10 Ways to Simplify Employee Benefits

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Ten Ways to SimplifyEmployee Benefits

Presented by Cuatro Groos

For the Business Bank of TexasBusiness Resource Center

May 12, 2011



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Key Issues Facing Employers� Growing your business in an uncertain recovery

� Attracting and retaining the best employees matters asmuch now as ever

� Minimizing costs- few companies have ever cut their wayto growth, but plenty have spent their way to oblivion

� Keeping it simple in an age of information overload� Businesses want to purchase goods and services that work for

them



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Key Issues Facing Employees� Remarkably similar to those of employers

� Managing your finances in an uncertain recovery

� The best job with the best benefits matters now morethan ever

� Minimizing costs- Americans are saving and downsizing

more than ever to be ready for the next downturn

� Keeping it simple in an age of information overload

� We want goods and services that make life easier



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Focus of This Webinar Arm you with ideas that help you to enhance your

bottom line by:

� Improving your benefits offering to attract andretain the best people

� Lowering costs for both your company and your

employees� Enhancing satisfaction/productivity by simplifyingbenefits to work better for everyone



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#1 Multiple Plan OptionsWe are still surprised by how many companies are not

taking advantage of multiple health plan options

� Every carrier in Texas allows for dual or triple optionarrangements for small employer groups (<51 employees)

� Employee needs vary, so give them plan options to better fit their needs and budget

� Deductible, copay and coinsurance are the most commonelements to differentiate

� Adding HS As to the mix can really help affordability



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#2 Health Savings AccountsHealth Savings Accounts (HS As) can be established when

you have a High Deductible Health Plan (HDHP). Thelower premiums for the HDHP, combined with the taxsavings associated with the HS A, make this approachattractive for employers as well as employees.

� What is an HDHP?

� Deductible of $1200 or more for an individual ($2400 for family)

� No copays for doctor visits or prescriptions until the deductibleis met

� Annual maximum out of pocket cost of $5950 for individualsand $11,900 for families



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#2 Health Savings Accounts� What is an HS A?

� Bank account established in the employee¶s name

� Employee as well as employers can contribute to employee

HS As- tax advantages for both� Max Contribution: up to $3050 for individual, $6150 for family

� Funds can be spent tax-free on qualified health-relatedexpenses

�

Health, dental, vision, alternative medicine, etc.� Unlike Flexible Spending Accounts, HS As are NOT ³use it or

lose it´ accounts- they stay with account holder from year toyear



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#2 Health Savings Accounts� How do employers benefit from HS As?

� Lower premiums for HDHPs than traditional plans

� Another ³lever´ for employers to use managing benefits/comp

� Lower taxes

� Employer contributions expensed like 401k matches

� Employee contributions through payroll lower FIC A taxes

� How do employees benefit from HS As?

� Lower premiums for HDHPs than traditional plans

� More control of health care spending, become better healthcare consumers

� Lower taxes

� Employee contributions lower overall taxable income

� Employee contributions through payroll lower FIC A taxes



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#3 Deductible Gap PlansDeductible Gap or Bridge Plans allow employers to introduce

higher deductible/lower cost plans to employees whilelowering the impact on them by insuring the ³gap´ betweenold and new deductibles.

� Example: company saves 15% on premiums moving from a$2k deductible plan to a $5k deductible plan.

� Gap insurance will cost far less than those savings and provide

a safety net so employees don¶t feel the brunt of that change� Gap plans can be employer-paid or voluntary

� Renewal trends for gap plans more stable than major medplans



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#4 Health Reimbursement ArrangementsHealth Reimbursement Arrangements (HR As) allow

employers to set aside a certain amount of money per employee to help pay the employee¶s out of pocket healthcosts.

� If Employer offers a company health plan, HR As can beused to cover part of the deductible

� If no company health plan is offered, HR As can cover

premiums for employees¶ individual health plans as well asout of pocket costs



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#4 Health Reimbursement ArrangementsHR A Benefits for Employers

� Don¶t have to pre-fund accounts- can simply reimburse employees as they incur expenses

� HR A reimbursements are tax-deductible for employer

� Easier for employers to implement lower cost/higher deductible plans with HR A as a backup benefit

HR A Benefits for Employees

� Flexibility to use HR As as needed on health, dental, vision costs or evenindividual insurance premiums

� HR A reimbursements are not taxable for employees

* Avoid risk of HIP AA/COBR A violations by outsourcing HR A Admin



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#5 Urgent Care CentersHave you been to the ER recently?

