2016 Election Results: The Potential Impact on Health and Welfare Benefits

If you missed our partner,United Benefit Advisors (UBA) checkout this article by Les McPhearson

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

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

Trump Policy Proposals

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

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

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

Speaker Ryan's "A Better Way" Proposal

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

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

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

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

Process of Repeal

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

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

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

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

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

See the original article Here.


McPhearson L.(2016 November 14). 2016 election results: the potential impact on health and welfare benefits [Web blog post]. Retrieved from address http://blog.ubabenefits.com/2016-election-results-the-potential-impact-on-health-and-welfare-benefits

Health insurers willing to give up a key ACA provision

Great article about new changes to the ACA from BenefitsPro by Zachary Tracer

U.S. health insurers signaled Tuesday that they’re willing to give up a cornerstone provision of Obamacare that requires all Americans to have insurance, replacing it with a different set of incentives less loathed by Republicans who have promised to repeal the law.


Known as the “individual mandate,” the rule was a major priority for the insurance industry when the Affordable Care Act was legislated, and also became a focal point of opposition for Republicans.

In a position paper released Tuesday -- the first since President-elect Donald Trump’s victory -- health insurers laid out changes they’d be willing to accept.

“Replacing the individual mandate with strong, effective incentives, such as late enrollment penalties and waiting periods, can help expand coverage and lower costs for everyone,” AHIP said.

That also includes openness to Republican ideas such as an expanded role for health-savings accounts and using so-called high-risk pools to cover sick people.

In return, insurers are asking Republicans to create strong incentives to buy insurance, and to ensure the government continues to make good on payments it owes insurers under the ACA. The paper was released by America’s Health Insurance Plans, or AHIP, the main lobby for the industry.

“Millions of Americans depend on their current care and coverage,” AHIP said in the document outlining its positions. The group called on lawmakers to “ensure that people’s coverage -- and lives -- are not disrupted.”

Republican replacement

Now that they’re set to gain control of the White House, Republican lawmakers are working to define their vision for replacing the law after years of attempts to repeal it. Obamacare brought insurance coverage to about 20 million people via an expansion of Medicaid and new insurance markets, and repealing the law without a replacement would leave those individuals without coverage.

Trump has said that repealing and then replacing the law will be one of his first priorities. Republicans in Congress, however, have signaled that they’ll need time to write a replacement -- potentially via a years-long delay between passing a repeal and implementing it -- to craft a replacement.

And AHIP on Thursday said insurers will need at least 18 months to create new products and get them approved by state regulators, if Republicans change the market. It could take even more time to educate consumers and change state laws, AHIP said.

“It’s taken six years to get where we are now and to demonstrate the failure of Obamacare, so it’s going to take us a little while to fix it,” said Senator John Cornyn of Texas, a member of the Republican leadership in the chamber.

Medicaid changes

Republicans may also make substantial changes to Medicaid, by turning the joint state-federal program into one where the U.S. sends “block grants” to the states, which exert more control. Vice President-elect Mike Pence said on CNN Tuesday that the Trump administration will “develop a plan to block-grant Medicaid back to the states” so they can reform the program. Some Medicaid programs are administered in part by private insurers.

AHIP said any such plans should ensure that payments are adequate to meet the health needs of individuals in Medicaid coverage. And they should ensure that when enrollment increases in an economic downturn, funds are available to help states deal with the increased demand, AHIP said.

AHIP is open to working with Congress on replacement plans for the ACA, said Kristine Grow, a spokeswoman for the lobby group. The document is the first detailed look at AHIP’s priorities.

Big insurers like UnitedHealth Group Inc. and Aetna Inc. are already scaling back from the ACA’s markets, because they’re losing money. At the same time, remaining insurers are boosting premiums by more than 20 percent on average for next year.

Trump’s election increased the level of uncertainty in the market, and a repeal bill without something to replace the law could destabilize it further. To shore up insurance markets, AHIP says lawmakers should fund a program, known as reinsurance, designed to help insurers with high costs, through the end of 2018, and avoid cutting off cost-sharing subsidies for low-income individuals.

See the original article Here.


Tracer Z.(2016 December 7). Health insurers willing to give up a key ACA provision[Web blog post]. Retrieved from address http://www.benefitspro.com/2016/12/07/health-insurers-willing-to-give-up-a-key-aca-provi?ref=mostpopular&page_all=1

The year in employer-based healthcare: ACA uncertainty and cost-stemming efforts

Great recap from Employee Benefits Advisors about the ACA over the past year by Phil Albinus

With President-elect Donald Trump now filling his cabinet with men focused on elimination and possible replacement of the Affordable Care Act, it’s no surprise the top EBA story of the year in healthcare was the ACA and its future in a new political landscape. Almost immediately following his win, the fate of the insurance law that gave coverage to an extra 20 million uninsured Americans became uncertain.

