Health prices to outpace inflation for first time since 2010

Since 2010, our health prices have stayed in pace or below inflation. For the first time since then, they're expected be much, much more. Get the details in this article from Employee Benefit Advisor.

The growth in U.S. healthcare prices is projected to outpace economy-wide inflation for the first time since 2010, the second report in a week to signal the end of a long stretch of restrained medical increases.

This year, price increases for personal health expenditures are projected to rise 2.2%, compared with 1.9% for overall inflation, according to a report released Wednesday by the Centers for Medicare and Medicaid Services. The findings confirmed a recent analysis warning that the U.S. could be at the cusp of a return to higher medical inflation.

Health spending is determined by the price of goods and services, as well as how much health care people use. In recent years, increases in health spending have been driven by volume, as millions more people gained insurance coverage under the Affordable Care Act. While high-cost drugs have made headlines, overall price hikes have been historically low, increasing by an average of 1.1% annually between 2014 and 2016.

Those trends are projected to reverse. Government actuaries expect the number of people without health insurance to increase slightly after Republicans lifted the ACA’s penalty for going uninsured late last year. Medical price growth, meanwhile, will rebound, “in part reflecting more rapid growth in healthcare workers’ wages,” the report said.


Healthcare inflation has been partly restrained by limits on how much Medicare pays hospitals and physicians under the ACA and other legislation, combined with overall slow growth in prices throughout the economy.

In recent days, concerns about higher-than-expected inflation have rattled stock markets and pushed up Treasury yields. Investors feared that a tightening labor market and rising wages could push up prices and spur the Federal Reserve to raise interest rates faster than anticipated to keep the economy from overheating.

Total health spending is projected to increase by 5.3% to about $3.7 trillion in 2018, according to the CMS report, and the growth will average 5.5% per year over the next decade. While that’s still faster than the overall rate of economic growth, it’s an improvement from past decades. Between 1990 and 2007, annual health spending increased by 7.3% per year.

Read the original article here.

Bloomberg News (20 February 2018). "Health prices to outpace inflation for first time since 2010" [Web Blog Post].Retrieved from address

Trump proposes bigger role for skimpy insurance, undermining ACA

Are you an advocate of short-term insurance plans? Get some of the pros and cons in this article from Employee Benefit Advisor on the Trump administration.

The Trump administration is proposing to expand the availability of short-term insurance plans, offering a cheaper health coverage option for consumers, while taking another step to undercut Obamacare.

The Department of Health and Human Services proposed allowing short-term plans to be sold for coverage periods of up to a year, up from the current maximum of three months set by the Obama administration. The plans would also be allowed to offer far less comprehensive coverage than plans sold under the Affordable Care Act.

The short-term plans are likely to appeal to healthier individuals who don’t think they need full coverage, potentially drawing them out of Obamacare’s markets. Combined with earlier moves by the Trump administration -- such as ending the ACA requirement that all people buy health coverage or pay a fine -- the latest proposals could result in higher costs or fewer options for individuals who still want to buy the more comprehensive Obamacare plans.

The Administration said its goal is to give people more insurance options at a time when premiums have been rising.


“It’s one step in the direction of providing Americans with health insurance options that are both more affordable and more suited to individual and family circumstances,” HHS Secretary Alex Azar said on a conference call with reporters. “We need to be opening up more affordable alternatives to the all too often unaffordable Affordable Care Act health insurance policies.”

‘Young or Healthy’

The administration, in the proposed rule announced Tuesday, said the short-term plans may lack some Obamacare protections such as required coverage of pre-existing conditions, and coverage for a broad array of services such as maternity care, hospital stays and prescription drugs. But it anticipates that most of the individuals who switch to the plans will be “relatively young or healthy.”

The proposed rule builds on an executive order the president issued last year. The health insurance industry has been divided on the plans, with some insurers already offering them, while others worry they could undermine the ACA’s individual market.

UnitedHealth Group Inc., the biggest U.S. health insurer, already offers short-term coverage, and has said it would explore expanding offerings. Two major industry lobby groups, America’s Health Insurance plans and the Blue Cross Blue Shield Association, have warned that the short-term plans could harm state insurance markets.

Read the original article.

Bloomberg News (20 February 2018). "Trump proposes bigger role for skimpy insurance, undermining ACA" [Web Blog Post]. Retrieved from address


Medicare Beneficiaries’ Out-of-Pocket Health Care Spending as a Share of Income Now and Projections for the Future

In this report from Kaiser Family Foundation, we are going to take a look at the past and current out-of-pocket health care expenses in relation to Medicare.

Medicare helps pay for the health care needs of 59 million people, including adults ages 65 and over and younger adults with permanent disabilities. Even so, many people on Medicare incur relatively high out-of-pocket costs for their health care, including premiums, deductibles, cost sharing for Medicare-covered services, as well as spending on services not covered by Medicare, such as long-term services and supports and dental care. The financial burden of health care can be especially large for some beneficiaries, particularly those with modest incomes and significant medical needs. Understanding the magnitude of beneficiaries’ current spending burden, and the extent to which it can be expected to grow over time, relative to income, provides useful context for assessing the implications of potential changes to Medicare or Medicaid that could shift additional costs onto older adults and younger people with Medicare.

