. drug spending by source from 2010 to 2018. Each incorporates rebates and spending on drugs, excluding over-the-counter (OTC) products.

  • ASPE estimates total prescription drug spending, including retail and nonretail, using CMS NHEA, IQVIA, and Altarum Institute data.2
  • CMS’ NHEA data provide estimates of retail prescription drug spending, excluding nonretail.3
  • IQVIA estimates total manufacturer revenue (“net price spending”), accounting for rebates and other price concessions.IQVIA also breaks down manufacturer revenue for drugs sold in both retail and nonretail settings.

Figure 2 illustrates drug spending as a percentage of health expenditure. Each of these estimates incorporates rebates and spending in retail and nonretail settings excluding OTC products, unless noted below.

  • ASPE estimates total drug spending (retail and nonretail) as a percentage of personal health expenditures, a subset of national health expenditures.5
  • The Altarum Institute estimates total prescription drug spending (retail and nonretail) as a percentage of total national health expenditures.6
  • CMS NHEA estimates drug spending (excluding nonretail) as a percentage of total national health expenditures.7
  • IQVIA estimates net drug spending (retail and nonretail) as a percentage of health care spending, including OTC products that do not require a prescription.8

See also: How employers can manage the skyrocketing cost of specialty drugs

Organizations use different denominators to describe health care expenditures

  • National health expenditures: Total health expenditures, including medical spending and public health activities, administrative costs, and research investments (Altarum Institute and CMS).
  • Personal health expenditures: Spending exclusively on direct patient care (ASPE).
  • Healthcare spending: An estimate of health care spending from the World Health Organization (IQVIA).

What drug spending estimates include

  • Rebates: Drug price reductions intended to increase sales through formulary placement. While the method used to calculate the rebate is specified at the time of purchase, the actual rebate is received in the future, as it is based on product sales. Most rebates are paid to pharmacy benefit managers and health plans. Rebates are accounted for in all five estimates, but none of the organizations has access to the specifics of manufacturer agreements.9 IQVIA approximates rebates and other price concessions using publicly available wholesaler and pharmaceutical sales data, public financial filings, the Medicare trustees’ report, and proprietary audits. CMS NHEA adjusts estimated drug expenditures to account for rebates in retail and mail-order settings.10 Altarum Institute and ASPE apply CMS’ rebate adjustments to their drug expenditure estimates.
  • Payers: Entities other than patients responsible for paying health care costs. In the United States, payers generally include insurance companies, health plan sponsors—such as employers or unions—and pharmacy benefit managers. Medicare is the nation’s largest payer. CMS NHEA data include estimates of pharmaceutical expenditures by private health insurers and public health insurers such as Medicare and Medicaid. CMS NHEA data also incorporate the amount that premiums contribute to the cost of pharmaceuticals, though the data do not include the share of premiums that go toward pharmaceuticals. IQVIA does not directly incorporate patient premiums in its drug spending estimates. CMS NHEA data include nonretail prescription drug spending in overall health expenditures but do not separately report spending on nonretail drugs. Spending on drugs in these sites of care is included in overall health cost estimates for each respective setting (for example, drugs purchased by hospitals are reported as hospital spending). The Altarum Institute uses IQVIA data to estimate spending on nonretail prescription drugs. ASPE also publishes an estimate of pharmaceutical spending for both retail and nonretail outlets.
  • Over the counter: Drugs that do not require a prescription. Only the IQVIA estimate for net drug spending as a percentage of health care spending incorporates spending on OTC products.
  • Retail prescription drugs: Drugs sold in a retail setting, such as a pharmacy, drugstore, mail-order, or other mass-merchandising establishment.
  • Nonretail prescription drugs: Drugs dispensed in clinics and institutional settings such as hospitals, long-term care facilities, and nursing homes.

