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Stories of Success
If you’re one of the 80% of employers who have offered employee wellness programs and information,[i] you may be searching to see what is working at other companies. Developing a culture of wellness can decrease sick leave absenteeism by an average 28%, and workers’ compensation and disability costs by an average 30%.[ii]
How can you increase your employees’ job satisfaction and overall health, while saving hard-earned health care dollars? Here are four power ideas for more successful employee wellness programs
1. Offer Choices.
“One size does not fit all in employee wellness programs,” said Crystal Spicer, MedCost Human Resources Manager. As a company offering financial and health solutions for employer benefit programs, clients were asking what wellness outreach MedCost was doing for their own employees.
The MedCost HR team realized that what worked for one employee didn’t necessarily fit another. So the company’s wellness committee designed a point-based program with multiple ways to boost health and earn financial incentives.
The annual program, kicked off in 2016, measured points earned for employee wellness activities on a quarterly and a yearly basis. This chart shows multiple ways that MedCost employees could earn points for the financial incentives at year’s end:
“We got people’s attention, which is what we were striving for,” said Crystal. One group of women came to work an hour early to walk together – even climbing stairs.
A Weight Watchers group cosponsored by the company attracted 20 people. Sherry lost 56 pounds. Glenn lost 36. Trish, motivated on her own, lost 40. And their new habits of exercising and eating helped them keep it off.
MedCost offered $100 drawings quarterly for those who met point goals. At the end of 2016, those who accrued the 2,400 points will receive a $500 contribution into their personal Health Savings Account.[iii] Employees enrolled in a Preferred Provider Organization plan could earn a gift card for $250.
Fitness classes offered after work onsite were another way to add points. The company shared costs with employees who signed up for the six-week classes. From the beginning, classes were well-attended.
Financial incentives are effective for successful employee wellness programs. Four out of five employers use financial incentives to promote wellness.[iv]
“Getting buy-in is key,” said Crystal. “Earning these financial incentives are obtainable because there are a whole variety of ways to get there.
2. Incorporate Employee Suggestions
Our annual support of the Triad American Heart Association’s walk hit new levels this year – and not just financially. Jenny implemented a leadership contest to raise the most employee contributions, with the winner earning the right to wear this Southern Lady hat, red beads and tutu (See Figure 1).
Brad (in the lovely hat and tutu) definitely stood out in the crowd of 7,500 walkers through downtown Winston-Salem.
But even better were the 125 employees, family members and friends who walked between one to four miles on October 29th. Dogs, babies in strollers, music and laughter made this emphasis on healthy hearts a lot of fun.
Another employee suggestion resulted in a weekly “Walk with Me Wednesday” event, beginning in 2015. MedCost is located in a business park with sidewalks, gazebos and ponds. An average six to eight employees walk 15 minutes together at noon, enjoying fresh air, camaraderie and exercise in a beautifully landscaped setting.
One key benefit of this weekly walk is better connectivity among the employees who walk together. In many businesses, department knowledge is often siloed from other departments because of different functions. And employees don’t get to know each other.
“The walks really do benefit the mind as well as the body,” said Karen, a 16-year employee at MedCost. “Walking with others just motivates me to get out and walk.”
3. Take a Long-Term Approach to Your Return on Investment (ROI)
“Looking purely at hard costs, healthcare spending can be one of the largest single expenses for a business, next to payroll,” said Dan Birach, president of HEALTHWORKS division at Carolinas HealthCare System. [v]
“Statistics show that for every dollar an employer invested in areas such as wellness programming and disease management, they enjoyed an ROI of anywhere from $1.50 to $3.80. Healthy employees are more productive and miss fewer days.”
The Society for Human Resource Management reported that 80% of employers offered preventive wellness services and info in 2015.[vi]
Employee wellness programs are having an impact on reduced dollars spent on health benefits. When corporate wellness programs were implemented:
- Claims costs reduced 28%
- Doctor visits reduced 17%
- Hospital admissions reduced 63%
- Disability costs were down 34%
- Incidence of injury reduced 25%[vii]
“A wellness program can make just a small difference at first,” said Crystal. “It has to build gradually.”
Employers offering wellness programs are looking for the same key ingredient for their employees – motivation.