In this report, we assess the current and projected out-of-pocket health care spending burden among Medicare beneficiaries using two approaches. First, we analyze average total per capita out-of-pocket health care spending as a share of average per capita Social Security income, building upon the analysis conducted annually by the Medicare Trustees. Second, we estimate the median ratio of total per capita out-of-pocket spending to per capita total income, an approach that addresses the distortion of average estimates by outlier values for spending and income. Under both approaches, we use a broad measure of Medicare beneficiaries’ total out-of-pocket spending that includes spending on health insurance premiums, cost sharing for Medicare-covered services, and costs for services not covered by Medicare, such as dental and long-term care. We present estimates of the out-of-pocket spending burden for Medicare beneficiaries overall, and by demographic, socioeconomic, and health status measures, for 2013 and projections for 2030, in constant 2016 dollars.


  • In 2013, Medicare beneficiaries’ average out-of-pocket health care spending was 41 percent of average per capita Social Security income; the share increased with age and was higher for women than men, especially among people ages 85 and over.
  • Medicare beneficiaries’ average out-of-pocket health care spending is projected to rise as a share of average per capita Social Security income, from 41 percent in 2013 to 50 percent in 2030 (Figure 1).

Figure 1: Medicare beneficiaries’ average out-of-pocket health care spending as a share of average per capita Social Security income is projected to rise from 41% in 2013 to 50% in 2030

  • Half of beneficiaries in traditional Medicare spent at least 14 percent of their per capita total income on out-of-pocket health care costs in 2013. The spending burden was higher for people ages 85 and over, in poor health, and with modest incomes.
  • More than one-third (36 percent) of beneficiaries in traditional Medicare, and half of those with incomes below $20,000, spent at least 20 percent of their per capita total income on out-of-pocket health care costs in 2013. By 2030, more than 4 in 10 (42 percent) traditional Medicare beneficiaries are projected to spend at least 20 percent of their total income on health-related out-of-pocket costs.

Read the full report.

Cubanski J., Neuman T. (26 January 2018). "Medicare Beneficiaries’ Out-of-Pocket Health Care Spending as a Share of Income Now and Projections for the Future" [Web Blog Post]. Retrieved from address

National ACA Marketplace Signups Dipped a Modest 3.7 Percent This Year

In this article from Kaiser Family Foundation, we are going to take a brief look at the ACA sign-ups this year.

Overall ACA marketplace signups for 2018 dropped by 3.7 percent compared to last year’s enrollment period, a new analysis from the Kaiser Family Foundation finds.

11,760,533 people signed up for 2018 health insurance coverage on the ACA individual marketplaces, amid steep reductions in federal funding for outreach and navigators, an enrollment period half as long, and a climate of political uncertainty surrounding the law. The federal government also terminated cost-sharing subsidy payments to insurers in advance of the open enrollment period, leading to increases in premiums but also increased premium subsidies for many consumers that in some cases led to reductions in what they had to pay for coverage.

As a group, the 15 states plus the District of Columbia with state-based marketplaces, including those using the enrollment platform, exceeded last year’s totals this year by .2 percent, while the 34 states that relied on the federal marketplace saw total signups drop by about 5.3 percent. State-based marketplaces control their own funding for outreach and consumer assistance.

Fifteen states and the District of Columbia exceeded 2017 signups in 2018 – eight of these were state-based marketplaces, three were state-based marketplaces using the enrollment platform (KY, NV, and OR), and five were federal marketplaces.

Rhode Island (12.1%), Kentucky (10.4%), and Washington State (7.6%) saw the largest share increases in signups, while Louisiana (-23.5%), West Virginia (-19.5%), and Arizona (-15.6%) had the largest drop in shares of signups.

Read the original article here.

Kaiser Family Foundation (7 February 2018). "National ACA Marketplace Signups Dipped a Modest 3.7 Percent This Year" [Web Blog Post]. Retrieved from address

A Check Up on U.S. Global Health Policy, After One Year of the Trump Administration

From Kaiser Family Foundation, let's take a look at this informative article that reviews healthcare since the beginning of the Trump Presidency.

This month marks one year since Donald Trump became the 45th President of the United States after winning the election on a populist, “America-First”, platform. Since then, there have been many questions raised about what a Trump Presidency would mean for U.S. global health policy in light of statements on scaling back foreign aid and a skepticism of the value of multilateral institutions and key international agreements. Historically, global health has enjoyed bipartisan support and been highlighted as a major area of success for the United States. Funding for global health rose significantly in the last decade and, although it has leveled off, it still represents the largest component of U.S. foreign assistance (an estimated 24% in FY 2017).