On the campaign, candidate Trump called Obamacare a failed plan and a disaster, and many benefit advisers shared that view. Immediately following his victory, President-elect Trump revealed that his health plan would likely continue hallmarks of the ACA, such as the pre-existing condition rule as well as the provision allowing parents to keep their 26 year-old children on their health plans, but details have yet to be released.

Still, industry experts agreed that one of the first elements of the ACA to go would be the Cadillac tax. The employer mandate was a top concern for employers in a survey that was taken immediately after the election. According to Aon, which conducted the survey one week after the election, the reason was uncertainty. “The employer mandate, which has the reporting obligations, the disclosure obligations, 1094 and 1095 forms and the service tracking ... all of that goes into the ACA. The concern is, is it going to be dropped, expanded or modified in some way?” said an Aon representative.

When it comes to the new administration’s healthcare team, Trump has chosen U.S. Representative Tom Price (R-Ga.) to head the Department of Health and Human Services. A physician and outspoken critic of the ACA, Price has previously introduced legislation to replace President Obama’s health insurance law.

Critics of the ACA seemed to be hearted by Price’s nomination. “I think [it] shows a seriousness [about] at least repealing key parts of the ACA. No. 1 on the list to go first I think is the Cadillac tax,” says Brian Marcotte, president and CEO of The National Business Group on Health.

Marcotte adds, “I also think the employer and individual mandates would also be on the docket, as well as the federal subsidies. There’s a lot that’s unclear [about] how that would be done, but there is a seriousness here with [Trump] appointing Price.”

According to Craig Hasday, president of Frenkel Benefits, the politically divisive ACA would have to be replaced by a plan that pleased both sides of the political aisle. “I would give the Democrats an ‘A’ for effort, but a failing grade in executing President Obama’s signature legislation. And to a large part, I attribute this to partisanship arrogance. The party of ‘hope and change’ didn’t stay focused on what has worked to make our country great: the democratic process,” he says.

Cost concerns on the ballot
In other 2016 healthcare news that could have an impact on the coming year, the rising cost of prescription drugs remains a top concern. This year, it even reached the ballot box. A proposition to regulate drug costs failed on the California ballot in November, but a similar plan could pass or fail in Ohio next year.

Voters in California decided that drug prices should not be regulated so that state agencies would pay the same prescription costs that the U.S. Department of Veterans Affairs pays for its prescriptions. Despite this defeat, Ohio voters will decide a similar piece of legislation on the ballot next year, which is virtually identical to California’s prop 61.

Consumer-driven healthcare: Exchanges and telemedicine
The emerging private health insurance exchange market continued to emerge this year as large-scale employers took a wait-and-see approach to this healthcare delivery option. This was not the case with small to mid-size companies that saw the benefits of technology platforms that aim to simplify shopping for coverage, administering plans, costs controls and achieving improved results. Since the private exchange market now numbers at least 150 players, “employers are taking a longer time to assess which exchange is right for them,” says Barbara Gniewek, a principal PwC’s healthcare practice.

The caution over private benefit exchanges for workers approaching retirement thawed a bit in 2016 as well. A Willis Towers Watson survey found that 56% of U.S. employers said they were confident that public exchanges will be a viable option for their pre-age 65 retirees who are not yet eligible for Medicare. Employers consider public exchanges to be “relatively stable after a rocky start,” too. “About 25% of large U.S. employers offer pre- and post-age 65 retiree health benefits,” says Willis Towers Watson senior director of policy affairs John Barkett. “This is down from the late 1980s when upwards of two-thirds of employers provided this kind of coverage.”

When it came to new technology, American employers enthusiastically jumped on the telemedicine bandwagon even if their employees did not. Telemedicine services — such as workplace kiosks connected to nurse practitioners — among large employers surged to 59% in 2016 from 30% in 2015, according to Mercer’s National Survey of Employer-Sponsored Health Plans. The survey of 2,544 participants also noted the potential for significant savings when health plan members have a telephonic or video visit to assess non-acute issues. A telemedicine visit averages $40 compared with a traditional office visit that usually costs $125. “Now we have to get people to use the service in order for members and plan sponsors to benefit from the offering,” says a Mercer healthcare reform leader.

