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Age-Banded Rate Solution for Tech Employers

By Todd Bennett, Principal, Employee Benefits Division

clock March 28, 2016 at 10:00 AM

As of January 1, 2016, employers with 51-100 benefit eligible employees are now considered small group employers. As a newly labeled “small business,” you may see rate increases of 20-30%, depending on your group, if you haven’t already.

Why the big jump in rates?

The change is tied to rules that apply to small groups. Small groups are charged with what the insurance industry calls “age-banded” rates. Age-banded simply means age-based. In other words, cost is assessed for the age of each employee and spouse in the group. The shift impacts many employers, especially technology companies since many employ under 100 employees, and adds another obstacle in the quest to offer affordably priced health care coverage.

If you are one of these employers, the following is a quick summary of things to be aware of.

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Topics: Employee Benefits, Health Care Reform

Employee Benefits: How High-Growth Tech Companies Can Compete

By Adam Moise, Principal

clock December 7, 2015 at 10:00 AM

Small and midsized tech companies face many challenges, but none may be as difficult as attracting and retaining talent. The task is especially difficult given what these high-growth companies are up against in Silicon Valley. Consider the following: 

  • Google offers one-on-one consultations to new parents to help them find child care facilities
  • Intuit has onsite fitness centers for employees and offers $650 for gym memberships and exercise class fees
  • Netflix now offers a year of paid maternity and paternity leave for salaried employees
  • Twitter employees receive Zipcar discounts, access to in-office yoga and Pilates classes, and dry cleaning and laundry services

In addition to competing against cash-rich tech companies, smaller firms are grappling with increasing healthcare costs and are stuck in a new pricing system that doesn’t allow for effective rate negotiation. According to a survey by Mercer, a Marsh & McLennan Agency (MMA) sister company, employers predict that health benefit cost per employee will rise by 4.2% on average in 2016 after they make benefit plan changes, such as raising deductibles or switching carriers. This is consistent with actual cost growth in 2014 (3.9%) and the expected cost growth for 2015.

Band Together

So how does a promising tech company bring in the talent it needs when the tech giants are grabbing up the skilled employees with higher salaries, generous 401(k) plans, and impressive healthcare benefits?

One way small and midsized technology companies can compete is to take advantage of a small business trust.  A relatively new way to lower employee benefit costs, tech companies are pooling their collective buying power to compete with the giants on robust healthcare benefits.

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Topics: Employee Benefits, Human Resources, Technology

How to Implement a Successful Company Wellness Challenge

By Happy Chan, Client Manager II, CWWPM

clock August 24, 2015 at 10:00 AM

On Your Mark, Get Set, Motivate!  

Savvy employers recognize the benefit of a healthy workforce. Study after study has demonstrated the increased productivity, improved morale and the health insurance savings that come with a healthy and physically active group of employees. As John F. Kennedy said, “Physical fitness is not only one of the most important keys to a healthy body, it is the basis of dynamic and creative intellectual activity.”

Yet knowing that something is important to the wellbeing of an organization is not the same as knowing how to implement an effective employee wellness program. The question remains: What can employers do to introduce healthy habits and keep employees motivated to stay active?

Marsh & McLennan Agency decided to test the effectiveness of our own wellness program Total Health by challenging our associates.  In June, the MMA West San Francisco and Walnut Creek offices took part in the Get Up and Go Challenge, modeled after one of the basic challenge events from our Total Health wellness program. Using this model, we measured the number of steps people took, with the goal of 10,000 per day. This might sound like a lot, but using a conversion sheet, our associates were able to log steps taken doing everyday activities such as gardening, grocery shopping, and even housework.

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Topics: Employee Benefits, Wellness, Human Resources

5 Ways Technology Can Streamline Benefits Administration

By Adam Moise, Principal

clock August 10, 2015 at 10:00 AM

Marketlink_FB_Graphic-01Administering employee benefits can be time-consuming, but applying technology can help dramatically improve the process.

So what are the most effective ways to manage your benefits program, both from an employer’s and employee’s perspective?

Whether you’re in the early stages of looking for an online solution for your organization or already have one in place, here are five reasons technology will support your long-term goals and what to look for in a benefits administration platform.

1. Streamline enrollment information collection

Many companies have no organized approach to collecting enrollment data. Even today, with so much technology available, many companies still rely on a paper-based process to enroll employees or update benefits information.

With an online system, data collection is aggregated centrally and can be easily accessed and managed by the HR team from any location. Online data management is particularly important for complex benefits offerings, especially for employers with multiple offices, contribution strategies, and eligibility requirements.

2. Incorporate ACA tracking and reporting into your system

The "Affordable Care Act" (ACA) created two new duties to report healthcare information.

