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HomeMy WebLinkAbout04. Presentation by Alliant Employee Benefitsoil Central Contra Costa Sanitary} [district A091 LGIS916 0 m1hant EMPLOYEE BENEFITS Who is Alliant? What Does Alliant Do? ACA Overview Pay or Play Cadillac Tax © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 Established in 1925 L- A 26,000+ Cl Tents nationwide 000 000 I&1��1 CREATIVE r � �16 ■ ENGAGED 2,100 EMPLOYEES IN EXPERIENCED • 12,500+ Global Employers 2.8 million employees worldwide RESPONSIVE © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 3 Meet Your Service Team Christine Kerns Senior Vice President Erin Thomas Broker & Consultant Thomas Sher Senior Vice President Kimberly Miller Assistant Vice President /Account Executive Fiona Gledhill Account Associate Dianna Santos Benefits Analyst Scott McClave Underwriter Kristine Blanco, Esq. Director of Compliance Jill Dorris Health & Productivity Trish Stober Technology Director 44m EMPLDYIE BENEFITS Christine Erin Kimberly Fiona [ `a. Scott Kristii W N F OUR SERVICE MODEL o- Strategy IF T \I Health & Productivity Benefit Advocates Compliance 0, 0 0 Joint Labor -Mgmt Technology - - - - - • . - - - - - - • :+ +. up Analytics M Voluntary Benefits E Employee Engagement &Affiant EMPLOYEE BENEFITS CITIES City of Alameda COUNTIES County of Amador AC Transit District • Alameda County Schools Insurance Group ACSIG City of Belmont County of Butte Bay Area Air Quality Management District Association of California Water Agencies (ACWA JPIA) City of Brisbane County of Calaveras California Association of Highway Patrolmen Butte Schools Self- Funded Programs City of Concord County of El Dorado Dublin San Ramon Special District Cabrillo College City of Fremont County of Lake Napa Sanitation District City College of San Francisco City of Hayward County of Merced Placer County Water Agency Coast Community College District City of Livermore County of Napa Port of Oakland Evergreen School District City of Martinez County of Nevada Santa Cruz Metropolitan Transit District Long Beach Community College District City of Merced County of Placer Superior Court of Amador Marin Community College District City of Mountain View County of San Joaquin Superior Court of Calaveras Monterey Peninsula College District City of Pacifica County of San Luis Obispo Superior Court of Colusa Pajaro Valley Unififed School District City of Pleasanton County of San Mateo Superior Court of Contra Costa Redwood Empire Schools Insurance Group City of Redding County of Santa Barbara Superior Court of Del Norte San Jose Evergreen Community College District City of Richmond County of Santa Clara Superior Court of El Dorado Santa Clara County Office of Education City of Roseville County of Solano Superior Court of Placer Santa Clarita Community College District City of Sacramento County of Stanislaus Superior Court of Sonoma Santa Cruz City Schools City of San Bruno County of Tehama Superior Court of Stanislaus Santa Rosa Junior College City of San Leandro County of Tuolumne Superior Court of Tuolumne Self- Insured Schools of California (SISC) City of Santa Rosa County of Yuba Turlock Irrigation District South Orange County Community College District City of South San Francisco Union Sanitary District West Hills Community College District City of Sunnyvale City of Vacaville City of Visalia City of Walnut Creek City of Yuba City *This Information is Proprietary to Alliant and is notfor Distribution* Alliant is the Largest Public Entity Broker & Consultant in California © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 6 A DEDICATED TEAM OF EXPERIENCED ATTORNEYS AND SPECIALISTS, TO HELP YOU NAVIGATE THE ACA MAZE KNOWLEDGE STRATEGY TOOLS wwmws.w�.� • On Staff Attorneys ■ Compliance Reviews & Audits ■ Daily Q &A Support ■ ACA, E R I SA, COBRA, HIPAA ■ State, Local & Federal Mandates H UP= ■ Annual Planning Cycle ■ Formal Compliance Calendar • Compliance Checklists ■ Documentation & Reporting QUESTIONS AND ANSWERS: W' r- 'i IRS REPORTING REQUIREMENTS FOR EMPLOYERS ■ Model Documents ■ Proprietary Tools • Regulatory Audit Support • Vendor Selection RAW GwUmb h. Vkthrt Pllrs Agencies Release Proposed Regulations Modifying SBC Provisions ■ Alerts • Updates • Webinars: • Latest Information • What to Know / Do Alliant works with individual public employers and Joint Powers Authorities on behalf of their members to create exclusive programs specifically for special districts, cities, counties and schools. These programs allow Alliant to offer Central Contra Costa Sanitary District lower costs while matching your current benefits offerings. Our strategy is to provide an Independent Consulting Approach and present both program solutions as well as options that are available in the market. Benefits of Joint Purchasing: • Volume discounts on fixed costs • Reduced overhead charges • Reduced or eliminated risk charges • Reduced insurer and health plan profit margin • Risk shared across larger pool Lower Costs for Employers and Employees Greater Long Term Stability © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 $ Here are a few examples of Alliant public sector programs that are available to Central Contra Costa Sanitary District: Health Program ➢ Medical ➢ Pharmacy Life Program ➢ Basic Life AD &D ➢ Supplemental Life blue lf" INGAi) Dental Program ➢ DeltaCare ➢ Delta Preferred Provider Network ➢ Delta Premier Network Disability Program ➢ Long -Term Disability ➢ Short -Term Disability Anthem iN Cigna AfAA EXPRESS SCRIPTS* medca .d THE NEW EXPRESS SCRIPTS. BETTER TOGETHER. AffEsY %i.5 ion, Vision ➢MES ➢VSP EAP Proaram ➢MHN VSO!