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Four Tips on Implementing a Private Exchange – and Retaining Employees

Private health insurance exchanges continue to attract greater employer interest. More businesses – and more types of businesses – are looking beyond a one carrier solution for their employee benefits. Private exchange enrollment was up in the first half of 2016 by more than one-third as compared to 2015. The Society of Human Resources Management (SHRM) says the movement is primarily driven by costs, administration, and employee/enrollee experience (and the desire by employers to offer more employee choice, while still controlling benefits costs). The publication Benefits Pro featured an article in September where one private exchange enthusiast shared her employer experience. Amy Natalie, who works in the hospitality industry, knows how important employee retention can be. Hospitality was the industry with the highest voluntary turnover rate (17.8 percent) in 2015, according to Compensation Force. In her experience as an HR professional, Amy noted in the article that her company tried many ways to boost employee retention – recognition programs, internal advancement opportunities, and ongoing training. But it was the 2015 implementation of a private exchange that notably – and positively – affected their organization-wide turnover and employee morale. If you’re considering a move to a private exchange we have brokers throughout California who can help you get started. Additionally, here are some suggested best practices:

 

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Early engagement of leaders

Sharing information with leadership is essential to gaining ownership of the idea and selling the change across the organization. Her company was able to show how the change in their benefits program would enhance their ability to contain costs, expand employee choice, increase employee happiness, and boost employee retention. The executive launch included an exchange introduction, a demonstration video, and a webinar followed by an open dialogue to ensure leaders were champions of the exchange in their discussions with employees. Frequent communication drives enrollment Through the distribution of a pre-open enrollment packet to all departments, you can be sure all employees are aware of the planned shift to a private exchange. This gives them some time to adjust to the idea before facing open enrollment. Videos and flyers distributed in advance of enrollment can also help educate employees on the new marketplace and the benefit options available. Amy’s employer also held on-site enrollment meetings to demonstrate the enrollment website and discuss how employees would be able to shop and compare plans online.

Help your employees embrace change

At her company, all told, the organization dedicated six months to the roll-out of their private exchange. That might – or might not – work for your company, but they believed the longer introductory period was important to ensure a smooth launch and support by employees. They made themselves available for one-on-one meetings for a week after the large group open enrollment meetings. Computer kiosks were set up for those without their own device on which to enroll. Ongoing support was also offered for those needing assistance with the technology or answers to specific benefits questions. Decision Support Tools offered by their selected benefits administrator helped seal the deal.

Give your employees more choice

Employees love choice, and they want to feel they’re involved in making the right decisions for their individual or family health care choices. A private exchanges gives them that ability. While Amy’s company knew the private exchange would offer their employees greater flexibility, they were not sure how the move would affect each employee’s choices. Ultimately, eight in 10 employees selected a different health plan than they had in the prior year. The vast majority (96 percent) said they were satisfied with the choices offered through the new private exchange. A private exchange is a great way for employers of any size to manage their employee benefits. It empowers employees to play a bigger role in the selection of their health insurance and other benefits, while also giving employers a way to control costs (using Defined Contribution) and ensure compliance with the Affordable Care Act. Contact a CaliforniaChoice broker about implementing a private exchange – and improving your employee retention – at your organization.

A Single Consolidated Bill: Another Advantage of a Private Exchange

   If you’re a small business owner or manager, you don’t have a lot of time to waste. You’re probably already wearing multiple hats at work (chief executive, HR and benefits manager, supervisor, payroll administrator, etc.). So anything you can do to help you eliminate unnecessary tasks is likely a welcome change. One way to streamline your employee benefits is to move to a private health insurance exchange like CaliforniaChoice. It gives your employees access to eight different health insurance plans – Aetna, Anthem Blue Cross, Health Net, Kaiser Permanente, Sharp Health Plan, Sutter Health Plus, UnitedHealthcare, and Western Health Advantage.

