Advisers Seek a Tech Solution to Financial Wellness

Have you been looking for a new solution to increase your client's investment into their financial well-being? Check out this great article by Cort Olsen from Employee Benefits Advisors on how advisers are using technology to help their clients invest in their financial wellness.

With many employers taking advantage of wearable wellness devices such as Fitbits and Apple Watches, advisers and consultants say they would like to see a similar platform that will efficiently monitor a person’s financial wellbeing.

“For physical wellness there are health assessments like biometric screenings to gather information and then there is the wearable data that tells people where they need to be to stay on track with their health goals,” says Craig Schmidt, senior wellness consultant for EPIC Insurance Brokers & Consultants. “The difference with the financial piece is that there isn’t a way to track users’ spending habits or monitoring their retirement funding to make their financial status more budget friendly.”

While Schmidt says he has not been able to find a platform that monitors financial status at such a personal level, John Tabb, chief product officer of Questis, has put together a platform that manages to gather data and make suggestions on what employees should be focusing their investments on such as paying off student loan debt or investing in their Roth IRA.

Tabb estimates that there are roughly 30 companies that call themselves financial wellness firms but adds that none of them are “holisitic.” “Not to say that they are not good, but there are only a handful of companies that can allow advisers at financial institutions to utilize their platform as a tool,” he says.

Saving for retirement vs. paying off student debt
Shane Bartling, retirement consultant for Willis Towers Watson, says they have developed a program with their clients that addresses gaps in the market and increases the value of the overall lineup of financial well-being services offered by employers generally around retirement readiness.

“As a result of requests from clients and the needs we have identified with our consulting work, we have built out a technology solution to compliment the line-up of other resources that clients have available,” Bartling says. “We wanted to find the indicators of poor financial wellbeing in the workforce, how to measure it and then how do we engage the parts of our workforce that are going to see the highest value from the resources we are providing.”

The WTW program offers clients an initial assessment from an adviser to determine where employees are struggling the most with their finances. “There is a way to look at behaviors employees are signaling when they are in a poor financial situation,” Bartling says. “They begin to do things like using loans, taking hardship withdrawals and then ultimately you see issues like wage garnishment tend to pop up on the radar and are opting out of the 401(k).”

SoFi has expanded its business focus from student loan refinancing firms into the workspace by helping employers offer a student loan repayment benefit.

“Looking at the employee benefits space today, student loans are generally a pretty big hole in most employers benefit offerings,” says Catesby Perrin, vice president of business development at SoFi. “The main stays of employee benefit offerings are healthcare and 401(k), which we all know are essential, but in many respects don’t address the most pressing financial concerns of the largest demographic in the workforce, which are millennials.”

Perrin adds that 401(k) and other forms retirement saving is imperative for everyone in the workforce, however retirement is not a top priority for millennials due to other financial stressors that are taking place in their day-to-day lives.

“As great as a 401(k) is and how important it is intrinsically, if you have $500 or $800 a month due in student loan payments, which is totally plausible for somebody coming out of undergrad today, the 401(k) is a total luxury,” Perrin says. “Most employers are not doing much about student loan problem, so we are offering two primary benefits today for employers… a student loan refinancing benefit and a benefit set for employers to help pay down the principle balance of their employee’s loan.”

Alternative tech gaining traction
One option is the increasing popularity of mobile push notifications. Ayana Collins, wellness consultant out of EPIC’s Atlanta office, says she is seeing a greater response from users who utilize these alerts on their smartphones to view wellness tips and strategies that they may not read if they are delivered in the form of an e-mail.

“Employees receive thousands upon thousands of e-mails and one more e-mail coming from HR or from a wellness company may not be opened,” Collins says. “If they receive a push notification from their mobile phone they are more likely to check out what financial wellness tips we are sending to them.”

Privacy invasion?
Meanwhile, new legislation determining how wellness plans are regulated has sparked a renewed interest in finding a streamlined financial wellbeing platform.

Shan Fowler, senior director of employer portfolio and product strategy at Benefitfocus, says legislation such as the Employer Participation in Repayment Act and the Preserving Employee Wellness Programs Act, will help fuel the creation of a financial wellbeing platform.

“Financial regulation is very similar to healthcare regulation,” Fowler says, “due to so many branches that are contingent with legislative support. Seeing bipartisan support for this national epidemic [has me feeling] very optimistic.”

However, employees may not be as enthusiastic. Many workers are concerned about the level of data employers could have access to, seeing it as an invasion of privacy, Fowler adds.

“I think you need to put yourself into the shoes of the employee and ask if I want my company to have access to my personal information,” he says. “That speaks to that very fine line employers have to walk of having their employees’ best interests in mind, but not going too far into a ‘big brother’ mentality.”

Tabb says that while the Questis platform does offer individual advice on financial direction based off an initial assessment, the data collected is stored in an aggregate form that protects employees’ personal information from being viewed by their superiors or colleagues.

“If the employer wants some data, they are going to pay for it to help them make decisions, but it is all on an aggregate level,” Tabb says. “There is certainly a perception that needs to be addressed to ensure employees that their data is safe and that nothing is being shared with their employer that does not need to be shared.”

Both Bartling and Perrin also say their platforms offer data to employers only in an aggregate form to give them an idea of how many employees are utilizing the benefit and also the projected success rates, but when it comes to the personal finances of each individual employee, security is in place to ensure private financial information is protected.

EPIC’s Collins says no matter what branch of wellness an employer invests in, whether it be financial, physical or mental, there needs to be a reason behind the technology that they are using. If there is no payout for the employee, there will be no demand to carry the program.

“There has to be a ‘so what’ behind it,” Collins says. “If the employer is just doing a simple challenge with nothing behind it, people are not going to gravitate toward it, because it doesn’t create a moment where the users discover an improvement to themselves. That is the whole point behind wellness.”