When it comes to curbing costs and providing healthcare to workers, onsite clinics delivered in 2016. According to the Employer Measure of Productivity, Absence and Quality Survey from the National Business Group on Health and Truven Health Analytics, 60% of the employers surveyed offered an onsite clinic to some portion of their workforce. Employers offering onsite clinic access to their entire workforce saw an average of less than five workdays missed per employee in 2014 compared to employers without clinics. They reported an employee absence rate in 2014 at more than 20 days per employee.

See the original article Here.


Albinus P. (2016 December 15). The year in employer-based healthcare: ACA uncertainty and cost-stemming efforts[Web blog post]. Retrieved from address http://www.employeebenefitadviser.com/news/the-year-in-employer-based-healthcare-aca-uncertainty-and-cost-stemming-efforts?brief=00000152-1443-d1cc-a5fa-7cfba3c60000

4 holiday season fire prevention tips

by Caterina Pontoriero

It’s the holiday season and for many homeowners, it’s easy to neglect some of the most basic rules of home safety.

The hustle and bustle of activity this time of year can lead to property damage and injuries that normally can be easily prevented.

Denver-based insurance comparison shopping site InsuranceQuotes and Washington-based research firm Princeton Survey Research Associates International polled 1,000 American adults, asking them to recount the frequency of certain holiday hazards, including injuries to houseguests, weather-related driving accidents and fires caused by everything from cooking mistakes to misadventures with decorations.

According to the study, 16 million Americans have experienced a house fire because of a fryer or cooking accident, and 2 million have had fires caused by Christmas trees and other decorations.

Scott Humphrey, second vice president of risk control for New York City-based Travelers Cos., says homeowners file more claims for fire damage during this time of year than any other.

“Our claim data also shows that fire is one of the costliest claims,” Humphrey says. “If fire results in a total loss, it’s important that homeowners are insured for the total cost to rebuild, not just the market value of the home. Homeowners should be sure to review this point with their insurance agent or carrier.”

Here are some tips for homeowners to help prevent fanning the flames of fire risk:

1. Use deep fryers safely

While experts agree that it’s objectively safer to deep fry your turkey outside, they also say holiday chefs should make sure it’s set up on level ground at least 30 feet away from the home, trees or any other flammable objects.

“Believe it or not, dry leaves on the ground can serve as natural lighter fluid if there’s a mishap, so make sure to rake beforehand,” says Peter Duncanson, director of system development with the disaster restoration company ServiceMaster Restore.

2. Practice basic electrical safety

Humphrey says one of the main causes of fires this time of year result from electrical hazards like holiday lights, appliances or other devices that overload an extension cord or structural wiring in the home.

“It is especially important to inspect your strands of lights for frayed cords and cracked lamps before stringing them up,” Humphrey says. “Also, turn off your lights when you go out for the evening or when you go to bed so you don't wake up or come home to a fire.”

3. Use candles with caution

Candles are traditionally used in many holidays this season, but despite adding a warm and inviting touch to holiday tablescapes, candles can be as damaging as they are delightful, and Bud Summers, vice president of operations for Tamarac, Florida-based property restoration company PuroClean, suggests homeowners proceed with extreme caution when considering the placement of their holiday candles.

“Avoid setting them near curtains, towels, or anywhere they may be knocked over or forgotten about,” Summers says. “Make sure to leave approximately one foot of space between your burning candle and anything else. Be sure that the candle has a stable base and always extinguish the flame before leaving the house or room, or going to bed. When guests leave, designate someone to walk through each room to make sure candles are blown out.”


4. Care for the Christmas tree

When maintained properly, the only harm caused by a Christmas tree is the mess of fallen needles it inevitably leaves behind. But if it’s neglected, homeowners could find themselves with a significant fire hazard perched in the middle of their living room.

Related: 4 tips to avoid a Christmas tree fire

“Real Christmas trees are more likely to start a fire than artificial ones, especially over time as the tree tends to dry out. And it only takes 30 seconds for a dry tree to engulf a room when a fire is ignited,” Summers says. “If you choose to go the natural route, making sure to keep the tree moist and full of water will significantly decrease your chances of unintentional fire.”

See the original article Here.


Pontoriero C.(2016 December 8). 4 holiday season fire prevention tips[Web blog post]. Retrieved from address http://www.propertycasualty360.com/2016/12/08/4-holiday-season-fire-prevention-tips?eNL=58496aa3160ba015228ec3eb&utm_source=PC360_NewsFlash&utm_medium=EMC-Email_editorial&utm_campaign=12082016&page_all=1

Ballot Measures Expand Marijuana Use in 8 States

Ballot measures to expand the use of marijuana passed in eight states last month, bringing the total number of states allowing some form of legalized marijuana use to 28, including the District of Columbia.

