Agencies Issue FAQs Regarding Coverage of Over the Counter COVID-19 Diagnostic Tests

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Agencies Issue FAQs Regarding Coverage of Over the Counter COVID-19 Diagnostic Tests

On December 2, 2021, President Biden announced that federal agencies would soon issue guidance regarding the availability of coverage/reimbursement from group health plans and health insurance carriers for individuals who purchase over the counter, at-home COVID-19 diagnostic tests (“OTC COVID-19 tests”).  Accordingly, on January 10, 2022, the agencies released “FAQs About Affordable Care Act Implementation Part 51, Families First Coronavirus Response Act (FFCRA) and Coronavirus Aid, Relief, and Economic Security Act (CARES Act) Implementation” which, among other things, requires group health plans and health insurance carriers to reimburse participants, beneficiaries, or enrollees (“Individuals”) for no less than eight (8) OTC COVID-19 tests per calendar month beginning on January 15, 2022 (i.e., for tests purchased on or after January 15, 2022).

Background

During the COVID-19 public health emergency, the FFCRA requires group health plans (self-funded, fully-insured, grandfathered, and non-grandfathered plans, but not excepted benefits such as dental or vision) and health insurance issuers (“Plans and Carriers”) to cover testing or certain other items or services intended to diagnose COVID-19 without cost sharing (deductibles, copays, or coinsurance), prior authorization, or other medical management requirements.  It also permits the agencies to implement the FFCRA through sub-regulatory guidance, program instruction, or otherwise.  The CARES Act expanded the FFCRA to, among other things, include a broader range of reimbursable COVID-19 diagnostic items and services that must be covered without cost-sharing, prior authorization, or medical management during the public health emergency.

In 2020, the agencies implemented several FAQs intended to serve as statements of policy to implement the above-referenced requirements under the FFCRA and CARES Act.  Since that time, the FDA has authorized at-home OTC COVID-19 diagnostic tests that individuals can self-administer and self-read to diagnose COVID-19.  Accordingly, per the agencies, the FAQs issued on January 10, 2022 are intended to address both the FDAs approval of at-home OTC COVID-19 tests and the President’s request for additional guidance on group health plan coverage for these tests to address the ongoing COVID-19 public health emergency.

 

FAQ Guidance

Pursuant to the FAQs, Plans and Carriers must cover OTC COVID-19 tests that meet the criteria specified under the FFCRA even if they are not ordered by a health care professional, and must cover such tests without imposing cost-sharing, prior authorization, or medical management requirements.  This is so even if there is no order from a health professional for an Individual.

Coverage by the plan may be accomplished by directly reimbursing Individuals for their purchase upon submission of a claim by the Individual, or by reimbursing the entity who sold the OTC COVID-19 test directly, though the agencies strongly encourage plans to adopt the latter approach.

Note, however, there is no requirement for Plans or Carriers to provide coverage of OTC COVID-19 tests that are intended for employment testing, such as weekly testing an unvaccinated Individual is required to undergo pursuant to the OSHA Emergency Temporary Standard (“ETS”) or an employer’s own mandated testing program.

Plans and Carriers are required to reimburse OTC COVID-19 tests purchased from any retailer or pharmacy if the test meets the FFCRA statutory criteria, but if the test is administered without a health care provider’s assessment or order for testing and purchased from out-of-network pharmacies or retailers, then the Plan or Carrier may limit reimbursement to the lower of the actual price or $12 per test if the Plan or Carrier arranges for direct coverage (meaning the Individual who purchases the OTC COVID-19 test is not required to seek reimbursement post-purchase or make any up-front out-of-pocket expenditures) of OTC COVID-19 tests that meet the FFCRA criteria through both its pharmacy network and a direct-to-consumer shipping program.  Per the agencies, the direct-to-consumer shipping program may be provided through one or more in-network provider(s) or another entity designated by the Plan or Carrier.

In order to limit reimbursements for tests purchased from non-preferred providers, Plans and Carriers must ensure there are an adequate number of retail locations (in-person and online) with access to OTC COVID-19 tests and communicate necessary information about the direct coverage program, including when it is available and which retail pharmacies are available.

Per the agencies, whether access is adequate is determined based on all relevant facts and circumstances, including where Individuals are located and current utilization of the Plans’ or Carrier’s pharmacy network by Individuals.  Further, if there are significant delays for individuals to receive the OTC COVID-19 tests, such as through the shipping program, the Plan or Carrier must allow Individuals to purchase (and be reimbursed for) their OTC COVID-19 tests from any retailer.

