The U.S. government enacted Medicare 48 years ago to help senior citizens who were finding it difficult to obtain private health insurance coverage.
It originally consisted of Medicare Part A for hospital insurance and Part B for supplemental medical insurance. A payroll tax paid by employees, employers and the self-employed funded Part A, available to those 65 or older; it had a $40 annual deductible. Part B was open to aged citizens and legal aliens who lived in the U.S. for at least five years for a $3 monthly premium.
Medicare costs have climbed at rates substantially above growth in general inflation or GDP. Today the Part A deductible is $1,184 and the Part B premium is $104.90 with a $147 annual deductible.
“Nearly 50 million Americans — 15 percent of the nation’s population — depend on Medicare for their health insurance coverage. With increasing life expectancies and more baby boomers turning 65 every day, that number is expected to double between 2000 and 2030,” says Crystal Manning, a Medicare specialist at JRG Advisors, the management arm of ChamberChoice.
Smart Business spoke with Manning about how Medicare coverage operates.
Why is Medicare important?
Medical costs have become expensive, especially for those older than 65 and already retired. They are more prone to diseases and injuries, and need a plan that covers drugs, hospital stays and doctor’s visits to ensure necessary medical care. The Medicare benefit structure has remained stable, but medical technology has rapidly increased the tools available to diagnose and treat patients.
Medicare applies to individuals who can’t afford private health insurance, which prevents severe financial hardships from chronic or long-term diseases like kidney failure. Medicare also is available to people of all ages with qualifying disabilities that keep them from earning a living.
How is Medicare funded?
Medicare funding comes partially from payroll taxes. Federal Insurance Contributions Act (FICA) taxes are comprised of a Social Security tax that contributes to Social Security retirement benefits and a 2.9 percent Medicare tax. With Medicare taxes, employers withhold 1.45 percent from employees and then match it. High-income Social Security beneficiaries also pay income tax on Social Security income. Some of that goes into a trust fund used to pay doctors, hospitals and private insurance companies when Medicare patients use their services.
How were Medicare Parts C and D created?
Prescription drug costs are increasing as more seniors rely on new drug therapies to treat chronic conditions. Many cannot afford to maintain their health. This trend will continue as out-of-pocket spending for prescription drugs rises.
In 1997, Medicare benefits became available through private health plans. Now known as Medicare Advantage plans (Part C), they replace and cover all Part A and Part B benefits, with the option to add prescription drug coverage. The Medicare Prescription Drug, Improvement, and Modernization Act created a specific drug only benefit (Part D) through private insurance companies.
In the 2000s, 25 percent of Medicare beneficiaries had no drug coverage. Today, beneficiaries can join a Prescription Drug Plan for drug coverage, or join a Medicare Advantage plan, which covers medical services and prescription drugs. However, seniors need to join a drug plan when first eligible to avoid paying a monthly late enrollment penalty of 1 percent.
What’s critical to know about Medicare?
The drug benefit has a major coverage gap called the ‘doughnut hole,’ which begins when total retail drug costs — not what you personally spend at the pharmacy — reach $2,970. In 2013, anyone reaching the doughnut hole receives a 52.5 percent discount on brand-name formulary drugs and a 21 percent discount on generic formulary medications. Part D beneficiaries remain in the doughnut hole until their true out-of-pocket costs exceed $4,750.
Seniors need to choose the right Medicare coverage. However, know that Medicare isn’t part of the Affordable Care Act’s health insurance exchanges. Your benefits won’t change and you don’t need to do anything. ●
Insights Employee Benefits is brought to you by ChamberChoice
Preventable hospital readmissions cost the U.S. health care system an estimated $25 billion every year, according to a study by PricewaterhouseCooper’s Health Research Institute. A logical first step toward containing health care costs would be in controlling the expenses related to these readmissions.
“The patient-centered medical home is becoming a very effective tool for reducing preventable hospital readmissions,” says Dr. Stephen Perkins, vice president for Medical Affairs at UPMC Health Plan. “The care and attention that patients are provided in the medical home model is compatible with improved quality of care, well-coordinated care and readmission prevention. Coordinating care for patients with complex conditions is essential.”
Smart Business spoke with Perkins about how the patient-centered medical home (PCMH) can be effective in reducing preventable hospital readmissions.
Why is the PCMH concept effective in reducing preventable hospital readmissions?
The PCMH stresses that a personal physician and a personal physician’s staff should proactively and holistically coordinate their patients’ care. Because the model encourages patients to become more engaged in their own care, patients are more prepared before, during and after their hospitalization to understand their condition. This leads to less confusion about their care plan and a better understanding of their self-care once they are sent home from the hospital.
