pcohen

About pcohen

This author has not yet filled in any details.
So far pcohen has created 100 blog entries.

5 Strategies for Reducing Health Benefits Costs in 2021

Health benefits costs are almost certainly going to rise in 2021. They’ve been trending upward for years—over 50% in the last decade, according to the Kaiser Family Foundation—and the current state of economic uncertainty over COVID-19 won’t slow things down. Realistically, after enduring months of business closures and managing exhausted workforces, many employers will be lucky to maintain uninterrupted operations.

That’s why it’s critical for employers to think about reducing health costs right now—figure out cost-effective benefits first so money can be shuffled as needed later. Having a solid plan going into 2021 will better position organizations facing limited budgets.  Better yet, work with your advisor on a 3-5 year benefits strategy to control costs instead of playing the year-to-year renewal game.

Here are five basic cost-reduction strategies employers should explore:

1. Dig Into Health Costs

Employers don’t let themselves overpay for the materials they use during production, so why is health care any different? Employers should look into every health care figure they can, from overall premium costs to individual employee expenditures. Understanding where money goes can help focus cost-cutting efforts.
For instance, if employees are going to the emergency room for every health visit, employers know they must promote more health literacy among their workforce.
Speak with Broad Reach Benefits for details about digging into your health plan cost data.

2. Embrace Technology

The health care landscape of today is starkly different than the one of even a few years ago. Now, the name of the game is virtual health care or “telemedicine.” There are numerous ways for individuals to take charge of their health care without the hassle—and added cost—of in-person consultations.
For example, there is tech that can monitor glucose levels to help diabetic employees without test strips; there are …

By |September 8th, 2020|Employee Benefits, Employee Benefits Adviser, Medical|Comments Off on 5 Strategies for Reducing Health Benefits Costs in 2021

Our Team is Here for You, Your Employees and Their Families

Our team is focused on helping our many friends, clients, and associates through these difficult times. There is tremendous pressure to either maintain business operations or figure out how to restructure in the short-term to come out on the other side of this pandemic. Either way, it is no small feat.

We are here to help, with no strings attached. We have the information and the resources to help. Feel welcome to reach out to any of our team for information or assistance relating to employee benefits or property & casualty issues, compliance, or the latest COVID-19 regulations that are coming out at a rapid pace.

We are Stronger Together!

Watch our Stronger Together Video

By |April 10th, 2020|Employee Benefits, Uncategorized|Comments Off on Our Team is Here for You, Your Employees and Their Families

Treating Employees Differently- Health Plan Rules

Do you want to be selective and treat employees differently for purposes of group health plan benefits?  For example, some employers may consider implementing the following plan designs:

  • A health plan “carve-out” that insures only select groups of employees (for example, a management carve-out);
  • Different levels of benefits for groups of employees; or
  • Employer contribution rates vary based on employee group.

In general, employers may treat employees differently, as long as they are not violating federal rules that prohibit discrimination in favor of highly compensated employees. These rules currently apply to self-insured health plans and arrangements that allow employees to pay their premiums on a pre-tax basis. The nondiscrimination requirements for fully insured health plans have been delayed indefinitely.

Employers should also confirm that any health plan rules do not violate other federal laws that prohibit discrimination. In addition, employers with insured plans should confirm that carve-out designs comply with any minimum participation rules imposed by the carrier.

Health Plan Design – General Rules

Nondiscrimination Tests

In general, a health plan will not have problems passing any applicable nondiscrimination test when the employer treats all of its employees the same for purposes of health plan coverage (for example, all employees are eligible for the health plan, and the plan’s eligibility rules and benefits are the same for all employees). However, treating employees differently may make it more difficult for a health plan to pass the applicable nondiscrimination tests. Examples of plan designs that may cause problems with nondiscrimination testing include:

  • Only certain groups of employees are eligible to participate in the health plan (for example, only salaried or management employees);
  • The health plan has different employment requirements for plan eligibility (for example, waiting periods and entry dates) for different employee groups;
  • Plan benefits or contribution rates …
By |April 19th, 2019|Compliance, Employee Benefits, Medical, Section 125, Uncategorized|Comments Off on Treating Employees Differently- Health Plan Rules

Association Health Plan Rules Struck Down by Federal Court

Overview

A federal judge ruled on March 28, 2019 that parts of the Trump administration’s 2018 final rule on association health plans (AHPs) were invalid. The court directed the Department of Labor (DOL) to reconsider how the remaining provisions of the final rule are affected.

