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Flexible Spending Accounts (FSAs)
A Flexible Spending Account is a cafeteria plan under Section 125 of the tax code. It is a tax-favored savings account and is funded solely by the employee through regular pre-tax payroll deductions. The funds from the account can be withdrawn tax-free to pay for eligible medical, dental, vision, prescription and dependent daycare expenses. Additionally, employees elect how much they want withdrawn from each pay period, which can be changed annually or upon a qualifying event such as marriage or divorce. For example, the average working employee in America spends more than $1,000 annually on these types of benefits. By participating in a FSA, an employee always has cash to pay for these expenses, and as an added benefit, their taxable income is reduced which also increases the percentage of pay they take home.
Health Savings Account (HSA)
An HSA combines a high deductible, lower premium group health insurance plan (PPO) with a savings account. Accordingly, both employer and employee can contribute, tax-free, to the savings account. Then, the account is used to help fund the deductible and other qualified medical expenses. Once the deductible is met, the insurance starts paying.
Unlike a traditional major medical plan that reimburses you or pays directly to a provider for approved hospital stays and medical care, a Hospital Indemnity Plan pays a lump-sum payment directly to the insured. The cash payment helps with out-of-pocket expenses and covers you when you are off work due to a hospital stay. The coverage is usually a set amount per day, per week, per month, or per visit depending on the benefit level selected.
Accidents can happen anytime. Accident insurance helps to protect employees from financial hardship due to a great deal of medical and out-of-pocket expenses that follow accidental injuries. For example, emergency treatment, hospital stays, medical exams, transportation and lodging needs are just a few of the expenses that accident insurance can help cover. In fact, some policies can even pay benefits in as little as one day, based on time of claim submission.
An HMO group health plan requires group members to obtain their health care services from doctors and hospitals affiliated with the HMO. Thus, members are required to designate a primary care physician within the HMO. Then, the primary care physician treats and directs health care decisions. In addition, the primary care physician coordinates referrals to specialties within the HMO network. Accordingly, HMOs offer access to a comprehensive package of covered health care services in return for a prepaid monthly amount (or “premium”). However, most HMOs charge a small co-payment depending upon the type of service provided.
If you belong to a PPO group health plan, you will save the most money on healthcare if you use providers within the PPO network. Thus, if providers outside of the network are used, it is possible that those services may be covered only partially or not at all. Also, deductibles must be met on this plan before some services will be covered. PPOs require a co-pay for physician visits and some other healthcare services. However, the great thing about a PPO is it’s rich network of quality doctors and healthcare facilities, and the ability to utilize healthcare services outside of your deductible. For example, doctors visits.
How fully-funded plans work.
A fully-funded insurance plan is structured so that the insurance carrier assumes all the risk, and also services the plan and claims administration, in exchange for a per-member premium. Premiums can fluctuate based on the size of the company, employee health, and healthcare usage. Premiums are not refundable, even if benefits are not fully utilized by employees.
How self-funding works.
When employers self-fund their own group health plan, they will benefit from a significant savings in the overall cost of their benefit programs. For example, savings may be in premiums, increased cash flow and certain tax advantages. Additionally, employers have more control over the benefits that the plan offers. Typically, self-funding was not available to small employers in the past. However, today self-insured group health plans are considered to be good options for both small and large employers.
A self-funded group health plan requires the employer to become the insurer. Most often, employers will partner with a PPO to provide services for the plan. Then, a third party administrator (a TPA) is engaged to handle claims and processing. Self-insured employers run the risk of large catastrophic claims. As a result, they need to purchase stop-loss insurance to protect themselves in such an event. Even with the additional expense of stop-loss insurance, employers save a significant amount of money on premiums and other advantages.
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Employees always appreciate dental & vision coverage as part of the benefits package. We offer both dental and vision as part of the employer sponsored package or on a voluntary basis.
Studies have shown that regular dental exams help employees to stay healthier and more productive in the work place. Additionally, you can detect serious underlying conditions such as heart disease and diabetes, through regular dental exams. In fact, the National Association of Dental Plans and the Centers for Disease Control have performed studies that show that employees with dental insurance have better attitudes and are less likely to suffer from depression, a common condition in today’s fast-paced world.
Dental insurance offers a variety of diagnostic, preventative care and corrective services. This includes cleanings, exams, x-rays, fillings, root canals, orthodontia for children, and emergency care while traveling.
Similar to dental policies, vision plans are inexpensive and save employees money on routine eye care. Examples of care include exams, eyeglass frames and lenses, contacts, and even discounts on procedures like LASIK. Additionally, monitoring your eye health with regular exams helps to prevent serious eye diseases like glaucoma and cataracts. In addition, regular eye exams help to detect early stages of diabetes, high blood pressure, and high cholesterol.