In this brief, we take stock of the U.S. global health response on the occasion of one year of the Trump Presidency and look ahead to the global health policy issues that are likely to be front and center in the coming months and years. Overall, there are a mix of challenges facing the U.S. global health response, some of which pre-dated Trump and others that are the result of decisions and actions of the administration, including proposals to significantly scale back funding. At the same time, global health programs still enjoy strong bipartisan support in Congress and, according to our just-released poll, about half of the public still wants the U.S. to play a major or leading role in improving health in developing countries (see Figure 1 and Appendix).

Figure 1: Half of the Public Sees Leading or Major Role for the U.S. in Improving Health in Developing Countries



In keeping with the “America First” campaign and promises to re-examine the U.S. role in world affairs, the Trump Administration has made a number of notable changes in broader U.S. foreign policy that affect global health. These include the administration’s decision to withdraw from the Paris Climate Accord, its criticism of and new demands for U.S. engagement in the context of international trade agreements such as the Trans-Pacific Partnership (TPP) and North American Free Trade Agreement (NAFTA), and skepticism of, and intent to reduce U.S. support for the United Nations and potentially other multilateral organizations. More recently, the administration has proposed to cut foreign aid to countries that voted counter to U.S. government wishes at the UN.  While this threat is not without precedent, it is a departure from U.S. policy over the prior two decades, and underscores the administration’s theme of emphasizing U.S. interests over other considerations.

The Trump Administration has also sought to make its mark on the agencies that carry out U.S. foreign policy, including the State Department and the U.S. Agency for International Development (USAID). Following a March 2017 White House Executive Order on reorganizing the executive branch, Secretary of State Rex Tillerson has attempted to re-organize and reform these agencies. One potential move that was feared by many was the idea of “merging” USAID and the State Department – the two currently exist as quasi-independent – but to date there is no evidence of such a change being actively pursued. At the same time, budget requests from the White House have demonstrated the administration’s desire to make significant cuts to these agencies’ budgets, and their day-to-day management has been criticized by current and former employees. In addition, there has been decidedly slow progress in nominating and appointing staff for key foreign policy leadership posts, along with a notable exodus of experienced staff over the last year. For example, as of this writing, President Trump had nominated far fewer candidates at the State Department (89) compared to Presidents Obama (137) and George W Bush (153) at the same point in their first terms.

And, whereas human rights has been a component of U.S. foreign policy that the Obama Administration sought to elevate in its foreign policy (even including it prominently in its national security strategy), Trump Administration officials have downplayed the importance of human rights, leading to worries in the foreign policy and development community, and letters of concern from members of Congress.


A lack of ambassadors in some countries, needed staff appointments in some positions, a shifting stance on human rights, and a shrinking foreign policy workforce have concerning implications for planning and carrying out U.S. global health programs. Such difficulties for global health have been compounded by certain policy decisions, including proposals to significantly cut U.S. global health funding (see Figure 2).

Figure 2: U.S. Global Health Funding, FY 2004-FY 2018 Request

The most concrete global health policy change of the administration to date came on the first Monday of President Trump’s term, in the form of a re-instatement and expansion of the Mexico City Policy. The Policy, which was in effect and applied to family planning assistance in previous Republican administrations, was not only re-instated but also expanded to encompass almost all global health assistance, increasing the number of organizations and the amount of funding affected by the policy. We found the expanded policy applies to more than $7 billion in funding and likely affects more than one thousand foreign NGOs. In addition, on March 30 the administration invoked the “Kemp-Kasten amendment” to withhold funding for the United Nations Population Fund (UNFPA), the lead U.N. agency focused on global population and reproductive health, as has been done in previous Republican administrations.

The administration’s request to significantly cut global health funding is unprecedented. For FY2018 the White House proposed cuts of over $2B to global health, representing a 23% overall reduction compared to FY2017; these included a proposed reduction to PEPFAR of more than $1 billion and a zeroing out of the family planning budget, among others. Multiple analyses of the potential impacts of such cuts conclude that serious negative health consequences would result, including many more infections and deaths from HIV and TB, and an increase in the number of abortions along with greater maternal mortality. None of these requested cuts have been enacted but this is the first time cuts of this magnitude have been proposed, and they mark a significant shift from the direction and emphasis of prior administrations.

Even as they have implemented more restrictive policies and proposed cuts, Trump Administration officials have publicly stated support for select U.S. global health priorities. In his first major speech to the United Nations in September, for example, President Trump highlighted three major U.S. global health areas of success: PEPFAR, the President’s Malaria Initiative, and the Global Health Security Agenda (GHSA).  Secretary of State Tillerson has also spoken about the importance of PEPFAR and the GHSA; the U.S. has signaled its intention to remain engaged in the larger GHSA effort, and has even highlighted the importance of global health security in the newly revised U.S. National Security Strategy, and is expected to do the same in a forthcoming national biodefense strategy. Despite the foreign policy vacancies noted above, some global health and development leaders have remained in their roles since the Obama Administration, including the U.S. Global AIDS Coordinator and the Director of the National Institutes of Health, while other key positions have been filled by President Trump, including the new USAID Administrator who has a strong record in global health, the Director of the Centers for Disease Control and Prevention, and leadership on global health within the White House National Security Council.