See the original article Here.

Source:

Olsen C. (2017 May 11). Advisers seek a tech solution to financial wellness [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/news/advisers-seek-a-tech-solution-to-financial-wellness


3 HSA Facts Employers Need to Know

With the passing of the AHCA, HSAs are on the verge of changing as we know it. Take a look at this informative article from Benefits Pro about what changes to HSAs means for employers by Whitney Richard Johnson.

Health Savings Accounts offer employers a way to help employees with health care costs without being as involved as they might be with, say, a Flexible Saving Account. But what are some other advantages?

And what are employers' responsibilities? Although employers will want to research more indepth about HSAs, here is a quick look at some basic HSA questions and answers:

#1: What are the advantages to an employer of offering an HDHP and HSA combination?

The benefits of offering employees an HDHP and HSA vary dramatically depending upon the circumstances. A major strength of offering an HSA program is flexibility.

Employers can be very generous and fully fund an HSA and also pay for the HDHP coverage. Alternatively, employers can also use the flexibility of the HSA to allow for the employer to reduce its involvement in benefits and put more responsibility onto the employee.

Generally, employers switch to HDHPs and HSAs to save money on the health insurance premiums (or to reduce the rate of increase) and to embrace the concept of consumer driven healthcare. The list below elaborates on strengths of HDHPs and HSAs.

Lower Premiums. HDHPs, with their high deductibles, are usually less expensive than traditional insurance.

Consumer-driven health care. Many employers believe in the concept of consumer-driven healthcare. If an employer makes employees responsible for the relatively high deductible, the employees may be more careful and inquisitive into their health care purchases. Combining this with an HSA where employees can keep unused money increases employees’ desire to use health care dollars as if they were their own money – because it is their own money.

Lower administration burden. Given the individual account nature of HSAs, much of the administrative burden for HSAs is switched from the employer (or paid third-party administrator) to the employee and the HSA custodian as compared to health FSAs and HRAs. This increased burden on the employee comes with significant perks: more control over how and when the money is spent, increased privacy, and better ability to add money to the HSA outside of the employer.

Tax deductibility at employee level. The ability of employees to make their own HSA contributions directly and still get a tax deduction is advantageous. Although it is better for employees to contribute through an employer, an employee can make contributions directly. An employer may not offer pretax payroll deferral or it may be too late for an employee to defer. For example, an employee that decides to maximize his prior year HSA contribution in April as he is filing his taxes can still do so by making an HSA contribution directly with the HSA custodian.

HSA eligibility. Becoming eligible for an HSA is a benefit that also stands on its own. Although not all employees will embrace HSAs, savvy employees that understand the benefits of HSAs will value a program that enables them to have an HSA.

#2: What are the employer responsibilities regarding employee HSAs?

If an employer offers pretax employer contributions, then the employer has the following responsibilities:

Make comparable contributions. If the employer is making a pretax employer contribution (nonpayroll deferral), it must do so on a comparable basis.

Maintain Section 125 plan for payroll deferral. If the employer allows pretax payroll deferral, then the employer must adopt and maintain a Section 125 plan that provides for HSA deferrals. This includes collecting employee deferral elections, sending the deferred amount directly to the HSA custodian, and accounting for the money for tax-reporting purposes.

HSA eligibility and contribution limits. Employers should work with employees to determine eligibility for an HSA and the employee’s HSA contribution limit. Although it is legally the employee’s responsibility to determine his or her eligibility and contribution limit, a mistake in these areas generally involves work by both the employer and the employee to correct. Mistakes are best avoided by upfront communication. Also, the employer does have some responsibility not to exceed the known federal limits. An employer may not know if a particular employee is ineligible for an HSA due to other health coverage but an employer is expected to know the current HSA limits for the year and not exceed those limits.

Tax reporting. The employer needs to properly complete employees’ W-2 forms and its own tax-filing regarding HSAs (HSA employer contributions are generally deductible as a benefit under IRC Section 106).

Business owner rules. Business owners generally are not treated as employees and employers need to review HSA contributions for business owners for proper tax reporting.

Detailed rules. There are various detailed rules that fall within the responsibility of the employer that are too numerous to list here but include items such as: (1) holding employer contributions for an employee that fails to open an HSA, (2) not being able to “recoup” money mistakenly made to an employee’s HSA, (3) actually making employer HSA contributions into employees HSAs on a timely basis, and (4) other detailed rules.

#3: How do employers switching from traditional insurance to HDHPs explain the change to employees?

Although there is no certain answer to this question, a straight-forward and honest approach to the change will likely work best.

Changing from traditional insurance to a high deductible plan with an HSA can be significant because employees likely face a higher deductible (although traditional health plan deductibles have been increasing to the point they are close to HDHPs).

Often the largest obstacle to the change is that employees feel something is being taken away from them. An employer that can show that the actual dollars contributed by the employer are level, or increased, versus the previous year helps a lot – especially if the employer makes a substantial HSA contribution for employees.

If the employer is making the change to reduce its health care expenses, then the employer will have to explain and justify that change to employees to get employees’ support for the change (e.g., the business is in a tough spot due to a difficult economy, etc.).

Depending on the facts, the change will likely be an improvement for some employees and HSA eligibility provides benefits to all employees. Some specific benefits include the following:

Saving money. The HDHP is generally significantly less expensive. Depending upon the circumstances, this fact often saves not only the employer money but also the employee. Highlighting the savings will help convince employees the change is positive. Although an actual reduction of the employee’s portion of the premium expense may be unlikely given increasing health insurance premiums, explaining that without the change the employee’s portion of the premium would have increased by more will help reduce tension.

Tax savings. The HSA enables tax savings. For some employees these tax savings are significant.

Control. HSAs give individuals control over their money and accordingly their doctor and treatment choices.

