Technology is the key to measuring the efficacy of a benefits program—communicating effectively, ease of enrollment and administration.
By Peter Marcia | December 07, 2018 at 10:22 AM
More and more benefits managers rely on voluntary benefits to fill important insurance gaps and provide essential services due to cuts in traditional benefits programs.
While the benefits department can create an attractive, holistic benefits program, that is only one piece of the puzzle. Employees need to know the what, why and how. Using technology is the key to measuring the efficacy of the benefits program— communicating effectively, ease of enrollment and worry-free administration.
As the availability of communication technology grows, benefit managers can target focused benefit information to an individual, eliminating unnecessary information and providing valuable resources that are most beneficial to the individual. It goes without saying, but when it comes to benefits, there is no one-size-fits-all approach. What may be appealing to an employee who recently graduated may not appeal to a senior-level employee who is nearing retirement. For example, employees with young children may be especially interested in accident insurance, while pet owners might look to pet insurance to help offset the costs of “well visits” and routine care.
Today’s consumers use multiple platforms (social, email, blogs, etc.) and devices (from desktops, to tablets, to smartphones), so communicate with your employees on their terms. Are your communications in a format that employees can easily share the information with his or her significant other? Reducing the jargon that typically accompanies benefit communication, enhancing relevancy, and reaching the employee where and when they want to receive information allows him or her to focus on the significant value of these voluntary benefit programs. Communications are constantly morphing, so it will be interesting to see how the advances in artificial intelligence will play out over the next few years.
With today’s technology, benefit managers can pull metrics on how employees are interacting with their communications and also help identify the natural path where employees are looking for information. By determining where employees expect to receive communications, employers can ensure that their workforce is seeing the information that is most pertinent to them.
So, you have implemented an effective communications campaign, the next technology opportunity is the enrollment medium. For years, enrollment in voluntary benefits could be likened to the Jurassic age…slow and cumbersome. Much like the way core benefit plans were enrolled during the disco era: paper application, directly with an enroller, etc. Now, most benefits can be enrolled online and allow you as the benefit manager to track your employees’ progress through enrollment.
Benefits managers can identify where employees may have abandoned the enrollment process. Utilizing this technology, benefits managers can retarget these employees with a personalized message, advising them what percent of the enrollment they’ve completed; how much time they have left to enroll; and provide support from customer service representatives.
Online enrollment technology also allows for a simplified enrollment experience by pre-populating certain required data fields and auto selecting the plan design they are most likely to select given their demographics.
One road block of voluntary benefits is the additional payroll slots for each new voluntary benefit. Payroll managers cling to payroll slots like gold. Employers know how difficult, complicated and costly it is to get payroll slots from their payroll administration systems and as the number of voluntary benefits increases, managing these benefits become difficult and expensive. Modern technology allows voluntary benefit outsourcers to offer consolidated payroll slots, giving employers the flexibility to consider multiple voluntary benefit solutions without the anxiety building the infrastructure to support it.
With diverse offers, ease of administration and modern communication technology, voluntary benefits are worth considering and should be an integral part of total rewards package.
Innovation in the insurance industry is no longer restricted or falls upon the carriers. In fact, there are a lot of things brokers can and are doing to optimize sales, automate their processes, and serve their clients better.
Marketplace models have taken over. One can only expect to see marketplace-focused platforms to continue. This increases consumer value and choice without taking any underwriting risk. As a broker, you can do a number of things to support this trend. It could be subscribing to a monthly quoting portal or creating strategic industry partnerships that provide the best benefits with the most value for your clients.
Data analytics is important for customer-centricity
It’s no surprise to insurance brokers that customer-centricity is the key to long-term relationships with brokers. Free swag delivered to the office doorstep is a thing of the past. Instead, customers look for brokers to give them actionable insights based on customer profile and data. There are a number of platforms available to provide these insights. Nothing will compare to having a distributor with key market knowledge of the area you work in and having the relationship to consult them as your business grows.
Sales optimization is the driving force.
Brokers have been rapidly adopting and should continue to embrace ways to optimize sales. BenefitsPro provides this article: analytics tools that spotlight the highest-value clients and can invest resources more efficiently. First and foremost, these tools identify accounts that have a higher probability of closing. This will allocate your time more efficiently in the long run.
Minimize the manual effort
Technology that can automate your client’s and your day-to-day processes is the gold at the end of the rainbow. Clients need better results, faster, yesterday. Brokers can work with multiple vendors to automate these unconnected processes, therefore, minimizing the manual effort of the account management and enrollment teams. Finding a distributor that already has multiple lines and carrier quoting process in place will provide your client’s the ideal benefits pricing to compare and reducing your efforts while still providing top, quality, service. Also, ensure you are providing benefits that have platforms in place to administer benefits online and the support to operate it.