4. Motivate Your Employees for Better Quality of Life
Claudia works with providers (hospital systems, medical offices and other professionals) at MedCost. When doctors diagnosed medical issues exacerbated by her obesity, she took a hard look at her lifestyle. And wanted to change.
“I am involved in Christian ministries in my personal life,” Claudia said. “I wanted to be in better health. My family and friends supported me to make some new choices.”
MedCost wellness choices inspired Claudia to do things differently. In January of 2016, she braved the cold temperatures to begin walking every morning at 7:30 a.m. with several other employees. She climbed stairs at lunch. She focused on her health.
“I’ve lost 30 pounds,” Claudia said. “I love the fact that I have gone from a size 22 to a size 18. My grandchildren are ten and six. I have to get rid of some more of this weight to keep up with them.”
Inspire your employees. Fit your wellness program to your unique business style and culture. One size won’t fit all, so try different ideas to see what resonates with your employees.
Above all, pour on the encouragement. Your employees are spending a large chunk of their time working for you. Your support may not only boost your bottom line, but improve your employees’ health in a life-changing way.
[i] “Eight Things You Need to Know about Employee Wellness Programs,” Alan Kohll, Forbes, April 21, 2016, http://www.forbes.com/sites/alankohll/2016/04/21/8-things-you-need-to-know-about-employee-wellness-programs/2/#4097a3e13e2d
[ii] “Be Stronger, Live Better,” National Association of Health Underwriters Education Foundation, http://www.nahueducationfoundation.org/materials/WellnessBrochure.pdf
[iii] For those enrolled in a High Deductible Health Plan with the company.
[iv] Incentives for Workplace Wellness Programs,” RAND Corporation, http://www.rand.org/pubs/research_briefs/RB9842.html
[v] “Five Things to Consider When Planning Your Wellness Program,” Dan Birach, HEALTHWORKS Division, Carolinas HealthCare System, http://www.carolinashealthcare.org/medical-services/prevention-wellness/employer-solutions/healthworks/info-hub
[vi] Kohll, ibid.
[vii] National Association of Health Underwriters Education Foundation, ibid.
A sprawling health bill that passed the Senate Wednesday and is expected to become law before the end of the year is a grab bag for industries that spent plenty of money lobbying to make sure it happened that way.
Here are some of the winners and losers in the 21st Century Cures Act:
Pharmaceutical and Medical Device Companies. The bill will likely save drug and device companies billions of dollars bringing products to market by giving the Food and Drug Administration new authority and tools to demand fewer studies from those companies and speed up approvals.
The changes represent a massive lobbying effort by 58 pharmaceutical companies, 24 device companies and 26 “biotech products and research” companies, according to a Kaiser Health News analysis of lobbying data compiled by the Center for Responsive Politics. The groups reported more than $192 million in lobbying expenses on the Cures Act and other legislative priorities, the analysis shows.
Medical schools, hospitals and physicians. The bill provides $4.8 billion over 10 years in additional funding to National Institutes of Health, the federal government’s main biomedical research organization. (The funds are not guaranteed, however, and will be subject to annual appropriations.)
The money could help researchers at universities and medical centers get hundreds of millions more dollars in research grants, most of it toward research on cancer, neurobiology and genetic medicine.
The bill attracted lobbying activity from more than 60 schools, 36 hospitals and several dozen groups representing physician organizations. They reported spending more than $120 million in disclosures that included Cures Act lobbying.
Mental health and substance abuse advocates. The bill provides $1 billion in state grants over two years to address opioid abuse and addiction. While most of that money goes to treatment facilities, some will fund research.
The bill also boosts funding for mental health research and treatment, with hundreds of millions of dollars authorized for dozens of existing and new programs.
Mental health, psychology and psychiatry groups spent $1.8 million on lobbying disclosures that included the Cures bill as an issue.
Patient groups. Specialty disease and patient advocacy groups supported the legislation and lobbied vigorously. Many of these groups get a portion of their funding from drug and device companies. The bill includes more patient input in the drug development and approval process, and the bill is a boost to the clout of such groups.
More than two dozen patient groups lobbied the bill, and reported spending $6.4 million in disclosures that named the bill as one of their issues.
Health information technology and software companies. The bill pushes federal agencies and health providers nationwide to use electronic health records systems and to collect data to enhance research and treatment. Although it doesn’t specifically fund the effort, IT and data management companies could gain millions of dollars in new business.