The following offers a brief summary of those ballot measures:

  •  Arkansas, Florida, Montana and North Dakota passed ballot measures that allowed or expanded the use of medicinal marijuana.
  • California, Maine, Massachusetts and Nevada passed ballot measures that legalized recreational marijuana use.
  • Voters in a ninth state, Arizona, rejected a ballot measure that would have legalized recreational marijuana use.

What remains unclear is what stance the Trump administration will take regarding enforcement of federal laws. Currently, marijuana remains illegal under federal law, and distributing marijuana is a federal offense. However, the Obama administration has been relaxed in its enforcement of federal marijuana laws.

Employers may want to review their employment policies regarding marijuana use, as well as consider local and state laws. For more information on what employers’ rights and responsibilities are regarding employee marijuana use, contact Hierl Insurance Inc. and ask for our Compliance Bulletin: Marijuana Use Legalized in 8 States

88 Percent of Employees Lack Knowledge to Prevent Cyber Incidents

According to a recent report, 88 percent of employees lack the understanding necessary to prevent common cyber incidents. That report is based on the results of a survey given to more than 1,000 employees across the Unites States, and was designed to test the level of knowledge and awareness of cyber security among employees by asking them to name proper behaviors in given circumstances. The survey covered eight risk domains and assigned three risk profiles—Risk, Novice and Hero—to indicate an employee’s privacy and security awareness IQ.

Key findings from the report include the following:

  • Only 12 percent of respondents earned a “Hero” profile, while 72 percent were given a “Novice” profile and 16 percent were given a “Risk” profile.
  •  Almost 40 percent of respondents disposed of a password hint using unsecure means.
  • About 25 percent of respondents failed to recognize a sample phishing email, even though it came from a questionable sender and included an attachment.

This report highlights one of the key vulnerabilities of any organization—employees’ lack of basic cyber security knowledge. Regardless of other hardware or network protections, employees can and will allow cyber criminals into an organization, often without even realizing it.

Fortunately, employee cyber training can help reduce this risk to your organization. For employee cyber training resources, contact Hierl Insurance Inc. today and ask about our Employee Cyber Training Manual.

BLS Reports Injuries and Illnesses Continue to Decrease

The latest numbers released by the U.S. Bureau of Labor Statistics (BLS) show that the rate of workplace injuries and illnesses are the lowest they’ve been in 13 years.

The BLS’s Survey of Occupational Injuries and Illnesses (SOII) showed that, in 2015, the rate for private industry workers was 3.0 recordable cases per 100 full-time equivalent workers—down from 3.2 in 2014. The rate for state and local government workers, conversely, increased slightly, from 5.0 in 2014 to 5.1 in 2015. Combined, the overall rate dropped from 3.4 in 2014 to 3.3 in 2015.

Despite an increasing population, the total number of cases dropped as well. The BLS estimates that there were 3.66 million injury and illness cases in 2015, down from 3.68 million in 2014.

The most notable outlier was in the public health care sector. For instance, public nursing home workers experienced an injury and illness rate of 12.6, while their private sector counterparts experienced a rate of 6.8.

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Travel is millennials’ work incentive

Do you know what millennials are looking for in the workplace? Travel and flexibility are among the top 2 as mentioned in the article below by Marlenen Y. Satter.

Original Article Posted on BenefitsPro.com

Posted: October 7, 2016

Millennials have itchy feet.

In fact, their desire to see faraway places is their main reason to work — after, of course, paying basic necessities. According to FlexJobs survey, a hefty 70 percent of millennials say their “overwhelming desire to travel” is their main motivation on the job — that’s just a tad less than the 88 percent who cite that basic motivator: necessities.

Gen X respondents are fond of travel too, but not as much as millennials; 60 percent ranked it as the fourth most important reason for working. And boomers are apparently settling down; just 47 percent ranked travel as fifth in importance.

Not only are millennials wanderers, they want flexibility — up to a point. Freelance work seems to be going farther than they’d like (particularly since at least some of that “flexibility” is really out of a freelancer’s control and in the hands of clients).

Although millennials tend to be more associated with freelance work than other generations, only 42 percent of millennials are open to freelancing as a flexible work arrangement.

Gen Xers actually view freelance work more favorably than millennials, with 47 percent willing to consider it. Forty-four percent of boomers also expressed interest in freelancing.

Flexibility, on the other hand, is important enough to millennials that 82 percent say it’s a factor in evaluating a potential job, and 34 percent have actually left a job because it did not have work flexibility. In addition, 82 percent say they’d be more loyal to an employer if they had flexible work options.