Flexibility. An HSA is very flexible and allows for some employees to put aside a large amount and get a large tax benefit. For those that prefer not to do so, the HSA allows that as well. Plus, even better, the HSA allows employees to change their mind mid-year. If an employee believes they are not going to need any medical services, the employee needs to contribute only a minimum deposit to an HSA. If it turns out that the employee does incur some medical treatment, the employee can contribute at that time and still get the tax benefits. Employees are often frustrated by HSA rules because of some confusion, but when explained that the rules are very flexible they appreciate HSAs more.

Distribution reasons. HSAs allow for more distribution reasons than FSAs: namely to pay for health insurance premiums if unemployed and receiving COBRA, to pay for some health insurance premiums after age sixty-five, to use for any purpose penalty-free after age sixty-five, to carry forward a large balance, and more.

See the original article Here.

Source:

Johnson W. (2017 May 11). 3 HSA facts employers need to know [Web blog post]. Retrieved from address http://www.benefitspro.com/2017/05/11/3-hsa-facts-employers-need-to-know?kw=3+HSA+facts+employers+need+to+know&et=editorial&bu=BenefitsPRO&cn=20170514&src=EMC-Email_editorial&pt=Benefits+Weekend+PRO&page_all=1


Why Technology is Key to Financial Wellness Success

Are you trying to help your employees become successful and financial stable? Here is a great article from Employee Benefits News on how employers are figuring out that technology is key to helping their employees achieve success in their financial well-being by Kathryn Mayer.

Financial literacy is an increasingly desirable benefit for employees. But many employers don’t offer budgeting assistance, and a majority of workers are reluctant to let their company get involved in their financial business.

Dean Harris realized that in order to make financial wellness appealing to both employers and employees, he had to design technology that delivered flexible, multi-layered and comprehensive financial education in a way that’s enjoyable for the user — and ensures privacy. The chief technology officer of iGrad — a technology-driven financial wellness education company — created and maintains the iGrad and Enrich platforms, which deliver choices to make financial wellness the backbone of any benefit program. The product aims to offer financial wellness benefits with minimal cost and time to the employer.

“Financial literacy empowers workers to take control of something they feel is out of their control,” says Harris, a 2017 recipient of an EBN Benefits Technology Innovator Award. “By offering more information and knowledge, they are better equipped to make the right financial choices that promise to have far-reaching positive effects.”

By applying data analysis on the behavior of the user both within the platform and with regard to his approach to money, the platforms offer responsive content and recommendations. As the user’s skills and knowledge increase, the algorithm adjusts accordingly to provide newer and more relevant content leading to increased engagement and learning possibilities.

Technology is vital in achieving financial goals, Harris says, in part because it provides employees the privacy they desire.

“Financial literacy is a delicate subject. Most people are not comfortable discussing their finances —especially not with their employer,” Harris explains. “The online financial literacy platform offers the personalized and self-guided learning that will help them without exposing their personal financial information to their employer.”

Furthermore, topics addressed through the platform provide “interest, engagement and learning” for employees, Harris says. And employers “gain the benefit of a newly focused and re-energized workforce without having to drill down into areas that are too personal.”

“Ultimately, technology has made it possible for everyone to gain access to the help they need while maintaining privacy and discretion,” Harris says.

See the original article Here.

Source:

Mayer K. (2017 May 9). Why technology is key to financial wellness success [Web blog post]. Retrieved from address https://www.benefitnews.com/news/why-technology-is-key-to-financial-wellness-success


6 Actions Employers Can Take to Boost Retirement Savings

Preparing your employees for their retirement has become a major responsibility for employers. From education to offering the right program for your employees to start saving, employers now more than ever must be prepared for everything involved with retirement. Take a look at this great article from Benefits Pro on what you can do to prepare yourself and your employees for retirement by Marlene Y. Satter.

Lots of people point to self-indulgent millennials or debt-beleaguered GenXers or negligent boomers as the reason for the retirement crisis and the cause of their own hardships.

But a Morningstar study instead points the finger at employers, and their disinterest in working harder to improve retirement plans so that they elicit the best response from employees.

A blog post from the Center for Retirement Research at Boston College highlights the study and points out that employers could improve retirement outcomes for their workers—if they were sufficiently interested in doing so—based on research already in hand.

Employers who offer 401(k)s to their workers made some progress, mostly, along the path of automatic enrollment, the blog post notes, during the early 2000s, with notable success: “Today,” it says, “nearly 90 percent of automatically enrolled employees stay where they are put, while only about half of workers sign up to save when 401(k) enrollment is strictly voluntary.”

But progress along those lines has ground to a halt, it points out, and because of the huge variations among 401(k) plans there are plenty of cracks in the private system through which employees are all too ready to fall—and employers apparently too ready to let them.

The Morningstar report points out that even when companies do use auto-enrollment, plans aren’t designed well enough to encourage an adequate level of savings—or, in fact, actually discourage it.

The report, titled “Save More Today: Improving Retirement Savings Rates with Carrots, Sticks, and Nudges,” highlights a number of ways in which plan features actually work against employees saving enough to actually retire on—but the flip side of that is that those features can be tweaked so that they work for the employee’s benefit, and turned into those carrots, sticks and nudges.

And it doesn’t even have to be expensive, since many employers are concerned about the outlay for a retirement plan and are often reluctant, at best, to add to it.

Here are 6 ways employers can encourage their employees to save more for retirement—and at limited, or no, additional cost.

6. Auto-enrollment.

If a company’s plan doesn’t have automatic enrollment, it should, since the results are so outstanding.

Lots of people fail to sign up, if “voluntary” enrollment is required, due to procrastination, preoccupation or other human failings—but if it’s an automatic feature, they get swept up and are saving for retirement almost before they know it.