Paperwork is dead.
Too much precious time is spent tracking paperwork, searching for lost client information, re-doing tasks multiple times, and correcting errors. Look for an insurance distributor that will give you the top customer service, reducing your workload and your client’s. Increase the level of comfort and enable higher collaboration between different parties. After all, insurance brokerage is a sales business, and brokers should be spending their time focusing on being the “chief communicator” rather than doing paperwork all day long.
Who’s buying short-term health insurance, and why?
By Anna Gorman, Kaiser Health News | November 21, 2018 at 10:41 AM
To some insurance brokers and consumers, short-term insurance plans are an enticing, low-cost alternative for healthy people.
Supporters of the nation’s health law condemn them. A few states, including California and New York, have banned them. Other states limit them. But to some insurance brokers and consumers, short-term insurance plans are an enticing, low-cost alternative for healthy people.
Now, with new federal rules allowing short-term plans that last up to three years, agents said, some consumers are opting for these more risky policies. Adding to the appeal is the elimination of a federal tax penalty for those without comprehensive insurance, effective next year. Short-term health plans often exclude people with preexisting conditions and do not cover services mandated by the Affordable Care Act.
Colorado resident Gene Ferry, 66, purchased a short-term health plan this month for his wife, Stephanie, who will become eligible for Medicare when she turns 65 in August. The difference in the monthly premium price for her new, cheaper plan through Life Shield National Insurance Co. and the policy he had through the ACA is $650.
“That’s a no-brainer,” said Ferry, who considers the ACA “atrocious” and supports President Donald Trump’s efforts to lower costs. “I was paying $1,000 a month and I got tired of it.”
He signed up his wife for a three-month plan and said that if she is still healthy in January, he will purchase another one to last six months. But Ferry, who is covered under Medicare, said if something happens to her before open enrollment ends — which in Colorado is in January — he would buy a policy through the exchange.
Dan Walterman, who lives in Iowa, says he chose a short-term policy for himself, his wife and their 3-year-old daughter because it was less expensive and provided the coverage he needed.
There’s a lot of “political jockeying” over the value of short-term plans, said Dan Walterman, owner of Premier Health Insurance of Iowa, which offers such policies. “I think people can make their own choices.”
Walterman, 42, said he chose a short-term policy for himself, his wife and their 3-year-old daughter — at a sixth of the price of more comprehensive insurance. “The plan isn’t for everybody, but it works for me,” he said, adding that he gets accident coverage but doesn’t need such things as maternity care or prescriptions.
You get what you pay for
Essentially, short-term plans cost less because they cover less. The savings should have consumers asking, “How much coverage will I actually need?”
Some plans have exclusions that could blindside consumers, such as not covering hospitalizations that occur on a Friday or Saturday or any injuries from sports or exercise, said Claire McAndrew, director of campaigns and partnership for Families USA, a consumer advocacy group. (Note from admin: It is important to note that although these exclusions are true for some short – term medical plans, it is not true for all. )
“People may see a low premium on a short-term plan and think that it is a good option,” she said. “But when people actually go to use a short-term plan, it will not actually pay for many — or any — of their medical expenses.”
The plans can exclude people with preexisting conditions such as cancer or asthma and often don’t cover the “essential benefits” required under the health law, including maternity care, prescription drugs or substance abuse treatment. They also can have ceilings on what they will pay for any type of care. Insurers offering such plans can choose to cover — or not cover — what they want.
“Democrats are condemning them as ‘junk plans,’ but the adequacy of the health plan is in the eye of the beholder,” said Michael Cannon, director of health policy studies for the libertarian Cato Institute. “The only junk insurance is a plan that doesn’t pay as it was promised.”
The plans originally were designed to fill brief gaps in insurance coverage for people in the individual market. When the ACA went into effect, the Obama administration limited short-term plans to three months, but the Trump administration this year expanded that to 364 days, with possible extensions of up to three years. Critics fear healthy people may abandon the ACA-compliant market to buy cheaper short-term plans, leaving sicker people in the insurers’ risk pool, which raises premiums for those customers.
But some agents said the policies may be good for healthy people as they transition between jobs, near Medicare eligibility or go to college — despite significant limitations.
“It’s hard to encourage those types of people to spend hundreds of dollars extra on a health insurance plan that they are rarely using,” said Cody Michael, director of client and broker services for Independent Health Agents in Chicago.
Michael said agents also get a higher commission on the plans, providing them with more of an incentive to sell them. But he advises clients that if they do have a chronic illness, they may face denials for coverage. “This is old-world insurance,” he said. “You basically have to be in perfect health.”
