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Health plans - design


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[Opinion] Five Years Old, Going on Ten: The Future of the ACA
"It is important now to look ahead, rather than counting up past achievements. What will its tenth anniversary look like? Here are three developments to watch. [1] Will the slow-down in growth of health care spending continue? ... [2] Will employer-sponsored health insurance survive?... [3] Will the health exchanges make private health insurance markets work -- at last?" (The Brookings Institution)
The ACA After Five Years
"[T]oday, due to the law, more than 10 million more people have health insurance than did five years ago, partly because of state-based health insurance exchanges selling coverage to individuals, universal issue of individual policies and rules requiring longer coverage of dependents. Exclusions due to pre-existing conditions are prohibited.... On the other hand, the price of health care is still advancing at a rate higher than that of the consumer price index, many companies and individuals have had large premium increases and progress on care coordination under the law remains to be seen, experts say. A number of experts described good and bad impacts caused by the law since it took effect five years ago." (Thompson SmartHR Manager)
Telemedicine and Employers: The New Frontier
"[O]nly about 20 percent of U.S. employers offer telemedicine services to employees today, but nearly 40 percent of employers surveyed said that they plan to offer access to such services in 2015, while 33 percent are considering offering access to telemedicine services within the next three years.... Effective use of telemedicine services could eliminate 15 percent of physician office visits, 15 percent of emergency room visits, and 37 percent of urgent care visits. This all results in significant savings to employers that cover any part of the costs of their employees' health care." (Epstein Becker Green)
TRI-AD Health and Welfare News, March 2015
Topics: [1] Two new events that allow employees to change benefit elections during a plan year; [2] Government opens special enrollment period for federal marketplace (exchange); and [3] More changes to Summary of Benefits & Coverage form. (TRI-AD)
2014 ERISA Advisory Council Report: PBM Compensation and Fee Disclosure
"After receiving testimony and information from multiple sources, including representatives of PBMs, plan sponsors, plan consultants, plan auditors, pharmacy groups, governmental agencies, and other interested persons, the Council recommends that the Department should consider making Section 408(b)(2) Regulations applicable to welfare plan arrangements with PBMs, and thereby deem such arrangements reasonable only where PBMs disclose direct and indirect compensation, including compensation paid among related parties such as subcontractors, in a manner consistent with current Section 408(b)(2) Regulations. The Council also recommends that the Department should consider issuing guidance to assist plan sponsors in determining whether to and how to conduct a PBM audit of direct and indirect compensation." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
Companies Spend More on Wellness Programs But Employees Leave Millions on the Table
"[E]mployers will spend an average of $693 per employee on wellness-based incentives in 2015, up from $594 in 2014 and $430 five years ago. Of the 79 percent of employers who offer health improvement programs, larger companies, those with more than 20,000 employees, are spending the most on these programs, where the per-employee average climbed to $878, up from $717 in 2014. The average for companies with between 5,000 and 20,000 workers rose to $661, up from $493 in 2014.... Fewer than half (47 percent) of employees earned their full incentive amount in 2014, while 26 percent earned a partial amount. Together, this translates into millions of dollars of unclaimed incentives." (Fidelity Investments and the National Business Group on Health [NBGH])
Employer and Worker Contributions to Health Reimbursement Arrangements and Health Savings Accounts, 2006-2014
"Among the 15 percent of individuals enrolled in a CDHP, 57 percent (or 9.3 million) had an HRA or had opened an HSA, while 43 percent were enrolled in an HSA-eligible health plan but had not opened an HSA.... Among individuals with traditional, employment-based health benefits and a choice of health plans, 35 percent were eligible for an HRA or an HSA-based plan in 2014 ... Two out of 3 workers (67 percent) with an HRA or HSA reported that their employers contributed to the account in 2014[.]" (Employee Benefit Research Institute [EBRI])
High-Deductible Plans Bring Lower Costs Now, But Will They Have Pricey Consequences?
