1. HRRS WebEx
October 8th, 2013
Countdown to Your Success

2. What We Will Cover
Traditional Benefits Are Gone
Things Are Changing
PLA & Private Exchange
Needs Meet Opportunity
Next Step for Your Client
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3. Most of the “benefits” are gone
The benefits of a group health plan may go away in 2014.
1.
Employer contribution – nobody else is going to pay for their
health insurance – the government may pay if the employer
doesn’t
2.
Payroll Deduction – Insurance products can be payroll deducted.
Supplemental and Ancillary Benefits are still pre-taxable.
3.
Guaranteed issue – employees and dependents cannot be denied
coverage or charged more due to medical conditions – all plans
will be guaranteed issue in 2014
4.
Mandated benefits – group plans cover services not covered by
individual plans (i.e. maternity) – the mandated benefits for group
and individual plans will be identical
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4. Regulatory Burden on Employers
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5. Employer Health Group Benefits
Rising Premiums
Member Level Rating
More hassles and headaches
Difficult to communicate
Lots of paperwork
More Audits
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6. Things are Changing
Offering group health benefits could soon repel employees.
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7. Individual coverage will be more popular
Better benefits
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Guaranteed
issue
No pre-ex
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Tax credits &
subsidies

8. 2013 Federal Poverty Guidelines
Household Size
100%
133%
150%
200%
300%
400%
1
$11,490
$15,282
$17,235
$22,980
$34,470
$45,960
2
$15,510
$20,628
$23,265
$31,020
$46,530
$62,040
3
$19,530
$25,975
$29,295
$39,060
$58,590
$78,120
4
$23,550
$31,322
$35,325
$47,100
$70,650
$94,200
5
$27,570
$36,668
$41,355
$55,140
$82,710
$110,280
6
$31,590
$42,015
$47,385
$63,180
$94,770
$126,360
7
$35,610
$47,361
$53,415
$71,220
$106,830
$142,440
8
$39,630
$52,708
$59,445
$79,260
$118,890
$158,520
Each extra person
$4,020
$5,347
$6,030
$8,040
$12,060
$16,080
Source: http://www.familiesusa.org/resources/tools-for-advocates/guides/federal-poverty-guidelines.html
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48 Contiguous
States and DC

9. Better Off if Employer Doesn’t Offer Coverage
Household
size
100% FPL
400% FPL
Premium Cap
Range
OOP Max
Range (2x
family max)
1
$11,490
$45,690
$0 - $363.85
$2,117 - $6,350
2
$15,510
$62,040
$0 - $491.15
$2,117 - $6,350
3
$19,530
$78,120
$0 - $618.45
$2,117 - $6,350
4
$23,550
$94,200
$0 - $745.75
$2,117 - $6,350
5
$27,570
$110,280
$0 - $873.05
$2,117 - $6,350
6
$31,590
$126,360
$0 - $1,000.35
$2,117 - $6,350
7
$35,610
$142,440
$0 - $1,127.65
$2,117 - $6,350
8
$39,630
$158,520
$0 - $1,254.95
$2,117 - $6,350
AVG Group Single
Premium 2014 –
AVG Group Single + 1
Premium 2014 –
AVG Group Family
Premium 2014 –
$772.07
$1477.05
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$2164.93
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10. Example: Family of 4
Income: $55k
EO: $5,400
EF: $14,556
Employer
Contribution
Employee
Contribution
Government
Contribution
Minimum ER
contribution
(9.5% W-2)
$5225
$9,331
$0
50% of single
$2,700
$11,856
$0
100% of single
$5,400
$9,156
$0
50% of family
$7,278
$7,278
$0
No group
coverage
$0
$4,135
$10,421
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11. The Moral Obligation May Be to Drop
Group Coverage
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12. Hospitals Are Controlling the Market
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13. Challenges of Group Health Insurance
•
Will Become More Cost Prohibitive to the Employer &
Employee .
– 60% plus increases could cause Employers to drop
group health.
•
Regulations are and will continue to become more
burdensome.
•
Bottom line…it will become a disservice to the
employee if the employer continues to offer group
health insurance.
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14. What is a “Premium Layered Health Plan”?
•
An After Tax Premium Reimbursement Arrangement for Major
Medical. Supplemental and Ancillary Medical are still Pre-Taxed.
• Employer sets defined dollar amount for employees if they choose
based on tenure and position.
• Employer can adjust wages for key employees (based on tenure
and position) to offset cost of those not receiving a premium tax
subsidy.
• Wages can be adjusted to any amount. Must be aware of
consistency within wage and hour guidelines.
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15. What is a “Premium Layered Health Plan”?
• Employees go to the Private Exchange and shop for
their own personal health insurance plan with the
guidance of a licensed and certified Health Benefit
Advocate
• Employer can setup insurance products via payroll
deduction
• Employees own their own health insurance plan
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16. What is a “Private Exchange”?
Multiple carrier venue for insurance policies
• Coventry & BCBS (NC & SC)
• United Healthcare & Assurant/Others
Not just health insurance, but health services
• Health Perx
Process of Enrolling Individuals via
• Paper/Electronically/Web/Phone
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17. Premium Layered Arrangement
Employer
Defined $ Amount
& Adjusted Wages
Employee
Portion
Payroll Deduction and/or DD
Individual Major Medical
 H.S.A. Plans
 Traditional Copay
Plans
 Exchange Qualified
 Outside the Exchange
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Additional Qualified Plans
 Accident & Critical Illness
 Lump Sum Cash Benefits
 Physician & Hospital Support
 Dental, Vision, Hearing
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Real cash to
pay your
personal bills
+
Coverage to pay
Hospital &
Doctor Bills
=
Peace of Mind

18. What an Employer Needs
Attract and retain good employees
Offer flexible and affordable benefit
plans that all of your employees will
qualify for
Maximize on tax savings without
administrative headaches

19. Private Exchange Meets
Employer’s Needs
Attract and retain good
employees
Offer flexible and affordable
benefit plans that all of your
employees will qualify for
Maximize on tax savings without
administrative headaches

20. What an Employee Needs
Make the most of their money
Have an easy shopping experience and
buy only the products they understand
and need
Have an actual person to talk to, not
just when buying but for as long as they
own the policy

21. Private Exchange Meets
Employee’s Needs
Make the most of your money
Easy and informative shopping
experience
Live support by professional,
licensed consultants

22. BIG
Question for 2014
Should I offer group
health insurance?
1. Size of group
Factors will be: 2. Average income of employees
3. Costs – group premium vs. penalty etc…
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23. What should an employer do?
1.
Get with Certified Benefit Consultant
2.
Determine if group health insurance will help or hurt
employees via review
3.
Decide on a wage adjustments based on decision to go
with PLA (Premium Layered Arrangement) and get out of
the health insurance business!
4. Work with your Benefit Consultant to set up your private
exchange to help communicate, educate and enroll
employees and then administer those elections
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24. What Is Needed for Proposal?
1. Census Data
2. Income Data
3. List Bill of All Benefits Offered
4. Plan Design
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25. © Copyright Reserved.
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