Affordable Care Act · Affordable Care Act: Employee Benefits Wellness ... •Basically build on &...
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Affordable Care Act: Employee Benefits Wellness – Making It Work Presented by: Ralph A. Sepe Partner, Health & Benefits Christine McCarton Principal, Health & Benefits August 2014
Transcript of Affordable Care Act · Affordable Care Act: Employee Benefits Wellness ... •Basically build on &...
Affordable Care Act: Employee Benefits Wellness –Making It Work
Presented by:
Ralph A. Sepe Partner, Health & Benefits
Christine McCarton Principal, Health & Benefits
A u g u s t 2 0 1 4
Agenda For Today
Overview – The Numbers Don’t Lie
The Four Barriers To Entry
Winning Over the CFO
The Most Important Ingredient – Your Employees
Branding and Implementing To Win
Wellness & The ACA
The Wellness Spectrum
Rules of Engagement – Five Steps
The 5 Year Plan
Overview
National Hay Group Survey – 17% Increase in Employer Wellness Spend (2013)
Annual Spend Per Employee
• Fortune 500 Companies - $778.00
• Groups 1,000 to 5,000 EE’s - $409.00
• Groups 500 to 999 EE’s - $320.00
• Groups less than 500 EE’s - $178.00
• New York City Employers - $303.00
• Long Island Employers - $153.00
WHY?1) Larger Employers
Have Deeper Pockets2) Expectations To Lead
The Way3) Direct Relationship
to Productivity4) Direct Relationship
to Lower Claims
The Numbers Don’t Lie
*Hay Group HR Survey 2013
The Four Barriers To Entry
Return on Investment
Management Support
Employee Engagement
Logistics (Rollout/Design)
Winning Over the CFO
Winning Over the CFO
Winning Over the CFO
Winning Over the CFO
The Most Important Ingredient – Your Employees
Branding
Implementing to Win
Wellness & The ACA
• Final ACA wellness rules: Incentives for Nondiscriminatory Wellness Programs in Group Health Plans
• June 3, 2013
• Basically build on & update FINAL HIPAA rules
• ACA rules apply to
• Grandfathered & non-grandfathered plans
• Insured & self-funded arrangements
• ACA changes effective 1st plan year beginning in 2014
• Two categories of wellness programs
• Participatory
– NOT SUBJECT TO ACA AND HIPAA WELLNESS STANDARDS
• Health-Contingent
– Satisfy 5 HIPAA nondiscrimination requirements
Key Definition – Health Factors
• Health plans cannot discriminate based on a
EXCEPT under certain wellness programs
Wellness Spectrum – Participatory WellnessMust be available to “similarly situated individuals”
• Based on bona-fide employment-based classifications consistent with the employer’s usual business practice
• Part-time & full-time and different geographic locations
• Dates of hire or length of service
» Different eligibility provisions, benefit restrictions, or costs, provided the distinction is consistent with the employer’s usual business practice
• Participants & beneficiaries
– May be classified based on relationship to participant (spouse/dependent child), age or dependent children student status
• Plan cannot create or modify a classification directed at individual participants or beneficiaries based on health factors
Wellness Spectrum – Participatory Wellness
The Wellness Spectrum – Health Contingent• Reward or absence of a surcharge
• Individuals satisfy a standard related to one or more health factors
• Final rules created 2 health contingent wellness categories
The Wellness Spectrum – Health Contingent
The Rules of Engagement - Five Steps
• All requirements apply to AB & OB wellness programs
• Rules 3 – 5 have different AB & OB provisions
1. Qualify for reward at least once per year
2. Size of reward limits
• ACA increases effective 2014
3. Program designed to promote health or prevent disease
4. Uniform availability & reasonable alternatives
5. Notice of other means to qualify for reward
The Rules of Engagement - Step 1
• Qualify for reward at least once per year
• Open enrollment
• Bifurcated smoker/non-smoker rates
• ACA Q&A XVIII – Q&A 8 (January 2014)
• Plan imposes tobacco surcharge
• Employee declines opportunity at annual open enrollment to participate/complete tobacco cessation program
• Wishes to join/participate during the year
• Is plan required to provide opportunity to avoid surcharge or provide another reward for that plan year?
The Rules of Engagement - Step 2
• Combined for all health-contingent rewards
• Percentage of total cost of employee-only coverage for plan in which employee is enrolled
• Employee + employer contributions
• Percentage of total tier costs in which family is enrolled
• Dependents may qualify for reward
• Reasonable method to determine appropriate percentage of tier cost among participating family members
– Family rates
– Only 2 of 4 dependents participate in program
The Rules of Engagement - Step 2Plan Years beginning January 1, 2014
• 30% all non-tobacco programs - Previously 20%
• 50% tobacco - New for 2014
• 50% limit on TOTAL reward
- If tobacco-cessation is included
- Otherwise 30% overall limit
Question: How are e-cigarettes treated?
• Tobacco or non-tobacco?
• Can they be considered an alternative for cigarette smokers?
- No guidance in this area
Question: Can you apply smoker rates for legal marijuana use?
- One would assume so if defined as a “tobacco” product
The Rules of Engagement - Step 3
• Reasonable chance to improve health or prevent disease
• Can’t be overly burdensome or subterfuge for discrimination based on health status factor
• Programs are NOT required to be accredited or based on evidence-based clinical standards, however DOL advises this is “best practice” approach
The Rules of Engagement - Step 3
The Rules of Engagement - Step 4
Full reward available to all similarly situated individuals
• Reasonable alternatives when defined standard can’t be met
The Rules of Engagement - Step 4
UNIFORM AVAILABILITY AND REASONABLE ALTERNATIVES
• Allow time for individual to request/establish/complete alternative for FULLreward
• Program may waive defined standard & provide reward
• Do not need to establish alternative standards in advance
– Alternatives by reasonable class
– Individually designed
Facts and circumstances
• Apply different alternative in year 2 than year 1
• Analyze whether alternative is ACTIVITY or OUTCOMES based
– Follow AB or OB protocol
– Special rules prevent “never-ending” cycle of alternatives
The Rules of Engagement - Step 4
UNIFORM AVAILABILITY AND REASONABLE ALTERNATIVES
• What is a reasonable alternative?
• Complete an education program
– Plan makes program available/assists employee
– No cost to employee
• Reasonable time commitment
– Cannot be excessive
• Diet program
– Plan pays membership
– Not food costs
• Consider personal physician recommendations
– Design standard is medically inappropriate
The Rules of Engagement - Step 5NOTICE OF AVAILABILITY OF REASONABLE ALTERNATIVES• Disclose availability of reasonable alternatives
Contact information
Personal physician recommendations will be accommodated
• OB plans
– Include with results that initial screening/standards not met
• New standard language
– Your health plan is committed to helping you achieve your best health. Rewards for participating in a wellness program are available to all employees. If you think you might be unable to meet a standard for a reward under this wellness program, you might qualify for an opportunity to earn the same reward by different means. Contact us at [contact information] and we will work with you (and if you wish, with your doctor) to find a wellness program with the same reward that is right for you in light of your health status.
The 5 Year Plan
Year 1 – Education/Voluntary Participation That Engage Employees
Year 2 – Give Rewards for Participation – raffles, gift cards, PTO days, etc….
Year 3 – Rewards for Activities – bifurcated contributions or HRA account
Year 4 - Multiple Activities – combination of Year 3 and Year 4
Year 5 – Outcomes Based program