Yet, although they’re the ones most interested in flexibility, millennials are also the generation most required to be at the office to work than older generations: 34 percent, compared with Gen Xers at 26 percent and boomers at 19 percent. Their work schedule — part of that flexibility — is also important to more millennials (65 percent) than it is to Gen Xers (57 percent) or to boomers (62 percent).

Interestingly, though, none of the generations regard the office during traditional working hours as their location of choice for optimum productivity.

See the Original Article Here.


Satter, M.Y. (2016, October 7) Travel is millennials' work incentive [Web log post]. Retrieved from http://www.benefitspro.com/2016/10/07/travel-is-millennials-work-incentive?ref=hp-top-stories

The Next Innovation In Controlling Healthcare Costs

As healthcare costs continually increase, understanding where the cost come from and how to manage them is critical. Bruce Barr gives a great editorial on why new trends are essential in controlling costs.

Original post from EmployeeBenefitAdviser.com on August 1, 2016.

Four decades ago, PPOs were hailed as the “silver bullet” to control healthcare costs. Participating providers were contractually obligated to accept discounted fees, which seemed like an obvious solution to out-of-control increases in healthcare costs. Self-funded plan sponsors readily adopted this approach to gain access to network discounts and lower their healthcare costs. In fact, some self-funded plan sponsors still periodically conduct a re-pricing analysis or another method of comparing which PPO yields the best discounts for their specific group.

However, as provider contacts expired, they were renegotiated at higher rates for providers and higher costs for plan sponsors. In addition, hospital charge-masters have increased at an exorbitant pace and have largely gone unregulated and uncontrolled. As a result, the significant discounts once achieved by PPOs no longer deliver the true savings that were seen in the 1980s and 1990s.

For example, a 60% discount on a $1,000 “oral cleansing device” (more commonly referred to as a toothbrush) clearly does not deliver value for the plan sponsor or member and is indicative of some of the billing practices that go undetected. The same could be said of a $150,000 knee replacement. Using a PPO for its discounted fees is somewhat analogous to buying a car by negotiating a discount off the list or sticker price.

As employers gain a better understanding of the questionable value of PPO discounts and pricing optics, reference based pricing (RBP) and reference based reimbursement (RBR) provide possible solutions by addressing the demand for:

· Price transparency,
· Benchmarking the cost of claims,
· Eliminating inappropriate charges, and
· A fiduciary or co-fiduciary serving on behalf of the plan sponsor.

With RBP, the plan specifies the amount that will be allowed for certain common procedures such as MRIs or knee replacements based on prevailing charges. Covered members have access to a list of participating providers who have agreed to accept these payments. Should the member choose a higher-priced provider, he or she may be responsible for the balance of the payment.

RBR uses a common “pricing reference” — often tied to the Medicare allowance and the actual cost for a specific service – and then reimburses the hospital or facility an additional 20-80%, allowing for the provider to make a “fair and reasonable” profit. For context, many PPO discounts result in net payments equal 250% or more of the Medicare allowance.

There are different ways this strategy can be implemented. Some employers begin using RBR exclusively for out-of-network claims. In other cases, RBR is used for all facility claims in conjunction with a PPO network for physician claims or an accountable care organization.

While used successfully by many employers, RBR can be disruptive for some employees when a provider attempts to “balance bill” patients for the difference between the set plan allowance and the provider’s billed charges. In the overwhelming majority of cases, however, these issues are quickly and easily resolved in favor of the plan sponsor and member. Rarely does a discrepancy like this lead to legal action.

Employers who decide to implement a RBR strategy need to carefully select a partner with expertise in communicating and educating employees about how these arrangements work and what to do should they receive a balance bill. The RBR partner should also have expertise in negotiating pricing discrepancies with providers, providing employee advocacy, indemnifying the plan and its members, and modifying the language in the plan document.

Many early adopters of this approach were often those who were subject to extreme increases in healthcare costs and who saw RBP and RBR as a last ditch effort that would enable them to continue to provide medical benefits for their employees. We’re now beginning to see more employers adopt this approach as a way to more effectively determine and control the cost of healthcare.

See Original Post Here.


Barr, B.F., (2016, August 1). The next innovation in controlling healthcare costs [Web log post]. Retrieved from http://www.employeebenefitadviser.com/opinion/the-next-innovation-in-controlling-healthcare-costs

See Which Employers Are Aggressively Increasing Rx Tiers for Cost Savings

How are you handling the rising cost of prescriptions? Find out what the trends are and how other employers are handling increasing costs from the UBA Health Plan Survey.