The agencies also recognize the important need for adequate testing to be available to health care providers who are diagnosing and treating COVID-19, and that everyone has reasonable access to OTC COVID-19 tests.  Thus, to prevent stockpiling and provide adequate safeguards, the agencies permit Plans and Carriers to limit OTC COVID-19 tests purchased by Individuals without a health care provider’s involvement or assessment, the agency provides a safe harbor from agency enforcement action for Plans or Carriers that limit the number of OTC COVID-19 tests eligible for reimbursement per Individual to no less than eight (8) tests per 30-day period or per calendar month.  Plans and Carriers are not permitted to limit Individuals to a smaller number of tests over a short period of time (such as limiting Individuals to four (4) tests per 15-day period).  Plans can choose to be more generous by reimbursing a larger number of OTC COVID-19 tests (i.e., more than 8) per calendar month if they prefer.

Testing for Employment Purposes

Plans and Carriers are permitted to address suspected fraud and abuse, such as taking reasonable steps to ensure OTC COVID-19 tests are purchased for an Individual’s (or their covered family member’s) own personal use as long as the steps do not create significant access barriers.  This may include requiring attestations that the OTC COVID-19 test was purchased by the Individual for personal, non-employment related use, will not be reimbursed by another source, and will not be made available for resale as long as the attestation process is reasonable and does not result in undue delay of reimbursement.  Plans and Carriers may also require reasonable documentation as proof of purchase, such as the UPC code from the OTC COVID-19 test, when claims are submitted.

Finally, Plans and Carriers may assist Individuals by providing education and information resources to support Individuals seeking OTC COVID-19 testing as long as the materials clearly indicate the Plan or Carrier is required to cover all OTC COVID-19 tests that meet FFCRA criteria (subject to the safe harbors referenced previously).  The FAQs provide some examples of potential education and information resources Plans and Carriers may use.

What Does This Mean for Employers?

Employers are encouraged to work with their carriers or third-party administrators and stop-loss carriers to ensure these new requirements are implemented and to determine whether the plan will implement any of the permitted safe harbors so that this can be effectively communicated to employees and their family members.

The agencies clarified that they will not take enforcement action against Plans or Carriers for modifying health insurance coverage mid-year to meet these requirements or for failing to meet the 60-day advance notice requirements (for changes made to information required to be included in SBCs) if notice of these changes is provided as soon as reasonably practicable.

Finally, employers should clearly articulate to employees that the employer’s testing policy adopted pursuant to the OSHA ETS, if any, is not subject to this requirement and, employees are expected to pay out of pocket for weekly COVID-19 tests without seeking reimbursement from the employer’s group health plan if the employer does not pay for the applicable testing.  Further, pursuant to the OSHA ETS, while the employer may allow an OTC COVID-19 test to be used for purposes of applicable employment testing, the test may not be both self-administered and self-read unless observed by the employer or an authorized telehealth proctor.

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About the Author.  This alert was prepared for Employee Benefit Consultants, Inc. by Marathas Barrow Weatherhead Lent LLP, a national law firm with recognized experts on the Affordable Care Act.  Contact Stacy Barrow or Nicole Quinn-Gato at sbarrow@marbarlaw.com or nquinngato@marbarlaw.com.

 

The information provided in this alert is not, is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients.  This is not legal advice.  No client-lawyer relationship between you and our lawyers is or may be created by your use of this information.  Rather, the content is intended as a general overview of the subject matter covered.  This agency and Marathas Barrow Weatherhead Lent LLP are not obligated to provide updates on the information presented herein.  Those reading this alert are encouraged to seek direct counsel on legal questions.

© 2022 Marathas Barrow Weatherhead Lent LLP.  All Rights Reserved.

Breaking Down Full-Coverage Health Insurance

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When it comes to attracting and retaining employees with various employee benefits, health insurance is at the top of their minds. A survey shows that “56% of U.S. adults with employer-sponsored health benefits said that whether or not they like their health coverage is a key factor in deciding to stay at their current job.” The same survey shows that “46% said health insurance was either the deciding factor or a positive influence in choosing their current job.”

With health insurance, the type of coverage is important. You may have heard the terms full-coverage health insurance or comprehensive coverage. Learn more about what this type of health insurance is, and why you should consider offering it to your employees.

What is full-coverage health insurance?  

Full-coverage health insurance, also known as major medical health insurance or comprehensive coverage, is a health insurance plan that provides overarching, broad coverage of a variety of healthcare services such as doctor visits, hospital visits, and emergency room visits.

In contrast to full coverage, limited-benefit plans (or supplemental policies) may cover only specific conditions (e.g., cancer) or specific types of services (e.g., hospitalization), or have a dollar cap on coverage. These plans are not considered comprehensive, nor are they considered minimum essential coverage, and are not regulated by the Affordable Care Act. However, they can be a good supplement to a full-coverage health insurance plan.

