This is the Long Term Care category of the Broad REach Benefits blog. At Broad Reach Benefits, we focus on employers that have between 30 and 500 benefit eligible employees. We’re employee benefit specialists, not a big box brokerage firm or payroll company with a sales force peddling policies.
Some employers may want to be selective and treat employees differently for purposes of group health plan benefits. For example, 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
– Varied employer contribution rates 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
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 […]
On Friday, March 24, 2017, the U.S. House of Representatives’ Speaker Paul Ryan pulled from the floor the American Health Care Act (AHCA), the proposed legislation to repeal and replace the Affordable Care Act (ACA), once it was clear that the bill was short on votes to pass. Effectively, this means the AHCA will not survive to become law and, at this time, any future efforts to repeal and replace the ACA are uncertain. This may mean, as Speaker Ryan said shortly after the announcement that the bill was […]
Long-term care (LTC) insurance is a benefit that seems ripe for the needs of today’s workforce. Yet, when employers offer employees the chance to purchase long-term care coverage through the workplace, the participation is usually low. (Typically, LTC insurance is offered as a voluntary benefit, for which an employee pays the entire premium.) A study contracted by the U.S. Department of Health and Human Services (HHS) found that, while purchase rates varied considerably among the group of surveyed employers, 40% saw participation rates below 2%. A separate study published by the Employee Benefit Research Institute (EBRI) found employee participation rates for LTC insurance averaged less than 10%. […]
There is a growing awareness and concern surrounding steadily rising long-term care costs and the fact that our population is living longer, thereby creating an increased demand for inventive solutions. Many employers have heard this demand loud and clear and are seeking methods that will provide their employees with the financial protection they need in the event that they should need long-term care.
One such solution is offering employees group long-term care insurance programs. Adding this new addition to an existing employee benefit plan is quickly gaining esteem from employers and employees alike, as these long-term care insurance products are reasonably priced, while still being offered through highly rated insurance companies.
Four Ways The Employer Benefits In Offering Group Long-Term Care Insurance
1. One of the most frequently complained about aspects of the employer to employee relationship is that the employer doesn’t care about their overall welfare and that of their dependents. Offering a long-term care insurance program can build and strengthen employee morale and loyalty, as it directly shows that the employer is considering the welfare of their employees and employee dependents.
2. Adding an additional benefit, such as a long-term care product, enhances company attractiveness. In doing so, the employer is more likely to obtain and retain highly skilled and highly qualified employees. […]