Original Post from UBABenefits.com on July 21, 2016 by Bill Olson, Chief Marketing Officer at UBA.

The Latest UBA Survey data shows employers are flocking to two strategies to control rising prescription drug costs: moving to blended copay/coinsurance models vs. copay only, and adding tiers to the prescription drug plans. Almost half (48.9%) of prescription drug plans utilize three tiers (generic, formulary brand, and non-formulary brand), 4.3% retain a two-tier plan, and 44.1% offer four tiers or more. The number of employers offering drug plans with four tiers or more increased 34% from 2014 to 2015. The fourth tier (and additional tiers) pays for biotech drugs, which are the most expensive. By segmenting these drugs into another category with significantly higher copays, employers are able to pass along a little more of the cost of these drugs to employees. Over the last two years, the number of plans with four or more tiers grew 58.1%, making this a rapidly growing strategy to control costs.

Employers with 1 to 99 employees have been driving the trend to adopt prescription drug plans with four or more tiers. In three years, plans with four or more tiers increased approximately 60% among these groups, making this the top cost-containment strategy for small employers, who make up the backbone of America.

Even the largest employers (1,000+ employees), 81% of which historically have offered plans with two or three tiers, have seen a 12.9% decrease in these plans as they, too, migrate to plans with four or more tiers (albeit more slowly).

The construction, mining and retail industries have also been steadily leading the migration to plans with four or more tiers over the last three years, and in the latest UBA survey, 47.5%, 53.2% and 46.3% of their respective plans fall in this category. But this year, the utilities industry has made a more sudden switch, with 58.3% of those plans now consisting of four or more tiers, leapfrogging its perennial tier-climbing peers. This is a significant jump, considering nearly 20% of plans in the utilities industry were still two-tier plans just three years ago—far more two-tier plans than any other industry group at that time. However, this wasn’t a total surprise since, in the 2014 survey year, the industry had an above-average amount of three-tier plans (65.9% vs. an average of 57.1%).

The education and manufacturing industries are more reluctant to shift to plans with four or more tiers. Over the last three years those industries have maintained the highest amounts of three-tier plans, and in the latest survey, 52.8% of their plans remain at three tiers.

Two-tier plans are becoming nearly as rare as single-tier plans, shrinking 45% to 4.3% of all prescription plans in three years. Agriculture has the most holdouts, with 14.8% of plans still comprised of one or two tiers.

Regionally, the East Central U.S. has been leading the migration to plans with four or more tiers for the last three years, followed by North Central and Southeast employers. In the 2015 survey year, Southeast employers eclipsed East Central employers with 60.7% of their plans with four or more tiers.

Strangely enough, East Central and Southeast employers have the lowest percentage of three-tier plans (34.3% and 34.1%, respectively) but the highest percentage of single-tier plans (4.7% and 4.2%, respectively). Other Western employers (excluding California) also have below-average three-tier plans (40.6%), above-average four-tier plans (49.1%) and above-average (10.2%) one- to two-tier plans.

Groups increasing tiers most aggressively for cost savings

California employers have the most two-tier plans (22.9% vs. the average of 4.3%) which, although still off the charts, represents a 20% decline from the previous survey year.

Mid-Atlantic and New England employers have had the most three-tier plans for the last three years, making them the top resisters of plans with four or more tiers over time.

Groups resisting 4+ tier plans

For more information on prescription drug trends, including the companies making an early leap to five-tier plans, download UBA’s free (no form!) publication: Special Report: Trends in Prescription Drug Benefits.


Olson, B (2016, July 21). See which employers are aggressively increasing Rx tiers for cost savings [Web log post]. Retrieved from http://blog.ubabenefits.com/see-which-employers-are-aggressively-increasing-rx-tiers-for-cost-savings

Industry Trends Emerge in Mail Order Drug Benefits

Mail Order Drugs have been a recent trend but will the rise in prescriptions impact this trend? Mary Drueke-Collins with UBA Partner Firm Swartzbaugh-Farber & Associates analyzes where this trend is going in the article below.

Original Post from UBABenefits.com on July 8, 2016.

Mail order has always been a convenient way for individuals to keep their maintenance drug prescriptions filled. Employers often wonder, are there other advantages to using mail order other than convenience? As an employer, should we be incentivizing mail order? The answers to some of these questions can be found in results from the latest UBA Health Plan Survey.

Mail order can provide cost savings to both the employee and the employer. In the past, mail order provided much larger savings because it allowed for a 90-day supply, something not available through traditional retail settings. These days, however, more retail pharmacies are offering 90-day supplies, so the cost savings achieved by using mail order are slightly lower than they have been historically. We anticipate those savings will diminish even more as the costs of prescription drugs continue to increase.

