Name: jeff kuzmich - Migrate_How_to_Reduce_Costs_of_Healthcare_09212023_4318014
Uploaded: 2026-02-26T05:54:22.337Z
Duration: 33 min 5 s
Description: jeff kuzmich - Migrate_How_to_Reduce_Costs_of_Healthcare_09212023_4318014

Transcript for "jeff kuzmich - Migrate_How_to_Reduce_Costs_of_Healthcare_09212023_4318014": Everyone. Welcome to today's event, How to Reduce the Rising Costs of Healthcare. I'm Rob Parsons and I'll be your host for this webinar. So first, I wanna take us through a little housekeeping here just to get you a feeling for the console. The primary audio connection is through your computer, so be sure to check your speaker volume, and you can follow the key commands here on screen just to make sure you've got it loaded up on your browser correctly. So here's the example of what you're seeing right now. This is our webinar console. It allows you to customize your experience, resize things, enlarge, reduce the windows, the slides, the media player, whatever you want to give you a great experience. So I want to take a look at some of the closer special features here. One is you can ask questions at any time during the event. You could just send an ask us the question window here. Just enter your question and type submit. We do have specialists standing by who can help individual questions. We'll try to answer questions at the end of the event, time permitting. But do know that these are very helpful, the questions for future webinars and future content. So, you have any questions at all, submit them. We also have a lot of resources you can download. We have a copy of today's content you can download for future reference, and we'll also be sending an email out with this recording after the event. There's also a brochure, a booklet on the Paychecks Insurance Agency, and a variety of articles that you may find useful as well. And then finally, if you experience any technical issues during the webcast, just click this help widget and it'll give you some of the most common issues and resolutions as noted on this slide. And finally, note that this is not legal advice. This is for informational purposes only and very general information. It's not legal opinion of any specific way. So, without further ado, I'd like to introduce our presenters. First, have Barbara Dreams. Barbara is a transformative leader with deep operational and strategic experience in human resource management, benefits program development implementation, and financial analysis and planning. She is responsible for the overall design, implementation, communication, underwriting and administration of the organization's health and welfare programs. She has over twenty five years of benefits and PEO experience. She's a certified human resource professional. She has her health, life and variable annuities license. Also joining us is Bill Blake. Bill leads the service and operations organization for the Paychecks Insurance Agency. Bill has a passion for helping small businesses find the best benefits and insurance offerings for them and their employees. With more than fifteen years leading in benefits, Bill's expertise is around constantly striving to be innovative in how products and service are delivered in the insurance space. So with that, I'd like to hand it off to Barbara to go over what we'll be covering today. Thanks, Rob. I appreciate it. Welcome, everyone. Pleasure to be with you this afternoon. Really just want to take a moment and go through the agenda, just to go through some of the bullet points on what we expect you will learn today. First, the importance of having a strategic benefits plan. We're going to talk about that in a moment. Then navigating traditional health insurance, but also exploring cost effective alternatives then, of course, preparing for open enrollment and then what you do beyond open enrollment and then having some time for Q and A. So here's a common scenario we see when employers don't have a long term benefits plan. They don't always think about benefits until open enrollment. And generally, that's too late, right? Because now you get sticker shock when you see and realize how much costs have gone up. Now you're forced to make last minute decisions. And when you do that, they're not always the most cost effective ones. So this is why it is very important to review your health care benefit strategy early and often, more than once a year, more than just at renewal time. Long term benefits planning can help you make more informed and cost effective health insurance decisions while allowing you the opportunity to maximize the value of your benefits. It can help you look at your benefits administration. How long does that take? Is it taking too much time? Is it too complicated? Do we need to change some processes? And it can help you plan for the changing needs of your workforce. Now, the strategic benefit package, it supports your goals, and and most goals are, right, controlling costs. That's huge. That's that's the number one, that most employers that I speak to are trying to accomplish. And then, of course, you wanna be able to attract and retain the best employees. You wanna be able to compete with your competitor across the street. You want to be the one to win the best talent and retain that talent. Along with that, better benefits package, you have high retention, you're enhancing your company reputation. Clearly then also contributing to a healthier and more productive workforce. And especially now in these times of economic inflation and uncertainty, it's providing employees with security. So that's definitely the goals that we want to go through when we're talking about a strategic plan. Now, I found this survey very, very interesting. In 2020, did a paycheck benefit survey of employees. And a lot of times, what I hear from employers is they expect to see that compensation is the top reason why employees would not leave or would consider leaving their employer. And as you see here, it is not the top. In fact, if you look at on the right hand side, top reasons why employees would consider leaving, it's not even there. It doesn't even register as a top complaint. So what's that number one? The benefit package. So the