What should be included in a full-coverage health insurance plan?

At the minimum, a full-coverage health insurance policy, which includes all new individual/family and small-group major medical health insurance policies sold after January 1, 2014, must cover the ten essential health benefits outlined in the Affordable Care Act (ACA) with no annual or lifetime benefit caps:

  • Hospitalization
  • Ambulatory services (visits to doctors and other healthcare professionals and outpatient hospital care)
  • Emergency services
  • Maternity and newborn care
  • Mental health and substance abuse treatment
  • Prescription drugs
  • Lab tests
  • Chronic disease management, “well” services, and preventive services
  • Pediatric dental and vision care
  • Rehabilitative and “habilitative” services

What is considered a full-coverage health insurance plan?

  • Most group health insurance plans
  • ACA-compliant policies purchased in a state’s health insurance exchange/marketplace
  • ACA-compliant plans purchased off-exchange (purchased directly from an insurance company or through an agent or broker, outside of the ACA-created health insurance exchange)
  • Medicaid and Child’s Health Insurance Program (CHIP) plans (Medicaid has some exceptions. Some people qualify for limited-benefit Medicaid coverage; this is not considered comprehensive coverage.)
  • Medicare (either Original Medicare or Medicare Advantage, although Original Medicare is typically combined with a Medigap plan and Part D plan to provide comprehensive coverage)

Be aware that the term “comprehensive” regarding health insurance plans is like the term “natural” regarding groceries. It’s not an officially defined term and has no official marketing rules associated with its use.

A variety of full-coverage plans

Employers can offer different types of full-coverage plans to cover specific needs. Here are some examples, as given by the official government healthcare website:

  • Exclusive Provider Organization (EPO):  A managed care plan where services are covered only if you use doctors, specialists, or hospitals in the plan’s network.
  • Health Maintenance Organization (HMO): Usually limits coverage to care from doctors who work for or contract with the HMO, and it generally won’t cover out-of-network care except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage.
  • Point of Service (POS):  A health plan where you pay less if you use doctors, hospitals, and other health care providers that belong to the plan’s network. POS plans require you to get a referral from your primary care doctor to see a specialist.
  • Preferred Provider Organization (PPO):  A type of health plan where you pay less if you use providers in the plan’s network. You can use doctors, hospitals, and providers outside of the network without a referral for an additional cost.

Be well-informed and do your research

Buying health insurance means you should always do your research. It’s important to work with your advisor and legal counsel to help you understand the fine print and terminology (such as essential health benefits and minimum essential coverage) before offering plans to your employees. Full-coverage health insurance is what employees want from their employers, and implementing such a plan will lead to employee attraction, retention, and satisfaction.

 

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6 Employee Benefits to Consider for 2022

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Employee priorities have changed because of the pandemic, which has led employers to examine their employee benefits offerings for 2022. Key concerns brought up by employees include physical wellbeing, peace of mind, and financial health—huge issues challenging employers to consider benefits they might have ignored in the past.

Here are six employee benefits trends to consider for 2022.

Paid Time Off (PTO)

The balance of work and personal life is an essential consideration for employees in today’s workplace. SHRM states that US workers rank Paid Time Off (PTO) as the second most important benefit after healthcare. Also, according to Project: Time Off, employees who work for companies that encourage PTO are happier with their jobs. If PTO is something you want to consider for your employees, decide what works best for them and your organization.

Flexible work hours and location

When a whopping 40% of workers would consider quitting if their jobs offered no flexible hours or the opportunity to work from home at least a few days a week, it shows how vital remote work has become. Remote work benefits, such as time saved commuting, more personal time, better sleep, and better overall health can be attractive options to employees. Employers who want to attract and retain the best talent might offer flexible hours and remote work locations as an employee benefit.

Financial wellness

Financial stress skyrocketed during the pandemic, as 32% of people said the pandemic still affects their finances. Stressed employees are more distracted and less productive, making it a lose/lose situation for both employees and employers.

However, 80% of people who feel employers are committed to helping strengthen their financial resiliency are more likely to stay with their company. If, as an employer, you want to show your company is people-centered, a financial wellness benefit is something to think about.

Family planning

Currently, 10% of employers with 50 employees or less offer family planning and fertility benefits, and more than 30% of employers with 500 or more employees provide these benefits. Considering millennials are the largest generation in the US workforce today, and many are at the age where family planning plays an important role in their lives, offering family-focused benefits could be a smart move for employers. Employers who create strategic benefits plans that meet the current needs of their workforce will have an easier time attracting and retaining talent.

