Wellness Programs - May 15, 2013

Transcription

1 Wellness Programs - May 15,

2 TWO PART WEBINAR MODERATOR 1 2 Adapting Wellness Plans to 2014 Kate Kohn-Parrott, CEO of the Greater Detroit Area Health Council PPACA: Countdown To 2014 Rod Reasen II, President, Healthiest Employer LLC The Next Wave of Employer Benefits Denise Christy, Founder and CEO, iselect Custom Benefits Store 2

3 Wellness Programs - May 15, 2013 Rod Reasen II President Healthiest Employer, LLC 3

4 2014 Countdown 1. Grandfathered Plans 2. Pre-Existing Conditions removed 3. Limits on Pre-Existing Conditions removed 4. Insurer underwriting changes dramatically Single or Family enrollment Geography Age (Older adults can expect to pay up to 3X more than the youngest) 5. EHB Essential Health Benefits 6. Cost Sharing Limits 7. Qualified Health Plans 8. Health Exchanges 9. Consumer Protections 10. PPACA Exclusions 4

5 Spotlight: Employee Wellness 1 Carrier Provided Wellness Programs 2 Small Business Workplace Wellness Grants 3 Wellness Incentives 5

6 Spotlight: Employee Wellness PPACA defines a Wellness Program as one that is reasonably designed to promote health or prevent disease. EIHQ Expenditures to Improve Health Quality Carriers must comply or these charges will be included in the administration and Medical Loss Ratio fees Grounded in evidence-based medicine or widely-accepted clinical best practices Capable of being objectively measured Capable of producing verifiable results and achievements Must primarily focus on health improvement not cost containment By these standards, most insurer offered wellness programs will fall short. 6

7 Spotlight: Employee Wellness Participatory and Non-Participatory Updates These rules apply to both grandfathered and non-grandfathered plans Programs must have a reasonable chance of preventing diseases improving health, and must not be unnecessarily burdensome - EIHQ Programs must offer a reasonable employer-provided alternative method for qualifying for the reward if they cannot meet the primary method for medical reasons Physician verification cannot be required The maximum permissible health-contingent reward is 30% of the cost of health coverage in general, and 50% for smoking prevention or cessation programs; no limit exists on participatory program rewards 7

8 Medical Loss Ratio Rebates PPACA requirements 1. Small Employers <50 eligible employees 80% of premiums on claims and health care quality improvement 2. Large Employers >51 eligible employees 85% of premiums on claims and health care quality improvement POTENTIAL IMPACT: Insurers who do not meet the above thresholds will need to rebate the excess to the policy owner Split share between the employer and plan participant by share BUT PPACA allows small rebates to be reinvested in 8

9 Medical Loss Ratio Rebates Wellness: Specifically to enhance wellness initiatives or other activities that will benefit plan participants. WHEN TO SEEK ADVICE: ERISA rules could apply Applying rebates to plans with both ERISA health plan participants and non may violate ERISA rules. Be prepared for an audit 9

10 Future of Wellness Evergreen An employee s health affects the bottom line. Healthy people, healthy bottom line Data becomes more important than ever. Individuals become increasingly empowered. The employer becomes a catalyst. Less carrot and stick. The Healthiest Employer Wellness Maturity Model 10

11 360 INSIGHT SERIES PPACA: Countdown To 2014 The Employer s Survival Guide 47 page full report Employer checklist Audit preparation guide Things to do now before 2014 healthiestemployers.com rreasen@healthiestemployers.com Rod Reasen II President, Healthiest Employers 11

12 Wellness Programs - May 15, 2013 Denise Christy Founder and CEO, iselect Custom Benefits Store 12

13 Relevance of Wellness in a Post Reform Marketplace Fully Insured Group Market Perspective Redefining the term to Wellbeing- therefore should include productivity, security, health and vitality. If employer wants a workforce that values a wellbeing as cultural driver and differentiator, then integrating strategies that reward outcome based behavior will happen. If employer sees wellness programming as a cost that is to be offset by premium reductions, it will be difficult to verify. Culture of Wellbeing or Health Cost Management. What is the motivation? Both can be achieved through a private exchange offering. 13

14 Defined Contribution Is the New Frontier of Health Benefits Very few employers (accounting for just 5% of employees) plan to drop employer-sponsored coverage in the future. - Oliver Wyman 2012 survey of 1,300 employers A large percentage of businesses plan to offer their employees benefits through a private exchange in the next few years. 80% of employers are willing to choose a private exchange model in the future. - Oliver Wyman 2012 Survey 47% of employers plan to move to a private exchange model. - J.D. Power and Associates 2012 Study 14

15 Private Exchange Value First What is a private exchange for the smaller employer and how does it work? Defined Contribution is the method to drive the shift in purchasing and usage behavior. Opportunities to improve financial security are more often elected through a Private Exchange. (WVB, HSA, FSA) Higher the engagement, personal control, greater satisfaction and accountability 15

16 Flat Dollar Allocation - Employee Goes Shopping on the Storefront Health 5-10 plans Dental 2-3 plans Vision 2-3 plans Life Disability STD/ LTD Worksite Voluntary CI, Acc, HI HSA Pet, Tele-med Optional FSA Optional 16

17 Why Employers Are Looking at a Defined Contribution Strategy? To reset how the employer and employee share the cost of coverage To connect employees to their health care and its cost- and be a catalyst for employees to make better choices To improve financial predictability in medical program budgeting To parallel retirement plans transition from DB to DC 17

18 The PPACA Push: Steps for Affordable Coverage Employer simply needs to meet the contribution target on the single rate of the lowest cost plan that meets the minimal actuarial value. 1 Set DC contribution accordingly. Employee will choose/ buy up plan design that meets their needs. Lowest income employee- 9.5% 18

19 The Wellness Opportunities Defined Contribution Dollars tied to Wellness targets. Predictive Modeling technology that guides consumers to make different choices due to preferences and lifestyle. Need partner that will supply a solution that is verifiable so the playing field is level and available for all. Reward dollars for outcomes: PPACA- 30% of premium for non smoking 50% for Smoking- Unlimited Participation Dollars 19

20 Upcoming Health Facts webinars: Benefit Design for 2014 June 26, 12 noon 1 p.m. The Pros and Cons of Using High-Deductible Plans July 17, 12 noon 1 p.m. Employee Health Literacy: Getting the Most Out of a Doctor Visit September 19, 12 noon 1 p.m. Employee Facts: New Rights and Protections Under the Law October 9, 12 noon 1 p.m. Employee Education: Picking a Plan on the Exchange August 21, 12 noon 1 p.m. Reserve your spot at crainsdetroit.com/webinars