Economic hardships, the sluggish job market and continued uncertainty surrounding the future of health care reform have taken a toll on employees. Now is the time to demonstrate your commitment to your workforce and boost morale by finding ways to effectively communicate your organization’s employee benefits package.

“Employers in the United States spend nearly 40 percent of payroll on benefits. That being said, a strategic approach to benefits communication is no longer a business tactic geared toward only large organizations; it is a necessity for employers of all sizes,” says Jessica Galardini, chief operating officer at JRG Advisors, the management arm of ChamberChoice.

Smart Business spoke with Galardini about taking a strategic approach to benefits communication.

Why should employers be taking a strategic approach to benefits communication?

A strategic approach can boost employee appreciation and comprehension. Maximize your annual open enrollment period by reiterating the positive aspects of what your company offers. ‘Value-adds’ such as paid holidays, vacation time or paid time off, and profit-sharing plans should not be overlooked.

Remind employees about the relevance of the financial contributions made on their behalf. Employers often pay a significant portion of the premiums for medical, dental and vision benefits, and full premium for life and disability insurance benefits. It’s not uncommon for employees to overlook how much employers pay for all components of the benefits package, which is why personalized benefit statements can be powerful communication tools. Referred to as the ‘hidden paycheck,’ these statements incorporate annual salary, the total value of all employee benefits, paid time off, etc.

What should be considered when preparing a benefits communication strategy?

A variety of factors should be considered, including life stages. In what stage of life are your employees? Are they single? Newly married? Ready for retirement? Employees have different needs from their benefits packages at different stages of their lives.

Employees respond differently to technology, which also should be taken into consideration. Email communications, a company intranet site and/or webinars might be well received by some, while others will benefit more from group forum discussions and presentations. Technology creates greater efficiencies and a new approach to benefits communication, but it should not be substituted for face-to-face and ongoing personal communication.

Another challenge is communicating with employees working remotely or in other locations, as well as those working weekends and/or shifts other than 8 a.m. to 5 p.m. Monday through Friday. You also are faced with new employees entering your workforce and older employees who might retire. People get promoted, married, divorced and have children. All of these life stages and factors can present challenges to effective communication if not taken into consideration upfront.

How do employers develop a benefits communication strategy?

Utilize your benefits advisor to help develop the communication strategy that will work for your organization. Ongoing education and communication are critical since the benefits needs of employees change throughout the year. So, provide employees with instruction and access to make needed changes. Effective programs work best when communication is employee friendly. Employees need to be shown how benefits work together, and they need guidance in order to make the best decisions.

If your organization is facing a change in benefit or contribution structure, make sure to plan how it will be communicated. Be honest, accurate and concise when delivering any message that relates to change. Your advisor can provide benchmarking data to compare your package to others in your industry, geography, etc., to help keep changes in perspective.

Because benefits have a profound impact on job satisfaction, effective benefits communication is one of the most challenging responsibilities facing employers today. The right approach and techniques can put some control back in the hands of employers, and boost employee morale.

Jessica Galardini is the chief operating officer of JRG Advisors, the management arm of ChamberChoice. Reach her at (412) 456-7231 or

Insights Employee Benefits is brought to you by ChamberChoice

Published in Pittsburgh

The Supreme Court ruled in June that health care reform is constitutional and upheld the Patient Protection Affordable Care Act (PPACA) in its entirety. As a result, health care reform will continue to be implemented as planned and provisions that are already in effect will continue, says Jessica Galardini, president and COO of JRG Advisors, the management company of ChamberChoice.

“The individual mandate requiring individuals to purchase health insurance or pay a penalty is the major component of the law. Because the court upheld that mandate, it did not need to decide whether other provisions of the law are constitutional,” says Galardini.

Smart Business spoke with Galardini about the impact of the PPACA on employers and the benefits that they offer to employees.

What does this ruling mean for employers?

All aspects of the law already implemented will remain in effect. These include the ability for adult children to remain on their parents’ coverage until age 26, no exclusions for children with pre-existing conditions and certain preventive services without cost sharing for nongrandfathered plans. A grandfathered plan is one that has been in existence continuously since before the act was passed and is not required to comply with select provisions of PPACA as long as it meets certain other requirements.

Provisions of the law not yet in effect will be implemented as planned. Although much attention has been paid to the big changes slated for 2014, there are numerous smaller requirements that employers need to be aware of and prepare for now.

For example, insurers have already started issuing rebates to employers with fully insured health plans who qualify due to medical loss ratio (MLR) rules. The MLR rules require insurance companies to spend a certain percentage of premium dollars on medical care and health care quality improvement rather than on administrative costs.

Rebates can be issued in the form of a premium credit, lump sum payment or premium ‘holiday’ during which premium is not required. Any portion of a rebate that is a plan asset must be used for the exclusive benefit of the plan’s participants and beneficiaries, for example, reducing participants’ premium payments.

What other changes do employers need to be aware of regarding benefits?

