Brokers Expand your Horizon

Transcription

1 1 Benefit Technology Resources, LLC Your Resource for HR Technology Selden Beattie Benefit Advisors Strategic Benefits Consultants Brokers Expand your Horizon

2 TODAY S AGENDA 2 1 Workshop Overview 4 Healthcare Reform 2 Benefit Technology Resources & Selden Beattie Introduction 5 ACA Audits and System Capabilities 3 System Components and HR Challenges 6 Benefits of Leveraging Technology and Case Studies

3 WORKSHOP OVERVIEW HR COMPLIANCE AND OTHER ISSUES 3 Learn what services you can and should offer in today s heavy compliance environment Learn how to protect your clients from fines that can cost a company thousands of dollars per day in penalties Discover why HR needs to evaluate their existing HR systems and their ability to capture the right information Gain a clear understanding of what data needs to be captured Learn how you can reduce the administration burden on HR staff by leveraging technology Discover a cost-effective way to improve your existing processes.

4 Benefit Advisor Services How our world has changed 4 More Government Involvement in Business? Are your Employer clients looking to you for compliance guidance? What Services can you offer to meet their needs?

5 Benefit Advisor Services How our world has changed 5 Services you can provide in-house or out-sourced to 3 rd party experts ACA impact assessment and DOL Audit preparedness Development of compliance documents (Wrap Documents/Section 125) HR consulting Technology Consulting

6 WHY ARE WE TALKING ABOUT THIS? FINES 6 The average ERISA fine (ACA) is $1,000 per day, per offense. That means that each item that is identified, the auditor can assess the $1,000 fine OR when it comes to offenses to members like non-compliance with benefit designs or offerings, it can be per member per day.

7 WHO IS BENEFIT TECHOLOGY RESOURCES? 7 Benefit Technology Resources (BTR) is a leading HR technology consulting firm. We are independent not tied to any provider. We specialize in HR technologies that include: Jamie Hawkins, President & CEO Benefit Technology Resources HRIS Human Resource Information Systems Benefits Administration Payroll Administration Time Keeping Performance Management Recruiting Talent Management Healthcare Reform Compliance

8 WHO IS SELDEN- BEATTIE 8 Founded in 1996 by Beverly Beattie Exclusively focused on Employee Benefits Strategies Creators of a formal benefit strategic planning processes that delivers better business outcomes for our clients A team of subject matter experts brought together to deliver best practices in: Beverly Beattie, President & CEO Selden Beattie Benefit Advisors Employee & Executive Benefits Consulting Human Resources Consulting Population Health Management Strategies Compliance Risk Reduction Benefits & HR Technology Solutions Benefits Communication and Branding Strategies

9 WHAT SYSTEM COMPONENTS ARE WE TALKING ABOUT? 9 You may only have one or two of these modules. Benefits Administration Payroll Recruitment/ Applicant Tracking Performance Management HRIS Time Keeping

10 CHALLENGES FACING HR TODAY 10 Compliance with healthcare reform and employee administration. Examining whether or not private exchanges have a place in your health care strategy. Data integrity: Entering the same data in multiple places (benefits, payroll, timekeeping, HRIS and carrier websites). Lack of business intelligence/combined reporting. Lots of systems. Lots of choices in the market today. Challenges with HR technology provider implementation and execution.

11 HEALTHCARE REFORM WHAT DOES YOUR SYSTEM NEED TO DO 11 Dependent Coverage 2010 Employers must expand coverage for qualifying dependent children to age 26. Benefit administration systems are configured to cap this age and report when dependents are approaching it. Summary of Benefits and Coverages (SBC) 2012 Employers must provide SBC s for annual enrollment. Systems distribute the SBC through Employee Self Service and track acknowledgment. Flexible Spending Limit 2013 For plan years beginning on or after 1/1/2013, a $2,500 limit applies to employee healthcare FSA contributions. Benefits Administration systems manage to the limit.

