Are you wondering what matters most for your large group employer health plan? This article discusses how the ACA has impacted employer-sponsored plans and a few strategies employers can evaluate regardless of the uncertainty surrounding health care. Now’s a great time to double-check that your health plan remains compliant, competitive and contractually sound. Learn more in this article by Zack Pace of CBIZ, Inc.

1. S T R A T E G I E S
Our business is growing yours
Employee Benefits
2017 Benefit Trends & Considerations
Where are we now?*
1. The October 2015 PACE Act ended the scheduled small group
expansion in all but a few states. Suggestion: If you moved to self-
funding to escape this expansion, revisit fully insured pricing.
2. ACA employer shared responsibility still applies.
3. 1095-C/1094-C forms still apply for tax year 2017.
4. The Cadillac Tax hurricane is still scheduled to come ashore
January 1, 2020. Thus, as it stands, non-calendar-year plans
will likely need to make final adjustments at the beginning of
the 2019 plan year.
5. Section 125 (aka the tax-favored status of employer-sponsored
health plans) remains the largest federal tax “expenditure”
and provides $250 billion in income and payroll tax savings to
employees and employers annually! Will Congress curtail or
eliminate these tax benefits in the future?
What are a few strategies employers can evaluate regardless of
what happens next?
1. If your plan is self-funded, explain to your employees how
the plan operates and why employee stewardship of the plan
financially benefits all parties. Emphasize that increases to
benefits compensation usually limit increases to cash wages.
Ask for your employees’ partnership and ideas.
2. If you’re interested in encouraging spouses to enroll in their own
employer’s plan, an easier, gentler alternative to implementing
spousal surcharges and exclusions is simply setting the payroll
deduction differential between single and employee/spouse
coverage and the differential between employee/children and
family coverage at a rate that is higher than what an individual
would pay, on average, for single coverage.
3. You might be surprised by the variability between pharmacy
benefit manager (PBM) contracts and pricing. Study your
current contract, review competitive vendor alternatives and
negotiate the best terms for your company and your employees.
Now’s a great time to double-check that your health plan
remains compliant, competitive and contractually sound.
1
Source: The Kaiser Family Foundation/Health Research Education
Trust 2016 Employer Health Benefits Survey
* as of August 25, 2017
BY ZACK PACE
L
et’s take a brief respite from the greater Affordable Care Act
(ACA) debate and narrow our focus on what matters most for
large group employer health plans.
Based upon the media coverage of the health insurance debate,
one might assume:
1. Most Americans with health insurance are now covered by
individual policies.
2. Some remain covered by employer-sponsored health plans.
3. All health plans operate similarly to car insurance. The
individual or employer pays fixed premiums to the insurance
company, and the insurer pays the resulting filed claims.
Facts that might surprise you1
:
1. The percentage of employers offering group health benefits
has not materially changed since the advent of the ACA;
59% of working-aged Americans still obtain health insurance
via their employer. Of these 59%, 61% do not have a “health
insurer;” their employer’s plan is self-funded. This 61%
figure jumps to 83% if we consider employers with 200 or
more employees.
2. 15% of working-aged Americans are now covered through
Medicaid.
3. Only 9% of working-aged Americans are covered by individual
policies (on or off an ACA exchange or marketplace).
How has the ACA impacted employer-sponsored plans?
1. Overnight, 30 hours per week became full-time employment.
2. Reclassification of employees into four categories: full-
time, part-time, variable hour and seasonal. The ACA ended
temporary and intern classifications, for example.
3. ACA employer shared responsibility penalty risks created a
paradigm shift from “What health benefits do employees
value?” to “What health benefits eliminate our ACA penalty
risks?” Thus, many employers introduced high-deductible health
plans, offering adequate coverage under the “easy button”
federal poverty line affordability safe harbor.
4. Adoption of self-funding contracts, including level funding,
rose due to the elimination of the new ACA Health Insurer
Annual Fee (aka ACA premium tax) and the early escape hatch
provided to employers with 51 to 100 full-time employees
plus full-time employee equivalents from the scheduled 2016
small-group expansion.
©Copyright2017.CBIZ,Inc.NYSEListed:CBZ.Allrightsreserved.
Article reprinted from Fall 2017
ZACK PACE
CBIZ, Inc. • Columbia, MD
443.259.3240 • zpace@cbiz.com
@zpace_benefits