More than a dozen computer, software and telecom companies reported Cures Act lobbying. The groups’ total lobbying spending was $35 million on Cures as well as other legislation.
Preventive medicine. The bill cuts $3.5 billion — about 30 percent — from the Prevention and Public Health Fund established under Obamacare to promote prevention of Alzheimer’s disease, hospital acquired infections, chronic illnesses and other ailments.
Consumer and patient safety groups. Groups like Public Citizen and the National Center for Health Research either fought the law outright or sought substantial changes. Although they won on some points, these groups still say Cures opens the door for unsafe drug and device approvals and doesn’t address rising drug costs.
Hair growth patients. The bill says federal Medicaid will no longer help pay for drugs that help patients restore hair. The National Alopecia Areata Foundation spent $40,000 on lobbying disclosures this cycle that included Cures.
The FDA. The bill gives the FDA an additional $500 million through 2026 and more hiring power, but critics say it isn’t enough to cover the additional workload under the bill. The agency also got something it opposed: renewal of a controversial voucher program that awards companies that approve drugs for rare pediatric diseases.
(Kaiser Health News, Sydney Lupkin and Steven Findlay, December 7, 2016)
How many of the terms in this example below do your employees understand? If you’re getting blank stares over words like “co-insurance” and “out-of-pocket limit,” it’s time to educate your staff before open enrollment starts for the next plan year.
Five Key Terms
Only 12% of American adults have a basic understanding of the terms used in their health plans.[i] As more health plans are transitioning to some type of Consumer-Driven Health Plan (CDHP), it is more vital than ever for employees to understand basic terms that identify their responsibilities for payment.
Here are five easy definitions for HR professionals to use when explaining your company health plan:
The amount an employee owes for health care services before the health insurance or plan begins to pay. For example, if a deductible is $1,500 as in Jane’s example above, the plan won’t pay anything until a $1,500 deductible for covered health care services is met. The deductible may not apply to all services.[ii]
A fixed amount (e.g., $25) that an employee pays for a covered health care service, usually when service is received. The amount can vary by the type of covered health care service. Co-payments are more familiar in traditional plans such as Preferred Provider Organizations (PPOs).
The facilities, providers and suppliers your health plan has contracted with to provide health care services. So in-network services or providers have already negotiated a billing rate that would be applied.
Out-of-network charges are usually more expensive, because no rate has been contracted with that doctor’s office or provider.
The most an employee pays during a policy period (usually a year). This limit usually includes deductibles, copays and/or co-insurance. Premiums, balance-billed charges or health care not specified in the plan would not be included.
An employee’s share of the costs of a covered health care service, calculated as a percent (for example, 20%) of the allowed amount for the service.
In the example above, after Jane met her deductible ($1,500), her plan began to pay 80% of qualified health expenses. Jane’s part of the payment (co-insurance) was 20%, paid until Jane’s total expenses for the year hit her $5,000 out-of-pocket limit.
After Jane had paid a total of $5,000, her plan paid all other expenses for the rest of the plan year.
As HR departments approach a new year, health plan terms may still sound like a language most employees don’t know. Equip your employees to make decisions they will feel good about so they can better manage those vital health care dollars.
[i] Quick Guide to Health Literacy Fact Sheet,http://health.gov/communication/literacy/quickguide/factsbasic.htm (accessed September 13, 2016)
[ii] Centers for Medicare & Medicaid Services https://www.cms.gov/CCIIO/resources/files/downloads/uniform-glossary-final.pdf (accessed September 13, 2016)
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Employer health insurance expenses continued to rise by relatively low amounts this year, aided by moderate increases in total medical spending but also by workers taking a greater share of the costs, new research shows.
Average premiums for employer-sponsored family coverage rose 3.4% for 2016, down from annual increases of nearly twice that much before 2011 and double digits in the early 2000s, according to a survey by the Kaiser Family Foundation. (Kaiser Health News is an editorially independent program of the foundation.)
But 3.4% is still faster than recent economic growth, which determines the country’s long-run ability to afford health care.
And the tame premium increases obscure out-of-pocket costs that are being loaded on employees in the form of higher deductibles and copayments. Another new study suggests those shifts have prompted workers and their families to use substantially fewer medical services.
For the first time in Kaiser’s annual survey, more than half the workers in plans covering a single person face a deductible of at least $1,000. Deductibles for family plans are typically even higher.
