After ACA. Identifying and Taking Advantage of Your Alternatives. September 3, 2015

Transcription

1 After ACA Identifying and Taking Advantage of Your Alternatives September 3, 2015

2 After ACA Agenda September 3, 2015 Health Care Reform Update - Timeline - Health Care Reform At-a-Glance - Cadillac Tax - Wellness Incentives - Other ACA Updates Where Do You Go From Here? - Benefit Strategy - Comparing the Options - Today s Top Trends - Defined Contribution Healthcare - Private Exchanges - Tools and Engagement Questions 2

3 Health Care Reform At-a-Glance

4 Health Care Reform At-a-Glance Uniform summary of benefits and coverage (SBC) Form W-2 reporting of health coverage begins Self-funded plans must have external appeal contracts ERRP funds exhausted Plans may begin to receive medical loss ratio (MLR) rebates Health FSA salary reduction contributions capped at $2,500 Retiree drug subsidy deduction ends Comparative effectiveness research tax (PCORI) fees must be paid Medicare Hospital Insurance tax increased for high income filers Medicare tax applies to investment income of high income filers Excise tax on medical device manufacturers Employer notice of state insurance exchanges and premium credits 60-day advance notice of mid-year changes (Notice of Material Modification) required Health care reform timeline for employer group health plans Selected provisions for calendar-year plans note effective dates may vary for non-calendar year plans 40% excise tax on high-cost health coverage (Cadillac tax) effective Employer shared responsibility provisions States may open insurance marketplaces to large employers Part D donut hole filled Annual dollar limits prohibited on essential health benefits Pre-existing condition exclusions prohibited for all enrollees Child coverage to 26 even if eligible for other coverage Waiting periods over 90 days no longer permitted Coverage of routine patient costs in connection with clinical trials Limitations on out of pocket maximums Plans may not discriminate against providers with respect to plan participation Auto enrollment required (effective date delayed) Individual shared responsibility provisions effective State health insurance marketplaces established Low income premium subsidy available for marketplace coverage HIPAA wellness incentives limits increased and new rules Insurer tax Transitional reinsurance program Employer reporting of 2015 health insurance coverage Provisions in blue italics only apply to new plans or plans that have lost grandfathered status. 4

5 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans Provision Health plan provisions applying to both grandfathered and non-grandfathered employer plans Annual and lifetime dollar limits No lifetime or annual dollar limits on essential health benefits (EHB) Not applicable to most FSAs, HSAs, and integrated HRAs Self-funded and large group plans must use authorized definition of essential health benefit ( benchmark plan ) beginning in 2014 Effective date Plan years beginning on/ after January 1, 2014 (annual limits phased in for ) Extension of child coverage to age 26 Income tax exclusion for child coverage to age 26 Up to age 26 for medical coverage regardless of marital or student status, residence, or support. Excludes stand-alone dental and vision coverage Cannot charge more than for other similarly situated individuals Beginning January 1, 2014, grandfathered plans cannot exclude children eligible for other employer coverage Exclusion through end of calendar year in which child reaches age 26 Includes dental, vision, health FSA, and HRA (different rule for HSA) Plan years beginning on/after September 23, 2010 March 30, 2010 Pre-existing condition exclusion No pre-existing condition exclusions for enrollees Plan years beginning on/after January 1,

6 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Provision Health plan provisions applying to both grandfathered and non-grandfathered employer plans Effective date Waiting periods Waiting periods over 90 days prohibited Plan years beginning on/after January 1, 2014 Treatment of OTC drugs as medical expense Health FSAs, HRAs, and HSAs prohibited from reimbursing cost of OTC drugs (other than insulin) unless prescribed by a physician January 1, 2011 Health FSA cap Salary reductions capped at $2,500 in 2013; indexed. In 2015, indexed cap was $2,550, and it is projected to stay at the same level for 2016 Plan years beginning on/after January 1,