_'_' MHM 4 Health Net Company' © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 g ■ Union / JLM Input ■ Benefit Positioning ■ Annual Initiatives Your Culture, People, Business, Market 1, 3 & 5 year planning Coverage, Cost, Administration, Compliance, Engagement Review and Adjust Annually ■ Claims History ■ Renewal Projections ■ Benchmarking ■ Benefit Year Calendar ■ Renewal / Marketing Strategy © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant InsdraQQ% QRjQat.00A RJaRe No. OC36861 10 Enrollment Communications ti = &W ABC CO OPEN ENROLLMENT Videos fr'S TWE TO TALK KWITs @ 2015 Alliant Insurance Services, Inc. All rights reserved Online/Portals YEAR-ROUND COMMUNICATIONS Mobile App Alliant E_�_�_ �'fits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 11 Ben-IQ TM - Benefits at the speed of life w ,ed. Total Fair Price $7,495 Repair of shoulder rotator cuff using a endoscope Facility Services $4,346 $10,865 LOWEST PRICE • LOWEST HIGHEST PRICE A-:: Fee Details: Price is for an outpatient procedure. Overnight stay is not included. Physician Services $2,181 $s,45i LOWEST 111FAM LOWEST PRICE HIGHEST PRICE Fee Details: Phvsician fee. nsurance :: Aetna Nurseline '1k. (800) 555 -1234 Benefit Advocates P`. (800) 410 -6571 u customerservice@alliant.com :: Aetna e. (800) 505 -5555 customerservice @aetna.com 12 • We understand the political nature of the collectively bargained benefit process • We believe unions need to be educated, informed, empowered and must gain consensus with their constituents to make collective decisions that ensure the future success of their health and welfare program ■ Alliant continues to receive feedback that our work in the joint labor management environment has successfully impacted negotiations and enabled organizations to implement change that was not possible before Alliant was the Employee Benefit Consultant ■ We understand what is important to your unions and communicate in terms that facilitate dialogue ■ Our role is to provide education and support tools that enable all constituent groups to make decisions that achieve mutually satisfactory results © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 13 Health & Productivity is so much more than just wellness! We incorporate the concepts, drive and implement key strategies, and bring the latest innovation in the space of health and productivity to our clients. Alliant Tools: 1. Low -Cost / No -Cost Resource Guide 2. H &P Toolkit DISCOVER AND ASSESS PLAN AND DESIGN IMPLEMENT AND AND © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of AlfiaRgAi wices, Inc. CA LiK Q WK1 14 The Affordable Care Act requires large employers (50+ employees) to offer medical coverage that is... • Employee contribution for single coverage of lowest Affordable cost plan does not exceed 9.5% of employee's income (W -2 income, actual wages, or federal poverty level safe harbor) • Coverage meets minimum value (60% actuarial value) requirement and meets Minimum Essential Coverage requirements • Offer coverage to all employees working 30+ hours per week and their eligible dependents (spouses not required) • Safe - harbors exist to define 30 hour determination ...or the employer may pay annual penalties of $2,000 or $3,000 per employee © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 16 Effective July 1, 2015 % 70% in 2015, 95% in 2016 1 FT EE gets subsidized coverage (if under 400% of Poverty level) $2.Q0o per each full time employee 1 FT EE gets subsidized coverage (if under 400% of Poverty level and pay more than 9.5 %) $3,00r per each subsidized employee © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 17 ■ To avoid Penalty A, Employers are required: ■ To offer access to coverage to "substantially all" 30+ Hour employees and dependents to age 26 (no mandate to offer coverage for spouses) ■ Variable or part -time employees could be considered full time and, ■ These employees could expose the District to Penalty A if they represent more than 30% of the full time work force in 2015 (5% in 2016) ■ Penalty A is $2,000 per eligible employee ($166 a month) if 1 30+ Hour employee obtains federally subsidized exchange coverage because the District did not offer them coverage — 30% safety net applies ■ Offer access to coverage on an annual basis ■ Recommendation: District should require an opt -out form for any employee who is offered coverage, but declines © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 18 ■ To avoid Penalty B ■ At least one plan offered to full time employees and dependent children to age 26 must be: Of minimum value (60% of medical expenses paid by plan) Affordable for self -only coverage — 9.5% or less of wages ■ No requirement by ACA to offer coverage to spouses ■ No requirement to contribute to cost of dependents ■ Penalty B is $3,000 per year ($250 per month) on any employee that meets all of these requirements 