Final expense insurance is designed to help protect your loved ones from the financial burden of funeral costs related to your passing. Unlike life insurance, final expense policies have a much lower face value because they are intended to only cover costs related to a person’s final expenses. Therefore, these policies can often be purchased at low or reasonable premiums.
A Gap plan provides benefits that supplement a major medical and comprehensive benefit package. It works by paying a significant amount of the deductible on a major medical plan. More specifically, the additional benefits help to cover out-of-pocket expenses related to coinsurance, co-pays and deductibles for inpatient and outpatient services. For example, if you have a $5,000 deductible on your major medical plan, gap coverage could pay up to $4,000 of that deductible.
This special type of coverage can reduce the personal financial impact of the cost of fighting critical illnesses, helping to keep up with everyday bills through that process. Some key features include cash benefits paid directly to the employee and plans to fit different levels of coverage/budgets.
Employees are more productive when they feel secure that their loved ones will be taken care of, in the event of illness or an untimely death. Thus, you should consider life insurance a key part of the benefit package for your employees. And, also a valuable tool in attracting top talent.
Whether employer paid or voluntary, a good life insurance policy provides for an employee’s final expenses, taxes, and mortgage. Additionally, it may even pay for their children’s education.
This type of life insurance builds cash value which is sometimes used as collateral for loans, if needed. However, most employers only offer basic term life insurance (see below), but also offer permanent life insurance on a voluntary basis. Even so, employees appreciate the opportunity to widen their safety net.
This type of life insurance does not build cash value. However, it will pay a set amount to the named beneficiary upon the death of insured within the stated term. Additionally, some policies may also make payments upon terminal or critical illness.
National surveys have shown that Short Term Disability and Long Term Disability remain of high importance for most employees. Thus, savvy employers attract and retain top talent by offering both STD and LTD insurance as part of the employer paid benefit package or as a voluntary (worksite) benefit.
During the time an employee is unable to work due to a qualifying disability (illness or injury), STD generally allows for income payments to the employee to begin after about a two-week waiting period and will continue to pay the employee until he/she recovers or maxes out the benefits–usually anywhere between one month to two years, depending on the policy.
During the time an employee is unable to work due to a qualifying disability (illness or injury), LTD generally allows for income payments to the employee to begin after about a 90-day waiting period. However, it could be much longer depending on the policy. The policy will pay the employee far longer than STD–for a few years, up to age 65, or even for life.
Group Long-Term Care plans are becoming an increasingly common voluntary benefit offered by employers today. The prospect of long-term care is one of the most important issues your employees may have to face. The cost of long-term care is expensive and generally not covered by other employee benefits, disability or even Medicare.
If someone requires long-term care, it is not just an emotional strain but a financial one as well, impacting retirement savings and overall financial position. Savvy employers know that access to additional resources can increase employee productivity when confronted with managing long-term care situations. Long-Term Care plans demonstrate to your current and prospective employees that your company cares about them–increasing the ability to attract and retain the very best talent.
Most LTC plans are designed to provide benefits for care through nursing homes, assisted living centers, home health care and adult day care.
Employers can provide a base benefit while giving the employees the opportunity to “buy up” and obtain the level of coverage that they need for their families.
Partially-Funded Plans (aka Level-Funded) are a variation of a Self-Funding and allows small employers to take advantage of all the cost saving and benefit design features of a fully self-insured plan, however, they share the risk with one of our top national carriers. Typically, these plans have been designed for larger groups. However, in today’s market, any small or large group could benefit greatly by the cost saving opportunities of a “shared funding” plan.
An employer will select any of the fully insured plans that the carrier offers. Then rates will be determined by the group’s claim history. Next, stop-loss insurance is added to protect against catastrophic claims. Since the carrier will handle the administration of the plan, there is no need to hire a separate vendor to handle claims and processing.
The premiums for shared funding plans are generally much lower than fully insured plans. That is because the employer shares some of the risk. Additionally, an employer may save even more by implementing wellness programs into the benefit programs. Our thorough plan analysis will help you determine if shared-funding is right for your company.
A Premium-Only Plan is a win-win solution for both you and your employees. It allows allows employees to purchase their own individual insurance with pre-tax dollars, decreasing taxable income and increasing take-home pay. It also reduces the employer tax liability and generally reduces premiums. In other words, both employees and employers can potentially save thousands annually in taxes and premiums combined.
Employees elect a set amount of pre-tax dollars to be deducted from each payroll. Then, the employee purchases an individual health insurance policy from a carrier of their choice. Accordingly, the employee is responsible responsible for paying the monthly premiums directly to the carrier. Then, the employee is then reimbursed by the employer for the monthly premium with the pre-taxed dollars.
