Category Archive - Group

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Sebelius Urges Employers to Implement Group Health Insurance Earlier

Friday, May 28th, 2010

Image: US Mission Geneva under CC 3.0

The deadline for large group health insurance plans to expand coverage to the adult children of employees until the age of 26 is September 23rd. However, the actual date depends on when the new plan year begins, which can be as late as January 1st of next year for many companies.

Secretary of Health and Human Services Kathleen Sebelius is encouraging employers to enact this element of healthcare reform earlier than required. Doing so will be especially helpful to recent college graduates, who would otherwise be uninsured.

Will businesses comply? On the one hand, the demographic in question is generally healthy, so total costs shouldn’t rise all that much. On the other hand, premiums may increase. One study found that 16% are planning to expand their health benefits to this group.

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NJ Public Sector Employees To Chip In For Health Insurance Premiums

Monday, May 24th, 2010

Image: Hugo90 under CC 3.0

Public sector unions in New Jersey, including the police and firefighters, have grudgingly agreed to pay for part of their health insurance premiums.

Starting June 1st, the state employees will have to contribute at least 1.5% of the cost of their New Jersey health insurance policies. Compared to private sector employees, that’s nothing. Many of the latter have to cover most or all of their own premiums!

For an employee with an annual salary of $50,000, they will have to pay just $750 per year in premiums: a very affordable health insurance option. Despite some previous concessions, these plans are typically comprehensive.

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Which Businesses Are Eligible for Health Insurance Tax Credit?

Friday, May 21st, 2010

Image: eneas under CC 3.0

One of the near-immediate benefits of healthcare reform is the creation of tax credits for small businesses, meant to encourage them to offer health insurance coverage to their employees.

The government has released guidelines detailing which companies are eligible for at least a partial subsidy. They are those that have:

  • Under 25 employees, and
  • an average salary less than $50,000 per year

However, in order to take advantage of the full 35% tax credit offsetting health insurance plan premiums, firms must have:

  • Fewer than 10 employees, and
  • an average annual salary under $25,000

Some small businesses believe that it’s a perverse incentive, given the fact that some companies would have to fire workers or cut their pay in order to become eligible.

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Hawaii Pays Half Of Health Insurance Premiums For Small Businesses

Wednesday, May 19th, 2010

Image: JoshBerglund19 under CC 3.0

Here’s a new way to encourage job creation: pay a large part of new hires’ health insurance premiums. Hawaii is doing that, largely through funding received from the healthcare reform law.

Small business owners believe that Hawaii Premium Plus is a program that will allow them to afford hiring more workers, since they will spend less in total on group health insurance coverage. Governor Linda Lingle touts it as a strategy for reducing the state’s unemployment rate by one percent. However, some skeptics are unsure if slightly under $11 billion is sufficient funding for such a program.

For each new hire between May 1st, 2010 and April 30, 2011, the program will reimburse employers $1,680 per year. Companies with under 50 employees are eligible, though the program may be expanded if it fails to meet the cap of 6,450. It is intended to increase the number of legal residents who are both employed and have Hawaii health insurance.

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Employers Limit Mental Health Insurance Coverage

Monday, May 17th, 2010

Image: Beautiful Insanity Photography under CC 3.0

Despite new federal regulations meant to prevent it, an increasing number of employers are limiting their mental health benefits in order to save money on their group health insurance. Mental health coverage has seen its costs increase by over 20% from last year.

How do they get away with this? Insurers are accused of forcing therapists to undergo long, detailed interrogations about their patients, to determine if they need further treatment. Therapists believe that the procedure is an unfair burden on them, and that doctors aren’t held to the same standards.

The dangers of this practice are several: it costs therapists in time and money, which is then passed onto their patients and their health insurance companies through higher co-payments. It often results in patients cutting their treatment short, which may result in them needing more extensive treatment or hospitalization in the future.

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Small Businesses Not Required to Change Group Health Insurance

Friday, May 7th, 2010

Image: lumaxart under CC 3.0

The bulk of the new healthcare reform mandates and changes take effect in 2014. However, they won’t affect all small businesses.

For companies with under 50 employees, their current group health insurance coverage will be grandfathered in. That means that they won’t be required to change it in any way, unless they make other changes to the plan.

This exception will be helpful to those businesses looking to save money on their health insurance plan through not offering more comprehensive coverage.

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Will Your Large Employer Extend Group Health Insurance?

Wednesday, May 5th, 2010

Image: josh.liba under CC 3.0

Many large private-sector employers self-insure. That means that instead of buying group health insurance directly from providers, they let insurers administer their health benefits, while paying the claims themselves.

As a result, they are not necessarily following the providers who have decided to extend coverage to adult dependents until the age of 27; the healthcare reform law doesn’t force them to until the start of their next plan year.

Experts have not heard of any major corporations making changes to their health insurance plan‘s eligibility yet. Rather, they are trying to decide whether or not to charge additional fees to young adults joining or rejoining their parent’s coverage.

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Group Health Insurance Wellness Incentives Will Increase

Monday, April 12th, 2010

Image: fuzzcat under CC 3.0)

An increasing number of companies have enacted wellness incentives as part of their group health insurance offerings. Such programs are meant to save money on claims, while rewarding employees for healthy habits. The healthcare reform law allows the benefits to become more attractive.

Currently, the maximum incentive that can be offered for quitting smoking, weight loss, or other healthy habits is 20% of the total cost of a health insurance premium–including both the employer’s and employee’s portions. In 2014, the maximum incentive will be increased to 30%.

In other words, affordable health insurance will be easier to find for those who are proactive about their health.

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Encouraging Activity With Group Health Insurance Discounts

Thursday, April 1st, 2010

(Image: Ed Yourdon under CC 3.0)

Some businesses are saving money on their group health insurance by encouraging exercise and other activity. One firm reports that they’ve saved over 5% on claims since enacting the program a year ago!

Employee wellness incentives are increasingly common, but this is a new spin on it. The firm provides electronic pedometers that track activity levels, in addition to online support. If they meet certain goals, the employee can save more than $100 on their health insurance premiums.

Currently, the programs are voluntary, and employees are not penalized for failing to reach their goals. (Instead of having their premiums increased, they simply stay the same–and forgo the opportunity for savings.) That may be why these programs have high participation rates; anywhere from 50-80% of the average workforce gets involved.

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Dependents To Lose Group Health Insurance Coverage?

Friday, March 26th, 2010

(Image: jeanbowe under CC 3.0)

Some worry that health insurance reform will have some inadvertent impact. Specifically, it could leave a previously insured population uninsured: dependents of employees, who currently receive coverage from their spouse’s or parent’s employer.

Why would this be the case? In 2014, firms with over 50 employees will have to provide coverage to their full-time employees or pay a $2,000 fine per-employee. Since the bill requires insurers to cover pre-existing conditions and prevents them from rescinding policies once a person becomes ill, health insurance rates may go up in the short run. The employer and individual mandates are supposed to mitigate that impact by increasing the size of the insurance pool, but that doesn’t stop companies from worrying about costs.

In order to save money on group health insurance, many employers may choose to drop coverage for dependents, which isn’t forbidden in the legislation. Ironically, one of the immediate benefits of healthcare reform that has been touted is that adult children can now remain as dependents on their parents’ insurance plans until they turn 26. If that coverage is dropped, it’d put them back in the same predicament.

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