Posted March 13, 2015
For the past few years, large employers have been anticipating significant benefit changes as part of the Affordable Care Act. Due to several delays in the implementation of regulations, many large employers now are focusing on other employee issues. They plan to accommodate ACA benefit adjustments as needed. Here are three things large employers should do to prepare for upcoming ACA changes:
- Do the homework in advance – According to BenefitsPro, research indicates that large employers are less panicked about the implications of the ACA than they were a year ago. However, many large employers are not 100 percent confident that they are ready for future ACA updates.
- HR professionals say three areas of the law are the most confusing:
- Annual IRS reporting – 49 percent
- Exchange notices – 62 percent
- ACA penalties – 60 percent
- It is imperative for HR to work closely with insurance sales reps and broker-consultants to find out the latest on benefit changes and communication requirements. While medical insurance can be confusing, ancillary benefits, such as dental, vision and hearing plans, are much easier to understand.
- Engage employees as consumers – Many employees want to choose the benefit plans that best fit their needs. As consumers, they want to know the cost of services, and expect to receive a certain level of service for their investment. They rely on employers to explain benefits and help them understand plan features.Many employers struggle to find time to create an effective benefits communication strategy. But to keep employees invested in their work, it’s essential to educate employees on benefit choices and provide reminders throughout the year on how to use their coverage options effectively. A good insurance carrier will help with this communication strategy.
- Plan for Cadillac tax – Beginning in 2018, the ACA requires a 40 percent tax on health insurance plans that cost more than $27,500 for family coverage or $10,200 for individual employees.Employers need to decide how they will handle this tax. Bloomberg News reports that most employers do not plan to pay this fee, also known as a Cadillac tax. Some employers will include a lower- quality health insurance plan in employee benefit packages. Others plan to shift more of the cost for insurance to employees through higher deductibles, copays and contributions.