We can help you obtain the small business tax credit available to eligible employers through the Federal Marketplace, Small Business Health Options Program (SHOP). Eligible employers may have their premiums reduced by as much as 50%. You must cover at least 50 percent of the cost of employee-only health care coverage for each of your employees. You must also have fewer than 25 full-time equivalent employees (FTEs). Those employees must have average wages of less than $50,000 (as adjusted for inflation beginning in 2014) per year.
We suggest you use our Business Tax Calculator to find out if you qualify. Those who qualify will be able to purchase traditional group health plans as described above through SHOP.
So now you have great benefits, but to be effective, your employees need know about them. A properly communicated benefit plan is critical to ensuring your employees understand, utilize, appreciate and get the most value from their employee benefits. A well administered benefit plan can also boost employee retention, helping you to avoid the high cost of employee turnover.
We provide tailored plan implementation with onsite open enrollment meetings, and are always available for questions by phone. We continually disseminate important employee communications/education, either online or by email, designed to increase plan participation and employee satisfaction. We educate employees on ways to control costs and encourage them to utilize benefits that promote a healthy lifestyle and prevent illness. We’ll even train your existing HR staff, helping them to increase the effectiveness of your benefit program.
For more information on how we effectively Communicate and Educate your employees on benefit programs, contact us online or call 361-400-2484
We strive to make sure you always have the most ideal benefits for you and your employees, while staying up to date with any new rules and regulations. Accordingly, we proactively plan for the renewal process by assessing your needs periodically and being prepared to make adjustments to contributions, choose new plans or take other steps necessary to ensure you are getting the most from your investment, and your benefits continue to align with team’s needs. Annually, we’ll do a thorough re-evaluation of employee needs, demographics, market trends and more, before considering final renewal strategies and carrier options.
For more information on our Benefit Management assistance, contact us online or call 361-400-2484
We save HR managers time and money by assisting with the ongoing maintenance of your benefit programs. For example, we’ll take care of enrolling new hires and terminating benefits when necessary. We handle employee notices for COBRA, FMLA, the ACA and other compliance. We assist with carrier billing or claims issues that may arise. We also provide employee advocacy services when needed, and more. We strive to do as much as we can to keep you benefit programs running smooth, so you can focus on other important matters.
Our consultation process takes a look at your entire benefit picture. We consider multiple factors, including benchmarking, past claims data, financial objectives of the company, and we’ll even poll your employees to find out which benefits are most valuable to them. Operating independently of any one particular carrier, we scour the market to find products and services that fit the unique needs of your organization and its employees. If advantageous, we’ll also consider various funding options, such as cost sharing or self-funding.
As studies continue to prove, the true key to lowering costs all the way around is through prevention and employee wellness. Our ultimate goal is to help you custom design a mix of low-cost, quality benefits to include medical and wellness plans, dental, disability, and life insurance along with additional voluntary options that promote financial stability for your employees.
For more information on our Consultation Process, contact us online or call 361-400-2484
We help retirees and other eligible employees tackle the challenges of ever increasing premiums and health care costs by purchasing a quality Medicare Supplement. While there are many options, the best coverage is a plan that leaves you with the least expenses, and has the lowest premium.
Medicare Supplement Insurance policies complement your Original Medicare Parts A and B. They cover some, if not all, of the expenses that Part A and B do not cover, like co-pays, deductibles and other charges.
There are many different types of Medicare Supplement policies available, however they are regulated so the benefits for these various policies (known as Plan A through N), are all the same regardless of the carrier. However, premiums can vary greatly among carriers.
Individual dental plans are inexpensive and can contribute greatly in promoting overall good health. Studies have shown that regular dental exams can optimize oral health to prevent cavities and bad breath. In addition, they help to detect serious medical conditions such as heart disease and diabetes. Some studies have even shown that people who have dental insurance suffer less from depression.
Dental plans can range from a PPO or HMO to Pre-Paid, Fee-for-Service, and Discount on a variety of diagnostic and preventative care services including cleanings, exams, x-rays, fillings, orthodontia for children, and emergency care while traveling.
Take care of your eyes with an individual vision plan that can be purchased separately or combined with your major medical insurance. Individual vision plans are similar to individual dental policies, as they are inexpensive and save you money on routine eye care, such as exams, eyeglass frames and lenses, contacts, and even offer big discounts on procedures like LASIK. Additionally, monitoring your eye health with regular exams helps to prevent serious eye diseases like glaucoma and cataracts, and also helps to detect early stages of diabetes, high blood pressure, and high cholesterol.
Call 866-820-1739 or fill out the form below to request a FREE assessment of our supplemental insurance plans.