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3 benefit strategies to prepare for health reform


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3 benefit strategies to prepare for health reform

  1. 1. 3 Benefits Strategies <br />To Help Employers <br />Prepare for Health Reform <br />Better Manage Health Care Cost Now.<br />Prepared by:<br />Tom Daly<br />Hartwig Moss Benefits<br />Toll Free: (800) 410-8140<br />Direct: (504) 827-8930<br />Cell: (504) 708-4866<br />To get more valuable information about our agency and the services we provide, please visit or check out my blog at<br />
  2. 2. Agenda:<br /> Health Insurance in U. S. Today and Brief History<br />How Did We Get Where We Are?<br />What Does Health Reform Mean?<br />For Employers?<br />For Employees?<br />3 Simple Strategies to Prepare for Health Reform.<br />Defined Contribution Approach<br />Health Reimbursement Arrangements (HRAs)<br />Choice and Education<br />Questions and Answers<br />
  3. 3. Health Insurance in U.S. Today<br />
  4. 4. Brief History of U.S. Health Insurance:<br /> Pre World War II:<br />Limited Employer Involvement<br />Catastrophic Health Coverage<br />Individual/Family Focused<br />Post World War II: <br />Group and Individual Policies mostly Guarantee Issue<br />Wage and Price Controls<br />Employer Healthcare exempted from taxes and price controls<br />Group Insurance flourished and transformed<br />10% - Access to providers offering discounted fees for services<br />50% - Access to pre-paid services<br />40% - Insurance against financial devastation from serious illness/injury<br />1970 – 2010 Individual Policies subject to medical underwriting – except NY, NJ, MA, RI, ME<br />2009 Tax parity given to Individual Policies <br />
  5. 5. Health Reform Impact to Employers<br /> Mandated Benefits for All<br />No lifetime maximums<br />Preventative Care with no copays or deductibles<br />Federal Minimum Benefit – rich in comparison to some of the norms<br />>50 Employees – Penalty for not offering “Affordable” Mandated Benefits<br />$3,000/employee receiving exchange subsidy, $2,000 max on all employees<br /><50 Employees – No Requirements, No Penalty<br />
  6. 6. Health Reform Impact to Employees<br /> Mandated Benefits for All Policies<br />No lifetime maximums<br />Preventative Care with no copays or deductibles<br />Federal Minimum Benefit – rich in comparison to some of the norm<br />Individual Mandate<br />Penalty paid if coverage is not in place. Up to 2.5% of earnings.<br />Individual Premium Subsidy:<br />
  7. 7. Defined Contribution Approach<br />With the ultimate cost of Federally mandated plans still unknown, employers that can, should define their maximum financial contribution to actual premium cost.<br /><50 employee groups and >50 employers with a large population of low-wage employees will move towards funding alone.<br />>50 employee groups with high wages will have less funding flexibility and need to know how to evaluate appropriate funding levels.<br />
  8. 8. Health Reimbursement Arrangements<br /> Employers can fund healthcare expenses (deductibles, coinsurances, copays) rather than simply paying and deducting as and expense their share of health insurance premiums. <br />This gives employers the flexibility to take selected and defined healthcare expense risk while giving access to greater information and greater control over cost.<br />
  9. 9. Health Reimbursement Arrangements<br />Traditional Group Insurance<br />Insurance Company Exposure <br />Reinsurance Company Exposure<br />RISK<br />$<br />Reinsurance Premium<br />Insurance Company Exposure<br />Employee Exposure<br />Premium<br />Insured Employees<br />
  10. 10. Health Reimbursement Arrangements<br />Alternate Funding Strategy<br />Reinsurance Company Exposure<br />RISK<br />$<br />Reinsurance Premium<br />Insurance Company Exposure<br />Employer Exposure<br />Employee Exposure<br />Premium<br />Insured Employees<br />
  11. 11. Choice and Education<br />
  12. 12. Choice and Education<br />
  13. 13. Choice and Education<br />Copay Plan<br />vs.<br />HSA eligible Plan<br />Copays:<br />Coinsurance<br />PC Visit:<br />Specialist Visit:<br />ER Visit:<br />HRA<br />Prescriptions:<br />HRA<br />Tier 1:<br />Employee Deductible<br />Tier 2:<br />HSA<br />Tier 3:<br />Employee Deductible<br />
  14. 14. Choice and Education<br />
  15. 15. Questions<br />Any Questions?<br />