7 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Provision Health plan provisions applying to both grandfathered and non-grandfathered employer plans HIPAA wellness incentives No discrimination regarding eligibility or coverage on the basis of a health status-related factor. Incentives increased to 30% (and an additional 20% (up to 50%) for tobacco use) of cost of coverage Effective date Plan years beginning on/after January 1, 2014 Automatic enrollment Auto-enrollment required for employee with option to opt out of coverage Not enforced until regulations are issued After regulations are issued Marketplace notice Notice to current employees concerning availability of health insurance marketplace provided by October 1, 2013, and to all new employees hired on and after that date Model notices include one for employers that offer coverage to some or all employees and one for employers that do not offer coverage October 1,

8 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Provision Health plan provisions applying to both grandfathered and non-grandfathered employer plans Summary of benefits and coverage (SBC) 4-page, double-sided summary of benefits with a prescribed format, content, language, and timing must be provided to new enrollees and at open enrollment Latest revisions deferred to 2017 Effective date Open enrollment periods beginning on/after September 23, 2012 Reporting plan value on Form W-2 Total value of medical coverage on an employee-specific basis reported on Form W-2 issued in January for preceding calendar year Some exemptions, such as coverage provided under certain church or multiemployer plans Reporting first required in 2013 for coverage provided in 2012 Medical loss ratio (MLR) reporting and rebates Insurers to submit MLR reports to HHS and issue rebates to enrollees in insured plans in large group market (more than 50 employees) where loss ratio (ratio of claims to premium) is less than 85%. Note that this provision applies on a calendar year, not plan year, basis Rebates payable by August 1. Starting with 2014 reporting year, reporting due date is July 31, and rebates are payable by September 30 January 1,

9 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Provision Health plan provisions applying only to non-grandfathered employer plans Preventive care Preventive care services must be covered at 100% when provided innetwork Insured plan nondiscrimination OB/GYN, pediatrician, ER services Insured plans prohibited from discriminating in favor of highly compensated. Enforcement delayed until guidance released Preauthorization or referral requirements prohibited Appeals process Mandatory internal and external claims and appeals process Women s preventive services Self-funded plans must contract with at least three independent review organizations (IROs) Effective date Plan years beginning on/after September 23, 2010 Additional preventive services for women covered at 100% Plan years beginning on/after August 1, 2012 Plan quality of care reporting Group health plans and health insurance issuers required to submit an annual report to HHS addressing plan or coverage benefits and provider reimbursement structures regarding the cost and quality of care After guidance issued 9

10 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Provision Health plan provisions applying only to non-grandfathered employer plans Clinical trials Must cover routine patient costs in connection with participation in approved trials Maximum deductibles and out-of-pocket (OOP) limits Provider nondiscrimination In-network OOP maximum for EHB same as for HSA- compatible HDHP in For 2015, $6,600/$13,200 (indexed annually). For 2016, $6,850/$13,700. Plan s maximum OOP limit can be divided among different coverage categories of benefits so long as the combined amounts don t exceed the annual OOP limit. (Special transition rule for 2014 for carve-out vendors such as prescription drug) Must apply an embedded self-only OOP maximum to each individual enrolled in family coverage if the plan s family OOP maximum exceeds the ACA s OOP limit for self-only coverage (also applies to deductibles) No discrimination against provider acting within the scope of license Effective date Plan years beginning on/after January 1,

11 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Taxes and fees HSA nonqualified withdrawals Pharmacy manufacturer tax Comparative effectiveness research (PCORI) fee Itemized medical deduction Medicare hospital insurance tax Medical device excise tax Provision Effective date Penalty tax increased from 10% to 20% January 1, 2011 Annual fee on manufacturers of branded prescription drugs based on market share Fee on insured and self-funded plans to fund clinical effectiveness research For plan years after October 1, 2013, fee equals $2/covered life/year; indexed thereafter Payment due by July 31, of each year 2011 Itemized medical deduction threshold increased from 7.5% to 10% 2013 Tax rate increased from 1.45% to 2.35% for income in excess of $200K (single or head of household) /$250K (joint filers) 3.8% unearned income tax on net investment income in excess of $200K (single or head of household)/$250k (joint filers) Employer required to collect tax only for employees earning $200K or more from employer 2.3% excise tax on the manufacturer or importer for the sale of certain medical devices Plan years ending after September 30, 2012 and before October 1,