"Consumers with high deductibles sometimes skip procedures, think harder about getting treatment and shop for lower prices when they do seek care. What nobody knows is whether such plans, also sold to individuals and families through the health law's online exchanges, will backfire. If people choose not to have important preventive care and end up needing an expensive hospital stay years later as a result, everybody is worse off." (Kaiser Health News)
Employer Contributions to HSAs Decreasing
"In 2014, employees saw a 10 percent decrease in their average single Health Savings Account (HSA) employer contribution from the previous year, from $574 in 2013 to $515 in 2014 ... Average family contributions also decreased 7 percent during the same period, from $958 to $890. Survey results reveal a correlation between enrollment in HSAs and Consumer Driven Health Plans (CDHPs), linking higher HSA contributions to increased enrollment in the cost-saving plans." (United Benefit Advisors)
[Guidance Overview] HHS Finalizes 2016 Reinsurance Contribution Rate and Out-of-Pocket Maximums (PDF)
"HHS also finalized the clarification of the treatment of other than self-only (family) OOPs that was included in the proposed guidance. Under this guidance, an 'embedded' individual OOP is required for family coverage.... High-deductible plans with health savings accounts (HSAs) often apply a single overall family deductible, and/or family OOP maximum, without an underlying or embedded self-only deductible or OOP maximum. That design is no longer allowed, unless the family-deductible and OOP are no greater than the ACA maximum for the self-only OOP ... If the family deductible in 2016 exceeds the self-only $6,850 OOP limit, then an embedded self-only deductible and OOP is required." (Buck Consultants at Xerox)
Health Plan Features: Implications of Narrow Networks and the Trade-Off between Price and Choice (PDF)
"Research on the impact of narrow networks is limited, but early studies suggest that several factors affect whether narrow network strategies will succeed. These factors include the way networks are constructed, the characteristics of the broader market in which narrow network plans operate, and whether consumers have the knowledge and tools to make informed choices about coverage. Additional research is needed to help policymakers better understand how to define and develop enforceable standards to measure the adequacy of narrow networks. Research can also help identify the quality considerations to be incorporated into the network design process, the development of network adequacy standards, and the type of guidance that can help consumers understand plan differences when making choices among products." (AcademyHealth)
Health Plan Enrollment Fears Prove Moot
"Across all 600 employers that participated in the survey, the average percentage of employees who were eligible for coverage rose just one percentage point. And the average percentage of eligible employees who enrolled actually dropped a point, from 84% to 83%. That left the average percentage of all employees (both eligible and ineligible) who enrolled in 2015 essentially unchanged from 2014, at 74%." (CFO)
How Private Exchanges Should Integrate Well-Being (PDF)
"One way that employers can embrace well-being for their employees is by selecting a private exchange with a well-being program that is fully integrated with other benefits services -- one that yields measurable outcomes and addresses all aspects of health (physical, mental and social) and financial well-being. And while companies can certainly integrate well-being using other types of programs, this article focuses on the integration of well-being with private exchanges." (Buck Consultants at Xerox, via workspan magazine)
121 Employee Wellness Program Ideas
"The key to having a successful corporate wellness program is by encouraging overall wellbeing while still keeping it fun ... If you can't get people engaged then your wellness program ideas will quickly lose steam. So make your initiatives fun, try new ideas and see what your team values the most. [This article includes a] list of 121 employee wellness program ideas that you can easily implement at your office." (SnackNation)
Unpacking the Burr-Hatch-Upton ACA Replacement Proposal
"As with the previous proposal, the Patient CARE Act [would repeal] the ACA's individual mandate and [replace] it with a framework under which no one can be denied coverage or charged higher premiums because of a pre-existing condition as long as they remain continuously enrolled in a health plan. Insurance regulation would be returned to the states.... Income-related tax credits would be available to those who do not have access to employer-sponsored health insurance and to workers in small firms with 100 or fewer employees.... Tax credit amounts under the current proposal are 26 percent higher than the subsidies suggested last year." (Health Affairs)