What elements of PCMH make it especially suited to reduce preventable hospital readmissions?
One potential component of a PCMH is the use of practice-based care managers. These care managers — who are often nurses or social workers — can coordinate health services with other providers, manage a patient’s health conditions, connect the patient with community resources, assist patients with managing prescriptions, and help members focus on lifestyle changes including lowering or maintaining weight, decreasing stress, smoking cessation, and identifying safety and fall risks in the home.
Practice-based care managers help serve as the bridge between members and their physicians — before, during and after office visits — as they function as part of the physician’s team, coordinating and assisting in the development of a care plan for members. They support their physician practices and meet with members face-to-face to address knowledge gaps and provide self-management tools.
These care managers also assist physicians in the delivery of continuous, accessible and high-quality patient-oriented population management by identifying stresses placed on patients and caregivers upon discharge from the hospital. They coordinate health services with other providers, and work with patients before and after hospital stays to make sure each patient understands his or her condition and care regimen. Practice-based care managers make direct contact with patients, identify barriers to care and educate patients.
Essentially, the use of practice-based care managers is a way of changing the workflow in the medical community. Historically, the medical community has approached health care in a reactive way; that is, they react to a patient presenting for care, rather than anticipating care needs. Likewise, patients react by seeking episodic care. In order to control costs and improve quality, this paradigm must change to allow the practice team to understand management of their patient population, and yet focus on the specific to identify the needs of individual patients.
What are the benefits to patients in a medical home situation?
Patients receive more coordinated services in a medical home system, which results in less confusion about their care plan. This usually leads to better compliance with the recommended treatment. In addition, they share in the decision-making with the physician and care team. The physician and patient are on a much more parallel track, understanding the patient’s goals, which causes greater patient satisfaction. ●
Save the date: Tuesday, Oct. 22, webinar “The Physician’s Role in a Changing Health Care System,” from 11 a.m. to noon. To register, visit the “Webinars” page, or email Lauren Formato at firstname.lastname@example.org.
Insights Health Care is brought to you by UPMC Health Plan
Cascade Capital Awards 2013 -- Sales Growth (tie)
Venture Products Inc.
When blight struck Japan, it left thousands of dead pine trees all over the country. While removing the tree limbs and trunks was a fairly routine procedure, a number of stumps were on steep or uneven terrain, making them difficult to remove. That’s when Venture Products Inc. stepped in with its compact tractors and commercial grade attachments.
Since Ventrac tractors have the ability to operate on 30-degree slopes with a stump grinder attachment, it made easy work of removing the tree stumps other machines weren’t able to reach.
Ventrac was finally able to gain traction in a market that had been a tough nut to crack — with competition from Kubota, Shibaura, Iseki, Yanmar and Baroness.
Today, more than 75 percent of all Ventrac power units exported to Japan are sold with a stump grinder attachment. Since that time, additional market opportunities such as slope mowing have increased in Japan. The company’s products are also now distributed in South Korea, Taiwan, Singapore, Malaysia and Indonesia, thanks to the foothold achieved in Japan.
Today, in addition to the Asian markets, Venture Products exports to more than 20 countries including Sweden, Australia and Canada.
Led by Dallas Steiner, CEO and president, Venture Products is driven by its passion for quality products and its vision to be a strong contributor in the global market. It has seen consistent growth in annual revenue since 2009 of 93 percent. ●
How to reach: Venture Products Inc., (330) 683-0075 or www.ventrac.com
Cascade Capital Awards 2013 -- Technology Sales Growth winner
Michael P. Teutsch
If there is one matter that can prey on the minds of business leaders, it’s a bottleneck in the accuracy and delivery of time-sensitive documents, especially invoices. Etactics Inc., launched in 1999, helps eliminate those bottlenecks and helps clients improve cash flow.
In the health care field, where paperwork is growing by leaps and bounds, Etactics’ services include delivering, editing and tracking insurance company invoices and patient statements — clients include hospitals, physicians and billing services.
The company also assists hospitals in managing their charity implementation policy, by providing software solutions that automate tasks that had once been done manually.
On the company website, the customer access and patient access portals are being updated continuously to provide an advanced electronic delivery and online payment system for clients.
During the past year, under Michael P. Teutsch, president and general manager, Etactics processed nearly 31 million transactions on behalf of its more than 2,000 clients. The company measures growth by revenue, profit and number of transactions processed.
Etactics also enhanced its clearinghouse software system last year, enabling the company to provide clearinghouse services for small to midsized hospitals.