Congress has also continued to play a significant role in global health, including bipartisan and bicameral push back against proposed funding cuts.  Funding for global health was kept at FY 2017 levels and, while not yet final, will likely be level in FY2018 as well. Moreover, Congress has asserted its role in directing global health efforts by including, for the first time, language in the FY 2017 budget legislation that prevents the administration from changing global health program funding levels. Congress also included language requiring a report before any reorganization of State and USAID could occur. Many stakeholders, including current and former U.S officials, the faith community, and members of the military, have also pushed back on the administration’s proposed cuts to global health and development.


Our latest (January 2018) tracking poll assessed public support for U.S. engagement in global health in the Trump era. The public perceives the Trump Administration as less supportive of global health, with half (53%) saying the Trump Administration has made global health a lower priority than previous administrations.

As mentioned above, about half of the public (54%) say they want the U.S. to play a leading or major role in improving health for people in developing countries. Support for such engagement is strongest among Democrats (73%), who also are more likely to support the U.S. playing “a leading role” (20%), and lower among independents (47%) and Republicans (49%), see Figure 3; Trump supporters are not interested in the U.S. playing a leading role (just 4% say they believe this). However, overall support fell slightly from 2016, when 61% said they think the U.S. should take a leading or major role.

Figure 3: Support for U.S. Role in Improving Health in Developing Countries by Party Identification

Most of the public (59%) believe the U.S. is spending the right amount or not enough on global health programs, but one-third (33%) believe the U.S. is spending too much – a significant jump from the 18% saying we were spending too much in 2016.

For overall global engagement, the poll numbers indicate a greater proportion of the U.S. public (69%) now believes the U.S. should take at least a major role in solving the world’s problems than in 2016 (57%).  The share of Republicans agreeing with this statement grew from 20% in 2016 to 31% in 2018. However, confusion about the amount spent on U.S. foreign aid persists, with half (49%) saying too much is spent in this area but when presented with the actual amount – about 1% of the federal budget goes to foreign aid – people are much less likely (29%) to view that as too much spending (as found in previous polls). See Appendix and poll results for more detailed information.


The push and pull in global health policy will likely continue in 2018 and potentially intensify. On the one hand, actions taken by the administration signal a reduced U.S. engagement in the world and intention to step back further in global health. On the other, U.S. global health programs have so far demonstrated resilience, buoyed by strong support from Congress and key stakeholders.

The tension will likely be tested again in the near term with the soon-to-be released FY 19 White House budget request, which many expect to propose at least the same level of deep cuts to global health. Negotiations will take place within the broader context of greater budget pressures and concerns about the deficit, particularly in wake of recently enacted tax legislation that could tighten discretionary spending, including for foreign assistance, even more.

Beyond that, there will be a number of other issues to watch, including:

  • Mexico City Policy: The expanded Mexico City Policy, which has only begun to be implemented, will likely be felt in a much more pronounced way in these next months and years including potential gaps in services in the field;
  • PEPFAR: The administration, Congress, and other stakeholders are beginning to assess whether they want to move forward to reauthorize PEPFAR – the program’s current authorization expires at the end of FY 2018 (though the program will not end and a new reauthorization is not needed to keep it funded). In addition, PEPFAR’s recently launched new strategy, which aims to focus most efforts on 13 priority countries, raises questions about the larger U.S. global AIDS response in the context of potential budget decreases;
  • Global Health Security Agenda: Key decisions about the next phase of the GHSA, including what to do regarding an impending fiscal cliff as supplemental Ebola funds expire in FY2019, will soon be coming down the pike and the U.S., as a founding and leading member of the partnership, will figure prominently in its future direction; and
  • Replenishment: Two major global health multilateral partners of the U.S. – the Global Fund and GAVI – will soon begin processes for launching their next replenishment conferences, marking an important moment for gauging future U.S. support.

The key question going forward, then, may very well be which vision of global health will end up holding sway in the political back-and-forth in Washington – that of the White House or Congress?  Ultimately, the winners, or losers, of this “battle” will be the people that benefit from U.S. investments around the world.

Kates J., Michaud J., Kirzinger A., Munana C. (29 January 2018). "A Check Up on U.S. Global Health Policy, After One Year of the Trump Administration" [Web Blog Post]. Retrieved from address

Algorithmic Bias – What is the Role of HR?

How should HR professionals deal with the forthcoming algorithmic bias issue? Find out in this article.

Merriam-Webster defines ‘algorithm’ as step-by-step procedure for solving a problem…In an analog world, ask anyone to jot down a step-by-step procedure to solve a problem – and it will be subject to bias, perspective, tacit knowledge, and a diverse viewpoint. Computer algorithms, coded by humans, will obviously contain similar biases.