[Opinion] Testimony on Behalf of American Benefits Council to House Labor and Workforce Committee Hearing on the 'Preserving Employee Wellness Programs Act ' (PDF)
Presented by Tamara M. Simon of Buck Consultants. "[This] testimony will describe the current state of employer-sponsored wellness programs. Not only are these programs important for achieving better health outcomes for employees, they also have the potential to increase employee productivity, improve workforce morale and engagement and reduce health care spending.... [O]ngoing legal and regulatory uncertainty is preventing more employers from sponsoring wellness programs[.]" (American Benefits Council)
Repayments and Refunds: Estimating the Effects of 2014 Premium Tax Credit Reconciliation
"[The authors] focus on reconciliation based only on income changes (prior year v. current year), and estimate that 50% of subsidy-eligible tax households would owe some repayment and 45% would receive a refund. Subsidy-eligible tax households with starting incomes under 200% of poverty would be somewhat more likely to owe a repayment (54%) and somewhat less likely to receive a refund (40%)." (Henry J. Kaiser Family Foundation)
Ripple Effect: The ACA and Stop-Loss Insurance
"The ACA's elimination of annual and lifetime dollar limits, pre-existing conditions, and the provision authorizing coverage of clinical trials has exposed the stop-loss carriers to greater risk. In response, employers have seen, on average, a 15% increase in stop-loss premiums over the last three years." (Mercer Select)
Problems, Potential of Self-Funding Draw Would-Be Disruptors
"Silicon Valley is coming for the employer sponsored health insurance business, trying to raise the bar on group health benefits and 'democratize' self-funding.... Among employers with less than 200 workers, fewer than 20 percent are using self-insured health plans, although many could as a cost-control strategy.... Collective Health has also gotten into that game with what its leaders pitch as a platform to 'optimize employee health benefit programs' by 'harnessing the power of data science and technology in ways that have simply not been possible to-date.' " (Healthcare Payer News)
Financial Incentives and Workplace Wellness-Program Participation (PDF)
20 pages. "Data from a large employer that offered financial incentives to encourage participation in its wellness program are analyzed in this paper. It examines how the characteristics of first-time, wellness-program participants changed with the enhancement of financial incentives for health-risk assessments (HRA) and biometric screenings. Those who completed an HRA or biometric screening in the two years prior to the change in financial incentives (i.e., pre-incentive) are compared to those who completed an HRA or biometric screening in the two years (for HRA) or three years (for biometric screening) after the change in the financial incentives. Findings from this study paint a vivid picture of the type of individual who favorably responds to wellness-program financial incentives." (Employee Benefit Research Institute [EBRI])
[Opinion] After Five Years, Here Are Five Ways the ACA Is Working for America
"More than 16 million Americans have found private health coverage that suits their needs.... Regardless of their income, more Americans have greater access to quality health care.... Those with pre-existing conditions can no longer be denied health insurance.... The uninsured rate for young Americans is at its lowest point this century.... Americans no longer have lifetime and annual limits on their coverage." (The White House Blog)
Self-Insurance Draws New Converts Among Small Employers
"Whereas employers with fewer than 500 employees and dependents were once generally deemed unsuitable for self-insurance, some stop-loss carriers today think nothing of signing up employers with 50 or fewer employees. Presumably they can do so profitably. Employers suited to self-insurance anticipate savings in the 5% to 10% range, or more, industry participants say." (Employee Benefit News)
Cadillac Tax Issues for Employer Consideration When Negotiating Collective Bargaining Agreements
"[E]mployers are using a variety of strategies in CBAs to attempt to deal with the tax prospectively, including: [1] Reducing plan benefits and increasing deductibles; [2] Including language to allow the employer to unilaterally reduce benefits to avoid the imposition of the Cadillac Tax in the event the cost of benefits under the CBA triggers the tax; [3] Including language to allow the employer to reopen negotiations in 2017, after concrete guidance has been issued; and [4] Avoiding specific dollar thresholds applicable in 2018 and beyond unless they have the ability to re-visit those amounts." (Winston & Strawn LLP)
Do Consumer-Directed Health Plans Bend the Cost Curve Over Time?