Student loan repayment

The number of people in the United who currently have an outstanding student loan debt is 44.7 million. A student loan repayment benefit aims to reduce the burden this debt has on employees and could attract millennial employees, as 28.9 million people in this age group are indebted borrowers.

Such a benefit would help with loyalty and retention, as 4 in 5 young people would commit to employers for 5 years if the employer helped pay their student loans. 

Mental health and wellbeing

During the pandemic, mental health issues such as anxiety and depression rose when the United States first went into lockdown. This is not an issue to ignore, both for the sake of employees’ mental health and an employer’s bottom line—depression, for instance, costs employers about $17 million to $44 million in lost productivity. With this in mind, think about expanding your employee health and wellness benefits to go beyond offering employee assistance programs (EAPs). An EAP is a type of employee benefits program that helps employees with personal and/or work-related problems that may impact their job performance and overall physical/mental wellbeing. For example, Joey Price, CEO of JumpstartHR, explained how companies are investing in mindfulness apps “to help employees balance the tension of work from home and life from home.”

Let your employees be the driver of your decisions

Now, more than ever, benefits that help with overall wellbeing and wellness are key trends to consider in 2022. But the best way to know what benefits your employees want? Ask them.

 

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Is a Pharmacy Carve-out Right for Your Group Health Plan?

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Pharmacy spend in the US is significant. Six in ten adults tell KFF.org they are currently taking at least one prescription drug and a quarter say they currently take four or more prescription medications.

PwC’s Behind the Numbers predicts a 6.5% medical cost trend in 2022, while drug cost trend reports show ongoing increases year over year and make up 20% of overall medical costs for employers.

Besides the cost burden on employers, employees can find that certain medications are not covered by their health plan. This increases pressure on employers to develop a sustainable strategy that provides cost-effective pharmacy benefits.

As a solution, many employers consider pharmacy carve-out plans as an option; however, carve-out plans are debated vigorously by health plan experts. By understanding what a pharmacy carve-out is and considering important factors, employers and brokers can work together to make the right decision.

What is a pharmacy carve-out?

A pharmacy carve-out is when an employer separates (carves out) their prescription drug benefits from their medical plan and contracts directly with a pharmacy benefit manager (PBM). A pharmacy carve-out is commonly used under the self-insured model. In comparison, fully insured medical plans typically have the pharmacy benefit as a built-in feature (bundle).

Advantages

Pharmacy carve-outs can provide transparency, flexibility, control, and accessibility to employers in the form of:

  • Better control over pharmacy benefit costs.
  • Access to the costs and data to evaluate program performance.
  • Greater flexibility to customize solutions in plan design and clinical programs to help reduce costs.
  • Standardized language in the PBM contract to allow increased transparency into pharmacy benefits, allowing employers to better understand and control spending, negotiate better deals, and ensure the program performs as promised. The contract itself can allow:
    • Access to pharmacy claims data.
    • Audit rights, such as a claims audit, operational assessment, and rebate audit.
    • Annual review to ensure rates are competitive.
    • Service performance guarantees.
    • Credits to help cover administration expenses or costs incurred when switching to a new vendor.

Disadvantages

There are a lot of variables that affect whether a pharmacy carve-out is the right solution for your company. It’s critical to understand the disadvantages of carve-outs before making your next move:

  • Carved-out plans offer short-term savings, though the savings might not be beneficial to an employer over the long term.
    • A July 2021 study compared the costs of bundled and carve-out plans and found that bundled pharmacy benefits are associated with reduced medical expenditures over the long term, resulting in annual per-member, per-month savings compared with a carve-out.
    • Another study found that savings from a carve-out plan may seem beneficial on the surface, but medical costs are 7.5 times higher in the long run. Therefore, any savings promised by a carve-out should be weighed against potential increases in medical spending by employers.
    • Managed Healthcare Executive also reported carve-outs could deliver short-term savings, but not long-term savings, due to PBM vendors’ approach to utilization management. For example, many employees are denied access to their prescribed medications and are unlikely to have their denial overturned on appeal. This results in employees paying for medicine out-of-pocket, added costs for employers if they pay multiple vendors, and a poor member experience overall.

Besides long-term costs, carve-out contracts for medical and pharmacy require multiple vendors, increasing the administrative burden on the employer.

Thoughtful considerations

After reflecting on the advantages and disadvantages of carve-outs, making the decision may still be no small feat. Fortunately, you can ask yourself important questions to help you with your decision.