The challenge before us is that with Moore’s Law, cloud computing, big data, and machine learning, these algorithms are evolving, increasing in complexity, and these algorithmic biases are more difficult to detect – “the idea that artificially intelligent software…often turns out to perpetuate social bias.”

Algorithmic bias is shaping up to be a major societal issue at a critical moment in the evolution of machine learning and AI. If the bias lurking inside the algorithms that make ever-more-important decisions goes unrecognized and unchecked, it could have serious negative consequences, especially for poorer communities and minorities.”What is the role of HR in reviewing these rules? What is the role of HR in reviewing algorithms and code? What questions to ask?

In December 2017, New York City passed a bill to address algorithmic discrimination.Some interesting text of the bill, “a procedure for addressing instances in which a person is harmed by an agency automated decision system if any such system is found to disproportionately impact persons;” and “making information publicly available that, for each agency automated decision system, will allow the public to meaningfully assess how such system functions and is used by the city, including making technical information about such system publicly available where appropriate;”

Big data, AI, and machine learning will put a new forward thinking ethical burden on the creators of this technology, and on the HR professionals that support them. Other examples include Google Photos incorrect labeling or Nikon’s facial detection. While none of these are intentional or malicious, they can be offensive, and the ethical standards need to be vetted and reviewed. This is a new area for HR professionals, and it’s not easy.

As Nicholas Diakopoulos suggests, “We’re now operating in a world where automated algorithms make impactful decisions that can and do amplify the power of business and government. As algorithms come to regulate society and perhaps even implement law directly, we should proceed with caution and think carefully about how we choose to regulate them back.”

The ethical landscape for HR professionals is changing rapidly.

Read more.


Smith R. (15 February 2018). "Algorithmic Bias – What is the Role of HR?" [Web Blog Post]. Retrieved from address

A New Approach to Paid Leave: WorkFlex in the 21st Century Act

From SHRM, let's take a look a this innovative approach toward paid leave using WorkFlex.

Do you ever sit in your office and wonder about everyone else? Ponder whether anyone is dealing with the same things that you are in that very moment? The simple fact is that everyone independent of age, gender, race or title, wants to be there to support their family. For myself, that means advocating for clients, while caring for my mother and doing all that I can for my wife and two boys. It is quite a balancing act on the best of days. To be fair, I know that I am not alone in this balancing act. As I write this I am wondering if you know exactly what I mean. Perhaps not for yourself, but a colleague or a friend.

Now since we generally live, work or both in New Jersey and in particular within the Delaware Valley there are some things that impact our ability to balance. For example, if you work for an organization that has offices in Philadelphia, PA; Wilmington, DE; Trenton, NJ; Montclair, NJ and Haddonfield, NJ exactly how do you provide equal paid leave to employees? Why should you care? Because these specific locations differ in how they require paid leave to be provided to employees. Are you concerned about this? You are not alone, clients regularly ask what to do as it relates to dealing with paid leave. Often this is more challenging for us than in most places around the country due to the varying ways that towns as opposed to States or the Commonwealth deal with this issue.

Some time ago I was asked to assist SHRM with the creation of federal legislation to address the issue of varying applications of paid leave laws around the country.  After a significant amount of discussions, revisions and hard work by a host of individuals we came up with a legitimate proposal to address our respective concerns.  Recently the “Workflex in the 21st Century Act” (HR 4219) was introduced in the House by Representative Mimi Walters. This bill is designed to support the goals of everyone, not just employers or employees. You can read more about the specifics at:

For now, allow me to give you three specific reasons (although there are more) that both you and your organization should support this legislation:

First, unlike federal mandates under the FMLA, FLSA, or ADA, this legislation is OPT-IN, which means as an employer in order for your organization to be held responsible under the bill it would have to decide to agree to it first. Put another way, an employer is not required to do it if it chooses to go in another direction.

Second, many federal employment laws bring with them a threshold beyond which every employer is held to the same standard, however that is not the case with the “Workflex in the 21st Century Act.”  It is designed to grow with your organization. As a result the benefit thresholds change based on the number of employees in an organization, so that it supports growth rather than stifling expansion.

Third, contrary to the way things are currently going in our region, this bill provides a level of certainty and flexibility for both employers and employees alike to know the threshold of their leave benefits, which will result in more productive employees and organizations. Part of the reason for this certainty is that the various local leave laws would be preempted by this bill.

What does all this mean? I would suggest that this bill is a good compromise of interests across the spectrum of both employers and employees, as well as unions, who want to do the right thing. Allow for realistic time to care for a child, parent or for yourself. No one needs to change jobs to get a specific type of benefit and employers can choose if it makes sense for their workplace, rather than being dictated to in terms of the benefits to provide their employees.