"Prior research shows that CDHPs reduce spending in the first year. However, there is little research on the impact of CDHPs over the longer term. [This study uses] data from 13 million individuals in 54 large US firms to estimate the effects of a firm offering CDHPs on health care spending up to three years post offer.... [The authors] find that spending is reduced for those in firms offering CDHPs in all three years post. The reductions are driven by spending decreases in outpatient care and pharmaceuticals, with no evidence of increases in emergency department or inpatient care." (National Bureau of Economic Research [NBER])
House Leaders Release Working Summary Outlining Framework of Bipartisan Medicare SGR Agreement
"[B]ipartisan leaders from the House Ways and Means and Energy and Commerce Committees released a working summary outlining the broader framework of an agreement being negotiated to permanently replace the broken Medicare Sustainable Growth Rate (SGR) formula with a system that rewards quality, efficiency, and innovation.... This broader agreement builds upon the SGR Repeal and Medicare Provider Payment Modernization Act, H.R. 1470 -- legislation reintroduced [on March 19] in the House along with a companion in the Senate." [Available online are: [1] a working summary of the SGR package; [2] a one-page summary of H.R. 1470; and [3] a section-by-section summary of H.R. 1470.] (Committee on Ways and Means, U.S. House of Representatives)
EEOC Sends Proposed Regs on ADA and Wellness Programs to OMB for Clearance
"This proposed rule, which was approved by a bipartisan vote, would amend the regulations implementing the equal employment provisions of the ADA to address the interaction between Title I of the ADA and financial incentives as part of wellness programs offered through group health plans. The submission of the NPRM to OMB represents the start of the regulatory process." (U.S. Equal Employment Opportunity Commission [EEOC])
[Opinion] Health Plans Covering Yoga: The Next Frontier?
"Insurers should cover 'new wellness- and prevention-oriented treatments such as yoga and meditation,' Sukanya Soderland, a partner in consulting firm Oliver Wyman's health practice, wrote recently in the Harvard Business Review.... Especially as the so-called 'Cadillac tax' on high-cost employer-based health plans is going to start sinking its teeth into those plans, why would any employer want to increase the likelihood of incurring that tax liability by channeling more of employees' compensation in to health plans that pay for benefits like yoga?" (National Center for Policy Analysis Health Policy Blog)
[Opinion] U.S. Chamber of Commerce Letter to Congress in Support of the 'Preserving Employee Wellness Programs Act' (PDF)
"EEOC's actions have created tremendous uncertainty among employers who have gone to great lengths to ensure that their wellness programs are compliant with the ACA. This bill would help to ease this uncertainty by specifically verifying that wellness programs that conform to the requirements set forth in the ACA are also lawful under ADA and GINA. Significantly, this bill would do nothing to limit EEOC's ability to investigate and pursue claims of discrimination, even when they involve workplace wellness programs." (U.S. Chamber of Commerce)
Is There a Future for Employer-Sponsored Health Insurance?
"The impacts of the ACA on firms will vary widely based on three main factors: [1] the size of the firm, [2] the average compensation within the firm, and [3] the degree to which wages within the firm are homogenous or heterogeneous. Keeping in mind that employees pay for all their health insurance, group insurance is not intrinsically superior to private exchanges, and cost trumps choice for consumers, firms will choose the option that maximizes benefits to their workers, takes advantage of the best available subsidies while avoiding tax penalties, and results in the lowest administrative costs." (Penn Wharton Public Policy Initiative)
[Guidance Overview] Agencies Finalize Regs on Limited Wraparound Coverage as Excepted Benefits
"It appears that wraparound coverage would primarily appeal to some large employers seeking to offer additional limited benefits to part-time employees. As the preamble explains, the regulations are not intended to create an opportunity or incentive for employers to discontinue group health plan coverage and transition employees to the Exchange ... In addition, the agencies have made it clear that plan sponsors may not combine multiple excepted benefits (e.g., both a health FSA and wraparound coverage) into an arrangement that functions as a 'material substitute for primary group health plan coverage' and still be exempt from applicable mandates." (Thomson Reuters / EBIA)
Five Years Down, But Final ACA Implementation Phase Still Looms: Insured Plan Nondiscrimination, Automatic Enrollment, and Cadillac Tax