  1. How much are pharmacy benefits currently costing your plan?
  2. How are you currently overseeing the pharmacy benefits program?
  3. What changes would be necessary for the new arrangement?
  4. How will the fees from your medical health plan vendor be impacted?
  5. Is now the right time to search for a PBM vendor (and possibly a medical health plan request for approval)?

When deciding to carve-out pharmacy benefit programs, employers and brokers should work together to consider critical factors such as internal staff expertise, current and future costs, and appropriate timing. However, your top consideration should be, “Does this make the most sense for our organization and our employees?”

 

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Protect Your Small Business from Cybersecurity Threats

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Is your business doing enough to protect itself from cyberattacks?

Cyber-attacks on small to medium-sized businesses (SMBs) have seen a sharp rise in the last few years. A 2019 report by the Ponemon Institute found that cyberattacks increased by over 20% between 2016 and 2019.

Data breaches cost not only time but also money. The FBI’s Internet 2020 Internet Crime Report found that the total cost of cybercrimes in the US in 2020 reached 2.7 billion, and with an average cost of a data breach for an SBM being $149,000 (2019), small business leaders must take the necessary steps to improve their risk mitigation for cyberattacks.

The first step is to familiarize yourself with the many different types of cyber threats that exist.

What are the most common forms of cyber-attacks on SBMs?

  • Phishing: Phishing attacks come in the form of communications disguised as coming from a reliable source. They can be emails that look like correspondence from company leaders or departments like the CEO, CFO, or Payroll. They can also be made to look like they come from a legitimate organization and prompt you to download a file, open a link, or provide sensitive information which will allow attackers access to your device.
  • Man-in-the-middle (MitM): MitM attackers intercept a two-party transaction. This usually happens when someone uses their device on an unsecured network such as public Wi-Fi. Attackers intercept the connection and steal information from the vulnerable computer, such as credit card numbers, bank account information, or passwords.
  • Malware: Malware is an umbrella term for many different attacks such as viruses, trojans, and spyware. Malware can be downloaded on a device by clicking a link that will install software onto the device. This “software” is designed to steal information or data, control the device, or otherwise impede the device’s functioning. Here are a few common types of malware:
    • Ransomware will gain access to sensitive files or data and deny the victim access unless a ransom is paid, often threatening to expose it, sell it, or delete it entirely.
    • Trojans are an attack using software that plants itself within an app or a program—often used to give attackers access to the device.
    • Spyware is software designed to track users on their devices and send the sensitive information it collects to a third-party attacker.
  • Denial of service: Denial of Service (DoS) cyberattacks target and overload a server’s capacity and bandwidth, resulting in a server crash that takes it offline from actual customers who want to visit the website or purchase something from it. This is done by overloading the server with requests so it can’t process legitimate requests.

How can you protect your business?

There are multiple cybersecurity platforms available for businesses that are easily found with a quick Google search. There are also many options for free cybersecurity software that can be upgraded with subscription services. Aside from implementing company-wide cybersecurity software on all company-linked devices, there are some standard practices that any business should be using, whether or not they have access to protective software.

1. Create a password policy

According to the
Ponemon report, 54% of SMBs have no insight into their employees’ password practices. Terrible password habits equate to seriously increased vulnerability to cyberattacks. Consider implementing
1Password or other password protection software programs that can be downloaded on every computer associated with your organization.

Ensure your employees aren’t saving their passwords in easily accessed folders. Have employees use password-generating programs to increase their passwords’ strength and ensure they don’t use the same password twice. A common way for cyberattacks to find saved passwords on devices is to do a device-wide search for words that are 8, 12, 16, and 24 characters long, meaning that even if employees save their passwords in a nondescript file, it’s easy enough to identify them. This is where secure folders and password protection programs come in handy.

2. Create a software update policy

Another common issue that causes device vulnerability is outdated software. Create a policy that requires employees to update their software as soon as a new update is released. Software updates are often released to fix security issues and vulnerabilities, so it’s critical employees don’t wait to update their devices.

3. Education and training

Finally, organizations must educate and train their employees to identify and protect themselves from potential cyberattacks. Start with including a training session during onboarding to ensure employees start with good practices from the beginning. Hold company-wide training sessions, and ensure you revisit the topic throughout the year.

 

Take a proactive approach

You may not be able to stop cyberattacks from targeting your business, but there’s a lot you can do to thwart them. By taking a proactive approach, educating your employees, and developing up-to-date risk management policies, you can save your business from dealing with damaging costs, harm to your reputation, and potential lawsuits. Take action early, and rest easy knowing you are protected.