Now I would like to challenge you to join me. This is the first piece of legislation that SHRM has created for the workplace and as you can see the goal is to address concerns that all workers have, independent of title, so we can all have the balance that we need and want in order to be better contributors in our respective organizations, supportive of our parents, children and ourselves. How can we achieve this together? We can all reach out to our federal legislators and let them know that you support the “Workflex in the 21st Century Act” (HR 4219). You can find more information on or on the SHRM Advocacy App. Let’s take this opportunity to make the workplace better for everyone, together.

Read more.


Lessig L. (February 8th, 2018). "A New Approach to Paid Leave: WorkFlex in the 21st Century Act" [Web Blog Post]. Retrieved from address

4 trends in financial education

Having financial wellness within your business is incredibly valuable for its overall growth and success. In this article, we are going to take a look at four trends contributing towards financial wellness in the employee benefits realm. Read more below.

Employees’ financial well-being is a hot topic these days. Right now, it’s top-of-mind with most employees. And it’s becoming more so with employers, not only because they are realizing the effect employee financial stress has on their bottom line, but also because industry surveys are revealing that employees want their employers to help by providing financial education and benefits.

Benefit advisers have a definite role in helping employers take steps toward building a more financially-secure workforce through financial wellness benefits. What should advisers expect to see this year in financial wellness benefits?

Industry research confirms the impact employee financial stress has on a company’s bottom line, including lower productivity, higher absenteeism and more healthcare claims. Only about half of employers offered some kind of counseling or instruction about money last year, according to SHRM and IFEBP surveys. Certainly, more employers will want to add financial education benefits this year. Benefit advisers can help by bringing this to the attention of their clients.

Another trend to consider is that financial education benefits are becoming more holistic. Financial education benefits should be more than planning for retirement and having access to supplemental medical benefits. Financial education benefits today should include financial education tools and resources as well as voluntary benefits that are designed to address both physical and emotional struggles while working to help employees with short-term financial needs.

Look for more student loan repayment benefits to become available in the industry this year. In 2017, more Americans were burdened by student loan debt than ever before. It’s a major concern among today’s millennials, the largest generation in today’s workforce. This year we likely will see more student loan repayment benefits appear, including programs in which employers are making contributions to loan balances or providing methods for employees to refinance their debt.

Increased attention to helping employees with short-term financial issues also will be a focus this year. In spite of the improved economy, employees are still struggling financially. Statistics show the alarming number of employees that continue to live paycheck-to-paycheck and do not have even $1,000 in savings for emergency needs.

While financial education benefits can help employees with budgeting and debt reduction needs, employers should offer additional voluntary benefits that provide employees some financial assistance in the short-term. Benefit advisers should bring short-term financial assistance voluntary benefits to the attention of their clients. Among these are employee purchase programs and low interest installment loans and credit that help employees avoid payday loans and cash advances from credit cards when they have emergency needs such as a broken refrigerator or unexpected out-of-pocket medical expenses.

Employers are realizing the important role that financial education plays in an employee’s overall well-being and will look to increase their financial wellness benefits on several levels. Benefit advisers not only can bring the need to the attention of their clients, but can also offer benefit recommendations to round out their clients’ employee benefits programs.

Read the original article.

Halkos E. (February 9th, 2018). "4 trends in financial education" [Web Blog Post]. Retrieved from address

Understanding the Intersection of Medicaid and Work

Sometimes, healthcare is confusing. We know this, which is why today we are focusing on Medicaid and work. Check out the snippet below, and check out the link for the full article.

Medicaid is the nation’s public health insurance program for people with low incomes. Overall, the Medicaid program covers one in five Americans, including many with complex and costly needs for care. Historically, nonelderly adults without disabilities accounted for a small share of Medicaid enrollees; however, the Affordable Care Act (ACA) expanded coverage to nonelderly adults with income up to 138% FPL, or $16,642 per year for an individual in 2017. As of December 2017, 32 states have implemented the ACA Medicaid expansion.1 By design, the expansion extended coverage to the working poor (both parents and childless adults), most of whom do not otherwise have access to affordable coverage. While many have gained coverage under the expansion, the majority of Medicaid enrollees are still the “traditional” populations of children, people with disabilities, and the elderly.

Some states and the Trump administration have stated that the ACA Medicaid expansion targets “able-bodied” adults and seek to make Medicaid eligibility contingent on work. Under current law, states cannot impose a work requirement as a condition of Medicaid eligibility, but some states are seeking waiver authority to do so.  These types of waiver requests were denied by the Obama administration, but the Trump administration has indicated a willingness to approve such waivers. This issue brief provides data on the work status of the nearly 25 million non-elderly adults without SSI enrolled in Medicaid (referred to as “Medicaid adults” throughout this brief) to understand the potential implications of work requirement proposals in Medicaid.  Key takeaways include the following:

  • Among Medicaid adults (including parents and childless adults — the group targeted by the Medicaid expansion), nearly 8 in 10 live in working families, and a majority are working themselves. Nearly half of working Medicaid enrollees are employed by small firms, and many work in industries with low employer-sponsored insurance offer rates.
  • Among the adult Medicaid enrollees who were not working, most report major impediments to their ability to work including illness or disability or care-giving responsibilities.
  • While proponents of work requirements say such provisions aim to promote work for those who are not working, these policies could have negative implications on many who are working or exempt from the requirements. For example, coverage for working or exempt enrollees may be at risk if enrollees face administrative obstacles in verifying their work status or documenting an exemption.

