1 No-Cost Employee Benefits

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1 1 No-Cost Employee Benefits

2 Copyright No part of this consumer report may be reproduced or transmitted in any form without the written permission of the author. This electronic book is optimized for viewing on a personal computer screen, but is optimally organized so that it can be printed out and assembled in a traditional book form. Since this electronic book is optimized for viewing on a personal computer screen, the type used is larger than that of which is traditionally utilized in printed books. Disclaimer This report was diligently researched and compiled with the intent to provide information for persons wishing to learn about the landscape of health insurance reform and the opportunities they present. Throughout the making of this consumer report, every effort has been made to ensure the highest amount of accuracy and effectiveness for the techniques suggested by the author. The report may contain contextual as well as typographical mistakes. No information provided in this report constitutes a warranty of any kind; nor shall readers of this report rely solely on any such information or advice. All content, products, and services are not to be considered as legal, medical, or professional advice and are to be used for personal use and information purposes only. This report makes no warranties or guarantees express or implied, as to the results provided by the strategies, techniques, and advice presented in this report. The publishers of this report expressly disclaim any liability arising from any strategies, techniques, and advice presented in this report. The purpose of this consumer report is to educate and guide. Neither the publisher nor the author warrant that the information contained within this consumer report is free of omissions or errors and is fully complete. Furthermore, neither the publisher nor the author shall have responsibility or liability to any entity or person as a result of any damage or loss alleged to be caused or caused indirectly or directly by this report. Safe Harbor Notice Certain statements in this presentation relate to future results that are forward-looking statements as defined in the Private Securities Litigation Reform Act of This presentation contains statements involving risks and uncertainties, including statements relating market opportunity and future business prospects. Actual results may differ materially and reported results should not be considered as an indication of future performance. Factors that could cause actual results to differ are not included. 2 No-Cost Employee Benefits

3 Contents The Need to Offer Benefits... 5 The Employer Contribution... 5 Free Benefits... 6 Other Perks of the Job... 7 Communication is Critical... 9 Want More? About Health Partners America No-Cost Employee Benefits

4 One of the by-products of the Affordable Care Act will be a reduction in employer-sponsored health insurance. There are several reasons for this shift from group to individual coverage:»» Cost This is probably the number one reason. With all of the market reforms required by the health reform legislation, many employers will see their premiums increase substantially, making group health coverage cost-prohibitive for some companies.»» Hassle In addition to the cost of offering a group health plan, there s also the hassle-factor to consider. Employers who provide health insurance to their employees have a number of compliance requirements and fiduciary responsibilities. This can take a lot of time, and dropping the ball on any of these requirements can result in big fines.»» Individual Plan Changes Group health coverage has long been a better option for many employees than individual policies because, until this year, individual coverage was medically underwritten in 45 states, which excluded consumers with preexisting conditions, while group policies were guaranteed issue for employees and their dependents. Also, group plans covered a number of benefits not covered by individual policies, maternity coverage being the most notable exclusion in most states. But starting this year, not only will these individual plans cover the same benefits as group plans, they will also be guaranteed issue with no pre-existing condition exclusions, limitations, or surcharges. Employees will no longer be dependent on their employer to offer coverage.»» Subsidies The biggest argument for ditching the group health plan, though, is that it may no longer be beneficial for many employees; in fact, it could end up doing more harm than good. The employer contribution to health insurance has long been a valued benefit by employees, but the way that the premium tax credits are designed, this employer contribution is likely to block the employees and their family members from qualifying for financial assistance. Ironically, this means that the benefits that were originally designed to attract and retain employees could end up repelling them, forcing them to seek out employers who don t offer health insurance. 4 No-Cost Employee Benefits