Effective September 23 of this year, insurers must provide a summary of benefits and coverage (SBC) to participants and beneficiaries. The SBC is to be a concise document with stringent criteria as to the number of pages and print font that provides information about the health benefits in a simple and easy-to-understand format. The SBC will need to be distributed to employees during open enrollment, with any material modifications to the plan throughout the year being communicated at least 60 days in advance.

Additionally, beginning with the 2012 tax year, employers that issue 250 or more W-2 forms must report the aggregate cost of employer-sponsored group health insurance on employees’ W-2 Forms. The cost must be reported beginning with the 2012 W-2 Forms, which are due in January 2013.

What changes are looming for 2013?

Changes scheduled for 2013 include limiting pretax contributions toward flexible spending accounts (FSAs) to $2,500. This limit will be indexed for cost-of-living adjustments for 2014 and later years.

Employers will also be required to provide all employees with written notice about health insurance exchanges and the consequences if an employee decides to forego employer-sponsored coverage and purchase a qualified health plan through an exchange.

Finally, employers will be required to withhold an additional 0.9 percent Medicare tax on an employee’s wages in excess of $200,000, or $250,000 for married couples filing jointly.

What is happening in 2014?

By all accounts, 2014 will be the most significant year. Annual dollar limits for health services will be eliminated, as will medical underwriting and exclusions for pre-existing conditions. Additionally, insurance exchanges will be enacted for individuals and small employers with fewer than 50 employees. This is a key component of health care reform law. Individuals will be required to have health insurance or pay a tax for not having it.

Businesses with 50 or more full-time employees must provide health insurance for employees or pay a tax for not doing so.   And for states that choose not to set up their own exchanges, the federal government will do it for them. To date, Pennsylvania has not passed legislation authorizing its own exchange.

Although the Supreme Court upheld the health care reform law, the future remains somewhat uncertain. Opponents will continue to challenge the law and debate its constitutionality through the November 2012 elections, and the strength of the economy and the response of private insurance companies with innovative products and funding solutions will also impact private and public options for individuals and employers.

What is certain is that health care benefits, funding and delivery are changing.  Employer and employee decisions are far more complex and require educated consideration.  Work with your advisor to learn more about your options and to understand exactly what is required of your company to remain compliant with the law.

Jessica Galardini is president and COO of JRG Advisors, the management arm of ChamberChoice. Reach her at (412) 456-7231 or

Insights Employee Benefits is brought to you by ChamberChoice

Published in Pittsburgh

Health care costs are increasing at an alarming pace and many businesses are struggling to maintain the level of health care benefits provided in the past.

While executives are keenly aware that comprehensive benefit programs play a significant role in attracting top-notch talent, many companies have neglected to analyze the effectiveness of their benefit strategy.

Reviewing your employee benefit program regularly offers the opportunity to revisit your carrier’s rates and ensure they are still competitive, says Steve Slaga, chief marketing officer at Total Health Care. Further, it presents an opportunity for employers to ensure their program continues to measure up against others in their industry.

“Health care benefits are important and serve as a very useful tool for employee retention and attracting new recruits,” says Slaga.

Smart Business spoke with Slaga about assessing the needs of your employees, how to determine an appropriate benefit plan and the importance of employee education.

How can a company assess the needs of its employees?

First, examine your health care plan to ensure you’re providing affordable, quality coverage with good service, flexibility and access to care. Make sure your plan isn’t prohibitively priced, so employees can afford to participate, and gauge employees’ satisfaction levels by utilizing surveys to determine which areas of the plan they consider strong and which can be improved upon. Bear in mind all employers are different and operate within circumstances unique to them, so not every health care plan fits every group.

The level of flexibility a health care plan facilitates is also an important consideration. Some plans work through Health Maintenance Organizations, which have a specific provider network, while others offer Preferred Provider Organizations or Point-of-Service plans with which employees have the option to go in or out of a predetermined physician and hospital network of preferred health care providers without fulfilling certain conditions, such as obtaining a referral. When choosing a health care plan, make sure the services fit the needs of your employees and that employees have access to a selection of physicians and specialists in their area.

How can employers determine an appropriate benefits plan for their employees?

Ask your agent or broker to do a comparative analysis among health care plans. That person will review the factors important to your employees, including pricing, access to care and type of benefits. The actual pricing is determined by the health care plan and is dependent on factors including the business, its industry and the average age of employees.

Employers at a minimum should review their benefit plans annually. By comparing your current plan to other plans, you can stay apprised of options in the marketplace, new products and how your premiums compare with other options. By reviewing plans regularly, you can assure employees you have shopped around and are providing them with the best value for their needs.

How can employers best balance the cost of the plan with employee needs?

This is a decision every employer must make on its own and it hinges on factors including the type of benefit program desired for employees and how much employees will be expected to contribute.

As the cost of providing health care coverage continues to rise, many businesses have scaled back benefits. Among those companies that continue to offer benefits, their employees are more often asked to make higher contributions to offset costs. Other companies pass along a portion of the increased costs through higher deductibles or higher co-insurance; both solutions reflect the challenge of dealing with today’s rising medical costs.

Companies are also coping with escalating health care costs by implementing wellness plans designed to encourage employees to take preventive action to improve their health. The idea is that a healthier pool of insured employees makes fewer claims.