number one reason employees would not leave their current employer is because they have a fabulous overall benefit package. And then conversely, the top reason they would consider leaving is because the benefit package is lacking. The other thing to note, which is interesting and probably post COVID, the commute and ability to work remote, even if only part time, is also a top consideration on whether or not an employee remains engaged with their current employer. So now what I want to do is I want to pass it over to Rob. We're going to do a quick poll. Thanks, Barbara. That's so interesting. So benefits, certainly top of mind. We have a lot of attendees today, so I'd love to hear from everybody. What is your main concern when selecting health benefits for your company? Are you looking at cost effectiveness? Are you looking at flexibility? Maybe it's comprehensive coverage and really making sure there's a lot of options. Or maybe it's employee satisfaction, really getting to the root of what your people want. We'll give you all just a minute here to enter your thoughts. Obviously, cost effectiveness is going to be highly important and highly top of mind. I suspect this is not a surprise Not surprise. To Right? The comprehensive is interesting as well, as is the employee satisfaction, but cost effective, number one, no surprise since people have come to an event called How to Reduce the Rising Costs of Healthcare. It's really the balance, Rob, it's really the balance, right, of the controlling the costs and still offering a comprehensive package. So it's kind of perfect time to turn it over to Bill. For sure. Yeah, all right, Rob and Barb, thank you. And for the audience, thanks for being with us. Thanks for having me today. We'll spend just a few minutes talking about really traditional health insurance, which a lot of you probably are familiar with. I'll give you a little bit of detail and some pros and cons of of some traditional style health insurance plan. So first is the HMO, Health Maintenance Organization. These typically, in terms of traditional insurance plans, tend to be a little bit on the lower cost, however, have very restrictive networks. So a good example, if you live in California, would be Kaiser. You use the Kaiser network for everything. You don't have benefits for outside of network. You often have to go to your primary care to get a referral to go see a specialist, sort of a gatekeeper model. But HMOs limit the network, but in doing so, at times, are able to control the cost a little bit more and keep costs down. PPO is a preferred provider organization. This essentially has both in network and out of network benefits. You typically get more insurance, more things covered if you use an in network plan, but it gives you the flexibility to go outside of your network, sort of your middle of the road from a cost standpoint. And then the POS, point of service. This is open flexibility. You can go whoever, wherever you'd like for health care. They tend to be more expensive because there is no in network. In network typically allows the insurance carrier to negotiate better rates, which allow them to pay less for services versus something like a POS where you could go to any doctor, any provider out there. So these are the three traditional types you'll likely have seen or heard of. HMOs, least amount of flexibility traditionally are the lowest cost all the way up to a POS, which tend to be a little bit higher cost, but offer you complete flexibility in the benefits. Alright. I'm gonna kick it back over to oh, no. I am not gonna send it back to Rob. So how how are plans funded? So fully insured is really the most traditional how many of you probably understand benefits to work. Every month, you pay a premium to the insurance carriers, any utilization from your employees of the insurances, claims get submitted to the carrier, they pay the doctors. The employer knows exactly every month what they're gonna be paying for each employee, coverages, expenses defined. Self funded is sort of the extreme opposite of that, and this is really where the, the employer pays a fee for administration. So someone to to manage claims, pay bills, but the employer themselves or the plan sponsor pays the claims. So this varies a lot month to month. So if you have no or low utilization amongst your employees, there may not be very much expense to you as the employer. If your employees have either some big catastrophic events or a lot of utilization, how much you have to pay could be significantly higher. There's generally a cap on these. There's a reinsurance. So, you get to a certain point, the employer pays out of pocket or they pay, and the reinsurance kicks in. But at time, this this allows, one, it's good for cash flow for employers. It can be very beneficial if your your your employee base has very low utilization of insurance. Typically, this is something we recommend for larger employers in the several 100 and up. And this really allows the risk to be spread out amongst a larger pool of employees. If you only have five or 10 employees, someone gets, you know, sick and has to spend a week in the hospital, the expense could be really high. There's not a lot of premium being paid in by your employees into the plan, so it's pretty expensive. If you have a thousand employees and one employee spends a week in the hospital, bearing that cost is really not such a big deal. And then there's level funded. This is really like a blend of traditional fully insured plans with self funded. It's a newer thing we've seen pop up really in the last five years or so. And this is where the insurance carrier sets a monthly amount for each of the employees so the employer knows what to pay. But if the insurance, or if the carrier doesn't pay out a certain percent of the premium in claims, the employer gets money back at the end of the year. If it goes over and the utilization is higher than what was expected, there's no additional no additional expense paid for that year by the employer. However, it means your your rates next year likely are to go up. So level funded is a good balance. It can be very functional and similar to self funded, but you can