Many employers pass on these savings to employees by requiring fewer copays when filling a prescription for 90 days via mail order. Unfortunately, not every employer has the luxury of incentivizing their employees to utilize mail order. Some states, like Nebraska, have laws that limit an employer’s ability to do so. These states prohibit fully insured plans from incentivizing mail order over retail, thus requiring individuals covered by a fully insured health plan to pay the same number of copays for a 90-day supply through the retail and mail order setting.

Those employers that are self-funded, or are not limited by state laws, have the ability to structure the copays of the mail order plan to encourage individuals to use mail order. According to the UBA Health Plan Survey, nationally 85% of employers that offer mail order require the individual to pay something other than three copays for a 90-day mail order supply. Nearly 39% of the respondents call for only one or two copayments for a 90-day mail order prescription.

As you look more closely at the data, you can see trends appearing by industry. Employers in educational services tend to provide the most incentive to utilize mail order, with only 4.6% of the plans needing three copayments for a 90-day supply, followed closely by the public administration and information industries.

Conversely, 34.4% of employers in the mining, oil and gas extraction industry required three copays or the least incentive to utilize mail order. The agriculture, forestry, fishing and wildlife plans were next in line with 20.3% of the plans of the survey had three copayments.

Even if there is no cost incentive to the covered individual, most employers still offer the opportunity for their employees to use mail order prescription services. In 2015, nationally only 4.9% of plans did not offer the mail order option. As you focus the data into industry groupings, you see 98.5% of employers responding to the survey that operate in the utilities industry offer mail order to their employees. The education services industry follows with 97.3% of the plans offering mail order services. On the other hand, just over 10% of the plans responding in both the agriculture, forestry, fishing and wildlife industry and management of companies and enterprises offered mail order as an option in the prescription drug plan.

Industry differences are likely due to the involvement of union negotiations, their employees' access to retail pharmacies (or convenience of non-mail order facilities), and level of overall benefit richness. The utilities and educational industries have historically offered richer benefit plans, and allowing the covered participants a lower cost mail order option continues that trend.

As the prescription drug industry evolves, we anticipate the cost benefits of providing a mail order program will shrink and eventually the copay incentives we see now will diminish. Mail order will continue to be a more convenient method of filing prescriptions and may actually improve the health of individuals on maintenance drugs by keeping them compliant with their prescriptions. For now, if you are an employer wondering whether mail order is worth incentivizing, the answer is still primarily "Yes!"

For more information on prescription drug trends, subscribe to the UBA blog, read our breaking news release or download UBA’s free (no form!) publication: Special Report: Trends in Prescription Drug Benefits.

Read the Orginal Article Here.


Drueke-Collins, M. (2016, July 8). Industry trends emerge in mail order drug benefits [Web log post]. Retrieved from http://blog.ubabenefits.com/industry-trends-emerge-in-mail-order-drug-benefits

Keep Employee Data Safe

Original post benefitspro.com

When a cyber breach occurs, lawsuits are usually not far behind. It’s a chain of events that has become de rigueur in the consumer realm when retailers experience a breach and it is bleeding over into the workplace, too.

Employees whose data is exposed are increasingly pointing the finger at failings in the technology employers use to secure their information and lapses in protocols that allow vulnerabilities to be exploited.

Who is responsible if your employees’ personal information is stolen on company time? Where does the company’s obligations begin and end under the duty of care laws? How might state and federal breach regulations impact an organization’s proactive and reactive data security efforts?

How a breach happens and how the company responds both play a major role in determining the potential legal ramifications. To mitigate the risks, it is critical for HR professionals to understand their responsibilities before a cyber criminal strikes.

Many employers aren’t even aware of either the enormous security risks their organizations face or the best strategies to protect the employee data they hold.

Ensuring that employers have access to the right tools and expertise to address data breach concerns is an important role for benefits managers and the brokers and agents who support them.

Know the risks, have a plan

Financial information is what comes to mind most frequently when businesses consider where breach risks exist, but that thinking is too narrow. It overlooks the incredible value inherent in employee data. Not only does financial information lurk within HR’s employment records in the form of salary histories and bank routing numbers used for automatic deposits, but standard consumer data is also present.

Full names, birth dates, addresses and social security numbers exist in every employee’s file. Health and benefit data may be present, too, such as carrier names, subscriber numbers, or details on beneficiaries and dependents. And where there’s smoke, there’s fire. The same servers and systems that host employee and customer data, likely hold data pertaining to trade secrets, M&As, business plans, and more. All the more reason to get your company’s cyber strategy in gear.