But the efforts to grow don’t stop there. The company has enhanced its presence in cloud computing and strengthened its HR functions through its relationship with its professional employer organization.
Since 2008, Etactics has grown its annual revenue by 39 percent and its employee base by 61 percent. The company employs 36 full-time and eight part-time employees. It also expects to hire two to three full-time employees in the next several months. ●
How to reach: Etactics Inc., (330) 342-0568 or
Cascade Capital Awards 2013 -- Technology Employee Growth winner
Epiphany Management Group
Epiphany Management Group offers IT managed services, professional development and education marketing to schools nationwide. EMG takes into account an innovative management approach that focuses on the K-12 market and helps today’s students who learn and live differently than those in previous generations.
Through technology, EMG aims to improve outcomes, collaboration, management and efficiencies.
Starting with just one employee, CEO Suranjan Shome, the company has grown to an organization with nearly 75 employees in three states. EMG has made significant investments in senior personnel, processes and systems automation, which has resulted in revenues doubling this year compared to 2012. This growth was financed organically, without outside venture funding.
The success can be largely attributed to a copyrighted and facilitated strategic planning process that has cascaded into all facets of the organization. This disciplined process was initiated when the company was launched in 2007 and has resulted in clarity of direction, message and purpose for the organization and employees.
In addition, the process has created an alignment throughout the company between employee and organizational goals and direction. It has also inspired employees to realize a perfect customer satisfaction and retention outcome.
With the future in mind, EMG has developed a multi-level executive and general management structure that delegates decision-making autonomy and accountability throughout the organization. This goes against many common theories that centralize authority with the top executive or partners, incorporating instead the experience of the principals, partners and associates of EMG who have spent decades in the K-12 market. ●
How to reach: Epiphany Management Group,
(888) 364-4512 or www.epiphanymgmt.com
Cascade Capital Awards 2013 — Service category, sales growth, established
CEO: Robert Littman
Senior Managing Director: Mark Goldfarb
SS&G Inc., one of the nation’s largest independent accounting and business consulting firms, was ranked No. 39 in Accounting Today’s 2013 Top 100 firms. SS&G serves clients across the country with offices in Ohio, Illinois, Kentucky and North Carolina.
Under the leadership of CEO Robert Littman and Mark Goldfarb, senior managing director, SS&G’s certified public accountants and advisers provide tax, assurance, employee benefit, payroll and consulting services to thousands of clients across a variety of industries. In addition, the company offers services through affiliates SS&G Healthcare Services LLC, SS&G Wealth Management LLC, SS&G Parkland LLC and its payroll affiliate, Paytime Integrated Payroll Solutions.
SS&G’s experts provide progressive, effective and timely services and solutions, demonstrating commitment to client satisfaction through consistent, proactive communication.
More than 20 percent of its accountants have experience in a Big Four firm. Another 15 percent have served as a CEO, CFO, COO or controller in private industry.
All these capabilities and skill sets have allowed SS&G to see strong growth over the years, and particularly here in Northeast Ohio. The company is slated to open a new office on Nov. 1 in downtown Cleveland on the 15th floor of the Hanna Building.
This strategic move will help establish SS&G as a competitive player in regional accounting and consulting, according to Littman, and will put SS&G in close proximity to clients and referrals, creating conveniences and efficiencies. The decision to create a downtown presence stemmed from a desire to be part of the revitalization of Cleveland and the interest of younger staff to live and work in an urban environment. ●
How to reach: SS&G Inc., (440) 248-8787 or
Cascade Capital Awards 2013 -- Service category, Employee growth emerging
Slate Rock Safety LLC
Kim Wilson, president
With a sales growth rate of more than 900 percent from 2008 to 2011, Slate Rock Safety LLC is among the country’s fastest growing private companies. Slate Rock Safety is a woman-owned e-commerce retailer/wholesaler and home to five separate business entities that specialize in the sale of flame resistant, occupational and safety apparel clothing for industries such as the military, utility, industrial and public safety.
Founded in 2007 and led by Kim Wilson, president, Slate Rock Safety has since seen a tremendous growth in employees and sales. The company is building off its 11 new job creations in 2012 with three new additions to date and more to come.
Along with the business unit, sales and marketing have continued to identify specialized niches across each of the industries Slate Rock Safety serves. Having formed close relationships with world-class manufacturers and customers, the company has been able to act as a liaison between customer and producer to help ensure ready-made products are meeting specifications.
Slate Rock Safety also has an in-house technology team that specializes in different disciplines — building the software architecture used for internal communications and reporting.