 

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Pet Insurance – A Pet Owner's Best Friend

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Animal healthcare costs are rising, with $31.4 billion spent on veterinary visits and care in 2020. Because of this, pet owners tend to go into credit card debt and miss a payment on bills to pay for their pet’s care. In fact, a survey of 1,000 pet owners found that 45% of pet owners spend the same amount, or more, on their pet’s healthcare than they do on their own. 

If your employees have pets, chances are they consider them to be well-loved and beloved family members. Pet insurance may be a benefit you want to offer to your employees.

What is pet insurance, and what does it cover?

Pet insurance pays—in part or total—for veterinary treatment of a person’s ill or injured pet. It covers things like:

  • General wellness exams
  • Booster shots and vaccinations
  • Flea prevention
  • Medical costs for emergency care
  • Chronic conditions (e.g., arthritis)
  • Acute illnesses (e.g., allergic reactions)
  • Acute injuries (e.g., a bone fracture)

What is the main benefit of pet insurance?

Having pet insurance ensures that cost will be less of a factor when it comes to providing pets the best possible care. With the average veterinary visit being between $50 to $400 on average, and the average emergency vet visit costing between $800 to $1500, employees will not have to choose between paying a bill or going into debt to give their pet the care they need.

What are the other benefits of pet insurance?

1. Delivers peace of mind

Not having pet insurance can make employees who own pets more stressed if they don’t know how to pay for their pet’s care, either preventatively or during an emergency. By offering this benefit, employees may be less stressed by this financial burden—and when employees are less stressed, they are more healthy, focused, and productive. Also, research shows owning a pet helps soothe anxiety and reduce blood pressure.

2.  Encourages employees to own pets

Pets are a significant emotional investment and a significant financial investment as well—pets require not only health care but also:

  • Food and treats
  • Dishes for their meals
  • Collars and leashes (for dogs and/or cats)
  • Grooming and nail trimming
  • Over the counter medications
  • Items for mental stimulation (e.g., toys)

For your employees who don’t have a pet but are considering purchasing or adopting one, a pet insurance benefit makes the choice of buying or adopting a pet easier since employees know their pets’ health needs will be a bit easier to manage.

3. Demonstrates to employees that you care

There are pet-friendly hotels, apartments, and restaurants, and by offering pet insurance, you send the message to your employees that your workplace, in this regard, is pet-friendly. You also demonstrate and support the idea that pets are important family members and deserve to be loved and taken care of. That is a genuine, loving, and caring message, which can also positively impact hiring and retention.

Pet insurance—protection for a pet’s wellbeing

By offering pet insurance, you will create a positive relationship with your employees, and they, in turn, will know that their pets can get the best care possible. If you are interested in providing this supplemental benefit to your employees and want to learn more about how it works, talk to a trusted consultant or advisor.

 

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Disability Insurance: Just the Facts

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Insurance protects your employees and their families against any unexpected financial losses. Health insurance protects against unexpected health expenses, and life insurance gives your employees’ families financial security after an unexpected passing. But what about disability insurance? What is it, and why is it important to offer to your employees?

Here’s what you need to know about it.

What is disability insurance?

Disability insurance, also known as disability income insurance or income protection insurance, is a type of coverage that replaces a portion of your employees’ income if an injury or illness prevents them from working. Disability insurance:

  • Provides financial security for your employees and their loved ones
  • Gives funds to your employees to use for whatever they like

Is it the same thing as health insurance?

Not exactly. Disability insurance replaces a portion of an employee’s income lost due to not being able to work because of injuries or illnesses. In contrast, health insurance covers medical expenses that arise due to an injury or illness.

What does disability insurance cover?  

While people may think of major injuries as the only thing disability insurance covers, here are just a few of the things disability insurance might cover:

  • Arthritis
  • Back pain
  • Cancer
  • Depression
  • Diabetes
  • Heart disease

It doesn’t mean injuries like sprains and fractures aren’t disabling. What it does mean is the scope of injuries that can prevent people from earning an income is broad.

Why is disability insurance important?

A massive 68% of non-government workers carry no form of disability insurance. With this in mind, here is why disability insurance is essential to offer—and necessary for employees to have.

  • Injuries are all too common: The chance of missing months or years of work seems remote. But more than one in four 20-year-olds will experience a disability for 90 days or more before they reach 67, according to the Social Security Administration. Disability insurance covers those “what-if” or worst-case scenarios. 
  • Disability insurance covers risk: People tend to shrug off the risk because they think only about worst-case scenarios. But the leading causes of disability claims are:
     
    • Pregnancy
    • Cancer
    • Mental health issues
    • Musculoskeletal disorders affecting knees, back, and hips
    • Digestive disorders such as hernias and gastritis
    • Injuries including fractures, sprains, and muscle/ligament strains

Disability insurance covers the risk involved with being affected by injuries, situations, or illnesses.