In its ruling, the court stated that the final rule was an “end-run” around the Affordable Care Act (ACA) and that the DOL exceeded its authority under ERISA.

The court specifically struck down two parts of the rule:

  • The provision defining “employer” to include associations of disparate employers; and
  • The provision expanding membership in these associations to include working owners without employees

Action Steps

Employers and business owners without employees that have joined an AHP, or are considering doing so, should review how their plans may be affected by the court’s ruling. These employers can also monitor developments from the DOL on any changes made to the rule.

By |April 1st, 2019|Compliance, Employee Benefits, Legislation, Medical|Comments Off on Association Health Plan Rules Struck Down by Federal Court

Get a Nasty Letter 226-J from the IRS? Enforcement for 2016 Pay Or Play Rules Begins

The Internal Revenue Service (IRS) began issuing enforcement letters related to employers’ compliance with the employer shared responsibility rules under the Affordable Care Act (ACA) for the 2016 calendar year. These letters, known as Letter 226-J, inform employers of their potential liability for an employer shared responsibility penalty, if any, for 2016.

The IRS only sends these letters to employers that are subject to the employer shared responsibility rules, known as applicable large employers (ALEs). The determination of whether an ALE may be liable for a penalty, and the amount of the proposed penalty in Letter 226-J, are based on information from Forms 1094-C and 1095-C filed by the ALE and the individual income tax returns filed by the ALE’s employees.

What You Need To Do

Employers that receive a Letter 226-J must respond to the letter, either agreeing with the proposed penalty or disagreeing with part or all of the proposed amount. The IRS provides an employer response form, Form 14764, for employers to use for this purpose. The IRS maintains a website on understanding Letter 226-J for employers who receive an enforcement letter.

Background

The ACA’s employer shared responsibility rules require ALEs to offer affordable, minimum value health coverage to their full-time employees or pay a penalty. These rules, also known as the “employer mandate” or “pay or play” rules, only apply to ALEs, which are employers with, on average, at least 50 full-time employees, including full-time equivalent employees, during the preceding calendar year.

The employer shared responsibility rules took effect for most ALEs beginning on Jan. 1, 2015. However, some ALEs may have had additional time to comply with these requirements. An ALE may be subject to a penalty only if one or more full-time …

By |December 31st, 2018|Compliance, Employee Benefits, Health Care Reform|Comments Off on Get a Nasty Letter 226-J from the IRS? Enforcement for 2016 Pay Or Play Rules Begins

DOL Finalizes Rule to Expand Association Health Plans

On June 19, 2018, the Department of Labor (DOL) released a final rule that gives small businesses more freedom to join together as a single group to purchase health insurance in the large group market or to self-insure. These benefit arrangements are called association health plans (AHPs).

By forming AHPs, small employers can avoid certain Affordable Care Act (ACA) reforms that apply to the small group market. According to the DOL, this will provide small employers with more affordable health insurance options.

However, in exchange for lower premiums, AHPs may cover fewer benefits. Most AHPs will not be subject to the ACA’s essential health benefits (EHB) reform, which requires small group plans to cover a core set of items and services, such as mental health care and maternity and newborn care.

ACTION STEPS

Small employers may want to consider banding together to form an AHP as a more affordable health insurance option. Employers should carefully review the AHP’s benefit design to make sure it is appropriate for their workforce. Because AHPs are regulated at the federal and state level, the availability of these plans will also depend on a state’s regulatory approach.

Background

On Oct. 12, 2017, President Donald Trump signed an executive order that directed the DOL to consider issuing regulations that would permit more employers to form AHPs as a way to expand access to more affordable health coverage. The DOL was specifically instructed to consider expanding the conditions that must be satisfied to form an AHP that is treated as a single plan under the Employee Retirement Income Security Act (ERISA).

Currently, the criteria that must be satisfied for a group of employers to sponsor a single ERISA plan are very narrow. As a result, most multiple …

By |June 21st, 2018|Compliance, Employee Benefits, Medical, U.S. Department of Labor|Comments Off on DOL Finalizes Rule to Expand Association Health Plans

New Jersey Enacts State Individual Mandate and Reinsurance Program

On May 30, 2018, New Jersey Gov. Phil Murphy signed two bills into law that are designed to stabilize and reduce health insurance premiums in the individual market.

These new laws are among the first state laws passed in response to changes made to the federal ACA. New Jersey is only the second state to enact its own health insurance individual mandate. Individuals in New Jersey should ensure that they are in compliance with the state individual mandate beginning in 2019.