Dania Palanker, assistant research professor at Georgetown University’s Center on Health Insurance Reforms, said preexisting conditions aren’t always well understood — or well explained. A person might discover too late that, for example, they aren’t covered if they have a stroke because an old blood test showed they had high cholesterol.
But Ryan Ellis, a 40-year-old lobbyist and tax preparer in Alexandria, Va., who is considering a short-term plan for himself, his wife and his three children, said his decision will be made “very deliberately, with my eyes wide open knowing the advantages and disadvantages.”
Some agents said they offer the short-term plan as a last resort—only after warning clients that if they have an accident or get sick, they might not be able to renew their plan. That means they could be stuck without insurance while waiting for the next open-enrollment period.
“They could really be in a world of hurt,” said Colorado insurance agent Eric Smith. “This is just a ticking time bomb.”
Roger Abel, of Marion, Iowa, said he’s willing to take the risk. He has a short-term plan for his 2-year-old daughter. Abel said he pays about $90 a month for her, compared with more than $450 that he would have paid for comprehensive coverage. He and his wife have a separate policy from before the Affordable Care Act took effect.
California resident Neena Moorjani says she wanted to buy a short-term plan, but they are now banned in the state.
But Abel, who is an investment adviser, has a backup option. He said he could always start a group health plan under his company that would provide his daughter with more coverage.
Neena Moorjani, 45, said she wanted to buy a short-term plan but can’t because she lives in California, where they were prohibited under a law signed by Democratic Gov. Jerry Brown this year. Moorjani, a tax preparer in Sacramento, said she rarely gets sick and doesn’t need an ACA plan.
She decided on religious-based health coverage known as a Christian ministry plan. These cost-sharing programs use members’ fees to pay for others’ medical bills. Such programs are not regulated by government agencies and may not cover preexisting conditions or preventive care.
When California banned short-term plans, “I was really, really upset,” Moorjani said. “I wish I had the freedom to choose what health care insurance is appropriate for me.”
Kaiser Health News is a nonprofit news service covering health issues. It is an editorially independent program of the Kaiser Family Foundation, which is not affiliated with Kaiser Permanente.
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The Centers for Medicare and Medicaid Services is asking states to think about creating new subsidy programs for specific groups of consumers, personal health accounts, state subsidy programs and help with paying for niche insurance products.
CMS has included those proposals in a new discussion paper that talks about how states should use the Affordable Care Act Section 1332 waiver program — and suggested that, in some cases, states could use web brokers to implement waiver program proposals.
CMS announced in October that it intends to expand the waiver program, and give the waiver program a new name: the State Relief and Empowerment Waiver (SREW) program.
ACA Section 1332 waiver program history
When Barack Obama was president, CMS called the Section 1331 waiver program the State Innovation Waiver program.
The Section 1332 waiver program gives states a chance to tailor their own versions of the ACA individual major medical programs and rules. In some cases, for example, a state might be able to find new uses for a portion of ACA premium tax credit money, or they might be able to replace a federal program with a state version of the program.
Hawaii used the Obama-era waiver program to bring back its old small-group universal health coverage program.
The Obama administration approved some states’ efforts to use the waiver program to set up state-run reinsurance programs for the individual major medical market. The Trump administration has approved several other Section 1332 reinsurance programs.
See the slideshow above for a look at five state Section 1332 reinsurance programs.
Under Obama, CMS developed regulations that set tight limits, or “guardrails,’ on Section 1332 waiver proposals.
Seema Verma, Trump’s CMS administration, has talked about wanting to make the waiver program rules more flexible.
In October, CMS said it wants to promote waiver program proposals that rely on private-sector solutions. CMS also said it could be flexible about coverage quality: The agency said that a waiver proposal should keep the number of people with coverage that complies with ACA benefits standards about the same, but that people with additional coverage could have less comprehensive coverage.
In the new discussion paper, CMS officials say they think states should be able to use the SREW program to propose four new types of health insurance market reform strategies:
- Account-based strategies. Verma may be warm this concept, because she herself developed an account that resembles a health reimbursement arrangement for some Medicaid enrollees in Indiana.
- State-specific premium subsidies: CMS has suggested that a state could tailor subsidies to get more young people covered or achieve other goals.
- Adjusted plan options: States could use this waiver concept to support use of products that don’t meet all ACA benefits requirements.
- Risk-stabilization programs: States could establish new reinsurance programs, or, possibly, risk pools for people with health problems.
Where you could fit in
CMS officials emphasize in the discussion paper that a state would still have to comply with the ACA and deal with implementation concerns, such as figuring how to provide subsidies for products other than individual major medical policies sold through an ACA public exchange.
“One implementation option for states is to allow enrollment to occur directly with participating issuers or web broker websites,” officials say.
Small businesses already use that approach to sign up for small-group exchange plan coverage, officials say.