12 Health Care Reform At-a-Glance Mandates and Reforms Grandfathered and Non-grandfathered Employer Plans (cont.) Taxes and fees Health insurance providers fee Provision Annual fee on entities that provide health insurance (self- insured employers specifically excluded) Effective date 2014 Transitional reinsurance fee "Cadillac plan" excise tax Fee paid by insurers and self-funded plans (major medical coverage) from 2014 to 2016 to help fund reinsurance program For 2014, contribution rate is $63 per covered life per year ($5.25 per month); for 2015, contribution rate is $44 per covered life, for 2016, it will be $27. 40% tax on value of coverage above: $10,200/individual and $27,500/family $11,850/$30,950 for pre-medicare retirees Future years indexed at CPI-U+1% for 2019, CPI-U only after 2019 Adjusted for high risk industries, age, and gender Excludes dental and vision. For multiemployer plans, all coverage is considered family coverage

13 Health Care Reform At-a-Glance Shared Responsibility Employer Mandate Shared responsibility payment for failing to offer coverage to at least 95%* of all fulltime employees (FTE) and children if any FTE gets subsidy in marketplace Shared responsibility payment for full-time employees who opt out of employer plan and get subsidy in marketplace Individual Mandate Penalty for failure to have minimum essential coverage Provision $2,000 (indexed) times the number of FTEs (excludes first 30* FTEs). FTE defined as working 30 or more hours per week. Not required to offer coverage to part-time employees, retirees, or spouses but must offer to broader category of children. No minimum employer subsidy required. * 95% threshold lowered to 70% and first 80 FTEs excluded for 2015 only. $3,000 (indexed) for each FTE who enrolls in marketplace and receives low income subsidy if: (1) employee s contribution for single coverage under employer plan exceeds 9.5% of W-2 income, rate of pay, or the federal poverty level (FPL) for individuals, or (2) employer plan fails to provide minimum value, i.e., the actuarial value of plan is below 60%. Greater of 1.0% of Modified Adjusted Gross Income or $95/person in 2014 Greater of 2.0% or $325/person in 2015 Greater of 2.5% or $695/person in 2016 Indexed for individuals who fail to maintain minimum essential coverage. Family dollar amount capped at 300% of individual penalty. Effective date Penalties first imposed in 2016 for failure to satisfy mandate in 2015 Penalties first imposed in 2015 for failure to satisfy mandate in 2014 Note: Individual and small group plans may keep their current plans for renewals up to October 1,

14 Employer shared responsibility assessments Does employer offer minimum essential coverage (MEC) to a least 95% of FTEs (and dependents)? No For 2015 only,70% of FTEs. No Employer assessment: $2,000 x FTEs (less 30; 80 in 2015), if at least one FTE receives subsidized marketplace coverage. Assessment of $167 payable monthly. Applies separately to each member of controlled group Yes For 5% group who are not offered coverage (30% in 2015 only) potential employer assessment. No Employer assessment lesser of: $3,000 x FTEs who receive subsidized marketplace coverage. Assessment of $250 payable monthly. $2,000 x FTEs (less 30; 80 in 2015) Does the employer offer at least one option that is affordable (under 9.5%) and satisfies minimum value (60% or more)? No Yes Employee chooses: Employer plan Individual penalty Marketplace coverage without subsidy Spouse / parent plan Medicaid No employer assessment Employer reporting to IRS and employees/ retirees: 6056 Reporting 6055 Reporting 14