Says the report: “[P]articipation rates are significantly higher in plans with automatic enrollment (compared to voluntary enrollment schemes).” It adds, “[E]arly research by Madrian and Shea (2001) noted a 48-percentage-point increase in 401(k) participation among new employees after the adoption of automatic enrollment.”

That’s a small action to have such a large effect.

5. Automatic reenrollment.

The marked effect of auto-enrollment on participation has a corollary: existing eligible employees aren’t usually included when the feature is added to a plan.

And this is not unusual.

In fact, the study cites two others that find the inclusion of “reenrollment”—adding existing employees to a plan—is “relatively uncommon,” with the studies finding only 15 percent or 12 percent of plans offering that opportunity.

However, adding “reenrollment” when an auto-enrollment feature is added can significantly boost the participation of existing employees.

4. Higher default savings rate.

An aggressive default savings rate will get employees saving more from the very beginning—and although employers say that workers will be reluctant to accept a rate of anywhere from 6–8–10 percent rather than the more common 3 percent, that’s contrary to study findings.

In fact, says the study, “Roughly half of investors tend to accept the initial default savings rate regardless of level, up to 6 percent using empirical data and up to 12 percent based on the online survey.”

And that’s not all: it adds that “Participants who reject the default rate tend to select higher savings rates, on average, as default rates rise,” which means they are saving even more.

This can be particularly important since, the report says, many employers are more concerned with the participation rate than the savings rate—but the savings rate is what will save employees come retirement.

3. Mandatory auto-escalation.

Automatic escalation, the study reports, “is commonly offered in conjunction with automatic enrollment (e.g., 62 percent of plans offering automatic enrollment also offered automatic escalation according to Aon.”

But only a third to a half of plans actually offer it, despite its benefits—and 62 percent of those who do provide it on an opt-in, rather than an opt-out, basis.

That design is poor on two counts: not only does it not “sweep” everyone into an automatic increase in savings, people who have to opt in don’t always keep doing so.

Just 11 percent, the report says, stay in the plan when it is opt-in, compared with 68 percent who do so when it is opt-out.”

And then there’s the issue of whether the auto-escalation rate is set high enough. Since workers will often accept whatever the default is, setting the rate higher rather than lower would push them to save more and better prepare them for retirement.

2. Matching contributions.

Matching contributions are a thorny issue, since driving up the participation rate will require more in contributions.

As a result, employers might not only be reluctant to boost the participation rate too much, they’re not all that anxious to increase their matching contributions either.

But again, a tweak can change employee behavior without a large increase in cost.

One option is to stretch the match out further; for instance, matching 25 percent of the first 8 percent of employee deferrals instead of matching 50 percent of the first 4 percent employee deferrals. Another option is moving to a discretionary match approach.

1. In-plan advice.

Plans that provide employees with advice can also have a marked effect on savings behavior, with higher recommended savings levels from in-plan financial advisors.

In fact, 90 percent of participants who engaged an in-plan advice solution increasing their savings rates—by about 2 percentage points on average.

“Additionally,” the report says, “higher savings recommendations result in higher implemented savings levels (i.e., more is better).”

This is one area in which it’s not clear whether opting in or having to opt out is more effective.

Perhaps it’s that those who are willing to save more seek out guidance on how much to save.

See the original article Here.

Source:

Satter M. (2017 May 15). 6 actions employers can take to boost retirement savings [Web blog post]. Retrieved from address http://www.benefitspro.com/2017/05/15/6-actions-employers-can-take-to-boost-retirement-s?ref=hp-top-stories&page_all=1


More Employers View HSAs as Part of Retirement Strategy

Did you know that more employers are starting to use health savings accounts as a tool for retirement? Find out more from this interesting read from Employee Benefits Advisor on how employers are utilizing HSAs in their retirement program by Paula Aven Gladych.

The health savings account market is continuing its massive growth — as well as its increasing importance to the retirement industry.

According to a survey conducted by the Plan Sponsor Council of America, more than 75% of plan sponsors “view the HSA as part of their retirement benefits strategy.”

Nearly 60% of the respondents believe HSAs should replace flexible spending accounts, and nearly three-fourths of employers think that HSAs should be open to all employees, not just those enrolled in a high-deductible health plan, according to the survey. The PSCA received 255 responses to its survey, with 181 of plan sponsors saying they sponsor an HSA for their employees.

HSAs are medical savings accounts that employees and employers can use to pay for qualifying healthcare expenses, now and into the future. It is widely acknowledged that healthcare expenses are one of the largest expenses people face in retirement, so this is one more tool individuals can use to save for their futures.

Made possible by the Medicare Modernization Act of 2003, the accounts allow employees to set money aside pre-tax. Any money that isn’t spent down in a given year can be invested, just like a retirement plan. That money can be used to pay for current and future healthcare expenses.

HSAEnrollment in employer-sponsored HSA/high-deductible plans more than doubled from 5% in 2005 to 11% in 2015, but in spite of that, 6.2 million of the 22.5 million people eligible to participate in an HSA did not contribute to it, according to the PSCA survey.

In 2016, the PSCA created an HSA committee to focus on health savings accounts and their impact on employee retirement readiness and to evaluate and improve their integration with defined contribution retirement plans.

“Absent legislative action that would curtail HSA tax preferences, HSA accounts are here to stay,” says PSCA Executive Director Tony Verheyen.

According to survey respondents, about 80% of employees are eligible to participate in an employer-sponsored HSA plan, with an average account balance of $3,161. Forty percent of employers said that fewer than 25% of their participants use up their entire HSA balance each year and 35% of plans said that 26-50% of their participants use their entire balance every year.

“So many employers participating in the survey do perceive the HSA to be a vehicle for employees to accumulate savings,” the report found.