How can employers help employees understand the features of their health care plan?

Education is key. Employees need to have a clear, concise understanding of their benefits from day one. There are numerous ways to make information available to employees, including health plan websites, interactive assessment tools, newsletters and other communications.

It is also important to provide employees with forums where they can ask questions about the plan and provide feedback. In addition, many employers are looking beyond employee communication and implementing multipronged education programs that engage employees throughout the year.

Most employees receive benefit information during open enrollment periods and that’s often the last time they examine the details of the plan. Instead, there should be ongoing education with information distributed regularly to employees so they are fully aware of what their benefits cover. This will allow your employees to utilize and access their plans efficiently and effectively.

What value should a benefit provider bring to the table?

Your benefit provider should present clear and concise information about the health care plan in a timely manner. On a group level, a provider should be able to help you with billing, invoice and claims questions. On the member level, the provider should be able to answer benefits questions. Contact your provider to see what other services are available.

Steve Slaga is chief marketing officer at Total Health Care. Reach him at (313) 871-7810 or

Insights Health Care is brought to you by Total Health Care

Published in Detroit

Keeping current with health care rules and regulations is never easy. For many companies, staying up to date with all the changes in health care can create a drain on resources, both from the standpoint of the enormous amount of time necessary for someone in the organization to spend to understand the systems, and in revenue if mistakes are made and the company is fined for noncompliance.

The problem becomes more difficult when dealing with the management of complicated health care regulation such as the Consolidated Omnibus Budget Reconciliation Act, which is better known as COBRA. COBRA is a program that was designed to provide a way for employees and their covered dependents to maintain group health benefits after experiencing a qualifying event, such as job loss, divorce, or loss of dependent status.

“Many companies underestimate what is involved with COBRA administration,” says Tammy Clay, manager of COBRA Operations, UPMC Benefit Management Services, a division of UPMC Health Plan. “COBRA has many requirements that involve notices and account tracking for varying time frames, depending upon the type of qualifying event. It’s not something all companies can or should handle themselves.”

Smart Business spoke with Clay about the complexities of COBRA administration and how employers should approach it in their companies.

What is COBRA?

COBRA gives workers and their families who lose health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances, such as voluntary or involuntary job loss, reduction in hours worked, transition between jobs, death, divorce and other life events.

Why does an employer need a COBRA administrator?

COBRA can be complex to administer. Employers need to be aware of deadlines and details that can make it difficult to be compliant with COBRA regulations. Because mistakes can be costly, in terms of fines or in lost time, it makes sense to outsource the task to an expert. Often, that means a third-party administrator of benefit programs.

COBRA specialty administrators are experts in staying up to date on the regulations and in keeping an employer in compliance.

What does COBRA require of employers?

Essentially, COBRA requirements call for employers to send notices to employees, former employees and their spouses and children, and to calculate and collect premiums. They are required to keep track of employees who are eligible and employees who are not. They also need to have a record of who received notices and when they were sent. Lastly, they need to determine whether premiums are accurate and paid on time.

What are some advantages to outsourcing COBRA administration for employers?

In a sense, outsourcing COBRA administration can be looked at as a form of risk management for the employer. Because of the legal issues that surround proper administration of COBRA, it is essential that all aspects of the process are done correctly. One of the primary reasons employers outsource COBRA administration is in an effort to minimize their exposure.

How can employers determine if they need to outsource COBRA administration?

There are three questions an employer might want to ask when determining whether or not outsourcing COBRA administration would make sense for the organization. First, does the company have the time to administer COBRA correctly? Second, is the company knowledgeable about the latest COBRA requirements? Third, can the company afford the cost for the liability of noncompliance should it get it wrong? If the answer to any of those questions is ‘no,’ then the employer should strongly consider outsourcing COBRA administration to a professional.

What kinds of features should an employer look for in a COBRA administrator?

There are several features employers should expect from a COBRA administrator. You should expect billing and collection service on a monthly basis. You may also want online credit and debit payment options available to COBRA participants. Flexible remittance options and the ability to interact with multiple carriers are services that give an employer the choice of how the premium will be paid to the carrier, the employer or both. It’s important that COBRA administrators be capable of monitoring and tracking. This would include the 60-day election period, the 45-day initial premium payment period, the ongoing 30-day grace period and cessation of COBRA coverage.

Expect an administrator to provide user-friendly monthly activity reports that summarize billing and collection from COBRA participants. Offering an employer a portal to view COBRA participants and activity in real-time, or even to enter information, is also a feature that many COBRA administrators are now offering in their menu of services.

What else can an employer gain by outsourcing COBRA administration?

Because COBRA can be difficult to understand as well as confusing, access to experts who can walk participants through the process is essential. Employers benefit by being able to rely on an experienced COBRA administrator that has a member services department and that understands COBRA and can answer COBRA questions from former employees. Being able to provide 24/7 access to account information online and having a broad time frame available for participant calls are also two important factors that employers can expect from any well-rounded COBRA administration service.

Tammy Clay is manager of COBRA Operations for UPMC Benefit Management Services. Reach her at (412) 454-8739 or

Published in Pittsburgh