Consumer attitudes about health. Four surprising ways millennials approach and engage with health care
Novant Health today released findings of its first Consumer Attitudes About Health Study noting the latest trends in millennial health attitudes and behavior. The nationwide online survey of 2,104 U.S. adults aged 18 and older, including 419 millennials aged 18-35, was recently conducted by Harris Poll on behalf of Novant Health.
Millennial Health
Key takeaways and findings from the study suggest millennials approach and engage with health care in four surprising ways:
Millennials indicate they would take better care of themselves if they had more time to do so (66 percent); however, they also report spending large amounts of time watching television and engaging on social media.
The Consumer Attitudes About Health Study indicates millennials spend significantly more time on sedentary activities than they do exercising— on average, they spend almost three hours sitting at a work desk, nearly three hours watching TV, and more than two hours on social media, while exercising makes up only about one hour of a millennial’s day.
Millennials are going “old school” when it comes to health information—four times as many millennials report relying on a health care professional for health information (63 percent) vs. using social media (15 percent) as a health resource.
While millennials spend more than two hours per day on social media on average, only about 21 percent use social media to diagnose themselves or their loved ones. Three in five millennials (61 percent) reported that social media is harmful (vs. helpful) to their health.
Millennials understand the importance of making end-of-life plans but do not feel equipped to do so. While 88 percent feel that planning for end-of-life care is important, millennials don’t feel they have the tools they need to do so.
More than 60 percent of millennials (62 percent) report not knowing where to start when thinking about end-of-life care, suggesting that they may not feel equipped to start planning for end-of-life care regardless of when they plan to start thinking about it.
The importance of being treated with respect by healthcare providers cuts across all demographics, with seven in 10 millennials indicating that being treated well/with respect is how they would define “quality healthcare”.
According to the Consumer Attitudes About Health Study’s findings, similar proportions of millennials say that being treated well/with respect (69 percent) and effective treatments (73 percent) are how they would define quality health care. Quality in health care is defined multi-dimensionally, starting with effective treatment, but respect, disclosure, meeting expectations for care, and being treated as a person, not a patient, are also commonly mentioned. Around seven in 10 millennials agree with this holistic view of quality, defining health care as an effective treatment, being treated with respect, and being kept fully informed
Millennial Health
“The closer we look, the more we see how unique the millennial population is,” said Jesse Cureton, Novant Health’s Chief Consumer Officer. “This study provides new insights into how millennials think and behave when it comes to their health, and the more we understand about them, the easier it will be to maintain our commitment as a consumer-centric organization that directly meets the needs of our specific patient population.”
The nationwide survey was conducted online among 2,104 U.S. adults aged 18 and older (including 419 millennials aged 18-35) by Harris Poll on behalf of Novant Health from March 1-9, 2016. For the complete research method, including weighting variables and additional subgroup sample sizes, visit NovantHealth.org/ConsumerAttitudes .
Millennials’ health is declining. Can employers and health plans help?
Millennials’ health concerns have seen double-digit increases in major depression and significant increases in substance use disorders over the past year. The prevalence of other chronic diseases is climbing, too. This data comes from the Blue Cross, Blue Shield, The Health of America Report® on millennial health. And it’s what prompted experts and advocates to come together recently for a Blue Cross Blue Shield Association (BCBSA) virtual forum about millennials’ health.
Health trends worsened by multiple crises
These worsening health trends were already in place when the COVID-19 pandemic hit. Then came a financial crisis, which has disproportionately impacted millennials, whose unemployment numbers are higher than other groups, according to Mark Zandi with Moody’s Analytics and a speaker at the BCBSA forum. The resulting stress may be exacerbating health conditions, in particular behavioral health.
Experts in healthcare, employee wellness, demographics, and economics gathered to share ideas for supporting this generation in ways that acknowledge their needs and preferences at this critical moment.
Employers focus on wellness and engagement for Millennials’ health
Krista Larson from the law firm Morgan Lewis and Aurora Davis with Comcast shared their strategies for building a healthier workplace for millennials. Larson said Morgan Lewis has invested in fostering open dialogue among employees about mental health to reduce stigma. The firm also features a senior leader who shares personal experiences with substance use disorder. The firm has also made the most of a difficult work-from-home situation, creating virtual communities for employees to boost mental and physical wellbeing. Comcast’s Aurora Davis said the company has focused on creating a healthier environment for employees. The new campus in Philadelphia, when re-opened after the pandemic, includes an onsite healthcare clinic, wellness center, physical therapist, and dietician. The company has also focused on virtual stress relief tools for employees.
One rationale behind those strategies, said Larson and Davis, is that they acknowledge millennial values, a key consideration given a large percentage of their workforces are millennials.
What millennials value in an employer
Kim Lear, a generational researcher with InLay Insights, sketched a portrait of those values and why Morgan Lewis and Comcast’s investments may be on track for attracting and keeping millennial talent, as well as helping them get and stay healthy. Millennials are more committed, she said, to companies that promote self-care, show leadership in social justice, and work to keep them engaged in wellbeing.
They also, said Lear, want healthcare that’s accessible and health plans that are easy to understand. That could mean expanding access to digital options, including telehealth, which has taken off during the COVID-19 pandemic. It could also mean re-thinking the design of health plans or how employers educate employees about their choices.