Adding complexity to the situation is the fact that employers must be concerned with two types of data breaches — those that are the result of a purposeful act, such as a hacker or a malicious insider, and those that occur by accident. Lost laptops and cell phones are just one common example where an inadvertent exposure could easily happen.

Each flavor of breach represents a different risk profile and each requires its own mitigation measures. A two-pronged approach to breach prevention that marries technology and best practices enables employers to address any existing security gaps while also providing improved protection for employee data.

Deploying technology tools to safeguard sensitive information assets is one part of a comprehensive data security strategy that keeps employers in line with duty of care laws and other breach regulations.

Firms have a range of solutions to choose from and they should tailor their approach based on their network and infrastructure architecture, the information types that are vulnerable to exposure, the volume of data that must be protected, resource availability — from funding to staffing — and any regulatory guidelines or compliance mandates that must be considered.

Encryption is a perfect example of a technology that is relatively simple, but still enormously effective when it comes to securing employee data. Free and low-cost encryption platforms are available which can help to protect confidential information from unauthorized access even if a hardware item (thumb drive, laptop, etc.) falls into the wrong hands.

Other technology tools may also be appropriate depending on the employer’s needs, including firewalls, mobile device management software, and multi-factor authentication to protect access to more sensitive systems.

Security best practices are the second half of a successful data protection strategy. These protocols largely deal with the ways humans interact with the organization’s information and they also cover what to do in the event of a breach. Employers will want to manage network and data access in a way to limits who is able to view and change employee information.

Methodologies for storing, processing, analyzing, archiving, and destroying employee data should be documented in detail and anyone responsible for those tasks must be trained on the organization’s security practices.

An incident response plan is another best practice employers should include under the data security umbrella. This doesn’t need to an exhaustive plan, but it should outline the steps employees are to take if they suspect a breach has occurred — everything from blocking access to compromised servers to contacting the company’s privacy or information security employee or consultant. (Don’t have one? Here’s why you should.)

A strong plan can significantly limit the potential harm that is likely to fall upon any employee whose data was exposed. And as risks evolve, so should the incident response plan – it should be a living, breathing part of a comprehensive cyber strategy with routine reviews.

Retain the right expertise

Another concern often faced by employers, particularly those smaller organizations where internal resources are lean, is that they don’t have good insight into the evolving cyber threat environment and the latest data protection strategies.

Efforts to craft, deploy, and maintain an effective privacy and security program are made more difficult when industry expertise is lacking. Without a strong understanding of where security vulnerabilities exist, or which new threat vectors are likely to be of concern, employers could find themselves directing their limited resources in too many directions and without much effect.

Because many breach scenarios involve little or no technology — hard copies of completed enrollment forms accidentally left in a shared conference room, for example — simply turning responsibility for data privacy over to the IT function isn’t going to work. It’s important that employers are able to seek guidance from someone experienced in data protection in all its forms.

Continuously educate the front line

Employees themselves may pose potential security challenges, so continuous training is essential to protect a company’s own data and that of its customers. Companies should consider implementing educational sessions about new scams and privacy and security refreshers as part of their annual compliance training.

By partnering with employees to help protect their data, the organization can maximize its technology investment and ensure that everyone is committed to the company’s culture of security.

Social engineering schemes are increasingly popular among hackers, effectively turning the workforce into either an employer’s first line of defense or its greatest weakness.

The most recent spoof comes courtesy of a company’s top executive — or so the scammer wants you to think. An employee will receive a request from the CEO — either by way of a hacked email account or an email address that closely resembles the real thing — to cough up documents, usually W-2s. With a few clicks, countless data about a company’s employees has been exposed.

Rather than quickly react, employees should be trained that if they see something, say something.

Identity management

Along with taking appropriate security measures internally, employers may also consider offering identity-related benefits to their employees. These packages bring a powerful suite of tools to the table that provide workers with proactive education and reactive support. Informational resources teach individuals how to spot corrupt websites and suspicious e-mail links.

They give details on what to look for when conducting annual credit report reviews. And workers concerned their personal data may have been exposed — whether at work or through a health care provider, retailer or other avenue — have access to identity theft experts able to help them navigate the resolution process.

The fraud team can assist them in replacing important documents that may have been lost due to theft, fire or flood. They can even monitor known black market websites to see if an employee’s stolen data is being used fraudulently.

Together, these strategies give employers a way to keep employees’ information safe while providing workers with assurances that they’ll have the support they need if the worst should happen.