5 The Need to Offer Benefits While the ROI from offering health insurance is definitely lower for most employers next year, there s still a very good reason to offer employee benefits and no, the terms are not synonymous. Group health insurance is just one of the many benefits employers can provide to their employees, and workers really appreciate the perks offered by their employer these value-adds are a great recruitment tool, and it s hard for many workers to give them up when they re considering hunting for another job. The Employer Contribution When a company makes the decision to drop its group health coverage and let its employees access the generous government subsidies, it suddenly has a lot of extra money to play with. Some of these funds could and should be used to provide other lines of coverage that are better or less expensive when purchased in bulk. Some of these options include:»» Employer-sponsored dental coverage: Many employees value dental coverage as much as they do medical, and it comes at about a tenth of the price. Depending on the size of the company, group dental plans may provide better coverage, often with no waiting periods, than plans purchased in the individual market, and they re usually available at a lower price. An employer could pay for some or even 100% of the employee premium and allow employees to pay the dependent premium on a pre-tax basis through a section 125 plan.»» Group life insurance: Life insurance is one of the most important and least expensive benefits that employers can offer. They could provide a base amount to their employees with the option to cover their spouse or increase the level of coverage.»» Group disability insurance: A little less common but just as important as life insurance is disability insurance, both short- 5 No-Cost Employee Benefits

6 and long-term. Employers can provide this coverage to employees at a much lower price than they could buy it on their own. HSA contributions: Even if the employer chooses not to provide group health insurance, he can still offer employees some assistance with their out-of-pocket expenses by making a contribution to their Health Savings Accounts if they buy an HSAqualified plan. As health insurance premiums have risen over the past few years, many of these employer-provided benefits have gotten the axe it just wasn t in the budget to pay for health insurance and continue to offer these ancillary benefits. But with the money that s freed up from dropping the group health plan, employers can now afford to put together a really valuable benefits package for their employees and still save some money in the process. Additionally, when an employer drops their group health plan, that doesn t mean their employees must navigate the world of health insurance alone. Employers can work with brokers who have partnered with HPA to establish a customized private exchange site where their employees can access health insurance and a variety of other ancillary benefits, not just the ones listed above. Free Benefits In addition to the other lines of coverage employers can choose to spend their money on, there are a number of options they can offer to their employees on a voluntary basis. These policies do not require an employer contribution at all the company just needs to withhold the money from its employees paychecks and send it to the insurance company. Not only will employees appreciate the opportunity to purchase this coverage at the workplace, they can even do it on a pretax basis if the employer sets up a section 125 premium only plan. And this saves the employer some money too letting employees pay with 6 No-Cost Employee Benefits

7 pre-tax dollars lowers their taxable incomes and lowers the payroll taxes the employer is responsible for paying. Here are just a few lines of coverage that are available to employees on a voluntary basis: Dental insurance: While employer-sponsored dental may cover a little more at a slightly lower premium, voluntary group dental is still better and less expensive for employees and their families than individual dental insurance. Accident insurance: Young adults are much more likely to end up in the hospital due to an injury than because of an illness. These policies will help replace their income when they re out of work. Critical illness insurance: These policies pay on diagnosis of a number of serious medical conditions. Cancer policies: Cancer is one of the leading causes of death in the United States. It seems that most families have been touched by it, which is why many employees will be interested in protecting against the financial loss that comes along with it. Medical bridge plans: As deductibles and out-of-pocket costs increase, these policies help pay a portion of the bill and reduce the employee s exposure. Most insurance companies that sell worksite products like the ones listed above offer all lines of coverage, which reduces the administrative burden for employers since they only have one check to write. And some of these companies offer a free Premium Only Plan and even provide onsite enrollers to explain the options to the employees. The broker can help the employer find a good vendor and schedule the enrollment meetings. Better yet, brokers can utilize an HPA provided private exchange site (custom labelled for the company) that can help collect the leads (i.e. inquiries from employees) and/or even have those inquiries be handled by a fulfillment center on the brokers behalf. Other Perks of the Job While insurance products usually make up a big part of the employee benefits package, they don t have to be the only benefit. Employers 7 No-Cost Employee Benefits