Health Plan Options Galore

You’re able to choose from dozens of HMO, PPO, EPO, and Health Savings Account (HSA) qualified coverage choices. Similar to the way bundling your phone, cable television, and Internet service at home can save you time and money, bundling your employees’ health insurance can also save you time and money. Another advantage to CaliforniaChoice is consolidated billing. Whether you have one employee or 100, you’ll get one monthly consolidated bill for all of your employees’ coverage. It will show each insured employee, his or her coverage level, your contribution, and the employee’s contribution to premium. We make it easy for you to pay your bill each month, too. You can mail a check along with the remittance portion of your monthly Premium Statement. Or, you can pay online and access past invoices at www.calchoice.com. Talk with your broker about your employees’ health insurance needs and whether a multi-carrier exchange like CaliforniaChoice makes sense for your business.

Five Things Employers Can Do to Retain Employees

 Nationwide, employers are beginning to see an uptick in their employee turnover rate. Earlier this year, the Employee Engagement Report cited a survey showing a 10 percent raise would prompt one in four employees to leave their current job. While some businesses have higher turnover rates than others, Compensation Force reported this year on 2015 turnover by industry. Across all industries, the voluntary turnover rate average last year was 11.6 percent. The highest turnover by industry was 17.8 percent in hospitality, with a low of 6.1 percent in the utilities sector.

So what’s an employer to do?

Here are five things to consider to help you keep your employees longer – and to help them feel more integral to your organization.

  1. Offer better employee benefits A national survey released in May found nearly three-quarters (72 percent) of employees using a private health insurance exchange say they are more likely to remain with their employer because of their benefits program. The survey found private exchanges help employees become more informed consumers of benefits. When survey respondents were asked to compare their exchange experience to a traditional benefits program, 83 percent said they were more engaged in their health care decisions (under the exchange) and 77 percent said they value their benefits more than they did previously. A Wells Fargo survey of benefits managers found 85 percent believe benefits have the most impact on employee loyalty and engagement.
  2. Survey your employees It’s good to regularly ask your employees for their feedback on topics like benefits, wellness programs, employee perks (like company-sponsored events), corporate culture, and job responsibilities. Why some employers may shy away from asking for staff feedback, it can be quite valuable. Consider setting up a focus group as a way to solicit ideas. Review the benefits employees value most and ask for suggestions on possible new coverage options. (As the number of pet parents increases, and as health care costs for pets increase, more and more employers are exploring insurance for dogs and cats. Consider adding more training for your employees. Employees stay where they feel valued and are learning new skills.) Ask your employees what prompted them to join your company in the first place – and why they stay. They’ll feel more engaged, even if not all of their suggestions are implemented.
  3. Improve your benefits communication Benefits can be especially confusing to employees as well as enrolled dependents. Employees tend to be more satisfied with their jobs if their benefits are well communicated. Be sure you offer information that is easy-to-understand and includes infographics, diagrams, and examples to explain how more complicated concepts (like coinsurance) work. Don’t just focus on your open enrollment communications; create a year-round communication plan to help keep your employees informed on ongoing plan and benefit changes (or benefits being considered). Include Facebook, YouTube, newsletters, and emails in your efforts. Ask your benefits consultant or broker if the carriers or private exchange they represent offers Smart Decision Technology to help employees get a better understanding of their benefits. That way they have the information to help them make more informed health care choices when making their annual benefit decisions.
  4. Offer customization choices Consider expanding your benefits by offering employees a private health insurance exchange (that includes multiple health plans and benefits) or by adding voluntary ancillary and other benefits. These could include Dental, Vision, Chiropractic, Long Term Care, Pet Insurance, Life Insurance, and other benefits. Employees love choice because it gives them the opportunity to create a more customized benefits program to fit their individual or family circumstances.
  5. Consider onsite health programs You already know it’s important to keep your employees engaged in their health, but what you may not know is that organizing a fitness program at work, onsite, can affect at-work attitudes and output. The American College of Sports Medicine noted in their study that workers who spent 30 to 60 minutes exercising during their break for lunch improved their performance by 15 percent. Sixty percent reported improved time management and better attitudes and focus on the days they exercised. Research by the Journal of Occupational and Environmental Medicine shows employees who included just 2.5 hours of exercise in their weekly schedule had fewer absences.

Ask your broker about implementing a private health insurance exchange or ancillary benefits program at your firm. He or she can share information on how the right benefits can help you improve your employee retention and increase employee satisfaction.