� Many people go for urgent but not life-threatening issues (esp. the uninsured)

� Long waits, lost productivity, expensive copays, serious out of pocket cost

Educate employees about Urgent Care Centers

� More convenient locations, open nights and weekends

� Faster service from quality providers for urgent issues

� Ex: lacerations, burns, cold/flu, x-rays/broken bones

� Lower cost (often just a copay)

� Most centers work with major insurance carriers

� *Get to know your in network UC centers near work and home



13#6

Bringing the Care to the Patient³Docs in a Box´- clinics located in major chain pharmacies and

stores, usually staffed with nurse practitioners, that make visitsfor routine and preventive medical care easy and affordable.

� Clinics work with most health insurance carriers

� Many locations with night/weekend hours to make it convenient

� Services include wellness/physical exams, condition monitoring, vaccinations,minor illness, minor injury, labs and tests

Chains

� Minute Clinic (CVS), Take Care Clinic (Walgreens), Target Clinic, The Clinic atWal-Mart, HEB RediClinic



14#6

Bringing the Care to the PatientWhiteGlove House Call Health

Austin-based firm with a presence in major Texas metros, growingnationwide. Return of the House Call!

The Service:

� Nurse practitioners come to you at your home or office

� Deliver a care package, consult on your situation

�

Prescribe medications (generics at no charge), and even deliversprescriptions to you

� All for the cost of an office visit copay.

� Additional features include online access to medical records, claims filing withcarriers (in network with Aetna, Humana and United)

� Subscriptions available for individuals/companies



15#7

Generic Drug ProgramsMany health plan copays for generic drugs have crept up in recent years

from $5 to $10, $15, or even $20 for a month¶s supply. For HS A styleplans, members pay the retail cost of generics. Cost consciousconsumers are now looking to generic drug programs at major chains tosave on monthly generic prescriptions.

Programs at Major Chains with pricing ranging from $4 to $6 per month:

� HEB Rx Rewards Platinum, CVS Pharmacy Health Savings Pass, WalgreensPrescription Savings Club, Target , and Wal-Mart

� You DO NOT need health insurance to participate. In fact, you should NOTshow your insurance card or file claims through your carrier if you want thesedeals on generic drugs





17#8

Wellness for Fun and FitnessExamples of Wellness Initiatives

³Outstep the Boss´

� Employees all equipped with pedometers (through Virgin HealthMiles)

�

Easy upload of steps through computers� Program tracked steps of employees and teams

� Those that out-stepped their department heads won prizes including time off

³Biggest Loser Meets The Olympics´

� Teams from different areas of company assembled

� Initial measures taken

� Series of races, contests, and activities over months

� Winning teams, individuals based on event results and individual progress

*Common success factor: BUY-IN FROM THE TOP



18#9

Don¶t Forget Voluntary BenefitsEmployers often mistakenly assume that they must pay for benefits for

them to be valued. In many cases, providing access to benefits, eventhose purchased entirely by employees, is a valued benefit.

Examples of Voluntary Plans

� Life

� Disability

� Accident

� Critical Illness

� ID Theft Protection- new development and huge need

Tips for success

� Don¶t introduce too many options at once

� Integrate with core benefits plans to add value

� Make time to explain the benefits and costs to employees



19#10

New Alternative for1st Time Groups

HealthyTexas is a new public-private partnership established to givecompanies that have not offered group health insurance a chance tosecure reasonable coverage at affordable rates (25%-30% lower thanmarket alternatives).

Who Qualifies

� Texas based small business (2-50 empl¶s)

� No health plan offered in past 12 months

� 30% of employees must earn no more than $32,670 per year ( excl owners)60% of employees must participate in the plan

Plan Elements

� Coverage through two carriers (United and Celtic)

� Much like typical private market coverage

� NO MEDIC AL UNDERWRITING



For more information, please contact

Cuatro Groos [email protected] or call 512-

366-8185

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10 Ways to Simplify Employee Benefits