  • It prepares employees for long-term challenges: It’s common to plan ahead and think about how far you can go without one or two paychecks. However, not enough people plan for possible long-term or future challenges. A study of consumer bankruptcy filings found that the primary reasons for bankruptcy involved illness or injury of themselves or a family member.

Also, workers’ compensation and Social Security do not cover most financial challenges:

Disability insurance gives employees an extra layer of protection to help prepare them and their families for any long-term challenges.

Consider offering disability insurance benefits

Absence of emergency savings and rising medical costs are a concern for many employees. Without added income protection, people may experience severe financial difficulty if they miss work due to injury or illness. Consider adding disability insurance benefits to your employee benefits package and be sure to talk to a trusted advisor to learn more.

 

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Three Financially Focused Benefits Your Employees Will Love

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In the last two years, employees across the country have had to adapt and adjust to a lot of challenges, many of which organizations had little to no control over. Employee burnout, stress, and wellbeing took major hits, putting more pressure on organizations to come up with solutions to help them face these challenges. According to the 2021 Employee Benefit Trends Study by Met Life, 86% of employees said finances are a top contributing factor to their stress now and into the future. While this may feel like an insurmountable problem for employers to take on, there are many solutions that can make a big impact for both the wellness of your employees and the health of your business.

1. Student Loan Repayment Programs

Today, 47 million Americans are carrying the burden of student loan debt. This year, student loan debt in America reached a staggering 1.7 trillion dollars. Despite the temporary loan forbearance the Biden Administration placed on federal student loan payments, student loan debt remains a top concern for many Americans in the workforce.

Employers looking for ways to help support employees who are paying off student loans should consider offering employee benefits aimed at just that—helping them pay off this debt. In December, Congress passed the Consolidated Appropriations Act of 2021, enabling employers to contribute up to $5,250 in student loan payments tax-free, making it easier than ever for organizations to help.

Supporting employees burdened with student loan debt can be a strong tool for attracting and retaining top talent.

2. Retirement Planning

A 2019 study by GOBankingRates found that 64% of respondents expected to retire with less than $10,000 in their retirement savings. Employers can help employees prepare for retirement and reduce stress by offering benefits designed to enable employees to begin saving for retirement. Some plan options that provide tax benefits to both employers and employees include:

  • Payroll Deductible IRA – For employers who don’t want to implement a retirement savings plan, this plan offers a way for eligible employees to contribute to an IRA through payroll deductions.
  • 401(k) Plan – This plan offers an opportunity to employees to save through salary deferrals with the option of employer contribution.
  • Money Purchase Plan – This plan allows employers to make contributions to employee savings based on their discretion. There is no fixed amount nor requirement to make a contribution by the employer.

There are many types of retirement plans available to organizations, so do your research and choose the one that fits the needs of your business.

3. Education and stewardship

Understanding the basics of investing, saving, and money management is a challenge for many Americans, leading them to avoid this type of planning altogether. If your organization can’t offer benefits to help them save, consider offering a program to empower them through education.

Platforms like Skillshare and financialgym offer online courses to help anyone learn the basics of investing, planning for retirement and savings, and managing money. Knowledge and understanding can make a more powerful impact, in many ways, than simply offering a plan that no one understands.

Their financial wellness is your reward

Helping employees plan for retirement and effectively manage their savings and debt is a sure-fire way to improve their overall wellbeing by reducing stress and creating stability within their lives and futures. You may see an increase in talent attraction, employee engagement, retention, and satisfaction by offering a hand and enabling employees to create financial stability within their lives. What’s good for them is good for business.

 

Content provided by Q4iNetwork and partners

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What You Need to Know About Group Life Insurance

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A study conducted by LIMRA and Life Happens found that 41 million Americans say they do not have life insurance coverage at all. When it comes to providing benefits for your employees, life insurance ensures they give their families much-needed financial security. All too often, however, life insurance is a misunderstood and confusing topic. We are here to help.

Here is what you need to know about group life insurance plans.

What is life insurance?

Life insurance is a contract between a person and an insurance company. A premium is paid, and after a person’s death, a lump sum, or death benefit, is paid to the beneficiaries the person designates. The beneficiaries can use the money for any purpose they like.

What is group life insurance?

Group life insurance is when an entire life insurance contract covers a whole group of people. The policy owner is the employer or organization, and the policy covers all the employees at the organization.

Are there different types of group life insurance?

Yes, there are two different types of group life insurance: employer-paid or voluntary. These are usually seen as term life insurance, which provides your employees coverage for the term of their employment.