Deductibles are what consumers pay out of pocket before the insurance kicks in. Employers sometimes contribute to pre-tax accounts to help workers pay such costs.
It also saves employers money. Having workers pay more out of pocket shaved half a percentage point off premium increases of employer-sponsored plans in each of the past two years, Kaiser researchers calculated.
Since 2011, the average deductible for single coverage has soared 63%, according to the survey, while workers’ earnings have gone up by only 11%.
(Kaiser Health News, Jay Hancock and Shefali Luthra, September 14, 2016)
A federally-funded project that researchers say has potential to promote aging in place began by asking low-income seniors with disabilities how their lives at home could be better, according to a study released Wednesday.
At the end of the program, 75% of participants were able to perform more daily activities than they could before and symptoms of depression also improved, researchers said in the journal Health Affairs.
Called Community Aging in Place, Advancing Better Living for Elders, or CAPABLE for short, the program was funded by the Center for Medicare & Medicaid Innovation.
The seniors who took part were each paired with a team for five months that included an occupational therapist, who made six visits; a registered nurse, who made four; and a handyman, who worked a full-day at the participant’s home installing assistive devices and doing repairs, according to the study.
The nurses and therapists helped participants identify three achievable goals for each member of the team and identify what barriers had to be overcome. For example, the therapist might survey a house for safety issues such as unsafe flooring, poorly lit entrances and railings in disrepair.
The therapist then worked with the elderly person to identify assistive devices, repairs or modifications that could help achieve the participant’s goals. Next, the therapist created a work order for the handyman that prioritized those goals within a $1,300 budget for each dwelling.
Spending on assistive devices and home repairs ranged from $72 to $1,398 for each participant, the researchers said.
They studied 234 adults older than 65 who participated in CAPABLE, all eligible for both Medicare, the government health insurance plan for seniors, and Medicaid, the government health insurance plan for low-income people.
All participants had trouble with routine tasks in a group of eight known as activities of daily living. They include bathing, dressing, using the toilet and walking across a small room. On average, participants had trouble with 3.9 tasks at the start, but improved to just two by the end of the program.
Researchers said they could not conclude that the participants’ improvements were due to the CAPABLE program because the project was funded without a control group to make scientific comparisons.
(Kaiser Health News, Rachel Bluth, September 7, 2016)
Competition on these exchanges will be diminished next year when three of the nation’s largest health insurers — Aetna, United Healthcare and Humana — will sell individual plans in many fewer markets. So too will several Blue Cross and Blue Shield plans in various states. That’s on top of the 16 nonprofit co-ops that have closed since January 2015.
The announcements, however, apply generally only to the individual market. The much larger market of employer-sponsored insurance is not part of the health law exchanges.
Most hurt will be marketplace consumers in Arizona, North and South Carolina, Georgia and parts of Florida, where only one or two insurers will be left when open enrollment season begins Nov. 1.
(Kaiser Health News, Phil Galewitz, August 18, 2016)
By Michael Berwanger, JD, Director, Quality Management & Compliance
As background, this program was established to fund a reinsurance pool to help stabilize premiums in the insurance markets created under the Affordable Care Act (ACA).
The program is being funded by three annual assessments on employer-sponsored health plans. The assessments are for average covered lives in 2014, 2015 and 2016 calendar years.
This year, enrollment data must be submitted by November 15, 2016, and payment must be submitted no later than January 17, 2017.
The 2016 Reinsurance Contribution Rate is $27.00 per covered life.
Online Submission Process
The Centers for Medicare and Medicaid Services (CMS) has implemented a streamlined process for the collection of reinsurance contributions. A contributing entity, or a Third Party Administrator (TPA) on its behalf, can complete all required steps for the reinsurance contributions process online (using the government portal, pay.gov), including registration, submission of annual enrollment count, and remittance of contributions.
A form is available for the contributing entity (or its TPA) to provide basic company and contact information and the annual enrollment count for the applicable year. The form will automatically calculate the contribution amounts, and entities will be required to submit payment information and schedule a payment date for remittance of the contributions.
CMS will not send an invoice to contributing entities. All required action will be completed online at pay.gov.
Options for Payment
There are two options for how a contributing entity can make a payment: (1) a one-time lump sum payment, or (2) a full contribution in two payments. (See chart below.)