Two-thirds of employers who sponsor a health savings account program for employees say they contribute a set dollar amount to each account based on the high-deductible health plan coverage tier an employee has chosen. More than 80% of the employers who sponsor an HSA say they contribute some money to the plan. Forty percent of plans say they front load contributions at the start of the year, while 30% contribute some amount every payday.

More than half of those surveyed said they cover the cost of HSA maintenance fees for active employees and 6% said they pay them for terminated employees. Only 21% of surveyed employers expressed concern about the fiduciary liability of sponsoring an HSA-high-deductible health plan.

The Plan Sponsor Council of America is made up of employee benefit plan sponsors who work together to help improve and expand upon the employer-sponsored retirement plan system.

See the original article Here.

Source:

Gladych P. (2017 May 9). More employers view HSAs as part of retirement strategy [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/news/more-employers-view-hsas-as-part-of-retirement-strategy


The Pitfalls of Online Enrollment Systems

Are you using an online system to enroll your clients into their employee benefits? Check out this great article from our partner, United Benefit Advisors (UBA) about the risk associated with online enrollment by Elizabeth Kay.

Online enrollment platforms are great, but communication and understanding are terribly important for the end-user.

I always say, "technology is great, when it works." Online enrollment platforms have been around for years, and the technology that powers them has grown and advanced at an exponential rate. Who would have guessed that we would be enrolling in our employee benefits directly from our own phones and tablets, without being given the huge enrollment packets from HR?

In this virtual communication age, you can't take the “human” out of Human Resources, and you can't take the confusion out of insurance benefits just because you wrap it in a nice, pretty website with fancy graphics and videos.

An employee's health concerns and needs are as diverse and different as hair colors are at Comic Con, so while a brief overview of plan details is fine for one person, someone else wants to know how many physical therapy visits they can have in a year, or if their child's insulin pump will be covered on their plan.

A simple online enrollment platform does not always meet the needs of all employees, and not all platforms will offer the level of detail some will require. Aside from posting the evidence of coverage, or insurance contract, at a place that is easily found on the portal, there may not be a way to achieve that level of detail. However, even for those that don't need that level of detail, critical information must be communicated easily and effectively.

Costly mistakes can be made when benefits are not communicated effectively, or when important information is simply omitted. For example, since the Patient Protection and Affordable Care Act (ACA) was implemented, some employers have opted to offer minimum value plans (MVPs), or plans that cover very few procedures such as office visits, preventive care, and hospital room and board, but they do not cover a wide range of other services such as ambulance, surgery, medical devices, physical or occupational therapy, etc.

When an employee sees a number of choices or plans from which to choose, they will likely compare the various plan options by looking at the carrier, if the plans are HMOs or PPOs, and the cost. From there, an employee may look at the office copays, deductibles, prescription drug costs, and coinsurance.

If the comparison shows MVP plans as well as traditional health plans, but does not call out in big, bold letters, all of the items the MVP plan does not cover, one could come away with the understanding that if they choose the MVP plan, they are selecting a plan that is a comprehensive insurance plan just like the other plans shown, or like they have had in the past.

Most of us don't read our car insurance policy in detail until we get in an accident and the insurance adjustor says, "sorry, your policy does not cover that." The same is usually true for our health insurance plans.

You could argue that it is the responsibility of the employee to verify that the plan they are choosing meets all of their needs, certainly. But if that information is not easy to locate, you could find fault with the employer, or insurance carrier, if there were to be a problem. Furthermore, an employer would want to show their employees that they want to take care of them, and not set them up for failure in the event of a crisis.

Let's walk through a scenario. An employee named "Joe" is 28, and is enrolling in his company's health plans during open enrollment. His company recently merged with another larger company, and so the benefits being offered are slightly different, but look pretty close to what they had been last year. There are four plans offered, two that are HMO plans with Kaiser and two that are PPO plans, one is labeled Silver, the other Gold.

Joe is young and single, and when he was living at home with his parents, he had never had Kaiser and always traditionally had PPO coverage. Last year, Joe enrolled in the Silver PPO plan so he could continue to see the doctors that had been managing his care for all of his adult life, so he elects the same plan this year. The online system shows a $250 deductible, $40 office visit copay, and 30% coinsurance. In addition, the Kaiser premiums have gone up considerably from what he remembered them to be last year, and are higher than the PPO plan options, so he feels comfortable that he has made the choice that is best for him.

Later in the year, he comes down with a bad cold. The pressure in his head that is caused by the cold is so severe that when he sneezed, he blew out his right ear drum. He goes to the doctor, and his doctor orders a CT scan of his ear. The CT scan shows he has perforated his ear drum and will need surgery to repair it. The surgery is scheduled for two weeks after that. He contacts the hospital and surgeon to confirm they are contracted, in-network providers under his health plan, and asks them to do a pre-determination of benefits so he will know up front how much he should expect to pay as his 30% of the cost of the procedure.

While waiting for the surgeon and hospital to get back to him regarding the out-of-pocket costs, he receives the bill for the CT scan and explanation of benefits from his doctor for the office visit and CT scan. They show his office copayment that he paid at the time of service, and his $250 deductible, plus 30% of the remaining cost of the CT scan, which came out to a total of $500. He pays the bills and continues to work even though he is in extreme discomfort from his right ear.

The surgeon and hospital both get back to him and let him know the surgery itself will cost approximately $20,000 because his plan does not cover surgery, period. Joe is not an executive in a large company; he does not have the money to pay for a $20,000 surgery and also afford to take three weeks off of work in order for him to recover. So, what is he to do?

He can't enroll in another plan offered by his employer for another nine months when they go through open enrollment again. It is March, so he has missed the state Exchange open enrollment window, and he has not experienced an involuntary loss of coverage that would enable him to enroll in a state Exchange plan. If he were to purchase a short-term, comprehensive medical plan it won't cover any pre-existing conditions, which his perforated ear drum would certainly be considered. So, unless he gets married and enrolls on his new spouse's plan if they were offered one by their employer, he is out of options. He will simply have to wait until open enrollment next year.