Get the full report and findings.

Kaiser Family Foundation (5 January 2018). "Understanding the Intersection of Medicaid and Work" [Web Blog Post]. Retrieved from address

HRL - White - House

Compliance Recap - January 2018

January was a busy month in the employee benefits world. On January 24, 2018, the U.S. Senate confirmed Alex Azar as the new Secretary of the U.S. Department of Health and Human Services (HHS).

The U.S. Department of Labor (DOL) proposed regulations regarding association health plans. HHS released the 2018 federal poverty guidelines. The DOL issued updated civil monetary penalties for 2018 and announced the applicability date for final regulations regarding disability claims procedures. A U.S. District Court modified its order regarding the Equal Employment Opportunity Commission's wellness regulations.

Congress and the President delayed the Cadillac tax's effective date, delayed the health insurance tax (HIT), and reauthorized the Children's Health Insurance Program. The Internal Revenue Service (IRS) released its Employer's Tax Guide. HHS issued a proposed rule to protect conscience rights in health care and created a new Conscience and Religious Freedom Division within HHS' Office of Civil Rights.

UBA Updates

UBA released seven new advisors in January:

UBA updated existing guidance: 2018 Annual Benefit Plan Amounts

DOL Issues Proposed Regulations Regarding Association Health Plans

The U.S. Department of Labor's (DOL) Employee Benefits Security Administration (EBSA) issued a proposed rule which would broaden the definition of "employer" and the provisions under which an employer group or association may be treated as an "employer" sponsor of a single multiple-employer employee welfare benefit plan and group health plan under Title I of the Employee Retirement Income Security Act of 1974 (ERISA).

The DOL posted 79 letters that were submitted as public comments as of January 31, 2018. The deadline for submitting public comments is March 6, 2018.

Read more about the proposed rule.

HHS Releases 2018 Federal Poverty Guidelines

The U.S. Department of Health and Human Services (HHS) released the 2018federal poverty guidelines (FPL). For a family / household of one in the contiguous United States, the FPL is $12,140. In Alaska the FPL is $15,180, and in Hawaii the FPL is $13,960.

For 2018, applicable large employers that wish to use the FPL affordability safe harbor under the employer shared responsibility / play-or-pay rules should ensure that their lowest employee-only premium is equal to or less than $96.72 a month, which is 9.56% of the 2018 FPL.

Civil Monetary Penalties Inflation Adjustment for 2018

The U.S. Department of Labor (DOL) published its civil monetary penalties for 2018. Under federal law, the DOL is required to annually adjust its regulations' civil monetary penalties for inflation no later than January 15 of each year. The adjusted penalty amounts are effective for violations occurring after November 2, 2015, that have penalties assessed after January 2, 2018.

Below are some examples of the increases.

Description 2017 Penalty Amount 2018 Penalty Amount
Failure to file Form 5500 $2,097 per day $2,140 per day
Failure to provide the Summary of Benefits and Coverage (SBC) $1,105 $1,128
Failure to provide documents requested by the DOL $149 per day, not to exceed $1,496 per request $152 per day, not to exceed $1,527 per request
Failure to inform employees of children's health insurance program (CHIP) coverage opportunities; each employee is a separate violation $112 per day $114 per day


DOL Issues Final Disability Claims Procedures Regulations' Applicability Date

The U.S. Department of Labor (DOL) announced that April 1, 2018, will be the applicability date for its rule that amends the claims procedure requirements of ERISA-covered employee benefit plans that provide disability benefits. The DOL'sFact Sheet contains a summary of the regulation's requirements.

U.S. District Court Modifies Order Regarding EEOC Wellness Rules

In August 2017, the United States District Court for the District of Columbia heldthat the U.S. Equal Employment Opportunity Commission (EEOC) failed to provide a reasoned explanation for its decision to adopt 30 percent incentive levels for employer-sponsored wellness programs under both the Americans with Disabilities Act (ADA) rules and Genetic Information Nondiscrimination Act (GINA) rules.

In December 2017, the court vacated the EEOC rules under the ADA and GINA effective January 1, 2019, and ordered the EEOC to promulgate any new proposed rules by August 31, 2018.

In January 2018, the EEOC asked the court to reconsider the portion of the court's order that required the EEOC to promulgate new proposed rules by August 31, 2018. The court vacated that portion of its order. The court's order to vacate the portions of the EEOC's wellness rules under the ADA and GINA as of January 1, 2019, remains.

Read more about the court's order.