Contribution Payment Options for the 2016 Benefit Year
Source: Centers for Medicare and Medicaid Services
CMS will permit contributing entities to submit each year’s contribution in two separate payments – one larger payment of $21.60 per covered life at the start of the year, and a smaller payment of $5.40 per covered life at the end of the year.
However, when submitting enrollment data, dates must immediately be scheduled for payment of the fees, whether there will be one payment prior to January 17, 2017, or two payments with the later in November 2017.
If You Are Self-funded for a Portion of the Reporting Period
For a plan that has moved from a fully insured plan to a self-funded plan during the first nine months of the 2016 calendar year, both plans will be responsible for paying a portion of the fee, using one of the permitted calculation methods.
Since fully-insured plans are not permitted to use the Snapshot Factor Method of calculation, either the Actual Count Method or the Snapshot Method of calculation must be used.
This site provides technical assistance and training related to the Marketplace and Premium Stabilization program (which includes the Transitional Reinsurance Program). Webinars are offered that provide entities with information on program and operational guidance, along with live demos of the enrollment count and contributions submission process.
This is the site where the contributing entity, or TPA, will create a profile, and submit the enrollment data and contributions for the Transitional Reinsurance Program.
This website is hosted by the Centers for Medicare and Medicaid to provide information about the Transitional Reinsurance Program.
For more information, consult your broker, legal advisor or cms.gov.
This blog post should not be considered as legal advice.
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One-Fourth of Employers Now Offering CDHPs to Avoid Tax
Employers continue to take action to avoid the looming excise or “Cadillac” tax on more expensive health insurance for their employees. This Affordable Care Act tax of 40% annually is currently set to take effect in 2020, but it is already having a major impact.
A 2015 Mercer study found that total health benefits cost averaged $11,635 per employee.[i] This average amount exceeds the Cadillac tax’s threshold of $10,200 for individuals, and would trigger the 40% tax on benefits above the threshold. And small employers are seeing higher increases in medical, dental and other health benefits than large employers.
Employers Turn to
For the first time, 25% of covered employees are now enrolled in Consumer-Driven Health Plans (CDHP). Large employers of 20,000 or more employees have added CDHPs the fastest (73%). A projected 34% of employers with 50+ employees will be subject to the excise tax in 2020 if they make no changes to their current health plans.
High-Deductible Health Plans (HDHP) are a type of Consumer-Driven Health Plans. Employers are saving an average of 18% with an HSA-eligible HDHP instead of a traditional Preferred Provider Organization (PPO) plan.[ii]
One key reason that employees are researching medical costs in advance for services such as maternity care, joint replacements and Emergency Room visits. A 2015 Consumer Health Insights’ survey showed that 22% always talked to others about costs or searched websites for information.[iii]
Employees who have a telemedicine option in their health plans can choose a more appropriate level of care for certain respiratory infections, fevers and nausea (see “Treatment Alternatives to the Emergency Room”). Choosing the right level of care reduces time away from work, boosting productivity. And employees save unnecessary dollars from their own pockets.
Some employers offer pricing transparency tools such as HealtheReports™ which compares costs for a complete procedure. Employees can review local facilities that offer mammograms, colonoscopies, X-rays and other services. HealtheReports also lists comments from members about their recommendations for health care organizations.
A New Era in Health Care
CDHP plans require a shift in thinking about medical spending. In traditional plans, employees are used to handing over their insurance card and paying a small copay.
It can come as a jolt to employees to realize that CDHP coverage begins with paying expenses up to a higher deductible before insurance kicks in. For this reason, employers must proactively educate employees when introducing CDHP options.
Our next blog will detail key steps for employers to take in providing tools for smart decision-making. Employers who can manage staff expectations with a balanced understanding of the changing health care industry will build a productive partnership with your team.
[i] “With the Excise Tax in Their Sights, Employers Hold Health Benefits Cost Growth to 3.8% in 2015,” Mercer Global, November 19, 2015, http://www.mercer.com/newsroom/national-survey-of-employer-sponsored-health-plans-2015.html (accessed August 8, 2016)
[iii] “Debunking Common Myths about Healthcare Consumerism,” McKinsey & Company, December 2015, http://www.mckinsey.com/industries/healthcare-systems-and-services/our-insights/debunking-common-myths-about-healthcare-consumerism (accessed August 11, 2016)