How do you think Joe is feeling about his employer right now? Do you think he is counting his blessings that he only ruptured his ear drum and was not diagnosed with cancer that needed to be removed before it spread any further? Or is he going to be using a few choice words to describe an employer that offers a medical plan to its employees that has a longer list of services not covered than are covered? I can't say that I know for sure, but I can guess.

Now, the question becomes how does an employer prevent their employees from running into these kinds of pitfalls? It comes down to clear communication—multiple forms of communication that are easily accessible to employees and their family members that may also play a role in making plan decisions. Having someone to partner with your company, such as a UBA Partner Firm that will not only help you develop long-term plan strategies for your employee benefits package, but can be an integral part of developing and implementing online systems, hard copy communications, and give you access to tools such as smartphone applications that not only give employees access to essential information, but also push out important communications that contain relevant information at the appropriate times like open enrollment. Making plan details easily accessible in the online platform, with clear and bold statements if there are essential benefits that are not covered on the plan such as a warning, should be clearly stated so that employees are well informed.

An ounce of prevention is worth a pound of cure. Insurance is a complicated business and you, as an employer, would not want to make decisions about the health care you offer your employees without someone to guide you through the various options and possibilities. As responsible employers, our employees should not have to either.

See the original article Here.

Source:

Kay E. (2017 May 2). The pitfalls of online enrollment systems [Web blog post]. Retrieved from address http://blog.ubabenefits.com/the-pitfalls-of-online-enrollment-systems


Is Social Media Putting Employees’ Health, Safety at Risk?

Do your employees know about all of the risks that can come from their social media? Find out how social media can affect your employee's safety and health in this article from Employee Benefit News by Jill Hazan.

The issue of personal online safety has finally crossed over into the healthcare arena — and employers need to step up and learn to best educate employees about keeping them safe.

A recent article in the Journal of the American Medical Association Pediatrics, “Parental Sharing on the Internet: Child Privacy in the Age of Social Media and the Pediatrician’s Role,” highlights how parents who post information about their children on social media put them at greater risk for identity theft. In addition, this trend toward oversharing compromises a child’s protected health information. What might happen when that child applies for a job in the future and a simple internet search reveals health information she would not want an employer to know?

While HIPAA protects the confidentiality of an individual’s medical records, it doesn’t provide comprehensive protections outside the healthcare environment. The laws around the privacy rights of children relative to their parents’ online disclosures are still evolving. The article recommends that pediatricians ask parents about their social media habits to help keep children safe and their data private. It is a natural extension that all primary care providers should be asking patients about social media behaviors, as the issues of identity theft and data privacy are relevant to children and adults alike.
This recommendation is increasingly significant from an employee benefit perspective.

So what should employers do?

Employers routinely provide healthcare benefits to employees. If health plans and physicians are acknowledging and addressing the risks of social media from a privacy and security perspective, shouldn’t employers extend that focus into the workplace? With the continued employer emphasis on wellness, it is incumbent on health plans and employers alike to educate employees on online security and the risks of identity theft.

 

There are a variety of resources and benefits that employers can access to assist employees in navigating the online world safely. A series of well-structured, engaging seminars on identity theft and online security that combine real-life stories with actionable advice are effective in educating employees and changing behaviors. Online tutorials, like those provided by the Center for Identity at the University of Texas, Austin, can guide employees on setting proper privacy settings on social media sites, such as Facebook, Twitter, LinkedIn and Pinterest.

Identity theft protection plans provide monitoring and restoration services, as well as education to help keep employees and their families secure. EAPs may provide guidance on identity theft and counseling for victims. Comprehensive legal benefit plans provide legal advice and representation for victims of identity theft. Employers may also provide employees access to online data protection tools for use at work and home with features that encrypt communication and block malware and phishing attempts.

Employees need to understand how to navigate the social media and online environment to keep their families safe. Identity theft of a family member affects more than just one person. It can register an emotional, physical and financial toll on the entire family. Employers need to structure a comprehensive approach to managing the health and wellness of employees as it relates to their online behaviors. A program with a combination of employee benefits, from healthcare to identity theft protection benefits, supplemented by onsite employee education, will support the goals of the health plan and, ultimately, the organization’s overall business objectives.

See the original article Here.

Source:

Hazan J. (2017 May 1). Is social media putting employees' health, safety at risk? [Web blog post]. Retrieved from address https://www.benefitnews.com/opinion/is-social-media-putting-employees-health-safety-at-risk?feed=00000152-18a4-d58e-ad5a-99fc032b0000


Employee Expectations Changing the Workplace

Do you know what benefits your employees are looking for? Take a peek at this great article from Employee Benefits Adviser about how employers are starting to customize their employee benefits programs to fit each individual employee by Nick Otto.

If employers want to retain and attract talent, they’ve got to start thinking about one big benefit trend: Customization.

“It’s not about just medical, dental and vision anymore,” Todd Katz, executive vice president, MetLife said Monday following the release of MetLife’s 15th annual U.S. Employee Benefits Trends Study.

Nearly three-fourths (74%) of employees say that having benefits customized to meet their needs is important when considering taking a new job, and 72% say that having the ability to customize their benefits would increase their loyalty to their current employer.

Workers say benefits customization is even more important than the ability to work remotely. In fact, more than three-fourths (76%) of millennials say benefits customization is important for increasing their loyalty to their employers, compared to two-thirds (67%) of baby boomers.

“Today, our lives reflect our preferences,” Katz says. “We choose how our coffee is made, create personalized playlists and decide which apps we have on our phones. In all aspects of our lives, we can make choices to meet our unique needs. The same should apply when it comes to benefits.”