12 HEALTHCARE REFORM CONTINUED 12 Form W-2 Reporting 2013 Employers with 250+ W-2s in the calendar year 2011 must include the value of group health coverage on the employee s W-2 form. Employers must also confirm that this figure is printed on the W-2. One entry will show both Employee and Employer cost. Payroll platforms have had this capability, or it is on the benefits admin side. Employee Notice of Marketplaces 2013 Employers must provide current employees with a notice describing availability of marketplace coverage. The notice must be provided to all new hires. Systems can distribute the notice through Employee Self Service and track acknowledgment. Wellness Incentives 2014 For plan years beginning on or after 1/1/2014, permitted wellness incentives increase from 20% of the cost of coverage to 30%. Benefit administration systems have the ability to track wellness plan participation and incentives.

13 HEALTHCARE REFORM CONTINUED 13 Automatic Enrollment and Non-Discrimination Rule (pending guidance) Employers with 200+ full-time employees must automatically enroll new employees in the employer s group health plan. Insured employer group plans may not discriminate in favor of highly compensated employees. Benefits administration systems have this functionality. Employer Shared Responsibility 2015 Fulltime and Part-time Status (2015 for employers with 100+ employees, 2016 for employers with employees) - Employer mandate to offer affordable coverage to all FT employees (over 30 hours per week). Payroll/HRIS Systems have built in reporting Patient Centered Outcomes Research Institute - Re-Insurance Fees (pending guidance) Some health Insurers must pay a transitional reinsurance program to help stabilize premiums. This annual rate ($5.25 per month in 2014) is calculated by the average number of covered lives. Benefit Administration systems have the capability of tracking this monthly.

14 HEALTHCARE REFORM CONTINUED 14 Determining Full-time and Part Time Status 2015 Beginning in 2013, this provision will allow employers to use all or part of calendar year 2013 as a measuring period to identify full-time employees for purposes of a stability period covering all or part of 2014, and thereby approximate their costs, in 2014, were they to pay excise taxes or play by offering those full-time employees group health coverage that is both adequate and affordable as defined under the ACA. We are assuming the group will use a 12 month look-back period for health reform purposes to determine full-time status for benefit eligibility. How technology can help: Some technology solutions have already configured this requirement and have reporting available. Systems can be configured to track hours worked and the look back. Benefits of leveraging technology: You will have a tracking method. Helps reduce administrative burden.

15 HEALTHCARE REFORM CONTINUED & 6056 Reporting The pay or play rules require employers to report certain employee coverage information to the IRS. Employers with self-insured plans are responsible for both reports, while employers with fully-insured plans are only responsible for the 6056 report. Both of these filings will be due in first part of 2016 for the plan year Data Requirements: Employees and dependents covered under the health plan; their name, address, SSN and the specific months they were covered at least one day Data Requirements: For each calendar month the number of full-time employees, name, address and Social Security number of each; whether the employer coverage offered provided minimum essential coverage, minimum value, met the 9.5% affordability test, was offered to full-time employees and their dependents, and the employee s share of the cost for the lowest-cost employee-only coverage offered. A lot of additional information is required, which the final regulations allow employers to report using indicator codes. **This requires point in time reporting