Employer-paid life insurance

Employer-paid life insurance is when the policy is paid by the employer. This offers your employees a convenient way to receive life insurance coverage. This type of coverage, at times, offers them coverage portability or the ability for your employees to continue their life insurance policy when they no longer work for you.

Voluntary life insurance

Voluntary life insurance is an optional benefit offered to employees. This type of life insurance is paid for by the employee directly to the workplace’s insurance company via a monthly premium taken out of their paycheck. Like employer-paid life insurance, voluntary life insurance can also offer coverage portability.

Why is life insurance important?

As an employer, you may wonder why life insurance is important to provide to your employees, and there are several reasons:

  • It provides for lost income: Providing a group life insurance policy helps ensure that your employees’ loved ones will have some financial replacement for the lost paycheck in the case of their death. This allows the family time to get a footing in their new reality.
  • It reduces stress: Losing a loved one is already a difficult and emotional experience without the added financial burden of losing a partner or parent. Life insurance will help protect the family from the difficulty that awaits. For example, finding help for childcare after the loss of a parent is a huge stress for the surviving parent. Knowing they have financial support to afford it can ease the pressure.
  • It helps cover bills and debts: Life insurance will help cover bills or debts your employees leave behind, so they are not passed to your employees’ loved ones.

It doesn’t have to be confusing

Life insurance can be, admittedly, confusing. But it is a smart move for employers who want to add family-focused benefits into their employee benefits plan. Talk to a trusted advisor who will help you decide on the best group life insurance plan for your employees.

 

Content provided by Q4iNetwork and partners

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3 Ways to Set Yourself Up For Open Enrollment Success

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Regardless of when your benefits package renews, there’s a lot to be said for employers who plan ahead. Undoubtedly, many changes caused by the pandemic have shifted the needs of employees and altered the ‘normal’ approach to open enrollment. However, planning has always (and will always) be a good idea—especially when it comes to group health plans.

Giving your organization time to plan and prepare will help you improve the absolutely critical process of implementing your benefits package, which has *major* repercussions on your return on investment (ROI). Start by following these three steps.

1. Consider changes to your benefits offering

Pandemic or no, employee needs are constantly changing. They have changed significantly over the past year and will continue to change as our country adjusts how we approach work. Since employee benefits are such a significant investment for employers, it only makes sense to meticulously review what benefits are most popular and what benefits don’t hold as much value.

Survey your employees and do your research. Since the start of the pandemic, some benefits have risen in popularity as employee needs have changed.

These include:

  • Virtual healthcare
  • Flex work, childcare, and elderly care
  • Financial wellness
  • Mental healthcare

Talk to your broker about your options and create a strategy that fits the needs of your employee population, as needs and wants can vary broadly. One size does not fit all for an attractive benefits package.

2. Open enrollment planning

Depending on the shifts your organization made since the pandemic, it’s important to consider how you will proceed with open enrollment this fall. Organizing a supportive and education-based strategy to guide your employees through enrollment can make a real impact on the employee experience during the process and increase plan utilization by employees.

  • Consider how to create a system that works for your employees wherever they are (on-site or remote).
  • Provide resources and support to employees as they make their decisions. These can include educational resources (such as this glossary of standard benefit terms), in-person or virtual support, and clear communication around deadlines and qualifications.
  • Get feedback from your employees before open enrollment about their experience last year and their concerns and needs for the upcoming season. Find common trends to help you fill in gaps that you may have missed in years past.

3. Preparing for implementation

Spend time reviewing and improving your plan of execution. This plan should include a detailed communication strategy, employee education, and year-round support. If you want to see significant participation from your employees, you need to engage with consistent support and education strategies. Ask your employees if:

  • They understand the benefits available to them. Do you offer an HSA or self-insured plan? If so, make sure your employees have a proper understanding of how these different plans work and what to expect when they participate.
  • They know where to go to ask for help. Do they have access to a support line? Are there online resources you are providing them?

Consistent and clear communication is a critical part of ensuring your employees participate in and get the most out of the benefit plan you’re offering. Consider which channels you will be relying upon (email, meetings, one-on-one support, a web page, etc.) to get the word out and offer support. Get clear on how and when you’ll use these channels and stay consistent in using them.

Preparation = success

The more you plan, the better you can guide your employees and your organization through the process of open enrollment. This isn’t the sort of thing you want to put off until the last minute or until your broker comes to talk to you.

Employee benefits are a crucial part of your employee engagement, retention, attraction, and ultimately, the business’s success. And as such, they require and deserve careful planning. By starting with these three steps, you’ll set your organization, and your employees, up for success.

 

 

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