[ ] 1 Iowa Telecommunications Association Health Reform Update

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Iowa Telecommunications Association

Health Reform Update


WELLNESS IN THE WORKPLACE

How can it save you?

Lindsay Guenther, HR Generalist


Back to Health Class

Question:

Even when resting, what muscles work twice as hard as the leg muscles of a person sprinting?

Answer:

The human heart.



Question:

Approximately how many gallons of blood is pumped through your body by your heart each day?

Answer:

2,000 gallons



Question:

During the average lifetime, how many times will the human heart beat?

Answer:

2.5 billion times


..And the cold reality

Question:

What percentage of deaths in the U.S. are from heart disease?

Answer:

25% (1 in every 4 deaths)


The Cost of Poor Health

• In 2010, the cost of cardiovascular disease in the U.S. was about $444 billion.– Heart conditions– Stroke– Peripheral artery disease– High blood pressure

• $1 of every $6 spent on healthcare was spent on the above conditions


The Cost of Poor Health (to your business)• Increased number of sick days/employee

absenteeism• Turnover• Presenteeism• Increased healthcare costs


The Rise of Costs

8%Single

9%Family

Overall inflation was 2%.


The Rise of Costs

Six causes of increased healthcare costs

1. Hospital Visits

2. Doctor Visits

3. New Medical Technologies

4. Lab Tests

5. Drugs

6. Health Plan Administrators


Back to Class

Question:

What is our controllable action in lowering the costs of healthcare?

Answer:

Education about being a smarter health consumer and wellness programs.


Who Even Participates?

52%Wellness

programs give them more energy and productivity.

41%Wellness programs encourages them to

work harder and better.

40%Wellness

programs would drive retention.

In a 2011 study conducted by Principal Financial Group, thousands of employees of companies who

offered wellness programs said…


Creating a Wellness Program

• Organizational Culture and Leadership– Develop a “Human Centered Culture”– Demonstrate leadership– Encourage mid-level management



• Program Design– Establish clear principles– Integrate relevant systems– Eliminate recognized occupational hazards– Be consistent– Promote employee participation



• Program Design (continued)– Tailor programs to the specific workplace– Consider incentives and rewards– Find and use the right tools– Adjust the program as needed– Make sure the program lasts– Ensure confidentiality



• Program Implementation and Resources– Be willing to start small and scale up– Provide adequate resources– Communicate strategically– Build accountability



• Program Evaluation– Measure and analyze– Learn from experience


One Last Question

Question:

Although we can’t fully stop the rise of healthcare costs in the U.S., who can help create awareness around better lifestyles and healthy choices related to their employees?

Answer:

You.


Sources

• Iowa Public Television http://www.pbs.org

• Cleveland Clinic http://my.clevelandclinic.org/

• Center for Disease Control and Prevention http://www.cdc.gov/niosh/TWH/essentials.html

• Kaiser Family Foundation http://kff.org/

• WebMD http://www.webmd.com/healthy-aging/features/heart-disease-medical-costs

• CNN Money http://money.cnn.com/

• Principal Financial Group http://www.principal.com/wellbeing/2011/wbwellness-4q2011-data.pdf

• National Institute for Occupational Safety and Health http://www.cdc.gov/niosh/


Questions?

Lindsay Guenther, HR GeneralistKiesling Associates [email protected]

(515)221-4647West Des Moines, IA

Thank you!

mailto:[email protected]


TAX CONSIDERATIONS


Upcoming Changes

– Individual mandates– Employer play or pay – Employer mandates (2015)– Large employer auto enroll requirement– Insurance exchanges for individuals and small businesses– Guaranteed issue, renewability and rating variation

requirements– Annual limits– Limit on waiting periods– Wellness incentives– Preexisting condition exclusions– Comprehensive health insurance coverage– Limits on cost sharing and deductibles


Major Changes

Insurance Exchanges– Under the law, states will create insurance

exchanges that will be operational by 2014– Open to both eligible individuals and some

employers• Before 2017, open to employers with 50 or

fewer employees only• Starting 2017, each state will be allowed to

open up the exchange to larger employers


Individuals

• The Shared Responsibility Provision– Effective January 1, 2014– Certain exemptions, some of which need to

be certified• You are not required to file a tax return• Coverage is more than 8% of household

income

– Penalties apply if exceptions do not apply


Premium Tax Credit

• Insurance is through the exchange• Are not eligible through employer plan• Are within certain income limits• If married you must file joint• Cannot be claimed as a dependent


Income Limits

• Individuals – Up to $45,960• Family of two – Up to $62,040• Family of four – Up to $94,200


