Open enrollment reminders for employees–useful tidbits to share
Everyone is busy with open enrollments. This year more than ever, people seem to be stressed about their health benefits and the cost of these. Employers are much more engaged on issues concerning cost and quality and are particularly interested in discussing specific wellness strategies and incentives for employees to change their behavior. Employees need useful and relevant information NOW. People are hurting in this economy. You’ll be surprised concerning the positive response you’ll get from employees when you offer up a few useful pointers.
Yesterday I went out to a nice employer group with one of my veteran brokers to do an open enrollment meeting. The group was professional and well educated and the majority of them had chosen an HSA plan in the previous year. I was incredibly impressed with their level of sophistication and the apparent engagement in their plan and the financing of their plan. The COO of the company stood at the front of the room and talked about business pressures and the due diligence process that he’d gone through with the broker to choose the plan and endorsed the strategy behind his selections. The employees were genuinely interested in the dialogue. Both the broker and the COO had done a marvelous job in getting them prepared/engaged in the strategy and had created a true ‘company culture’ around their plan.
I took the opportunity in the meeting to talk about some recurring themes that were relevant to ALL of the employees but weren’t front of mind. I’m listing these here in the hope that you’d consider discussing them in your meetings. Employees expressed their gratitude after the meeting for our discussion around these items.
(1) Claims stratification—The majority of claims activity as a percentage of actual activity for most groups occurs under $500.00 in the deductible for employees and under $1,000.00 for families. High deductible health plans with the tax advantages of the HSA are less expensive and give the employee the opportunity to accumulate money for a host of expenses for the future. Employees who take full advantage of the maximum contribution can help to finance future expenses including orthodontia or retiree health expenses.
(2) Preventive—Most plans now include comprehensive 100% coverage preventive coverage. There is no better prophylactic for members than an annual physical exam with a primary care physician or OB. These exams often pick up undiagnosed elevated BP, elevated cholesterol, elevated blood sugar and other pre-disease process ailments early….so that they don’t become full blown catastrophic claims. Programs that incent the use of preventive benefits are valuable to employers and employees alike. In fact, there likely isn’t a more valuable wellness program than one that consistently incents annual physical completion. PCPs provide continuity of care for members.
(3) PCP campaign—If a member doesn’t have a primary care physician….they should get one now! Massachusetts is the best example of this. We’ve just passed universal health care reform for all Americans. When MA passed reform…they quickly found out about the PCP shortage. It is veritably impossible for those without a PCP in MA to get one now. Get yourself a PCP NOW before reform goes into full effect. The shortage will likely be worse in CT than it is in MA. It is your duty to encourage members to get a PCP now and to help them find one if they need it.
(4) Stay out of the Emergency Department or Emergency Room if you don’t need to be there. ED visits average as much as $1600.00 per visit. Your PCP and alternative clinics like the CVS Mini-Med are good and less expensive alternatives. The clinic model is growing rapidly and many have standards that get you in and out for 26 of the most common CPT codes for about $65.00. Curiously, many of these have sophisticated Electronic Medical Records systems which immediately convey the history of your visit to your PCP…to provide continuity of care. You can show members where these facilities are….it’s part of your job. It makes you relevant.
(5) Prescription drugs— For many groups, prescription drugs account for 25% of their gross claims. There are many alternative generic drug programs offered through all of the national and many local pharmacy chains. Roughly 85% of all drugs have a generic equivalent. Employees don’t know this. Many of the national chains sell generic drugs for $4.00. You need to show this to employees. It is valuable and relevant. Both national and local chains have collateral materials that you can hand out to employees explaining their generic programs. Don’t waste money!
(6) HSA stuff– Many employees don’t realize that they can often contribute, tax free, more than the high deductible that they have. For 2011 the maximum contribution limit for an individual is $3050.00 and the family limit is $6,150.00. Employees over age 55 have an additional $1,000.00 contribution and over 55 spouses have $1,000.00. Remind eligible catch up employees that their dependent’s catch up contribution must be deposited into a separate account. Most don’t realize this…..you need to tell them. Talk about the financing of the HSA. Again, most employees don’t realize that they can save receipts and EOBs for unreimbursed medical expenses over many years. For persons who fully fund their accounts…they can choose to spend, real time for their expenses out of separate funds….and accumulate money in their HSA accounts. Many years from now, they merely need to present their saved receipts for unreimbursed expenses from the past……and spend out of their HSA account that they’ve accumulated over the years. Many employees are scared about the future. Saving in an HSA is a great way to plan for the future and for years in which they may have more expenses than they do now. Saving also gives employees the flexibility in future years to choose plan designs with higher deductibles/exposure that cost less in premium! Remind employees that the deductibles and co insurance from their dental plans can be reimbursed through the HSA as eligible expenses. Also remind employees that over the counter drugs now require a prescription from the pharmacy….if people want these expenses to be reimbursable under the HSA.
(7) Remind employees with working spouses that if they wish to put their spouse on the employee’s HSA plan….that they need to make sure that they aren’t still eligible for an FSA….which would negate the deductibility of the spouse’s HSA. Again, most employees don’t think of this when they are making the change.
Brokers and consultants who take the time to discuss these relevant topics with employees will be surprised at the positive reaction. Employees, under financial pressure, are finally becoming engaged in the health plan buying process. It is our responsibility to block and tackle them through the process and to inform them along the way. You’ll be amazed at the reaction from employees and employers when you do a few of these things! Under the new and proposed carrier compensation plans only the most relevant agents will continue to succeed in this more complex and difficult marketplace.
2011 IRS Limits Single Plan Family Plan Minimum Deductible $1,200 $2,400 Maximum Out-of-pocket $5,950 $11,900 Maximum Contribution Limit $3,050 $6,150 Catch-up Contribution (55+) $1,000 $1,000
Jeffrey Hogan|Northeast Regional Manager
Rogers Benefit Group
One Forest Park Drive| Farmington, CT 06032
P: 860.606.0370|F: 860.677.5098|C: 860.424.2600
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