Individuals offered company-sponsored health insurance must state whether they had coverage that met the ACA’s requirements. Companies considered an Applicable Large Employer (ALE) also must report that they have complied with the ACA. To verify that information, the IRS created two forms, IRS Form 1095 C and IRS Form 1094 C. Employers can be fined $100 per day for each 1095 C form that has not been submitted to the IRS.

An online benefits administration system can integrate payroll, time and attendance information, so all of the data can be accessed in one location and transmitted seamlessly to the IRS.

3. Provide a self-service administration option for employees

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Topics: Employee Benefits, Health Care Reform

New IRS Reporting Rules: Start Preparing Now

By Christopher K. Bao, Esq, Compliance Manager

clock July 6, 2015 at 10:00 AM

For most companies with more than 50 employees, 2016 will bring significant new Internal Revenue Service (IRS) employer reporting requirements.

The goal of the IRS: To ensure that your employees maintained health insurance coverage in 2015, in addition to ensuring that certain employers offer coverage to full-time employees, as mandated by  the Affordable Care Act (ACA).

Preparation is the key to managing this additional workload brought on by the ACA for your HR, Finance and Payroll teams.  Planning is critical if you want to avoid a potentially big penalty. Employers may be fined up to $1.5 million for failing to report the proper information to the government.

By January 31, 2016, employers are required to report to an employee (and the government) as to what months the employee was offered coverage, in addition to other information related to the coverage, to the employee and the government.  An employer must also transmit this information (along with other information regarding the offer of coverage to all of their employees) electronically to the government by March 31, 2016 (paper transmittals will be due one month earlier). 

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Topics: Employee Benefits, Health Care Reform, Legislative Compliance

Key Person Life Insurance: Would your Ship Survive without the Captain?

By Sharon Healey, LUTCF, FSS, Client Executive

clock June 15, 2015 at 10:00 AM

In maritime tradition, the captain is said to “go down with the ship.” But must the ship go down with the captain? This is the metaphorical question behind an insurance coverage called Key Person. Key Person is insurance that protects a business in the event that a key employee dies—the company owns and is the beneficiary of the policy.

The loss of any person in an organization is devastating. The loss of a person who is critical to the company’s operations, sales or decision-making can instantly multiply the impact of that loss. What would your organization do if something happened to your CFO? Or how about that long-term colleague who is the backbone of your company? Have you ever thought about how your company would function without them? Regardless of the size of the business or organization, there is always at least one person that is critical to the firm’s success.

Facing mortality is uncomfortable for most people and planning ahead for an unforeseen loss is a difficult subject, but for those responsible for the longevity of a company, it is an important coverage to consider.

Key Person Insurance protects a business by addressing the financial impact of losing a key person in the company. With the coverage in place, a claim would provide funds to:

  • Offset interrupted or lost cash flow from reduced sales or company earnings
  • Hire a temporary substitute
  • Offset the expense of attracting and hiring a qualified replacement

Most executives overlook this type of insurance, because it’s not something they want to think about or plan for. Captains don’t think about going down with or without the ship. However, Key Person Life Insurance could be your saving grace in the event that an unforeseeable death takes place. Key Person Life Insurance can help keep a business going strong, even if tragedy should strike.

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Topics: Employee Benefits, Individuals

The ACA Turns 4: Major Milestones in 2015

By Christopher K. Bao, Esq, Compliance Manager

clock May 18, 2015 at 10:00 AM

Unsurprisingly, the historic nature of the Affordable Care Act has made it a significant topic of discussion over the past four years and we don’t see that changing anytime soon. With numerous ongoing modifications and delays to legislation, it is essential employers stay up to date on ACA developments. As we approach the midway mark of 2015, we’ve compiled a list of high-priority ACA developments employers should have on their radar for the remainder of the year:

  • Pre-established Stability Period - In 2014, employers should have established a Measurement Period or Stability Period for their variable hour/seasonal employees. The Stability Period should have begun January 2015 for variable hour/seasonal employees (subject to transition relief). If an employer has not yet established a Stability Period, the employer should do so immediately, unless they are entitled to transition relief in 2015.
  • Section 125 Modifications - Employers that have not modified their Section 125 Plan documents to include the new permitted election changes introduced in 2014 may now choose to offer additional Section 125 Cafeteria Plan permitted election changes. This will allow their employees to make new mid-year election changes.  This includes employees who:
    • Intend to enroll in a Qualified Health Plan in the Exchange (i.e. Marketplace) or
    • Work less than 30 hours a week during a Stability Period.
  • Premim Reimbursement Grace Period for Small Employers - Small employers (less than 50 Full-time and/or Full-Time Equivalent employees) are able to continue having a premium reimbursement plan for their employees’ individual policies until July of 2015 without penalty.
  • Cadillac Tax Planning - Employers should be focusing on strategies to reduce the cost of their high-priced health plans in anticipation of the looming Cadillac Tax. Health benefits (including HRAs, HSAs, FSAs) valued above the IRS threshold are subject to the recently released IRS Guidance on the applicability of the Cadillac Tax. The IRS Guidance also requested comments from the public on potential methods for calculating the cost of these plans.
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Topics: Employee Benefits, Health Care Reform, Legislative Compliance

Age-Based Rates: The Solution for Life Science Employers

By Nicole Mehrara, Principal, Employee Benefits Division

clock May 13, 2015 at 10:00 AM

Beginning January 1, 2016, employers with 1-100 benefit eligible employees will be considered small group employers. If it hasn't already, this change has the potential to increase your rates by 20-30%, depending on your group.