use it for a smaller employer where their risk is quite a bit less, but there is upside should their employees have low utilization of benefits. All right, I'm gonna send it back over to Rob for another poll. Thanks, Bill. And this poll is about alternative health benefit options. So Bill did a nice job taking us through maybe what some of us are familiar with, what's traditional. But alternative, there's some different options out there. So this poll is really, have you considered implementing or implemented alternative health benefit options? For instance, yes, we have implemented an alternative plan, yes, we have considered it, no, but we are open to exploring, or no, we prefer traditional health insurance. I'll give you all just a moment. Ah, yeah, so people are open to exploring, which is great to hear. What do think about that, Bill? I love it. I love to see employers thinking about alternate ways offer benefits, offer great benefits, and make it as affordable as possible. That's fantastic. So I'm going to pass it back to Barbara. I do want to make one note. I'm seeing some notes in the chat that perhaps we have the wrong PDF deck in the console. Rest assured that after the event, we'll be sending you the correct PDF with the correct slides, and I apologize for that. Now I'll hand it back to Barbara. Thanks, Rob. So now we're going to talk a little bit about some we're going to explore. Especially, I love to see that employers are open to this cost effective alternative. So obviously, with rising costs and a labor market where employees just constantly want better benefits, the need for having a variety of solutions is stronger than ever. And we also know that employee wellness more than ever is a priority for employers and employees. Holistic wellness, that's not just physical, meaning medical plan, but mental, financial, social. So benefit solutions are expanding to nontraditional health care services, and employers are looking for ways to provide benefits to the under and uninsured. So we're going to go through some of that. So to the poll, let's talk a little bit about HDHPs and HSAs, so high deductible health plans and health savings accounts. High deductible health plans typically have lower premiums. They are more cost effective. And the reason is because they have higher deductibles than traditional health insurance. Copays don't typically kick in until the participant has paid their deductible. So the plan doesn't really cover anything until the participant has paid their deductible. So HSAs are a good option to pair with an HDHP because what an HSA does is it helps employees save on their taxes. So what they're doing is they're setting aside tax advantaged monies to fund their co pays, their deductibles, and other qualified medical expenses. And if they don't spend that money, what's great about it is that these funds can help supplement retirement savings. So these monies can roll over year over year if you never use it, if you never really meet your deductible, you don't go to the doctor very often, you don't have high medical claims, you can roll out over year over year, and it could become a retirement vehicle. And it helps minimize out of pocket medical expenses or unexpected medical expenses for an employee. So employees would make pretax payroll deductions, and they would get tax free distributions if they're using those monies for qualified medical expenses, plus the earnings were tax free. So it's an investment vehicle, pretax deductions, earnings were tax free. And then when you take it out for a qualified medical expense, you're not paying taxes on that either. And then another piece of this is employers can contribute to an employee's HSA, and that helps them save on FICA taxes through tax deductible contributions. Now, we do need to note that these employer health savings account contributions do need to be reported on an employee's Form W-two, So just wanted to make sure that we covered that. So what this is doing is that employees are essentially really paying themselves instead of the carrier when they're electing to participate in an HSA because they're paying lower premiums for the high deductible health plan and then funding their deductible using the HSA. So sort of like a forced savings account. Now, we'll talk a little bit about an HRA, And that is different than an HSA because an HRA is still a reimbursement program, but it's fully funded by the employer, not the employee. And sometimes it can actually be offered in place of a group plan. So an HRA can be used by the employees, again, to cover qualified out of pocket medical expenses for themselves as well as for their spouses and dependents. It's a cost effective health benefit. It gives you control by being able to choose how much you want to contribute for each employee each year. And if the employees don't use the funds in an HRA, it stays with you, the employer, unlike an HSA that belongs to the employee. So if you're an employer and you're funding an employee's HSA, an employee doesn't use it in that year, it's still their money, whereas in an HRA, it gets returned to the employer. And the employer contributions are tax deductible, and reimbursements are tax free to the employee when employees file a claim. Now, if you're an employer with less than 50 full time employees and you don't offer a traditional group health plan, a QSEHRA or Qualified Small Employer Health Reimbursement Arrangement that's a mouthful may be a good option for you to reimburse your employees for costs of individual insurance and or of their qualified medical expenses on a pretax basis. As an employer, you can reimburse employees with individual coverage up to $5,850 and with family coverage up to $11,800 Now, those are numbers for 2023. Those will likely change in 2024. Both provide flexible options that allow the business to control costs while still offering a valuable benefit, and employees have the ability to choose an insurance plan that best meets their needs. Now, another option is a PEO or professional employer organization, a master plan. And what is that? That is when a smaller business joins a PEO and joins their group plan. So what happens is