Employers are turning to consumer-directed health care to help lower costs more than ever. Many employers turn to health flexible spending accounts ("health FSAs"), health reimbursement arrangements ("HRAs") and health savings accounts ("HSAs") to accomplish this goal. These are all types of consumer-driven health care, each with its own compliance-related issues. Surprisingly, many employers do not realize that health FSAs and HRAs require ERISA compliance. Plus, healthcare reform and recent IRS regulatory guidance impacts consumer-directed accounts. Employers must be more cautious than ever to ensure they are not inadvertently operating their consumer-directed plans out of compliance with a variety of employee benefits laws.
Please be very aware of the changes and contact me if you need some guidance. Rules have changed.
Tuesday, March 10, 2015
Tuesday, February 10, 2015
Should you "Self-Fund" your group health care plan?
Self-funding an employee health benefit plan is a long-term health strategy to save money
because it can provide an excellent opportunity for a company to achieve immediate savings
plus sustainable cost control. However, smaller employers may be hesitant to self-fund their health plan because they commonly perceive it as appropriate only for large companies.
Establishing the right health plan can become an integral part of the growth and success of
your company.
Smaller employers can be hesitant to self-fund a health plan because such plans are perceived as only appropriate for large employers. However, there exists new and innovative products and services specifically designed for employers with fewer than 250 employees that can make a self-funded health plan a compelling option for employers with as few as 25 employees.
This plan is called Level Funded or "Agg" only product. Individual Stop-loss insurance is purchased to protect the employer. With individual stop-loss insurance, when health claims reach a specific dollar limit in a plan year for a covered individual, the stop-loss insurance policy reimburses the employer’s health plan for claim amounts above the individual stop-loss insurance
limit. For example, if an employer has individual stop-loss insurance of $25,000 and an individual has $85,000 worth of claims, the stop-loss insurance policy would reimburse the employer’s health plan $60,000. The cost of stop-loss insurance is a monthly premium, and there are a variety of stop-loss insurance dollar amounts from which to choose. For employers with fewer than 250 employees,Pekin GPS offers stop-loss insurance with individual dollar limits.
They also deal with stop-loss carriers that reimburse the plan promptly when the stop-loss dollar limit is reached. Otherwise,your company could be responsible for covering the full amount of any excess claims until it’s reimbursed under the stop-loss insurance policy.
If claims are lower than predicted, the employer can save money directly, compared to paying the set monthly premium of a fully insured plan, while the stop-loss insurance policy puts a ceiling
on the maximum amount the employer would pay in claims.
because it can provide an excellent opportunity for a company to achieve immediate savings
plus sustainable cost control. However, smaller employers may be hesitant to self-fund their health plan because they commonly perceive it as appropriate only for large companies.
Establishing the right health plan can become an integral part of the growth and success of
your company.
Smaller employers can be hesitant to self-fund a health plan because such plans are perceived as only appropriate for large employers. However, there exists new and innovative products and services specifically designed for employers with fewer than 250 employees that can make a self-funded health plan a compelling option for employers with as few as 25 employees.
This plan is called Level Funded or "Agg" only product. Individual Stop-loss insurance is purchased to protect the employer. With individual stop-loss insurance, when health claims reach a specific dollar limit in a plan year for a covered individual, the stop-loss insurance policy reimburses the employer’s health plan for claim amounts above the individual stop-loss insurance
limit. For example, if an employer has individual stop-loss insurance of $25,000 and an individual has $85,000 worth of claims, the stop-loss insurance policy would reimburse the employer’s health plan $60,000. The cost of stop-loss insurance is a monthly premium, and there are a variety of stop-loss insurance dollar amounts from which to choose. For employers with fewer than 250 employees,Pekin GPS offers stop-loss insurance with individual dollar limits.
They also deal with stop-loss carriers that reimburse the plan promptly when the stop-loss dollar limit is reached. Otherwise,your company could be responsible for covering the full amount of any excess claims until it’s reimbursed under the stop-loss insurance policy.
If claims are lower than predicted, the employer can save money directly, compared to paying the set monthly premium of a fully insured plan, while the stop-loss insurance policy puts a ceiling
on the maximum amount the employer would pay in claims.
Sunday, February 8, 2015
China Suspected in Anthem Cyberattack
The massive cyberattack against health insurer Anthem Inc. received significant coverage on television and in print, garnering nearly seven minutes of coverage across all three network newscasts Thursday night. Sources indicate the attack, which compromised the personal information of tens of millions of Americans, may have originated in China. A number of media outlets portray the attack as the latest example of broader cybersecurity issues across the healthcare industry.
