Controlling costs, providing competitive benefits, and complying with the ACA – these make up the converging trifecta of difficulties that many small-midsize organizations face on a daily basis when it comes to employer sponsored healthcare. And increases in healthcare costs, which aren’t keeping pace with inflation, are a main sticking point for CEOs and EDs.
Increasing healthcare costs, ACA compliance, balancing ever-precarious budgets, retaining valuable staff…midsize nonprofit organizations must consider many factors related to offering and managing group health coverage these days. More than ever, they need a better solution to the dilemma of providing mandated and high-quality employee healthcare while also watching the bottom line.
While traditional fully-funded healthcare can be expensive and self-funded coverage comes with a significant financial risk, partially self-insuring melds the two into a more affordable health insurance option with less monetary risk.
With the Supreme Court’s June ruling signifying that the ACA is here to stay, many are now looking ahead to the 2018 Cadillac tax as more of a reality – and its heating up discussions among economists, large corporations, unions, and politicians. In fact, later this month a lobbying group called The Alliance to Fight the Forty is launching to attempt to repeal the tax. And legislation to repeal the tax was introduced by both Republicans and Democrats in the Spring.
Corporate wellness programs are the norm nowadays, with many organizations implementing activities and incentives to increase employee wellbeing and save money. And the EEOC recently issued guidelines around incentives and voluntary activities, providing employers with more clarity around offerings. But a wellness program is only as good as the people who use – and benefit – from it, whether that is employees who take on a healthier lifestyle or employers who reap the financial and productivity benefits of a healthier workforce.
Despite questions around the future of employer-sponsored healthcare, American workers still rate healthcare benefits as the most important consideration when choosing a new job. A recent survey conducted by the Employee Benefit Research Institute (www.ebri.org) provides information about employees’ feelings toward current employer-sponsored healthcare offerings and what changes they would like to see in the future:
On April 20, 2015, the Equal Employment Opportunity Commission (EEOC) proposed new rules around employee wellness programs, especially as they relate to the Americans with Disabilities Act (ADA). Specifically the proposed rules provide further clarification around what constitutes a “voluntary” program, how incentives can be used, confidentiality of medical information, and accommodations for those employees who are unable to participate in an incentivized wellness program.
In early May, the IRS released new information around 2016 eligibility and contribution limits for health savings accounts (HSAs), as well as minimum deductions for HDHPs (high deductible health plans) and caps on out-of-pocket expenses incurred with HDHPs. According to the IRS, an HSA is “a tax-exempt trust or custodial account you set up with a qualified HSA trustee to pay or reimburse certain medical expenses you incur.”
For most of us, sitting is just part of the job. We sit at our desks, we sit in meetings, we sit at lunch. Then maybeafter work we finally get out of the office and move our bodies through exercise. But even if we power through a grueling 60-minute workout, new research shows that it won’t cancel out all that sitting from earlier in the day – and it doesn’t guarantee our health. In fact, even those who meet the public health guidelines for exercise may have elevated health risks if they sit for too long.
Beginning in 2018, organizations that provide high-cost employer-sponsored healthcare to employees will be required to pay a non-deductible excise tax, dubbed the “Cadillac tax.” Organizations that afford more than $10,200 per individual and $27,500 per family for employee healthcare will be taxed 40% of the overage amount (pre-tax employer contributions to HRAs, HSAa, FSAs, and MSAs are included). By 2018, the American Health Policy Institute predicts that 38% of large employers (with more than 1000 employees) will have to pay the tax, and 17% of all businesses in the US will be responsible for payment.