15 Cadillac Tax

16 Cadillac Tax - Overview of the Excise Tax Starting in 2018, a 40% excise tax will apply to each employee s excess benefit, which is the aggregate cost of applicable employer-sponsored coverage that exceeds the limit calculated on a monthly basis For each employee, former employee, surviving spouse, or other primary insured individual Aggregate cost of applicable coverage Less: self-only or other than self-only limit Excess benefit Multiplied by: 40% Excise tax attributable to that individual The tax is allocated by the employer to insurers, TPAs, PBM and other coverage providers for payment to the IRS. Insurers, TPAs, PBM and other administrators expected to charge back cost to employer, perhaps with tax gross-up. 16

17 Cadillac Tax - Applicable Coverage Generally, applicable employer-sponsored coverage Includes: Health coverage excludable from income, including HRA contributions Health FSA/HSA employee and employer contributions Onsite clinics if considered a group health plan EAP if considered a group health plan Wellness programs, if COBRA premium charged Executive physical programs and supplemental medical programs if excluded from income Excludes: Insured dental (self-insured dental?) Insured vision (self-insured vision?) Long-term care Accident and disability benefits Coverage for a specified disease or illness or fixed indemnity coverage (e.g., critical illness and hospital indemnity plans) if 100% employee paid with after-tax dollars Auto insurance Liability insurance Credit insurance Workers compensation Based on total cost of plan, not net of employee contributions 17

18 Cadillac Tax - Aggregate Cost For self-insured plans, calculated like COBRA premium Includes employer- and employee-paid portions Separate rates for self-only and other than self-only coverage For retirees, option to combine pre-65 retirees with post-65 retirees Will future guidance require actuarial certifications and standard assumptions? o Actuarially sound and self-supporting rates o Claims base, trend, margin, tiering, plan changes, etc. For the health HSA Includes employee salary reduction contributions Includes employer contributions 18

19 Cadillac Tax - Impact of Health FSA 2018 Projected Per Capita Cost 2018 Blended Per Capita Cost FSA Total Projected Per Capita Cost 2018 Limits Excess Benefit Per Employee Excise Tax Employee $9,663 $9,663 $0 $9,663 $10,200 $0 $0 Employee $9,663 $9,663 $2,500 $12,163 $10,200 $1,963 $785 Employee only tax allocation (Based on assumed split of medical and Rx costs): Medical 67% $526 Rx 17% $133 FSA 16% $126 $785 While illustrated on an annual basis, the tax is calculated on a monthly basis for each employee/retiree. 19

20 Expected Leveraging of Cadillac Tax 20

21 Cadillac Tax - Tax Mechanics Will vendors pass along the cost? Since excise tax is not deductible for vendors, will they also gross up for taxes to stay whole after taxes? A Hypothetical Example Excise tax on employer s plans $61,000 $135,000 $448,000 Vendor s corporate marginal tax rate 35% 35% 35% Expected charge-back to employer (income vendors need to stay whole)* $93,846 $207,694 $689,231 * Excise tax/(1 marginal tax rate) Grossing up increases the cost to employer by about 54% Payments may vary between not-for-profit and for-profit administrators Penalty for underreporting tax liability equal to amount that would have been paid, plus interest (effectively a 100% penalty) 21

22 Anticipating the Cadillac Excise Tax Absorb the cost o Could offset another source of total rewards to cover the expense Migrate employees to lower cost medical options Improve plan efficiency o Improved networks, discounts, wellness, move to self-insured Reduce medical benefits to delay, reduce, or eliminate the tax o Could replace lower medical value with increase in other total rewards Implement HDHP/HSA plan o Eliminate or reduce employer HSA contributions o Eliminate or cap pre-tax employee contributions if subject to the tax Eliminate ancillary health care benefits such as the health FSA Ensure dental and vision in separate plans Review COBRA rating assumptions End health plan sponsorship for actives and/or retirees o Subject to ACA $2,000/employer shared responsibility assessment 22