"[1] Health FSA: The statute specifically provides that both employer contributions (including through flex credits) and employee salary reduction contributions will count toward the Cadillac tax limit. [2] HSA: The statute states that 'employer contributions' to an HSA count toward the Cadillac tax limit. However, the IRS has determined that because employee pre-tax salary reduction contributions to an HSA are treated as employer contributions for tax purposes, both employer and employee contributions will count toward the Cadillac tax.... [3] HRA amounts -- which are funded solely by the employer -- will also count toward the Cadillac tax limit. The IRS is considering how best to determine the cost of coverage provided under an HRA, including potentially relying on the amounts made newly available to a participant each year (and not carryover amounts made available prior to 2018)." (ABD Insurance & Financial Services)
[Opinion] Let the States Fix Obamacare
"[The ACA] sought a template for insurance rules, benefits and other structural features that would be the same from Vermont to Texas and Florida to Alaska. That was unwise. The continuous political warfare since the enactment of the legislation reflects the fact that different parts of the country have very different views of how health care should be organized.... The solution to these conflicts over engineering is to allow different structures to be adopted.... Different approaches also permit regional diversity within the broad bounds of national values and goals.... Amending the ACA to unleash federalism and permit states much greater flexibility to innovate is the way to achieve such a truly American health system." (The Brookings Institution)
Health Law Brings No Drop in Insurance Enrollment At Work, Study Finds
"Part of the explanation for the stable results stems from the fact that most employers were already in compliance ... In 2014, employees had to work 25 hours a week on average to be offered health insurance, according to Mercer. That figure has edged up since 2011, when it was 23 hours weekly, but is still well below the law's 30-hour threshold.... Food and lodging companies were most affected by the new rules, with the average percentage of workers who were eligible for coverage increasing from 57 to 60 percent." (Kaiser Health News)
The 'Next Generation' Accountable Care Organization Model
"Next Generation ACOs will be able to choose among several financial arrangements, including capitation, which will permit assuming higher levels of risk and, in return, an opportunity for greater financial rewards for performance. Next Generation ACOs can choose between two risk arrangements. One arrangement provides for an 80% sharing rate in performance years 1 through 3 and an 85% sharing rate in performance years 4 and [5] The other provides for 100% risk for Part A and Part B expenditures per year. Both arrangements provide for a 15% savings/losses cap." (Nixon Peabody LLP)
Health Coverage for Staffing Firm Employees: Who Is Responsible?
"If the worker receives an offer of coverage under the staffing firm's health plan, that offer will be treated as an offer of health coverage by the recipient employer so long as the staffing contract provides that the fee the recipient employer pays to the staffing firm for employees enrolled in the health coverage is higher than the fee the recipient employer would pay for the same employee if he or she did not enroll in the health coverage. The regulations do not specify how much higher the fee must be (so it is possible that even a nominal amount would be sufficient), but the increased fee can only apply to those who elect the staffing firm health coverage, and cannot be spread across all full-time employees." (Drinker Biddle)
Proposed Wellness Plan Legislation Responds to Lawsuits Filed by EEOC
"[The] House of Representatives Education and the Workforce Committee ... will conduct a hearing on March 24, 2015 about the House version of ... the 'Preserving Employee Wellness Programs Act' (S. 620) (H.R. 1189).... The Bill seeks to respond to two positions taken by the EEOC: (i) that a wellness program that offers incentives or rewards in compliance with the ACA may still violate the ADA or GINA, and (ii) offering incentives for the collection of an employee's spouse's genetic information for participation in the employee's wellness program violates GINA.... As proposed, the Bill would be retroactive to March 23, 2010 -- the date that the ACA was signed into law." (Jones Day)
[Guidance Overview] Agencies Expand Definition of Excepted Benefits to Cover Certain Types of Limited Wraparound Coverage
"Limited coverage that wraps around eligible individual health insurance for non-full-time employees must meet three standards regarding plan eligibility ... For limited coverage that wraps around a multi-state plan, four eligibility requirements must be satisfied[.]" (Littler)
[Guidance Overview] New Guidance Issued on Excepted Benefits (PDF)
"The Departments have provided an enforcement safe harbor for plans that are designed to fill gaps in the primary coverage.... The Departments also intend to propose regulations clarifying the circumstances under which supplemental insurance products that do not fill in cost-sharing under the primary plan may be considered designed to fill gaps in primary coverage. This guidance will allow additional categories of benefits to be covered by a supplemental plan." (Marsh & McLennan Agency LLC)
Nontraditional Wellness Initiatives Emerge