16 SAMPLE OF AN AUDIT 300 EMPLOYEES PAYROLL PROVIDER 16 Dependent coverage ensuring children are covered up to age 26 IN COMPLIANCE SBC s ABC Company must supply to EE s Payroll Co CAN ADD DOCUMENTS TO THE HR HOMEPAGE AND SUGGEST ADDING TO THE BENEFIT PLAN ITSELF. THEY DO HAVE THE ABILITY TO SEND A SURVEY FOR EMPLOYEES TO ACKNOWLEDGE RECIEPT HOWEVER CAN NOT CURRENTLY ASK FOR INDIVIDUAL/IMMEDIATE ACKNOWLEDGEMENT. THIS IS ON Payroll s ROAD MAP TO ENHANCE. NO ETA AT THIS TIME. POSSIBLY 2014 NOT IN COMPLIANCE Form W2 reporting are both employee and employer cost displayed? YES DID NOT APPEAR ON 2012 W2 s. CURRENTLY SET UP FOR 2013 (SINCE JAN 2013) IN COMPLIANCE EE Notice of exchange Document that an exchange will be offered. Needs acknowledgement- NOT IN COMPLIANCE Automatic enrollment rule launch date TBD THIS WILL HAVE TO BE MANAGED OUTSIDE THE SYSTEM. THIS CAN NOT COMPLETELY BE AUTOMATED IN PAYROLL. NOT IN COMPLIANCE Fulltime and Part-time status 30hr a week rule TIME KEEPING MODULE HAS A SUMMARY (PPACA report ) THAT USES THOSE MEASURMENTS. NUMBER OF EE S, NUMBER OF HOURS ARE CAPTURED, INCLUDING CERTAIN PAY CATEGORIES. TONY WILL SEND CLIENT A SAMPLE. THIS REPORT IS STILL BEING WORKED ON AND IMPROVED CURRENTLY. IN COMPLIANCE Wellness incentives/programs Clients can offer incentives for those who participate in the program that will credit their premiums. Can this be tracked on HR side? 2 OPTIONS CAN SET UP DIFFERENT RATE TABLES ON THE SAME BENEFIT PLAN CAN ADD AN EARNING IN PAYROLL TO SHOW SAVING IN COMPLIANCE

17 MEASURING VARIABLE HOUR EMPLOYEES 17 What must an employer s system be able to track for variable hour employees?

18 MEASURING VARIABLE HOUR EMPLOYEES 18

19 MEASURING NEW VARIABLE HOUR EMPLOYEES 19

20 SYSTEM CAPABILITIES 20 Do most systems have this capability?

21 SYSTEM CAPABILITIES 21 What questions do employers need to be asking their providers to ensure that their system can track and provide the needed information?

22 ACA COMPLIANCE AUDIT 22 Do administrators have the ability to run a specific report to track variable hours for the ACA requirement? Do administrators have the ability to track hours worked by an employee? Do administrators have the ability to pull reports showing hours worked for the previous 12 months? Do administrators have the ability to view employees approaching 30 hours? Can this be automated to flag the administrator or manager? Do administrators have the ability to run a specific W2 Safe Harbor Test? (9.5% of EE s wages as reported in Box 1 of W2)

23 OPTIONS IF YOUR PROVIDER CAN T COMPLY 23 The average ERISA fine (ACA) is $1,000 per day, per offense. That means that each item that is identified, the auditor can assess the $1,000 fine OR when it comes to offenses to members like non-compliance with benefit designs or offerings, it can be per member per day. Track it manually via Excel. Have some kind of manual process documented, so that you can produce verification, if audited. Select a new provider that is compliant.

24 ACA TRACKING 24 Are there providers you already know are compliant?

25 ACA TRACKING 25 Is there anything that I didn t ask you that I should have?

26 WHAT IS HAPPENING IN THE PAYROLL SPACE WITH ACA? 26 There is a movement away from on-premise solutions and to the cloud also called SaaS. SaaS solutions can push out compliance and ACA updates easily to all clients. Costs for software are coming down with increased functionality. Providers are offering more modules, some are not best in class. Do your homework.

27 ACA TRACKING 27 Is it easy to get ACA tracking set up with most providers?

28 ACA TRACKING 28 What happens if the provider s system will not provide the needed tracking and reporting? 3 stand alone platforms 1. Equifax 2. Health e(fx) 3. Syncstream

29 BENEFITS OF LEVERAGING TECHNOLOGY 29 Healthcare reform compliance. Total savings of $19.07 PEPM can be realized through the accuracy and efficiency of complete automation. (bswift benchmark study surrounding billing) One point of entry versus multiple (payroll and carrier websites). Accurate employee and dependent eligibility. Employee and manager self-service. Reduces errors and omissions 88% of spreadsheet documents contain errors. (University of Hawaii analysis) Streamlined, centralized communication campaigns. Better vision of the total value of their benefits package with total compensation statements.