Congress Delays Cadillac Tax Effective Date, Delays HIT Tax, and Reauthorizes CHIP

Congress and the President passed H.R. 195, a short-term spending bill. The bill delays the effective date of the excise tax on high cost employer-sponsored health coverage ("Cadillac tax") to 2022. The bill delays the health insurance tax (HIT) that applies to insurers. The HIT was in effect in 2014, 2015, and 2016, and will be in effect for 2018. Now the HIT will be delayed from 2019 to 2020; essentially, the bill implemented a one-year moratorium for the HIT for 2019. The bill also reauthorizes the Children's Health Insurance Program (CHIP) for six years.

IRS Issues 2018 Employer's Tax Guide

The Internal Revenue Service (IRS) issued its Publication 15 (Circular E) Employer's Tax Guide that discusses employers' tax responsibilities. The guide generally discusses health insurance plans, health savings accounts, and medical care reimbursement.

HHS Issues Proposed Rule to Protect Conscience Rights in Health Care

The U.S. Department of Health and Human Services (HHS) published a proposed rule titled "Protecting Statutory Conscience Rights in Health Care; Delegations of Authority."

HHS proposes this rule pursuant to President Trump's May 4, 2017, Executive Order 13798 "Promoting Free Speech and Religious Liberty" and the U.S. Attorney General's October 6, 2017, "Federal Law Protections for Religious Liberty"memorandum.

HHS proposes this rule to enhance awareness and enforcement of federal health care conscience laws and associated anti-discrimination laws, to further conscience and religious freedom, and to protect the right to abstain from certain activities related to health care services without discrimination or retaliation.

The rule cites several federal health care conscience laws and the activities that they protect, including:

·    The Church Amendments: conscience protections related to abortion and sterilization

·    The Coats-Snowe Amendment: conscience protections related to abortion, training, and accreditation

·    The Weldon Amendment: protections against discrimination for health care entities and individuals who do not further abortion or other services

·    HHS' 2011 final rule that enforces the Church, Coats-Snowe, and Weldon Amendments

·    The Consolidated Appropriations Act of 2017: protections from discrimination for health care entities and individuals who object to furthering or participating in abortion under programs funded by HHS' annual appropriations

·    The Patient Protection and Affordable Care Act: conscience protections related to assisted suicide, abortion, and the individual mandate to maintain minimum essential coverage

·    The Assisted Suicide Funding Restriction Act of 1997: protections for Medicare or Medicaid program providers and their employees from informing individuals about a right or service related to assisted suicide and from applying any advance directive term related to assisted suicide

·    Medicare and Medicaid: protection from being compelled to provide, reimburse for, or cover any counseling or referral service over a moral or religious objection

·    Global health program conscience and anti-discrimination protections

·    Exemptions from compulsory health care or services generally and under specific programs for hearing screening, occupational illness testing, suicide assessment or treatment services, vaccination, and mental health treatment

·    Conscience clauses related to religious nonmedical health care in Medicare, Medicaid, and the Children's Health Insurance Program (CHIP).

The proposed rule aims to revise the current regulatory framework of federal health care conscience protection statutes to a more robust regulatory framework similar to those that implement and enforce other civil rights laws.

To do so, the proposed rule would require written assurances and certifications of compliance with federal health care conscience and associated anti-discrimination laws as part of accepting federal financial assistance from HHS. The proposed rule would also require HHS and certain recipients to post a notice to the public, patients, and employees of their protections under the federal health care conscience and associated anti-discrimination statutes, including how to file a complaint with HHS' Office of Civil Rights (OCR). The proposed rule's Appendix A provides the notice's text. Further, the proposed rule would require recipients to report information about OCR investigation notices and compliance review letters to their applicable HHS funding source and to disclose complaints filed with OCR when applying for new or renewed federal financial assistance from HHS.

The proposed rule details OCR's authority to conduct outreach, provide technical assistance, initiate compliance reviews, receive and process complaints, and conduct investigations. The proposed rule grants OCR discretion to choose its means of enforcement, which will range from informal resolution to funding termination. The OCR may also refer cases to the U.S. Department of Justice for enforcement.

Public comments are due by March 27, 2018.

HHS Creates New Conscience and Religious Freedom Division

The U.S. Department of Health and Human Services (HHS) announced the new Conscience and Religious Freedom Division (CRFD) within HHS's Office of Civil Rights (OCR). According to HHS' press release, the CRFD will restore federal enforcement of laws that protect the rights of conscience and religious freedom. CFRD's website includes instructions on how to file a conscience or religious freedom complaint with OCR.

Question of the Month

Q. Can an employer exclude children from coverage based on a child's access to other coverage, employment status, or marital status?

A. No, if a group health plan provides dependent coverage, then the plan must generally make coverage available for children until age 26. These group health plans must not define dependent, for purposes of dependent coverage, in terms other than the relationship between the child and the plan participant.

This means that a plan cannot use items such as a child's access to other coverage, employment status, marital status, tax dependent status, residency, or student status to define dependent.

Also, if the employer is an applicable large employer, then it must offer coverage to its full-time employees' dependent children to avoid penalties under the employer shared responsibility provisions.