How the Election Results Could Change the Affordable Care Act

 With the first presidential debate for 2016 now in the rear view mirror, it’s a good time to take a look at how the results of the upcoming election could affect health care and the Patient Protection and Affordable Care Act (ACA). The two major party candidates, Democratic nominee Hillary Clinton and Republican nominee Donald Trump, have very different ideas on health care and the election of either would definitely impact the ACA. Former Secretary of State Clinton would expand the ACA, while Mr. Trump advocates its full repeal. Trump’s proposals do not offer a replacement plan, but they reflect a move to what he describes as free market principles. Since the ACA was enacted, the number of uninsured persons in America has declined significantly.

The Uninsured Dilemma 

According to The Centers for Disease Control and Prevention, the uninsured stood at 15.1 percent in 2011. The uninsured percentage declined to single digits for the first time, falling 9.1 percent in 2015 after a 2.4 percent decline in 2014. Clinton’s proposed policies would further reduce the number of uninsured by 9.1 million. She supports lowering out-of-pocket costs and prescription drug costs with a tax credit of up to $5,000 per family (and $2,500 per individual). It would be available to those whose medical costs exceed five percent of their household income. Secretary Clinton also wants to put a cap on ObamaCare premiums, so no one pays more than 8.5 percent of household income for coverage. A RAND Corporation/Commonwealth Fund analysis released in September says Clinton’s tax credit proposal could increase access to insurance for about 9.6 million people. Changes to the so-called “family glitch” and reducing the maximum premium for those purchasing insurance could add another 2.8 million insureds nationwide.

The Value Of The State Marketplace

In contrast, the Trump campaign wants to eliminate the federal and state marketplaces and allow people to buy their own health insurance and deduct the costs from their taxes. Mr. Trump wants to expand the use of tax-exempt Health Savings Accounts, give states a fixed amount to cover lower-income Americans under Medicaid (instead of paying a share of each participant’s cost), and permit the sale of health insurance across state lines, which he says will increase competition and reduce costs. His other goals include allowing overseas drug providers into the market and increasing price transparency from health care providers. For employers, according to the Society of Human Resource Management (SHRM), the Trump plan would also institute a cap on the employer tax exclusion for health care and expand employer-sponsored wellness programs. RAND estimates the Trump proposal would cause nearly 20 million people currently insured to lose their insurance in 2018. RAND and Commonwealth say the Trump proposals would increase the average premium and out-of-pocket costs for people who buy coverage on their own, while also increasing the federal deficit. (The deficit would go up because of the loss of tax revenue from the new deduction for individual health insurance.) Three of the Clinton proposals would increase the federal deficit as well – the largest increase associated with tax credits for those with high out-of-pockets costs. Secretary Clinton has proposed this be offset by rebates from drug manufacturers and taxes on higher-income individuals and families.

Current Polling

The race for the White House is very tight, and appears to be tightening in some areas of the country as the election nears. However, the Kaiser Family Foundation reported in its ongoing survey of voters that (at least into September) Clinton was holding an advantage over Mr. Trump when it comes to health care issues. More voters told Kaiser they trust Clinton to do a better job than Trump. For example, Clinton leads Trump on the future of Medicare (53 percent to 38 percent), access and affordability to health care (52 percent to 39 percent), Medicaid’s future (54 percent to 38 percent), and prescription drug costs (54 percent to 34 percent) in the Kaiser Health Tracking Poll.

Senate & House Control Will Play A Big Role

Regardless of who wins the White House, changes to the Affordable Care Act are more dependent on whether the U.S. House of Representatives and U.S. Senate stay in Republican hands, both flip to the Democrats (a highly unlikely scenario), or go back to being split (with one party in charge of each chamber).

The change both major party candidates and both the House and Senate can likely agree upon is an end to the so-called Cadillac Tax, which would levy a 40 percent tax on the cost of employer-sponsored health coverage that exceeds certain thresholds: $10,800 for self-only coverage and $29,100 for family coverage (adjusted for inflation). Implementation has already been pushed back twice – now it’s set to begin in 2020 – but it could be eliminated altogether after a new occupant moves in at 1600 Pennsylvania Avenue.