That’s particularly important for driving engagement and loyalty among millennials, he said, who comprise the largest generation in the workplace today. “Customization for them is inherent, and they want to know that their employers understand and are willing to address their specific needs.”

Not only is benefits customization important for employee satisfaction and retention, but so is helping employees with their holistic wellness — both health and financial — needs.

Nearly two-thirds of employees say that health and wellness benefits are important for increasing loyalty to their employer and 53% say the same about financial planning programs.

Every day, employees come to work with financial concerns, and in larger businesses, employees acknowledge that they sacrifice their health and are less productive. Close to a third of workers (30%) say they lay awake at night worrying about money, and 23% admit to being less productive at work because of financial stress.

“Looking across the work force, when you understand what’s on the minds of employees it’d be wonderful if the set of benefits is matched to address what is a drag on the minds of workers and their worries back at home,” Ida Rademacher, executive director, financial security program at The Aspen Institute, noted at MetLife’s symposium in Washington, D.C. on Monday.

She notes there are four elements to helping workers achieve financial well-being:

Financial security in the present: Employees having control over day-to-day and month-to-month finances
Financial security in the future: The ability to absorb a financial shock
Freedom of choice in the present: Financial freedoms to make choices and enjoy life
Freedom of choice in the future: The ability to be on track to meet financial goals

Despite the need for wellness education, many employers are falling short in their offerings.

Only a third of employers (33%) say they are very likely to offer wellness benefits and just 18% currently offer financial planning programs. At the same time, only 36% of employers say wellness benefits and financial planning programs are valuable to their employees, according to the study.

“Employees are looking to their employers to help them with their overall wellness needs, whether it’s through gym memberships to stay healthy or financial education programs to plan for their futures,” says MetLife’s Katz. “As employees have more non-traditional workplace options available to them, it will become increasingly important that employers prioritize holistic wellness to drive employee engagement and loyalty in this new era.”

This may be why retention is the top priority among employers. When asked to rank their top benefits priorities, more employers (83%) chose retaining employees as an important benefits objective than increasing employee productivity (80%) and controlling health and welfare benefit costs (79%). More so, over half of employers (51%) say that retaining employees through benefits will become even more important in the next three to five years.

“Benefits historically were used for attraction and retention, but there now much more strategically important than they have ever been,” added Randy Stram, senior vice president, group, voluntary & worksite benefits at MetLife. “A diverse employee base, uncertainty regulatory environment and the changing digital landscape are adding to the increase complexity of managing benefits for employers.”

See the original article Here.

Source:

Otto N. (2017 April 19). Employee expectations changing the workplace [Web blog post]. Retrieved from address https://www.employeebenefitadviser.com/news/employee-expectations-changing-the-workplace?feed=00000152-1377-d1cc-a5fa-7fff0c920000


Employees Want Money More than Perks

Have you been trying to leverage your employee benefits as a way to attract and retain talent? Take a look at this great article from Benefits Pro about how employees still value money over the perks of employee benefits  Marlene Y. Satter.

There’s plenty of talk these days about all sorts of employee benefits that might help to attract and retain top talent — but when push comes to shove, it’s the dollar sign that has the most influence.

That’s according to a Paychex.com survey, which finds that in the employment conversation, money still talks the loudest. It’s not that people don’t want or like other benefits, such as health insurance, vacations and 401(k)s, but what they really want, what they really, really want is cold hard cash in the form of bonuses and raises. Regular bonuses, they say, are the most important job incentive.

However, asked about the benefits they do receive, survey respondents list a range of benefits, including health care, dental insurance, 401(k)s, casual dress days and free snacks, but bonuses only come in at eighth place. Least important to them of all are “nomadic days” — days on which they can work away from the office at the location of their choice.

Asked their salaries and which benefits they’d gladly give up in exchange for more money, there are quite a few — with low-cost benefits the most disposable. Millennials, perhaps unsurprisingly, make the least money at less than $47,000 a year, while boomers come in second (despite their longevity on the job) at just over $49,000 annually; GenXers are the best paid, at an average of more than $53,000.

And they all know the value of a buck. The top five most expendable benefits named are free coffee or snacks; casual dress days; company events or outings; discounts on company products; and discounts on other products. In fact, such “benefits” may actually backfire if companies think offering them instead of merit-based compensation or bonuses to induce greater productivity.

There’s certainly a disconnect between what employees say they value most and what employers believe are the most valuable options, with employees saying the most important to them are monetary bonuses, additional paid vacation time, and health and dental insurance.

Bosses, on the other hand, think employee morale benefits more from paid vacations, bonuses and finally paid maternity leave and vision and dental insurance.

To show how out of touch employers can be, employers rate health care just above lunch breaks in terms of morale-boosting importance, despite its value to employees.

Considering that low-wage jobs are associated with higher rates of employee turnover, the study points out that providing employees with a salary increase could cut the costs associated with recruitment and training.

Of course, smaller companies tend to offer fewer, and less expansive, benefits than larger companies, with employers of fewer than 100 more likely to offer employees casual dress days or free snacks than they are to provide them with the considerably more important benefit of health insurance. But on the flip side, smaller companies are also more likely to offer bonuses than are larger companies, and indeed employees rank those bonuses above health care, dental insurance, and 401(k) plans in importance.

And the benefits on offer could depend on the age of the boss, with millennials more willing to offer employees commission and sales bonuses, paid gym memberships and student loan reimbursement while Gen Xers hit on all cylinders in offering bonuses, paid maternity leave and on-site health and wellness services.

Boomers, alas, seem stuck in the dark ages when it comes to modern benefit offerings, reluctant to see the benefit of such perks as bonuses, nomadic days and paid maternity leave; in addition, they’re really resistant to such things as student loan reimbursement and paid professional development.