23 Wellness Incentives

24 Common Designs and Applicable Laws Disclaimer: this is a generalization; analysis depends on facts and circumstances Component ADA HIPAA GINA Tax Other Nutrition classes Cash reward for walking a mile per day (Reasonable accommodation) (Reasonable accommodation) (Participatory program) (Activity-only program 30% max reward) (Included in taxable income) Premium discount for meeting biometric standards offered to employee and spouse (30% max reward; eeonly coverage) (Outcome-based program; 30% max reward) (confidentiality/ privacy, election change) Tobacco surcharge if test shows presence of nicotine (30% max reward; eeonly coverage; family not addressed) (Outcome-based program; 50% max reward) (confidentiality/ privacy, election change) Reward of car seat for maternity management enrollment Pregnancy Discrimination Act (confidentiality/ privacy) 24

25 Common Designs and Applicable Laws Component ADA HIPAA GINA Tax Other Achieve 3 biometrics within normal range, or show 2 improvement from previous year (including BMI) employee only Premium reduction if attest to not smoking (30% max reward; eeonly coverage) (Reasonable accommodation) (Outcome-based program; 30% max reward; RAS required; special participatory rule) (Outcome-based program; 50% max reward) (confidentiality/ privacy) Reward for completing HRA offered to employee and spouse (30% max reward; eeonly coverage; family not addressed) (Participatory program) Weight loss challenge; reward is gift card Age/gender appropriate preventive screenings ; reward is health FSA contribution (confidentiality/ privacy; ADEA) 25

26 ADA Proposed Regulations Analysis Flow Chart Does wellness program include a medical exam for disability-related injury? Yes Part of group health plan? Yes Provide notice to participants Incentives limited to 30% of cost of employee-only coverage Comply with HIPAA privacy rules No No General ADA rules apply (e g, no discrimination, reasonable accommodations) Must be reasonable designed Must be voluntary No requirement to participate No denial of coverage under any plan or benefit package No adverse employment reactions Meets confidentiality requirements Complies with other nondiscrimination laws 26

27 Other ACA Updates Employers with 50 to 99 employees o Subject to the Employer Shared Responsibility rules effective 1/1/16 Part D doughnut hole continues to be filled in o In 2015, the retiree pays 65% of the cost of generic prescriptions and 45% of the cost of brand name prescriptions No Health Reimbursement Account without an accompanying sponsored benefit plan o Not allowed to reimburse employees through an HRA for premiums of individual insurance purchased in the public marketplace o The HRA would not meet ACA requirements and would be subject to $100 per day per employee penalty May need embedded cost-sharing limits in 2016 o Self-funded and large groups may need to apply the 2016 Federal costsharing limits of $6,850 self-only, $13,700 family, by individual o Problem for CDHP where no embedded deductible is allowed by individual o For example, $4,000/$8,000 CDHP deductible would not comply with $6,850 individual OOP requirement 27

28 Where Do You Go From Here?

29 Benefit Strategy - Where Are You on the Consumerism Spectrum? Where Do You Want to Be? Consumerism Spectrum Essence of Contract Employer Role Paternalism Consumerism Individualism We ll take care of it for you Architect/custodian providing, at a minimum, adequate benefits, fair policies We support each other and share responsibility Partner, enabling employees to make informed decisions for their well-being You re on your own Limited obligation or involvement in the individual s choices Employee Role Passive, entitled ; waits for employer to make decisions; little concern about costs or impact Engaged consumer; seeks information, weighs alternatives, considers cost and outcomes Like an independent contractor; simply minimizes cost and maximizes personal outcomes 29