8 that offer employer-sponsored and/or voluntary insurance products to their employees can supplement those benefits with other job-based perks. The possibilities are limited only by our imagination. Some companies, like Google, are famous for some of the perks they offer to their employees, including things like an in-house gym; swim-inplace pool; ping pong, billiards and foosball tables; laundry facilities; on-site haircuts; daycare facilities; and a subsidized massage program. Of course, not every employer can afford most of these perks, but there are still plenty of low- or no-cost ways to keep employees happy. Here are a few ideas:»» Flex time: One of the easiest things a company can do to keep its employees happy is offer them the ability to take off for doctor s appointments or leave early for their kid s school play and make up the time by coming in early or staying late the next day. Most employees will appreciate the flexibility and won t abuse this perk.»» Casual Fridays: It s amazing how much this means to some employees, and sometimes the relaxed atmosphere can make employees more creative and more productive.»» Healthy snacks: To help keep employees healthy and happy, some employers provide healthy snacks for free. This can be a nice substitute for a more costly wellness program.»» Free soft drinks: A vending machine that distributes free soft drinks would be a small investment for an employer but could really make employees feel appreciated. Plus it ll keep them from running to the convenience store when they need that afternoon pick-me-up.»» Smoke breaks: True, this may not be the best way to keep employees healthy, but if you do give the smokers time to light up, you might as well make sure they appreciate it.»» Company-paid cell phones: If your employees use their phone for work, you can pick up the tab, and this benefit would be tax-free for the employees.»» Recognition: Pats on the back and public recognition for a job well done go a long way toward boosting employee morale. 8 No-Cost Employee Benefits

9 Communication is Critical The real key to a successful employee benefits program whether the employer is spending a lot of money on group insurance products, giving the employees the ability to buy insurance with pre-tax dollars, or simply offering some free perks to keep the employees happy, is communicating those benefits to employees. As an employer, the last thing you want is for an employee to realize how great it was to work for your company after they quit and get another job. So how do you do this? Simple tell them! You can and should highlight the job perks at open enrollment time, but it might work better to tell them throughout the year. These benefits could be spotlighted on the company intranet site, in staff meetings, or even with paycheck stuffers. When communicating these benefits, it s important not to pound your chest and say look at all the nice stuff we re doing for you. Instead, saying we want to make sure everyone s aware of this benefit and taking advantage of it is a more subtle and equally effective approach. One good idea, courtesy of Jellyvision Lab in Chicago, Illinois, is to have a benefit of the month. Some months you could point out your free perks; others would be introduced at renewal time. But by focusing on a different benefit every month of the year, employees will be constantly reminded about why they like working for you and not for a competitor. Want More? If you would like some more ideas about how to help employers save money while keeping employees happy, visit our site at 9 No-Cost Employee Benefits

10 About Health Partners America Since 2007, Health Partners America has been providing game-changing training and solutions to agents and brokers nationwide. HPA is a technology and consulting company that works with and through brokers in order to engage with the marketplace through healthcare reform. HPA Partners with agents and brokers nationally to bring them technology solutions, private exchange sites, marketing tools, training and leverage to help them be more successful. HPA believes in championing, protecting and nurturing the relationships that exist between brokers, employers, and employees. Using white-labeled technology that extends from us to the broker partnering with us, then to the employer and the end-user employee, Health Partners America s private exchanges facilitate the vast array of options available to employees in a safe, user-friendly environment. HPA s technology connects the broker to their respective clients (employers), and connects their clients (employers) to their employees as the employer of choice. In addition to facilitating government subsidies for health insurance, the Health Partners America marketplace technology goes far beyond just health insurance, delivering the complete universe of insurance needs. The recent changes in health insurance law present a huge opportunity for those who are prepared, and HPA has a plan. Team up with Health Partners America and get started right away. Learn more at Keep up to date by visiting our resources section: 10 No-Cost Employee Benefits