30 HR TECHNOLOGY AUDIT CASE STUDY #1 30 Client 150 employees in Florida Not ACA Compliant Struggling with current payroll provider Disparate systems No HRIS system No Benefits Administration Manual Processes. Details The client asked us to go through an HR Technology Audit. Please refer to next few slides.

31 WHAT IS BEING DONE MANUALLY? 31 BTR identified 16 different touch points for each new hire, status change, and termination. Payroll system COBRA Carrier Performance Management Spreadsheet Time Keeping Time Keeping Spreadsheet Medical Carrier E-Learning Software Recruitment Spreadsheet Applicant Tracking Spreadsheet EE Training and Licenses Internal Company Portal LTD / STD Carrier Background checking software FSA Carrier FMLA Spreadsheets OSHA Incidents

32 WE ALSO REVIEWED THEIR BENEFIT PROCESS 32 Manual process, employee completes forms HR tracks employees waiting period HR follows up with employee to see who has completed the forms. HR receives form, and then completes a benefit deduction form and faxes it to the Payroll provider HR routes deduction form to the payroll administrator RED IS MANUAL BLUE IS AUTOMATED Payroll administrator manually keys deductions into payroll Monthly carrier bills are manually reconciled by HR. Approx. 3 hours per month HR sends confirmation to Broker that the employee is enrolled HR manually keys in add/term/ changes into each carrier website: Medical, Dental, Vision, Ancillary, etc.

33 BENEFIT PROCESS WITH BENEFIT ADMIN SYSTEM 33 Employee logs in to enroll online Eligibility is managed in the system Payroll deduction file is sent electronically to payroll provider Eligibility files are electronically submitted to carriers Monthly carrier bills are reconciled through the system The Broker was able to get this client s Life and Disability carrier to pay for the cost of a HRIS/Benefits Admin system. Cost was approximately $3.50 PEPM. WIN WIN - The client implemented a platform they needed and it was cost neutral.

34 HR TECHNOLOGY AUDIT CASE STUDY # 3 34 Client 1000 employees based in the Southeast They had a current benefits administration platform Cost was: $100,000 to implement $18.50 PEPM Cost Comparison Details BTR managed the RFP process for the client We selected 5 providers to review The cost of the new provider with better technology: $30,000 Implementation $7.50 PEPM $600, $400, Annual Total Review your costs $200, $- Current Provider New Provider Per Employee Per Month Implementation Fee

35 HR TECHNOLOGY AUDIT CASE STUDY #4 35 Client Manufacturing Company with 1500 Full time and 1500 Part Time Employees. 7 companies that rolled up under the corporate infrastructure. Most were on different ADP Platforms, no roll up reporting or consistency in data tracking. Client wanted a single source solution that would make them ACA compliant and allow for roll up reporting.. Details BTR handled the RFP and included the top 4 providers the client wanted to consider. They then narrowed it to the top 2. BTR negotiated a $600,000 discount on the 3 year agreement with their new provider. Win Win BTR helped the HR Director insure they were making the right choice, and they paid the right price for the technology. Negotiate your contracts and pricing

36 HR TECHNOLOGY AUDIT CASE STUDY #5 36 Client Retail employer with 500 employees. Had a benefits admin platform that was dated and had not been reviewed in quite some time. It was not meeting minimum security requirements (SSAE-16) BTR reviewed and explained the current platform was missing ACA tracking, mobile capabilities, and plan comparison tools for employees. Details The client decided to see what other solutions were in the market. BTR prepared the RFP and managed the process, the client narrowed the selection to a best in breed provider. Win Win - This provider saved the client $120,000 per year and delivers much more robust technology. Verify their security

37 PROVIDERS THERE ARE OVER 300 IN THE MARKETPLACE 37

38 38 THANK YOU!