See the original article Here.

Source:

Satter M. (2017 April 28). Employees want money more than perks [Web blog post]. Retrieved from address http://www.benefitspro.com/2017/04/28/employees-want-money-more-than-perks?ref=hp-news&page_all=1


Health Reform Expert: Here’s What HR Needs to Know About GOP Repeal Bill Passing

The House of Repersentives has just passed the American Health Care Act (AHCA), new legislation to begin the repeal process of the ACA. Check out this great article from HR Morning and take a look how this new legislation will affect HR by Jared Bilski.

Virtually every major news outlet is covering the passage of the American Health Care Act (AHCA) by the House. But amidst all the coverage, it’s tough to find an answer to a question that’s near and dear to HR: What does this GOP victory mean for employers? 

The AHCA bill, which passed in the House with 217 votes, is extremely close to the original version of the legislation that was introduced in March but pulled just before a vote could take place due to lack of support.

While the so-called “repeal-and-replace” bill would kill many of the ACA’s taxes (except the Cadillac Tax), much of the popular health-related provisions of Obamacare would remain intact.

Pre-existing conditions, essential benefits

However, the new bill does allow states to waive certain key requirements under the ACA. One of the major amendments centers on pre-existing conditions.

Under the ACA, health plans can’t base premium rates on health status factors, or pre-existing conditions; premiums had to be based on coverage tier, community rating, age (as long as the rates don’t vary by more than 3 to 1) and tobacco use. In other words, plans can’t charge participants with pre-existing conditions more than “healthy” individuals are charged.

Under the AHCA, individual states can apply for waivers to be exempt from this ACA provision and base premiums on health status factors.

Bottom line: Under this version of the AHCA, insurers would still be required to cover individuals with pre-existing conditions — but they’d be allowed to charge astronomical amounts for coverage.

To compensate for the individuals with prior health conditions who may not be able to afford insurance, applying states would have to establish high-risk pools that are federally funded. Critics argue these pools won’t be able to offer nearly as much coverage for individuals as the ACA did.

Under the AHCA, states could also apply for a waiver to receive an exemption — dubbed the “MacArthur amendment” — to ACA requirement on essential health benefits and create their own definition of these benefits.

Implications for HR

So what does all this mean for HR pros? HR Morning spoke to healthcare reform implementation and employee benefits attorney Garrett Fenton of Miller & Chevalier and asked him what’s next for the AHCA as well as what employers should do in response. Here’s a sampling of the Q&A:

HR Morning: What’s next for the AHCA?
Garrett Fenton: The Senate, which largely has stayed out of the ACA repeal and replacement process until now, will begin its process to develop, amend, and ultimately vote on a bill … many Republican Senators have publicly voiced concerns, and even opposition, to the version of the AHCA that passed the House.

One major bone of contention – even within the GOP – was that the House passed the bill without waiting for a forthcoming updated report from the Congressional Budget Office.  That report will take into account the latest amendments to the AHCA, and provide estimates of the legislation’s cost to the federal government and impact on the number of uninsured individuals …

… assuming the Senate does not simply rubber stamp the House bill, but rather passes its own ACA repeal and replacement legislation, either the Senate’s bill will need to go back to the House for another vote, or the House and Senate will “conference,” reconcile the differences between their respective bills, and produce a compromise piece of legislation that both chambers will then vote on.

Ultimately the same bill will need to pass both the House and Senate before going to the President for his signature.  In light of the House’s struggles to advance the AHCA, and the razor-thin margin by which it ultimately passed, it appears that we’re still in for a long road ahead.

HR Morning: What should employers be doing now?
Garrett Fenton: At this point, employers would be well-advised to stay the course on ACA compliance. The House’s passage of the AHCA is merely the first step in the legislative process, with the bill likely to undergo significant changes and an uncertain future in the Senate. The last few months have taught us nothing if not the impossibility of predicting precisely how and when the Republicans’ ACA repeal and replacement effort ultimately will unfold.  To be sure, the AHCA would have a potentially significant impact on employer-sponsored coverage.

However, any employer efforts to implement large-scale changes in reliance on the AHCA certainly would be premature at this stage.  The ACA remains the law of the land for the time being, and there’s still a long way to go toward even a partial repeal and replacement.  Employers certainly should stay on top of the legislative developments, and in the meantime, be on the lookout for possible changes to the current guidance at the regulatory level.

HR Morning: Specifically, how should employers proceed with their ACA compliance obligations in light of the House passage of the AHCA?Garrett Fenton: Again, employers should stay the course for the time being, and not assume that the AHCA’s provisions impacting employer-sponsored plans ultimately will be enacted.  The ACA remains the law of the land for now.  However, a number of ACA-related changes are likely to be made at the regulatory and “sub-regulatory” level – regardless of the legislative repeal and replacement efforts – thereby underscoring the importance of staying on top of the ever-changing guidance and landscape under the Trump administration.

Fenton also touched on how the “MacArthur amendment” and the direct impact it could have on employers by stating it:

“… could impact large group and self-funded employer plans, which separately are prohibited from imposing annual and lifetime dollar limits on those same essential health benefits.  So in theory, for example, a large group or self-funded employer plan might be able to use a “waiver” state’s definition of essential health benefits – which could be significantly more limited than the current federal definition, and exclude items like maternity, mental health, or substance abuse coverage – for purposes of the annual and lifetime limit rules.  Employers thus effectively could be permitted to begin imposing dollar caps on certain benefits that currently would be prohibited under the ACA.”

See the original article Here.

Source:

Bilski J. (2017 May 5). Health reform expert: here's what HR needs to know about GOP repeal bill passing [Web blog post]. Retrieved from address http://www.hrmorning.com/health-reform-expert-heres-what-hr-needs-to-know-about-gop-repeal-bill-passing/