Endnotes

  1. Gigi A. Cuckler et al., “National Health Expenditure Projections, 2017–26: Despite Uncertainty, Fundamentals Primarily Drive Spending Growth,” Health Affairs 37, no. 3 (2018): 553–63, https://doi.org/10.1377/hlthaff.2016.1627; Centers for Medicare & Medicaid Services, “National Healthcare Expenditure Data,” accessed February 14, 2018, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData.
  2. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation, “Observations on Trends in Prescription Drug Spending” (2016), https://aspe.hhs.gov/pdf-report/observations-trends-prescription-drug-spending. ASPE figures rely on data from the NHEA and the Altarum Institute. ASPE expenditures are available from 2009 to 2013 and projections from 2014 to 2018. This was a one-time publication.
  3. Centers for Medicare & Medicaid Services, “National Healthcare Expenditure Data.” CMS data are sourced from Census Bureau retail data, Medicare and Medicaid claims, and IQVIA data. CMS expenditures are available from 1970 to 2016 and projections from 2017 to 2026. CMS publishes these data annually.
  4. IQVIA, “Medicines Use and Spending in the U.S.: A Review of 2017 and Outlook to 2022” (2018), https://www.iqvia.com/institute/reports/medicine-use-and-spending-in-the-us-review-of-2017-outlook-to-2022. IQVIA data are sourced from wholesaler and pharmaceutical company sales information. IQVIA publishes expenditures from 2013 to 2017 and projections from 2018 to 2022. It updates this publication annually.
  5. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation, “Observations on Trends in Prescription Drug Spending” (2016).
  6. Charles Roehrig, “A Ten Year Projection of the Prescription Drug Share of National Health Expenditures Including Non-Retail,” Altarum Institute (2017), https://altarum.org/sites/default/files/uploaded-publication-files/Non-Retail%20Rx%20Forecast%20Data%20Brief%20with%20Addendum%20May%202017.pdf.
  7. Centers for Medicare & Medicaid Services, “National Healthcare Expenditure Data,” accessed February 14, 2018, https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData.
  8. IQVIA, “Understanding the Dynamics of Drug Expenditure: Shares, Levels, Compositions and Drivers” (2017) https://www.iqvia.com/institute/reports/understanding-the-dynamics-of-drug-expenditure-shares-levels-compositions-and-drivers. IQVIA data are sourced from wholesaler and pharmaceutical company sales information and the World Health Organization’s Global Health Expenditure Database from December 2016. This one-time publication includes expenditures from 1995 to 2015.
  9. IQVIA accounts for but does not report drug supply and payment chain entity profit retentions (e.g., discounts, rebates, chargebacks and other financial transactions among manufacturers, pharmacy benefit managers, pharmacies, and wholesalers).
  10. Centers for Medicare & Medicaid Services, “National Health Expenditure Accounts: Methodology Paper, 2015,” https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/DSM-15.pdf.

SOURCE: PEW (27 February 2018) "A look at drug spending in the U.S." (Web Blog Post). Retrieved from http://www.pewtrusts.org/en/research-and-analysis/fact-sheets/2018/02/a-look-at-drug-spending-in-the-us


Who are Benefits for, Anyway?

Why do employees turn down benefits offered to them by their employers? Continue reading to find out why and how employers can educate them about the benefits that are offered.


With many Americans living paycheck-to-paycheck, U.S. employees have a significant need for financial protection products to secure their income and guard against unplanned medical expenses. However, employees frequently decline these benefits when they are offered at the workplace. Only two-thirds of employees purchase life insurance coverage at work when given the option, while roughly half enroll in disability coverage and less than one-third select critical illness insurance coverage. Why do so many employees choose not to enroll in benefits?

Is this right for me?

Some employees may opt out of nonmedical benefits because they do not believe these offerings are intended for people like them. In a recent report, “Don’t Look Down: Employees’ Understanding of Benefits and Risk,” LIMRA asked employees whether they thought life, disability, and critical illness products were “right for someone like me.”

While a majority of employees feels that life insurance coverage is appropriate for someone like them, they are on the fence about other coverages. Fewer than half believe they need disability insurance and only 36 percent feel they need a critical illness policy.

It is also noteworthy that a large portion of employees respond neutrally or only slightly agree or disagree with these sentiments, which suggests a lot of uncertainty. Given employees’ poor understanding of these benefits, many simply do not know if the coverage is intended for them.

Role of behavioral economics

Behavioral economics reveals that human behavior is highly influenced by social norms, particularly among groups that people perceive to be similar to themselves. In light of this, LIMRA asked employees if they think most people like them own certain insurance products. Their responses indicate that employees feel very little social pressure to enroll in these benefits.

Only 22 percent of employees think most people like them are covered by critical illness insurance, while 47 percent disagree. Similarly, 38 percent disagree that most people like them have disability coverage (versus only 34 percent who agree). Life insurance is the only product where a majority of employees (60 percent) think most others like them have the coverage.

Employees who believe others like them purchase benefits will tend to be influenced by this peer behavior. This could lead them to take a closer look at the information provided about these benefits and possibly enroll.

However, for the larger group of employees who think others like them do not have coverage, social pressure will discourage them from enrolling. These employees will perceive not having coverage to be the “norm” and assume it is safe to opt out, without giving these benefits proper consideration.

Who should purchase benefits?

If employees do not think insurance benefits are right for them, who do they believe these products are intended for?

Of employees who are offered disability insurance at work, only 38 percent recognize that anyone with a job who relies on their income should purchase this coverage. Troublingly, more than 1 in 5 think disability insurance is only for people with specific risk factors, such as having a physical or dangerous job, a family history of cancer, or a current disability.

Similarly, less than half of employees recognize that critical illness insurance is right for anyone. One in five think this coverage is only for people with a family history of cancer or other serious illness, while 15 percent believe the coverage is for people who have personally been diagnosed with a serious health condition.

Employees have a better understanding of life insurance. Eighty percent of employees recognize that life insurance is appropriate for anyone who wants to leave money to their spouse or dependents upon their death. However, some employees still express uncertainly about this or believe life insurance is only for high-risk individuals.

Confusion about who should purchase insurance benefits is contributing to low employee participation in these offerings. To counteract this trend, educating employees to understand how these products apply to their own lives is crucial. By clearly explaining what the products do and providing examples of how anyone could use them, benefit providers can help employees see the relevance of these offerings and help them make more informed financial decisions.

SOURCE:
Laundry, K (12 July 2018). "Who are benefits for, anyway?" [Web Blog Post]. Retrieved from https://www.benefitspro.com/2018/07/12/who-are-benefits-for-anyway/