5 products that could benefit from the waiver concepts
Here are five types of programs that the discussion paper could eventually help:
- Short-term medical insurance: CMS suggests that a state could help pay for this product for some people.
- High-risk pool coverage for people with health problems: Before the ACA came along, many state high-risk pools were underfunded, offered weak benefits and had long waiting lists. CMS notes that, under ACA rules, a state could offer a high-risk pool through a waiver program, but that the high-risk pool would have to compete for the business of people with health problems. A state could not make people with health problems sign up for the high-risk pool plan.
- Association health plans (AHPs); CMS specifically mention that a AHP program could be part of a waiver proposal.
- Value-based insurance design (VBID) plans: Designers of these plans try to offer richer benefits for what they believe to be higher-value care. CMS mentions VBID in the discussion paper.
- Health expense account (HEA) administrators: CMS suggests that, if a state offered ACA exchange plan users or others access to HEAs, the state could establish each HEA as a trust administered by a private financial institution on behalf of the beneficiary.
A copy of the CMS waiver concepts discussion paper is available here.
CMS has posted a summary of the discussion paper here.
Key Insurance Terminology Definitions
|Premium||The monthly fee charged to keep your policy active.|
|Co-pay||A flat rate you’ll pay for a specific service such as a doctor’s visit or prescription benefit.|
|Coinsurance||An additional patient expense. It is over the deductible that is included with some plans.|
**For example, with 20% coinsurance, you would pay $1,000 for every $4,000 paid by your insurance company.
|Out of pocket maximum||The maximum amount an individual or family would be required to pay annually through deductibles and/or coinsurance.|
**In 2018, the ACA out-of-pocket maximum was $7,900 for individuals and $15,800 for family coverage.
|Lifetime Maximum Benefit||The max dollar amount an insurance company will pay out during your lifetime on a short-term insurance plan for non-essential healthcare services.|
|Chronic Conditions||A chronic condition is a syndrome, physical impairment, disability or disease state that is persistent or otherwise long-lasting in its effects, or a disease that comes with time.|
Common chronic diseases include arthritis, asthma, cancer, COPD, diabetes, hepatitis C and HIV/AIDS.
|Pre-existing Conditions||A pre-existing condition is any medical condition the patient has already received medical advice or treatment for prior to enrollment in a new insurance plan.|
|Underwritten Policies||With underwritten policies, you are subjected to a health background check by the insurance company. Chronic conditions typically exclude you from getting coverage or are not covered by underwritten insurance plans. However, pre-existing conditions that are chronic (like a knee or back injury that happened earlier and is no longer a problem) usually won’t prevent you from getting covered and often will be covered if the injury reoccurs.|
|Guaranteed Issue ACA Policies||ACA policies are guaranteed, in that insurers are required to offer coverage to all applicants. Sex, age, economic status, or pre-existing condition is a reason for rejection.|
Healthcare Sharing Services are also guaranteed coverage, so long as the applicant confirms that they share the groups beliefs. With the exception of some states, guaranteed issue doesn’t limit how much you can be charged if you enroll. Refer to state in question market place site for more information specific to zip code.
|Guaranteed Issue ACA Alternative Policies||In most instances, short-term medical, GAP, indemnity and association- based coverage will enroll you even with a pre-existing chronic condition. The condition likely will not be covered. Some instances, you may be charged more if you have a pre-existing condition.|
The official report regarding the proposed HRA changes for small businesses is below. It is great news for agents that have clients with a employee participation of less then 100.
WASHINGTON, Oct. 24 — The Small Business and Entrepreneurship Council issued the following news release:
On October 23, the Department of Labor issued a proposed rule on health reimbursement accounts (HRAs) that provides more flexibility for their use among small businesses. Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan said this type of flexibility is exactly what small businesses need to offer and continue coverage for their employees.
“The Administration continues to produce a host of rulemakings and policy initiatives that will give entrepreneurs and small businesses more affordable and flexible options for health coverage. The proposed rule on HRAs is no exception. The proposal will allow for more flexibility in the use of HRA funds, which vastly improves this important tool for small businesses. SBE Councilappreciates the work of the Administration in developing more practical and affordable options that will help cover more people employed by small businesses, and improve the competitiveness of these firms,” said Kerrigan.
Under the proposal, small businesses would be allowed to use HRA funds to provide offsets for premiums purchased by their employees in the individual market. Current rules in Obamacare do not allow employers to provide this type of financial support for employees. Employers who offer traditional group coverage would also be allowed to provide an HRA of up to $1,800 per year (indexed to inflation) to reimburse an employee for certain qualified medical expenses, including standalone dental benefits and premiums for a short-term health insurance plan for those employees who choose not to participate in the traditional coverage option offered by an employer.