businesses, a lot of businesses, hundreds, thousands of businesses are participating in this master plan that is sponsored by a professional employer organization, and the PEO is able to negotiate lower costs, higher value, large group type health insurance rates and plans. These are plans that typically small employers would never have access to in the open market due to their size. And PEOs are the only outsourced HR partner that can create these master plans because of the co employment component of the relationship. It's really a one stop shop for high quality, cost effective benefits. And then, of course, administration is simplified since all of it is handled by the PEO. So you're leaving the driving to the PEO from new hire eligibility tracking, deduction management, open enrollment, billing reconciliation, carrier payments, COBRA, all those wonderful things that most employers don't really have time to do or want to do. They want to focus on their own business. And this also helps smaller businesses compete for better talent because it's leveling the playing field. In fact, it can allow smaller companies to offer the same gold standard benefits as a larger company would. And this also can keep current employees from going to larger a larger company with bigger, more cost effective benefits. I'm gonna turn it over to Bill to talk a little bit about supplemental plans. All right. Thank you, Barb. And, yes, we're gonna talk about supplemental. We're gonna specifically talk about one particular option related to supplemental called a limited medical plan. So limited medical is typically less expensive than the traditional benefits that that I've covered or even the things that Barbara was just talking about. Typically covers a few things like doctor's visits, urgent care, maybe x rays, emergency room, but isn't it quite as comprehensive as a traditional medical plan. We often see these types of limited medical plans used to either supplement, where an employer offers a major medical but also offers this, as a low cost option or lower cost option. But more than anything, we see it used for part time employees or where there's very low wage employees that just want some level of insurance benefit, but can't afford a major medical plan. One kinda condition around this, if you are an applicable large employer, so 50 or more full time equivalents per the Affordable Care Act, limited medical doesn't necessarily meet all the requirements that the ACA lays out there that an employer has to offer from a benefit standpoint. But it is ideal for either a company that can't afford a full medical, has employees that can't afford a traditional medical plan to get some level of benefits and some preventive care that can happen to help keep their employee population healthy. I'm gonna transition over and we're gonna talk a little bit about navigating open enrollment. So open enrollment is certainly a stressful time for employers and employees. As the employer, not only are you selecting a new benefit plan for the year, you're also having to take your employees through open enrollment. What does that look like for them? And how do we help you, and how could you make it less complicated? How could you improve the experience for your employees? So we're gonna talk about five steps to enhancing open enrollment. Alright. Sorry. I'm hitting some technical difficulties. All right, hold on a moment there, Bill. Looks like we've lost your looks like we've lost your audio. Barbara, would you be able to step in and help with some of these steps to make open enrollment easier? Sure, sure. No problem. Bill's getting back online. So let's start with talking about some of these five steps. First and foremost, you want to be able to review your plan options with a licensed insurance agent. You want to do that early. You want to make sure that you have enough time to really think about and give yourself enough time if you do want to change the type of benefit plan that you're offering. You want to give yourself enough runway to be able to do that and make it seamless for your employees. So working with an agent can also assist you with understanding and finding the best options for your company. Then you, of course, ensure that the plans you select can work seamlessly with your benefit administration system. You want to be able to reduce the administrative burden on your HR team and also on your employees. The other thing that I recommend is survey employees to understand their needs and preferences. Nowadays, with Gen Z, with millennials, they might have different needs and different expectations than Gen Xs and baby boomers, things like that. So really surveying your employees to understand what it is that they want so that you're putting in place health benefits that align with the needs of your workforce. Clearly, educate employees. This is complicated stuff. Not everyone finds this easy to make their decision. So hosting workshops, webinars, explaining the different benefit plan options, ensuring that your employees understand the value and details of the benefits that you offer. You want to increase employee satisfaction and utilization. Communicate with your employees early and often through multiple channels to ensure they have all the necessary information. If you can do push alerts on a phone, great. If you email different medium, could be PowerPoint, whatever. Just make sure that you're doing it through multiple channels. Provide resources for employees to ask questions and get help before and during the open enrollment process. And finally, use the benefit administration technology to do the process for you for as much as you can. If you can provide employees with online enrollment that they can do in a few clicks, even better. You can have a portal that has FAQs. You can get employees questions answered without them having to go and search. Post educational content, a lot of administrative software allows for videos and PDFs and decision tools to make it easy for your employees to enroll, to make changes, or just learn about the plans. So the right benefit administrative software can do most of the work for you. All right, Barb, thank you. I'm back