State Individual Mandate

Effective beginning in 2019, the New Jersey Health Insurance Market Preservation Act imposes a state individual mandate that largely mirrors the ACA’s federal individual mandate requirement. The ACA’s individual mandate penalty has been effectively eliminated beginning in 2019.

New Jersey’s individual mandate requires most individuals in the state (and their family members) to be covered under minimum essential coverage for each month of the year, beginning in 2019. Individuals that don’t obtain acceptable health insurance coverage will be penalized.

Notably, the new law provides that the state individual mandate penalty will not be enforced for any tax year in which the ACA’s federal premium tax credits become unavailable.

Minimum Essential Coverage

For purposes of the New Jersey individual mandate, the term “minimum essential coverage” (MEC) has the same definition as under the ACA.

MEC includes …

By |June 4th, 2018|Employee Benefits, Health Care Reform, Legislation, Medical|Comments Off on New Jersey Enacts State Individual Mandate and Reinsurance Program

HSA Limit for Family Coverage for 2018 Reduced by IRS

You thought you were finished with your open enrollment changes for 2018?  Not so fast.  The Internal Revenue Service (IRS) released Revenue Procedure 2018-18 on March 5, 2018 to announce changes to certain tax limits for 2018, including a reduced contribution limit for health savings accounts (HSAs).

The new tax law enacted late last year—the Tax Cuts and Jobs Act—changed the consumer price index for making annual adjustments to the HSA limits. Based on this new index, the IRS lowered the HSA contribution limit for individuals with family coverage under a high deductible health plan (HDHP) from $6,900 to $6,850. This change is effective for the 2018 calendar year. The IRS’ other HSA and HDHP limits for 2018 remain the same.

What You Need To Do

Ugh.  If your company has a HDHP you’ll need to inform employees about the reduced HSA contribution limit for family HDHP coverage. Employees may need to change their HSA elections going forward to comply with the new limit. Also, any individuals with family HDHP coverage who have already contributed $6,900 for 2018 must receive a refund of the excess contribution in order to avoid an excise tax.

By |March 12th, 2018|Compliance, Employee Benefits, Medical|Comments Off on HSA Limit for Family Coverage for 2018 Reduced by IRS

The New York Paid Family Leave Law Became Effective January 1, 2018. Confused?

It keeps getting harder for even the most seasoned Human Resources team to stay on top of employee leaves.  Employers with 50 or more employees in New York need to comply with the federal Family and Medical Leave Act (FMLA) and the new New York Paid Family Leave (NYPFL).  Here are some key differences to consider:

By |February 15th, 2018|Compliance, Disability, Human Resources|Comments Off on The New York Paid Family Leave Law Became Effective January 1, 2018. Confused?

ACA Taxes Affected by the Spending Resolution

On Jan. 22, 2018, President Donald Trump signed into law a short-term continuing spending resolution to end the government shutdown and continue funding through Feb. 8, 2018. The continuing resolution impacts three taxes and fees under the Affordable Care Act (ACA).

Specifically, the continuing resolution:

  • Delays implementation of the Cadillac tax on high-cost group health coverage until 2022;
  • Provides an additional one-year moratorium on the health insurance providers fee for 2019 (although the fee continues to apply for 2018); and
  • Extends the moratorium on the medical device excise tax for an additional two years, through 2019.

Employers should be aware of the evolving applicability of existing ACA taxes and fees so that they know how the ACA affects their bottom lines. Broad Reach Benefits, Inc will continue to keep you informed of changes.

Cadillac Tax Delayed

The ACA imposes a 40 percent excise tax on high-cost group health coverage, also known as the “Cadillac tax.” This provision taxes the amount, if any, by which the monthly cost of an employee’s applicable employer-sponsored health coverage exceeds the annual limitation (called the employee’s excess benefit). The tax amount for each employee’s coverage will be calculated by the employer and paid by the coverage provider who provided the coverage.

Although originally intended to take effect in 2013, the Cadillac tax was immediately delayed until 2018 following the ACA’s enactment. A federal budget bill enacted for 2016 further delayed implementation of this tax until 2020, and also:

  •      Removed a provision prohibiting the Cadillac tax from being deducted as a business expense; and
  •      Required a study to be conducted on the age and gender adjustment to the annual limit.

The continuing resolution …

By |January 24th, 2018|Uncategorized|Comments Off on ACA Taxes Affected by the Spending Resolution