"More traditional wellness initiatives like health risk assessments and flu shots remain popular among workplaces, but [a recent survey] noticed a growing emphasis on more non-traditional initiatives like mental health coverage, vacation time and tuition reimbursement. According to the survey, top non-traditional wellness initiatives include: vacation time/time off use is encouraged (66 percent); mental health coverage (63 percent); tuition reimbursement (63 percent); community charity drives (57 percent); and on-site events/celebrations (50 percent)." (Wolters Kluwer Law & Business)
Fifth Circuit Clarifies and Approves ERISA Rights for Out-of-Network Providers Regardless of Non-PPO Discount
"According to the appellate court's ruling, Third Party 're-pricing negotiation' agreements and discounts will be preempted by ERISA if: '[t]he contracts by their terms are subject to the underlying ERISA plans.' Even after re-pricing discounts have been negotiated, [out-of-network] providers, with valid and complete assignments, have the right to seek all eligible payments according to the plan terms. The profound impact of this appellate court ruling may fundamentally change the nation's healthcare landscape and existing managed-care model." [North Cypress Medical Center v. Cigna, No. 12-20695 (5th Cir. Mar. 10, 2015.] (AVYM Healthcare Revenue Consultants)
Aging Baby Boomers Make Health Insurer Humana an M&A Target
"Humana and WellCare, both providers of Medicare coverage, are generating record revenue as aging U.S. baby boomers drive an increase in enrollment in the government-sponsored program for the elderly. Insurers are also benefiting from expanded Medicaid coverage for the poor under Obamacare. Larger insurers such as Aetna Inc. and Anthem Inc. would like to continue expanding beyond coverage that's paid for by employers, and could be interested buyers." (Bloomberg)
[Guidance Overview] New HHS Regs 'Clarify' That Health Plans Covering Families Must Have 'Embedded' Individual Cost-Sharing Limits
"[HHS] now requires group health plans to embed an individual cost sharing limit within the family limit.... The HHS clarification is not effective until plan years beginning on or after January 1, 2016. It is important to note that, at the moment, it is unclear whether the HHS clarification is intended to apply to self-insured plans.... Additionally, all previous cost sharing guidance applicable to self-insured plans have been issued jointly by the HHS, Department of Treasury and [DOL]. As of the date of this [article], the Departments of Treasury and Labor have not issued a similar clarification." (Proskauer's ERISA Practice Center)
Lessening the Impact of Coverage Churn Through Multimarket Health Plans
"While making sure people can enroll in or renew their Medicaid and marketplace plans through a single entry point would reduce breaks in coverage, it would not address the fact that insurers sell different health plans, with different rules and health provider networks, in the Medicaid and exchange markets. This may affect continuity of care ... For this reason, there has been interest in insurers that offer complementary health plans, using a common provider network, for both Medicaid and the marketplaces. Such a strategy could protect people from the health care consequences of what really is only a different source of financial support as they move from one form of subsidized coverage to another." (The Commonwealth Fund)
[Guidance Overview] Final Excepted Benefit Rules Address Limited Wraparound Coverage
"These final regulations are intended to offer employers a way to provide certain employees, dependents and retirees who have enrolled in individual market coverage with overall coverage analogous to what they could receive under the employer's group health plan.... [T]he wraparound coverage is subject to a significant set of compliance requirements and design restrictions that may limit its appeal for many employers. However, the government did appear willing to allow a relatively broad set of benefits to be offered as 'meaningful benefits' in the limited wraparound context, as reflected by the additional examples it provided." (Practical Law Company)
[Opinion] Blue Shield of California Loses Its State Tax-Exempt Status
"Blue Shield of California has annihilated the dream of those who believed that the United States could adopt a universal system of private, non-profit insurance companies like they have in Switzerland. There are many serious problems with the Swiss model, but some believed that a market of well-regulated, non-profit insurers would make optimal patient care a priority. Blue Shield of California has now demonstrated to us that this pipe dream would only become another nightmare in the saga of private insurance markets in the U.S." (Physicians for a National Health Program [PNHP])
Retiree Health Benefits Program Alternatives Gaining Steam
"Among existing options for Medicare-eligible retirees, 78% of employers are now using or considering using the services of a private Medicare exchange to assist retirees in selecting individual coverage. Four in 10 (41%) are funding or considering funding retiree medical benefits through a voluntary employee beneficiary association or 401(h) to reduce their risk profile. And 21% of employers are converting their subsidy to a retiree medical savings account, with another 18% considering this by 2017." (Towers Watson)
[Opinion] When It Comes to the Value of Wellness, Ask About Fairness Not Just About Effectiveness