All I apologize about right, so let's talk just briefly beyond open enrollment. One of the things that I do see employers make the mistake sometimes, they purchase and decide on a benefit plan and they do nothing else. And maybe next year, they just renew with the existing plan that they have. It goes up five or 10%, and they just roll that over and let it go. Benefits are not set it and forget it. There are things that change in a market, and there's things that change with your employee base that might make it necessary to change your strategy around benefits. So I think it's really important that you regularly review your strategy, work with your, insurance broker to be ready to adapt as you have new employees come in. Maybe they live in a different geographic area. Maybe your city's changing and evolving. Networks change from time to time. So doctors that were in your network last year may not be next year, it's important to understand that and review that. Cost is really important, but it's not the only component. There's not really a lot of benefit to providing a super cheap plan that nobody has access to or doesn't meet the needs of your employees. Barbara mentioned using benefits administration software. It can really help you stay organized and track what's going on. And I think just lastly, educate yourself and your employees around benefits. Really, health insurance literacy is important. You can help employees understand, shop around a little bit. If you need an MRI, don't necessarily just go to the first place you find. Things are priced differently in the market. It may cost different to them. So there's a lot of opportunity. And then preventive wellness is huge. If we can catch things early, it prevents things from blowing up and getting really expensive down the line. So there's a lot of things that your employees can do the more they understand benefits. And we'll close it up. How can paychecks help? Paychecks can work with you. We know shopping for benefits, managing the compliance of insurance can be daunting. Controlling cost is not an easy thing for any business to do, and it could be really complicated. Working with paychecks, you could benefit from a personalized service approach. Our licensed insurance professionals in our insurance agency have access to all the key networks, key carriers, out there can help provide and design a benefit plan that suits you, whether you're a small business of just one or two or three employees looking for coverage or your larger 500,000, two, three, five 4,000 employees, we can help you find the right benefits, structure it appropriately that benefits you and your employees the most. Paychex provides ongoing account management where we offer multiple different service approaches. We'll give you a dedicated service team to help support you if need be. Compliance is a big thing with it with benefits, and we have compliance analysts and systems in place to help our our clients ensure that they remain compliant with all the regulation out there. And then integrate it with our HCM technology platform. So, Paycheck Flex, our payroll platform, our insurance is integrated right with that. We know when you add an employee to be able to offer them benefits. We know if an employee leaves your organization to be able to offer them COBRA. Things like that can really help ease administrative burden. Alright. With that, I appreciate the time. I'm gonna hand it back to Rob. We're getting near the half hour here, so I'm not sure if we're gonna have time for questions, but Rob, I'll throw that over to you. Thanks, Bill. Yeah, I think we're up against it here. And there were some great questions, a lot of questions about If people can stay for just a minute, I'd love to throw this one out. This was from Doug Klarberg. A lot of times when I choose a cost effective plan, that means less coverage or more restrictive coverage or higher deductibles, which seems to defeat the purpose of offering more benefits. So how can I offer more benefits or better benefits without adding a ton of costs? Yeah. That's a great question. And certainly, you know, I said it a minute or two ago, just scaling down cost doesn't necessarily get you the outcome that you need. So I think the one number one is really understanding your employees and what's important to them, from a network standpoint, from a cost standpoint is really important. So if you the better you understand that, the better you can be. There's a lot of different ways to structure your plan. I think the things that Barbara talked about around an HSA or an HRA could be a really good way to supplement if you're offering a higher deductible plan, driving cost down on the on the the health plan itself that way, and putting a little bit of money towards an HRA or an HSA and encourage employees to do so can help kinda control costs on the plan itself, and then then there's some some money available to employees that do end up using the benefits. So we see a lot of that being a positive experience. I think the other key thing and strategy employers need to think about is how much of the benefits do you pay for your employees? And that can certainly be an opportunity to, one, attract really good people into your organization, but also retains people if you're paying for a portion of their insurance. So your strategy around that as a business is really, really important to think about, and what behavior and actions you're trying to drive with your employees. Love that. And I'd love that phrase you used, Bill, health insurance literacy. I think it applies to employers and employees alike. So Bill, Barbara, both of you, thank you so much for all of this great information today. And there were so many questions. I know we couldn't get to them all. If you'd like to talk to an expert, talk to a rep about how paychecks can help and see if there's some options for you that may make sense, please go ahead and just, click this link to to talk to a rep, and, we'll get to you and try to get you the answers you need. So once again, thank you all for joining us today. It was great having you. This was great information. And I look forward to having you on the next event.