The design of its managed care program reduces the need for customer resources, saving them administrative time and money.
If you weren’t already impressed, the company also opened a new warehouse this year to give Slate Rock Safety more space for items and to expedite customer service. ●
How to reach: Slate Rock Safety LLC, (866) 783-7977 or www.slaterocksafety.com
Cascade Capital Awards 2013
Service Category/Employee Growth/Established
Sam Falletta, president and CEO, Incept Corp.
If you work for Sam Falletta, you don’t need to worry about his reaction when you bring him a problem. One of his greatest passions as president and CEO of Incept Corp. is coming up with a solution to a client or co-worker’s challenge.
It’s no doubt a key reason why Incept has become a successful business where people like to work.
During the past five years, Incept has nearly doubled the size of its workforce and realized a pretax profit increase of more than 375 percent. The business process outsourcing firm specializes in call center and social media support services for the biomedical, software and automotive industries.
Incept has created a strong employee culture based on the Lead by Culture philosophy developed by Zappos.com. It combines a commitment to people with the employment of best industry practices and promotes productive peer-to-peer and superior-to-subordinate communication across all levels of the organization.
Employees not only work well together on the job, but also bond through the company’s philanthropic efforts. In 2009, the company established a committee to manage its charitable fund, which is comprised of entry-level and senior executives and manages.
According to Falletta, the growth of the company’s staff and revenue are a direct result of the company’s community-driven corporate culture. In 2012, Incept grew its staff by 30 employees and is poised for continued growth in the years ahead. ●
How to reach: Incept Corp., (330) 649-8000 or www.inceptresults.com
Cascade Capital Awards 2013 -- Service -- Best story
J. Rayl Transport Inc.
Jeremy Rayl, the third generation to lead J. Rayl Transport Inc., has experienced a lot of success as CEO since taking over in 2008, including 46 percent growth in sales.
Don’t believe for a second though that Rayl takes that success for granted.
“If you don’t understand the risks that are out there, then you’re being naive to the potential things that could possibly bankrupt your company,” Rayl says. “It’s being able to identify these opportunities and being able to accurately identify our costs, what our revenues need to be and really understanding what drives profitability for our company.”
J. Rayl Trucking has about 230 trucks, 750 dry van trailers and 15 flatbed trailers covering more than half the country, and its brokerage covers the rest of the U.S. and Canada. The company has more than 250 employees and strives to develop cost-saving solutions for its customers.
Through its ability to provide several logistic options for a variety of commodities, J. Rayl Trucking has been able to maintain and expand its customer base.
Rayl puts a lot of effort into measuring risk vs. reward when attempting to meet the ever-changing needs of his customers.
“It has to have some sort of measurable ROI, and it has to add value to the company whether it is dollars saved or overall quality improvement,” Rayl says.
The result is an organization that continues to grow and continues to be a place where employees enjoy going to work. ●
How to reach: J. Rayl Transport Inc., (800) 753-5050 or www.jrayl.com
Cascade Capital Awards 2013 -- Manufacturing -- Employee Growth winner
Ohio Hickory Harvest Brand Products Inc.
Darlene Swiatkowski and Joseph Swiatkowski
The improvements, changes and innovations at Ohio Hickory Harvest over the past several years read like, well, a “soup to nuts” list.
Not only has the wholesale distributor of dried fruits and vegetables, nuts, trail mixes and confections expanded by acquiring I.M. Good Snacks, it’s built a new 30,000-square-foot facility in Akron — and has already added an additional 17,000 square feet. A new nut roaster, bringing the total to three, was included in the expansion, along with two new form fill and seal packing machines and an automated tub packaging line.
Over the last two years, the company has added 10 new items to the products list, as well as more flavorings and blends of nuts.
To top it all off, Ohio Hickory Harvest formed a new LLC company in 2012 and became majority owners of a Columbus-based chocolate and yogurt pretzel company, American Confections.
CEO Darlene Swiatkowski explains how significant that move was.
“We are now manufacturing and producing the best line of chocolate, yogurt, peanut butter, blueberry, raspberry and holiday-coated pretzels you’ve ever eaten,” she says. “And we’ve just begun.”
To help manage the growth, Ohio Hickory Harvest has increased its personnel by 175 percent since 2008.
Owned by the Swiatkowski family (Darlene’s son Joseph is president and son Mike is vice president of sales and marketing), the company has managed to maintain a family-friendly atmosphere — and every item that leaves the company represents the staff, the family’s ancestors and the future successors. ●
How to reach: Ohio Hickory Harvest Brand Products Inc., (800) 448 6887 or www.hickoryharvest.com