"[P]rogram participation eliminates only about 10-25 percent of the risk burden, which suggests possible savings of $90 to $225 per year. [One] national survey shows typical participation rates less than 20 percent.... Combined with the small size of the prize, 'bending the curve' with wellness programs as currently designed is an elusive goal.... [T]he lack of a financial return does not rule out value in wellness. The workplace is an excellent setting to improve health habits.... But the problem is that most employers did not invest in wellness to make the organization a happy and healthy place. They invested because vendors and benefits consultants promised lofty returns. Now that those expectations are not materializing, ... employers [may] draw dangerous conclusions." (Health Affairs)
With Billions in the Bank, Blue Shield of California's Loses Its State Tax-Exempt Status
"Authorities have revoked the tax-exempt status of nonprofit Blue Shield of California, potentially putting it on the hook for tens of millions of dollars in state taxes each year. The move by the California Franchise Tax Board comes as the state's third-largest health insurer faces fresh criticism over its rate hikes, executive pay and $4.2 billion in financial reserves. The state quietly stripped the San Francisco insurer of its exemption from California income taxes in August. The company held that since its founding in 1939." (Los Angeles Times)
Missouri Medicaid Turns to Wellness Incentives
"Consumer wellness incentives are trending throughout the health insurance market, most notably in employer-sponsored plans. Now Missouri is getting in on the action on behalf of its roughly 400,000 managed care customers. The contracts, awarded to three companies this month, include proposals designed to help patients exercise, eat healthier and make regular doctor visits." (Kaiser Health News)
[Guidance Overview] IRS Publishes Guidance on Reimbursing Employees' Individual Health Insurance Premiums
"The IRS has published new guidance to clarify that no matter how a reimbursement arrangement is structured or what the reimbursement arrangement is named, reimbursement of employees' individual health insurance policies violates certain mandates under Health Care Reform. [Notice 2015-17] affirms and expands upon earlier guidance addressing this issue. To encompass all such arrangements, the IRS coined a new term: 'employer payment plans.' The penalty for violating Health Care Reform's mandates is contained in Section 4980D of the Internal Revenue Code and is severe." (Miller Johnson)
[Guidance Overview] IRS Releases Initial Guidance on Cadillac Tax
"[IRS Notice 2015-16] is intended to 'initiate and inform' the process of developing regulatory guidance on the Cadillac tax and, as such, does not offer guidance on which taxpayers may rely. However, it does discuss some of the major issues surrounding the implementation of the Cadillac tax and offers potential approaches for resolving those issues. It also seeks comments from interested parties on these issues as well as on related issues under COBRA. The Notice focuses on three key topics relating to the Cadillac tax: [1] What types of coverage constitute applicable coverage subject to the Cadillac tax. [2] How to determine the cost of applicable coverage. [3] How to apply the annual statutory dollar limits to the cost of applicable coverage." (Miller Johnson)
[Opinion] Ways the Federal Government Is Lagging Behind in a Post-ACA World
"As envisioned, encouraged, and otherwise incentivized by the ACA, an increasing number of health and hospital systems are integrating, joining forces through formal collaborative agreements, and otherwise partnering to create economies of scale, provide the patients and communities they serve with holistic care, and undertake strategic efforts to engage in population health management. These endeavors increasingly are bumping up against the FTC's long-standing presumption -- not yet updated for a post-ACA world -- that an increase in market share will create harm for consumers in the form of increased prices for inpatient hospital care and services." (Drinker Biddle, via Morning Consult)
Bill Would Eliminate 'Confusion' Over Wellness Programs Caused by EEOC Scrutiny
"[T]he Preserving Employee Wellness Programs Act (S. 620/H.R. 1189) would reaffirm the right of employers under the law to offer wellness programs that are tied to a financial reward.... The legislation would reaffirm existing law and clarify that an employee's spouse may participate in the program as well. It also provides employees up to 180 days to request and complete an alternative wellness program if it is medically inadvisable or unreasonably difficult for an employee to participate in the original employee wellness program." (Wolters Kluwer Law & Business)
ACA's Broadened Eligibility Rules Have Little Impact on Employee Enrollment Levels in 2015
"While there was a 1.6% increase in the absolute number of employees enrolled, that was the result of a 2.2% increase in the size of the workforce, rather than the changes required by the ACA.... Across all employers in the survey, the average percentage of employees who were eligible for coverage rose one percentage point, from 87% to 88%, but the average percentage of eligible employees who enrolled dropped a point, from 84% to 83%. That left the average percentage of all employees (both eligible and ineligible) who enrolled in 2015 essentially unchanged from 2014, at 74%[.]" (Mercer)