Why the big jump in rates?

The change is tied to rules that apply to small groups. Small groups are charged what the insurance industry calls “age-banded” rates. Age-banded simply means age-based. In other words, cost is assessed for the age of each employee and spouse in the group. The shift impacts many employers, especially life science companies that typically employ within the 51-100 range, and adds another obstacle in the quest to offer affordably priced health care coverage.

If you are one of these employers, the following is a quick summary of things to know.

For renewal dates that occurred on or after January 1, 2016, employers with 51 to 100 benefit eligible employees will:

  1. Move from large group to small group
  2. Pay medical rates based on each family member’s age and not the employee’s age
  3. Have rates based on the ZIP code of the employer (instead of the employees’ residential zip codes)
  4. Lose online administration of benefit eligibility
  5. Cease to receive underwriting discounts for industry and favorable employee demographics

Solution for Life Science Employers

Marsh & McLennan Agency, in partnership with Biocom, created the Beyond Benefits Trust to provide large group underwriting for small group life science companies impacted by this law.

Beyond Benefits leverages specific regulations established by The Department of Labor (DOL). These regulations allow for the formation of DOL-qualified small business trusts which pool small companies together. Under this structure, employers qualify for large group rates, regardless of their size.

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Topics: Employee Benefits, Health Care Reform, Breaking News

Why You Need An Employee Benefits App

By Madalyn Altschuler, Manager, MarketLink & Benefits Communications

clock April 27, 2015 at 10:00 AM

How much would your employees appreciate a cool new, employee benefits app?

Consider the following:

  • Over 70% of the U.S. population owns a smartphone¹
  • Mobile users check those smartphones 40 to 100 times each day¹
  • Four out of five smartphone users wake up and look at their phone within 15 minutes¹

Benefits for All

Today, an easy-to-use benefits app, fully branded with your corporate identity, is one of the best ways for employees to understand their benefit options and for employers to communicate their benefits programs.

Click here to learn more about MMA's new, upgraded iBenefits app.

For employers, a benefits app reduces costs, streamlines benefits communication and creates buy-in from employees, who are much more likely to turn to their smartphone for information than anyplace else.

A well-designed, fully-featured app can save your Human Resources team time and also further shift resources to mobile delivery from traditional paper-based employee communications.

A Digital Swiss-Army Knife

An app can store an organization’s entire benefits guide, as well as plan summaries for each benefit offered. For communicating throughout the year, an app can send “push notifications” to employees highlighting important plan changes or other relevant benefits program information. An FAQ residing in the app can also ease the workload on your HR team and minimize inquiries to a call center by making information readily available.

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Topics: Employee Benefits, Human Resources, Technology

Medicare: What You Need to Know About Turning 65

By Heather Woodruff, Client Executive, Specialty Services Division

clock March 30, 2015 at 10:00 AM

Blowing out 65 candles on your birthday cake means more than just getting a senior discount at the movies. For many of my clients it means deciding whether to stay on their group health plan or switch to Medicare. As a Client Executive, I have the opportunity to help individuals navigate through their options. Over the years, there are two questions I am often asked by clients as they reach 65.

Question 1: I’m enrolled in a group health plan and turning 65. Do I need to enroll in Medicare?

No. According to Medicare guidelines, you may continue on your group health plan if you or your spouse is working and on the group health plan that is associated with that employment.

Question 2: I’m retiring at the end of the year, enrolled in a group health plan and am over 65 years old. When do I apply for Medicare?

It is best to apply for Medicare 3 months before retirement. Because you have been on a group health plan, you will not be penalized. Once you have Medicare and supplemental coverage, this will allow you to come off your group health plan outside of Open Enrollment.

Plan Considerations

If you are turning 65 and you continue to be an active employee, we recommend that you consider your options regarding your healthcare plan. Sometimes it is less expensive to join a Medicare plan than remain on the current employer-provided group plan. Every situation is different, so it’s a matter of looking at cost, preferences and your personal needs.

There are two major things to consider when deciding to enroll in Medicare or stay on your group health plan:

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Topics: Employee Benefits, Individuals

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