1. Qualifies for a federal subsidy from the Exchange based on total household income (excluding MediCal eligible participants) 2. Elects and receives subsidized coverage from the Exchange 3. Demonstrates that the lowest cost, minimum value coverage offered by the employer was not affordable for self -only coverage © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 19 ■ The Affordable Care Act includes an excise tax on Cadillac Health Plans, known as the "Cadillac Tax" that becomes effective on January 1, 2018 ■ The excise tax is 40% on any health plan premium over the following "estimated" thresholds: ■ $10,200 for Single Coverage ■ $27,500 for Family Coverage ■ Exception - Higher limits for retired individuals age 55 or older and not eligible for Medicare and potentially for employees in high risk professions, e.g. fire and police, single $11,850, family $30,950 ■ These initial threshold amounts are benchmarked to the Federal Employee Health Benefit Plan (FEHBP) and are unlikely to increase by 2018; increases after 2018 will be relative to general inflation (the CPI -U — for all Urban Consumers) L 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 21 ■ There is an exception for certain individuals in the following cases: ■ Qualified Retiree • (A) is receiving coverage by reason of being a retiree, ■ (B) has attained age 55, and ■ (C) is not entitled to benefits or eligible for enrollment under the Medicare program under title XVII I of the Social Security Act ■ High Risk Employee • An individual who participates in a plan sponsored by an employer where the majority of employees covered by the plan are engaged in high -risk professions such as law enforcement and fire protection officers L 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 22 1 Late Spring /Early Summer 2016 Additional IRS Notice anticipated followed by comment period. • Procedural issues related to calculation and assessment of the tax (mechanics of how tax is applied and paid) Late 2016 Proposed regulations followed by comment period 2 2017 Final regulations 3 January 2018 Tax effective L 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 23 oly elfOn _, $10,200 ($850 /mo) 4W Self + Other $27, 500 ($2,291.67/mo) (Any tier of EE plus dependent coverage) ■ Thresholds increase if the cost of one of the Federal Employee Health Benefit (FEHB) Plans increases 55% between 2010 and 2018. Unlikely to happen at current trend. • CPI Adjustment — Estimated 2% to 2.5% • Cost of living adjustments (COLA) for 2018 & 2019 — 1% It!, ?015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 24 Applicable coverage is coverage under a group health plan that would be excludable from an employee's (includes retirees and surviving spouses) gross income, including: Medical coverage Employer and employee FSA contributions Employer HSA contributions, including employee pre -tax contributions On -site medical clinics (see next slide) Multi- employer plans Critical illness /hospital indemnity plans paid for with pre -tax dollars Applicable coverage does not include: Accident or disability income insurance Workers' compensation insurance Long -term care insurance Separately insured dental and vision coverage Critical illness /hospital indemnity plans paid for with after -tax dollars Medicare Plans © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 25 Tax: 40% on the amount that exceeds $10,200 for self -only coverage and $27,500 for self + other coverage Includes overall cost (employer + employee contributions) Excise tax is non - deductible for federal income tax purposes Sample Calculation: A) EE only total annual medical premium B) Other applicable coverage - FSA C) Total annual cost . jw D) Employee (EE) only threshold E) Amount that exceeds EE only threshold F) Excise tax A + B = C C - D =E Ex40 % =F $10,500 $500 $11, 000 $10,200 ' ►:11 $320 _M It!, ?015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 26 ■ Medical Benefits • Health insurance carrier pays for insured plans Kaiser and Health Net HMO's • Cost passed along to employer, most likely in the rates • Regulations appear to allow cost to be passed on to employee, but final regulations have not been issued Excess HSA, HRA and FSA contributions ■ "Excess" means amount in excess of threshold when combined with medical premiums Employer pays © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 27 Alliant's public agency clients are considering the following strategies to limit their liability on the Cadillac Tax: Exploring Lower Cost Alternatives, such as High Deductible Health Plans (lower in premium) ■ As an additional option ■ As a replacement to an in -force plan Ending employer contributions to Health Savings Accounts and /or Flexible Spending Accounts Determining how the Tax will be paid: • By Agency? • By Employee if they choose the Cadillac Plan(s) • Employees who choose the lower cost alternative would not pay a tax • Employees who choose a plan with that is higher than the thresholds would pay the tax ■ Sharing in the Cost © 2015 Alliant Insurance Services, Inc. All rights reserved. Alliant Employee Benefits, a division of Alliant Insurance Services, Inc. CA License No. OC36861 28 Questions? •�4//iant EMPLOYEE BENEFITS •�4//iant EMPLOYEE BENEFITS