Credit Limitations

Income Relative to FPL

Floor Premium Responsibility

Ceiling Premium Responsibility

Up to 133% 2.0% 2.0%

133% to 150% 3.0% 4.0%

150% to 200% 4.0% 6.3%

200% to 250% 6.3% 8.05%

250% to 300% 8.05% 9.5%

300% to 400% 9.5% 9.5%


Credit Calculation

Household Income $60,000

Family Size 4

FPL 255%

Estimated health insurance $7,128

Credit limitation 8.19%

Out of pocket $4,914

Premium credit $2,214


Penalty Calculation

The Lesser of: Flat Dollar Exceeds Income

2014 $95 1.0%

2015 $325 2.0%

2016 + $695 2.5%


• Available 2014 if participating in exchange

• Phase-outs– 10 to 25 full time equivalents– $25,000 to $50,000 in wages

• 50% of employer’s non-elective contributions

• Credit is netted against deduction

Business Health Insurance Credit

30


• Exclusions– Self-employed– 2% shareholders in an S-Corp– 5% shareholders of C-Corp

Health Insurance Credit

31


Health Insurance Exchange Credit• Available in 2014• Credit equal to 50% of costs purchased

through state exchange• Available for only 2 consecutive years• Additional exchange information

available in October 2013


Manager $62,000

Asst Manager 41,000

Accountant 40,000

Customer Service 1 38,000

Customer Service 2 29,000

Total Wages $210,000


33


Full time employees 5

Part time employees 1

Total annual hours worked by PTE 1,040

Full time equivalents(FTE) -

Total employees 5

Total annual wages $210,000

Average annual wage $42,000


34


Health insurance premiums $55,000

Maximum credit(50%) $27,500

FTE exceeding 10 -

AAW exceeding $25,000 $17,000

AAW credit reduction $18,700

Net credit $8,800


35


Requirement to Provide Insurance• Deferred Until 2015


Employer Responsibilities

Employers with more than 50 Ees to pay 2k per employee if no health insurance coverage is offered and 1 EE is receiving premium assistance

– First 30 employees are excluded from calculation of penalty

– Full time employees only are used in calculation


Minimum Essential Coverage

• The employee’s share must not exceed 9.5% of household income

• The employer’s share must be at least 60% of the actuarial value of the total plan


Full Time Equivalent (FTE)

• Employed on average 30 hours in a week

• Employed 130 hours in a month• Part time hours are divided by 120 per

month• Seasonal workers excluded if 4 months

or less


Counting Employees

• Full time employees for each month +• FTE for each month =• Divide by 12


Monthly Calculation

Employees Hours Total Hours FTE

Full time employees 47 130 6,110 47 Part-time 6 90 540 4

51


Annual CalculationFull-Time Part-Time Total

Jan 47 2 49 Feb 47 2 49 Mar 47 2 49 Apr 47 2 49 May 47 6 53 Jun 47 6 53 Jul 47 6 53 Aug 47 6 53 Sep 47 6 53 Oct 47 2 49 Nov 47 2 49 Dec 47 2 49

608 ÷ 12

51


Annual CalculationFull-Time Part-Time Total

Jan 47 2 49 Feb 47 2 49 Mar 47 2 49 Apr 47 2 49 May 47 6 53 Jun 47 6 53 Jul 47 6 53 Aug 47 6 53 Sep 47 2 49 Oct 47 2 49 Nov 47 2 49 Dec 47 2 49

604 Seasonal (16)

588 ÷ 12

49


Employer Costs

Total Exemption Net

Employee

Cost

Employer

Cost

Jan 49 30 19 166.67 3,166.73 Feb 49 30 19 166.67 3,166.73 Mar 49 30 19 166.67 3,166.73 Apr 49 30 19 166.67 3,166.73 May 53 30 23 166.67 3,833.41 Jun 53 30 23 166.67 3,833.41 Jul 53 30 23 166.67 3,833.41 Aug 53 30 23 166.67 3,833.41 Sep 53 30 23 166.67 3,833.41 Oct 49 30 19 166.67 3,166.73 Nov 49 30 19 166.67 3,166.73 Dec 49 30 19 166.67 3,166.73

2,000$ 41,334.16


Wellness Program

• Limited to 30% of employee coverage and 50% for smoking.

• May increase premium or provide credit• Can be a

– Participatory Wellness Program– Contingent Health Program


Participatory Wellness Program• Providing incentives for

– Health club memberships– Smoking cessation classes– Preventive care


Contingent Health Program

• Increasing employee rates for– Smoking– Body Mass Index– Blood Pressure– Cholesterol Levels


W-2 Reporting of Health Costs• If <250 W2 filed in prior year exemption

for 2012 forms and 2013 until further guidance issued

• Reporting done in box 12, code DD• Reporting is for information purposes

only


W-2 Reporting of Health Costs• Exemptions

– Long term care insurance– Worker compensation– Supplemental liability


Resources

• Kaiser Family Foundation – www.kff.org• www.healthcare.gov• http://www.cms.gov/cciio/index.html• http://www.irs.gov/uac/Affordable-Care-

Act-Tax-Provisions-Home

http://www.kff.org/

http://www.healthcare.gov/

http://www.cms.gov/cciio/index.html

http://www.irs.gov/uac/Affordable-Care-Act-Tax-Provisions-Home

http://www.irs.gov/uac/Affordable-Care-Act-Tax-Provisions-Home


Questions?

Todd Thorson, PartnerKiesling Associates [email protected]

(515)221-4623West Des Moines, IA

Thank you!

mailto:[email protected]

Documents

[ ] 1 Iowa Telecommunications Association Health Reform Update