30 Benefit Strategy - Benefit Delivery Options Maintain Manage Sponsor Facilitate Exit Existing plans and financing Uncommon except for: Labor contracts Grandfathered plans PPO - Only Status Quo is working for me I am contractually obligated Simplify and streamline plans Insourced focus on cost management: Vendor selection Plan design Communication Engagement CDHPs and H.S.A.s I will make the investment to improve performance Our unique benefits differentiate us Best-in-class designs and partners Outsource functions: Vendor partners Quilted network Portfolio of designs Engagement resources Self-funded or insured I believe better performance is achievable, but lack the resources on my own I will actively support the activities that have proven outcomes, and outsource wherever it makes sense DC model with insurance focus Outsource functions and risk: Insured choices Fixed DC cost Low focus on health engagement I want to provide broad access to benefit programs while not having a role in day-to-day management My CFO insists on a fixed cost model No benefit relationship with employees I am no longer in the benefits business Typical Current Strategy Typical Objectives Today Private Exchange with Flexibility in Design, Paternalism Private Exchange DC design, no Paternalism Send employees to Public Exchange 30

31 Benefit Strategy - Progression of Plan Design Defined Contribution Indemnity Managed Care Risk Shifting Flexible Benefits CDHC Employee: Increase financial responsibility and health management 31

32 Benefit Strategy - Philosophy of Shared Accountability Imperatives I must Infrastructure I m able to Incentives I want to Information I understand Mandates that enforce accountability for specific behaviors and actions Resources, services and tools that enable individuals to take action Motivators that encourage greater individual accountability Elements that educate and promote your benefits and build personal awareness Leadership support Environmental support Social contract mandates Vendor partners Technology Individualization at time of need Plan design Incentives Social/behavioral techniques Communication Branding Data Dashboards 32

33 Concerns Advantages Comparing the Options Pay Play Public marketplace Private exchange Standard employer group plan Easier to cost shift to employees Potentially no resources required to respond to employee health concerns Cost savings could be transferred to employees as taxable income More choices Easier to cost shift to employees Fewer employer resources required to respond to employee health concerns More choices Focus on wellness and disease promotion Self funded Less administrative hassle for employer Offer plans that meet specific employer needs Ties health benefits to corporate culture and broader employment package Retain direct control of vendor relationships Directly influence employee health Retain input on regional and national delivery of care Website/enrollment problems No national approach, varies by state Employees lose buying leverage and employee costs rise, often dramatically Fundamentally changes/erodes benefit package Potentially poor employee consumer experience Limited employer adoption, thus far Limited employer input on options or vendors Requires material communications effort to educate employees Requires continued resources & diligence to manage program Harder to limit employer s cost increases below medical inflation Reduced ability to promote employee health and productivity 33

34 Today s Top Trends Clarity on health reform is fueling rapid transition Migration to consumer driven health benefit designs True shared responsibility and costs with employees Use of account-based plans to encourage financial awareness Engagement of workforce with communications, tools and resources Introduction of 1 st and 2 nd generation wellness and health management programs Reliance on partners- general and specialized- to integrate employee experience Serious consideration of exchanges and defined contribution benefits 34

35 Defined Contribution Healthcare Defined contribution can take many forms: Insured or self-insured group plans Company announces fixed employer subsidy or credit amount, and determines employee premium contributions for each plan based on total plan cost minus fixed subsidy amount Group plans offered through a private exchange Fixed employer subsidy or HRA amount provided to employee, and employee uses that subsidy to offset cost of plan selected in the private exchange Individual plans offered through a private exchange Fixed employer subsidy or HRA amount provided to employee, and employee uses that subsidy to offset cost of plan selected in the private exchange 35

36 Defined Contribution Healthcare Key components of Defined Contribution Health Care: Clear and concise communication of the defined contribution commitment from the employer Employer makes conscious decision from year to year on if and how much that DC commitment will change Typically includes multiple plan offerings to allow employees to choose a plan that fits their needs and budget Employee cost determined by total cost of plan reduced by the DC commitment Includes tools for assisting in plan choice, transparency in cost and quality of services, and support in delivery of benefits 36