Small Area Health Insurance Estimates, 2013
"The estimates show the number of people with and without health insurance coverage for all states and each of the nation's roughly 3,140 counties. The statistics are provided by selected age groups, sex, race and Hispanic origin (state only), and at income-to-poverty levels that reflect the federal poverty thresholds for state and federal assistance programs. The Small Area Health Insurance Estimates program is the only source of single-year health insurance estimates for every county in the U.S." [Census Bureau Release CB15-TPS.24] (U.S. Census Bureau)
[Guidance Overview] Agencies Issue Wraparound Benefits Final Rule
"Under the new rule, employers may offer part-time and retired employees wraparound coverage that wraps around and increases the benefits covered through primary 'qualifying individual coverage.' This includes any individual coverage that is not grandfathered or transitional coverage or another form of excepted benefits. Specifically, the final rule clarifies that qualifying individual coverage includes coverage under the Basic Health Plan Program. Employers may also supplement marketplace coverage offered through the Multi-State Plan (MSP) to their employees." (Timothy Jost, in Health Affairs)
Most New York Exchange Plans Lack Coverage for Out-Of-Network Care
"Except for offerings by a few insurers in far western New York and the Albany area, the only options available elsewhere in the state, including the entire New York City metro area, are health maintenance organization-style plans that cover care provided only by doctors and hospitals in the plan's network. People who go out of network for anything other than emergency care are generally going to be responsible for the entire bill." (Kaiser Health News)
Collectively Bargained Health Plans: More Comprehensive, Less Cost Sharing Than Other Employer Plans
"National statistics on the cost and provisions of collectively bargained health plans show them to have similar single premiums, but lower family premiums, compared to employer-based plans not subject to collective bargaining. Union members contribute 4 percent and 6 percent of the cost of their premiums for single and family coverage, respectively, versus 18 percent and 29 percent for workers in employer-based plans. Cost sharing in collectively bargained plans is considerably less than in employer-based plans; coverage for prescription drugs is similar." (Health Affairs; purchase or subscription required for full article)
Are High Deductible Health Plans Right For Your Older Clients?
"Many investors are already aware of the tax advantages of HSAs and how savvy use of this financial tool can help with retirement planning. The fumble more retirees make when transitioning from their 50s into their 60s is the health-care dilemma: What plan to choose? Even knowing the financial advantages of choosing a high-deductible health plan through an employer or the public marketplace does not mean that is the right plan for a person, whether or not he or she is gearing up to build their retirement stash." (Financial Advisor)
[Official Guidance] Text of IRS, DOL and HHS Final Regs: Amendments to Excepted Benefits
57 pages. "[T]he Departments reiterate that limited wraparound coverage that is an excepted benefit cannot be an account-based mechanism and instead must be a risk-sharing product that covers a defined package of services.... Either the dollar or percent limitation would satisfy the Departments' objective of ensuring that the limited wraparound coverage provides a limited benefit, as required by the statute, and be similar to other limited excepted benefits.... These final regulations adopt the [nondiscrimination] approach outlined in the 2014 proposed regulations... As under the 2014 proposed regulations, limited coverage that wraps around eligible individual health insurance (or BHP coverage) for an individual who is not a full-time employee is required to satisfy three standards relating to plan eligibility.... For limited coverage that wraps around Multi-State Plan coverage, four requirements would be required to be met under the 2014 proposed regulations.... A self-insured group health plan, or a health insurance issuer offering or proposing to offer Multi-State Plan wraparound coverage, would report to OPM ... information OPM reasonably requires to determine whether the plan or issuer qualifies to offer such coverage or complies with the applicable requirements of this section. In addition, the plan sponsor of any group health plan offering any type of limited wraparound coverage would report to HHS ... information HHS reasonably requires to determine whether the exception for limited wraparound coverage is allowing plan sponsors to provide workers with comparable benefits.... [T]hese final rules specify that wraparound coverage could be offered as excepted benefits if the coverage is first offered no earlier than January 1, 2016 and no later than December 31, 2018. The end date is unchanged ... from the proposal[.]" (Internal Revenue Service [IRS], U.S. Department of Labor [DOL] Employee Benefits Security Administration [EBSA], and U.S. Department of Health and Human Services [HHS])

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