Scott Pelley reported in the lead story for CBS Evening News (2/5, lead story, 2:50, Pelley) that “cyber thieves” broke into a database at Anthem Inc., the country’s second-largest health insurer, jeopardizing the privacy of “millions of Americans.” The company “says that database contains 80 million records, including names, birth dates, and social security numbers,” though it’s unclear whether the hackers gained access to health records. Speaking on the potential fallout from the breach, American Medical Association President Robert Wah, MD, said, “If you lose your credit card, we all know you call 1-800-I lost my card and they turn your credit card off. There is no one-800-I lost my health record and you can turn off all that rich information in your health record.” CBS Correspondent Kris Van Cleave added that sources “say the FBI Is looking into the possibility the attack came from overseas, possibly China.”
Correspondent Pete Williams reported on NBC Nightly News (2/5, story 2, 2:40, Williams) that the Anthem cyberattack “is different from the recent big hack attacks of Target and Home Depot,” which “went after credit cards and account numbers.” This time, “the hackers were targeting the kind of personal information that can be used to steal someone’s identity.” Anthem says it appears no medical information or credit card numbers were compromised, “but it says a trove of personal data was stolen – names, social security numbers, birth dates, street and email addresses, and employment information.”
Scott Pelley reported in the lead story for CBS Evening News (2/5, lead story, 2:50, Pelley) that “cyber thieves” broke into a database at Anthem Inc., the country’s second-largest health insurer, jeopardizing the privacy of “millions of Americans.” The company “says that database contains 80 million records, including names, birth dates, and social security numbers,” though it’s unclear whether the hackers gained access to health records. Speaking on the potential fallout from the breach, American Medical Association President Robert Wah, MD, said, “If you lose your credit card, we all know you call 1-800-I lost my card and they turn your credit card off. There is no one-800-I lost my health record and you can turn off all that rich information in your health record.” CBS Correspondent Kris Van Cleave added that sources “say the FBI Is looking into the possibility the attack came from overseas, possibly China.”
Correspondent Pete Williams reported on NBC Nightly News (2/5, story 2, 2:40, Williams) that the Anthem cyberattack “is different from the recent big hack attacks of Target and Home Depot,” which “went after credit cards and account numbers.” This time, “the hackers were targeting the kind of personal information that can be used to steal someone’s identity.” Anthem says it appears no medical information or credit card numbers were compromised, “but it says a trove of personal data was stolen – names, social security numbers, birth dates, street and email addresses, and employment information.”
Repeal and Replace
On Tuesday, the House voted for the fourth time to repeal the Patient Protection and Affordable Care Act (PPACA). This was the first time during this congressional session and the 56th overall repeal of all or part of the law. The vote for H.R. 596 was 239-186 and included three Republican 'no' votes from Bob Dold (R-IL-10), John Katko (R-NY-24) and Bruce Poliquin (R-ME-2); all of whom represent districts previously represented by Democrats. There were no Democrats who crossed-over to vote yes, with many of those Democrats who supported repeal no longer in Congress. Speaker Boehner contended that this vote allowed the 47 new House Republican members to have a chance to vote against the law. The repeal includes a six-month delay before it would take effect to allow Congress enough time to develop a replacement plan.
The repeal now heads to the Senate where Senator Ted Cruz (R-TX) introduced companion legislation to repeal with a six-month delay. This bill is likely to skip the committee process under Rule 14, and instead head straight to the Senate floor. Majority Leader Mitch McConnell has not yet announced a schedule for a floor vote. Crossing the 60-vote threshold in the Senate will be a challenge, as few moderate Democrats remain to join the chamber's 54 Republicans in voting for repeal. However, there could be potential to pass a repeal in the Senate by the budget reconciliation process, which only requires 51 votes, and was the process by which PPACA was ultimately passed in 2010. Yet, even with a passage, President Obama has made it clear that he will veto a full repeal of the law.
The repeal now heads to the Senate where Senator Ted Cruz (R-TX) introduced companion legislation to repeal with a six-month delay. This bill is likely to skip the committee process under Rule 14, and instead head straight to the Senate floor. Majority Leader Mitch McConnell has not yet announced a schedule for a floor vote. Crossing the 60-vote threshold in the Senate will be a challenge, as few moderate Democrats remain to join the chamber's 54 Republicans in voting for repeal. However, there could be potential to pass a repeal in the Senate by the budget reconciliation process, which only requires 51 votes, and was the process by which PPACA was ultimately passed in 2010. Yet, even with a passage, President Obama has made it clear that he will veto a full repeal of the law.
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