37 Best Practices with CDH Benefit Design Driver Best Practices to Consider Pricing and plan design Premium differential to promote wellness and consumerism Account contributions and fund access Covered benefits parity Communications Broad calendar Financial levers- co-pay, co-insurance, etc. Amount by employer to steer participation to CDHP Contribution approach promote wellness Ease of access and understanding Multi-media approach Engagement and personalization Decision support Health plan selection approach Contribution/distribution decisions and management 37

38 Evolving Wellness Program Models Health-Related Fringe Benefits Typical Wellness Program Today Strategic Health & Productivity Initiative Focus Improve morale and loyalty Promote healthy activities Drive business results Oversight Unmanaged Some coordination Multi-year strategy Participation Voluntary Voluntary with heavier promotion Target all employees and dependents Personalization None Some High Incentives None Small activity-based Significant outcomes-based Measurement & Evaluation None Some evaluation Thorough metrics, analysis & reporting Emerging trend 38

39 Health Advocacy Find the right doctors, dentists, hospitals, other healthcare providers; expedite appointments Address complex medical conditions, research and locate latest treatments Coordinate care and schedule follow-up visits with the medical team; help transfer X-rays, medical results Arrange specialized treatments and tests; answer questions about results, treatments and prescribed medication Clarify benefits including copays, and help facilitate access to appropriate care Provide health cost estimates for common medical procedures for informed decisions Help resolve insurance claims, negotiate billing Gaps In Care Coaching. Ongoing tailored gaps in care health coaching by Personal Health Advocates Offer personal contact with a nurse and web-based health information Locate eldercare including assisted living, adult day care and other issues facing parents, parents-in-law Secure second opinions Prepare members for doctors appointments including questions to ask o o Identify best-in-class medical institutions for a serious illness or injury Find community services and government programs when needed 39

40 The Emergence of Private Exchanges Operated by for profit private companies (e.g. insurers, consulting firms, specialty firms) Vary in structure: single or multiple carrier, fully insured and/or self-funded, group or individual, active employees and/or retirees Plans and services can extend beyond ACAdriven structure of public marketplaces Flexibility in plan offerings, although many follow metals designs Can also offer other forms of insurance and related services 40

41 Comparing Apples to Apples High Level Questions Fully insured/self funded? Employer control of plan design? Help with enrollment? Other administrative bells and whistles? One carrier or multiple carriers? Cost? Who is paid for what? Platform for employees? Vendor relationships? Contracting responsibility? 41

42 Comparing Apples to Apples (cont.) What s included? Insurance products, administration capabilities, and decision support tools for the employees both during enrollment and throughout the year How much can you customize? Ranges from complete customization to a fixed set of both carriers and plan designs How sustainable is the solution? Determine what happens after year one to both the employer and the employee costs How much choice is right for your employees? Complexity of decisions you are asking your employees to make, the adequacy of the support they will have to make decisions, and if those choices truly add value What role does HR now serve? Understand your role after the exchange is deployed to ensure you are not too far removed from your data to be able to impact the productivity of your workforce 42

43 Emerging Practices Typical Engagement Tools and Technology Common engagement interface (web-based) between employer and employee/family Health plan selector tools and decision guides Calculators for short and long-term health costs Shopping tools Financial transparency to health costs, provider quality ratings, location services Carrier-based, CastLight, Healthcare Blue Book, Healthgrades, etc. Health condition web tools and search functionality (e.g. WebMD) Mobile apps and social media Integrated health records and personalized services Personalized avatars/coaches and gamification Devices (e.g., FitBit, pedometers, Body Media, etc.) 43

44 Principle #1: Make it Personal and Relevant Know my numbers Personalized interests Spending Account Balances 44

45 #2: Drive Actions and Outcomes Incentive rewards Targeted messaging Personalized recommendations 45

46 #3: Make it Accessible and Convenient Mobile access Centralized access to all plans and programs Single Sign-On and Deep Links 46

47 # 4: Use Social Influence Social Media and Grassroots Support Leadership Support 47

48 #5: Apply Behavioral Science Aspiration Loss aversion Regret aversion Statistical optimism 48

49 Questions?