Health plans are making it easier for millennials to tackle chronic disease
Health plans are helping employers shape those offerings. Blue Shield of California’s David Bond said the company’s new wellness and chronic disease management and prevention platform, Wellvolution, was designed with millennials in mind. It asks users to identify their health goals and matches them to personalized, evidence-based digital health programs.
Wellmark Blue Cross and Blue Shield’s (Wellmark BCBS) Julie Enga agreed that millennials need a path toward health beyond the primary care physician (PCP). The speakers agreed that millennials are interested in wellness but not necessarily relying as much on, or waiting for appointments with, PCPs as previous generations. Rather, they’re seeking information online or going to urgent care centers. That makes it difficult to address chronic issues like diabetes or depression, which require ongoing care. Digital wellness platforms can help, engaging millennials online and on-demand.
Enga also said millennials in Wellmark BCBS’ market have indicated an interest in a health plan that’s simpler to use and understand, so the company rolled out a product called BlueSimplicity℠ that simplifies choices and makes costs clearer upfront.
The biggest opportunity: engage millennials in behavioral health treatment
While chronic physical diseases remain a top concern about millennials, experts returned to the theme of behavioral health throughout the October 28, 2020, virtual forum. A significant percentage of people with a behavioral health diagnosis also have one or more chronic diseases. Treating both is difficult, and expensive. But engaging millennials with behavioral health conditions in treatment options that appeal to them will make managing chronic diseases easier. Employers, insurers, and community leaders emphasized the urgency to address millennial mental health, especially in the face of what some are calling the triple pandemic of COVID-19, a financial crisis, and systemic racism.
As healthcare premiums are increasing you may have noticed rising prescription costs. In a study done by Consumer Reports in 2019, 12% of individuals said their prescriptions costs increased by more than $100 over the past year. One contributing factor is that there are no federal regulations that keep drug prices in check.
How are consumers able to offset rising prescription costs?
Ask your doctor for generic:
Most brand-name drugs have generics that can be up to 90 percent cheaper. They aren’t available for all prescription drugs, but it doesn’t hurt to ask your doctor or pharmacist.
Ask about over-the-counter options:
Some medications can be a combination of two inexpensive drugs that you can purchase without a prescription.
Use manufacturer discounts:
Many drugmakers offer some type of discount. For example, Janssen, which makes Xarelto, offers a discount that can drop the price down to $10.
These are not all the ways you can help reduce your prescription costs but are some of the most effective ways. As always if you have any questions regarding your healthcare costs please talk to one of our insurance agents.
The terms Qualifying Event, Special Enrollment Period, and Open Enrollment Period get tossed around in conversation when discussing both employer-sponsored benefits and individual health insurance plans.
The timeframes in which you can alter your benefits through a company or for your own individual policy are limited to certain times or events of the year. For employer-provided benefits, the time of year to make changes, add, or remove coverage for yourself and family members is called open enrollment and is managed by Human Resources. It’s “open” because these adjustments are made at the employee’s discretion. If you purchase your own health insurance through a private insurance company or the Health Insurance Marketplace (Obamacare), open enrollment takes place each year starting November 1st and ending December 15th. Any changes from this timeframe go into effect as of January 1st of the following year. Outside of these timeframes, your benefits are locked in until the next enrollment period. But what happens if you need to make changes at another time due to a qualifying event?
What is a Qualifying Event?
A Qualifying Event is a life circumstance that allows someone to make changes to their insurance coverage outside of open enrollment for both employers and individuals. A Qualifying Event is a reason to have a Special Enrollment Period or midyear change. The allowed timeframe for reporting these changes or updating coverage is between 30-60 days from the date of the event. If you have missed this timeframe, you may not be allowed to make changes. Some examples of qualifying events are birth, marriage, divorce, or loss of other coverage. If you have questions about your own coverage or coverage through an employer, we are here to help!
If you have any questions or would like to explore your options for health insurance, it is always a good idea to contact your insurance carrier or speak with an insurance agent. Shield Insurance Agency represents over 40 insurance companies and can provide you with a free quote and personalized advice. Contact Shield Insurance Agency at (616) 896-4600 for a free quote today or start the quoting process by visiting this LINK and an agent will be in touch soon.
There is a wealth of information in this article and too much to post, but please check it out as the Health Insurance Companies are listed A-Z and each one explains HOW they are responding to the Covid Crisis.
Insurance Companies response to Covid
The health and well-being of millions of Americans remain our highest priority. Health insurance providers are committed to helping prevent the spread of COVID-19. We are activating emergency plans to ensure that Americans have access to the prevention, testing, and treatment needed to handle the current situation.
Here are some ways health insurance providers are taking action:
Insurance and you — why open enrollment is not something to ignore. Consider your options carefully and keep your eye on the clock.
If you are one of the 183 million people who receive health insurance through your employer, you might be asking if open enrollment actually applies to you and, if so, if there’s anything you need to do. The answer to both questions is “yes.”
Each year, an open enrollment period takes place that allows employees to enroll in their employer-sponsored health insurance. It gives you the opportunity to either confirm your current health insurance coverage or to consider signing up for a new plan that better suits your needs.
When considering your options during the open enrollment, there are several factors to take into account. Here they are.
Changes to Your Health
First, take a moment to check in with your actual health. You’ll want to plan for any upcoming or ongoing medical needs. For example, if you know you’ll need surgery in the coming months, take the time to check your insurance plan’s network of doctors. This can help you avoid any surprises when it comes to what doctors and services are covered.
Your Budget
Next, take a moment to consider how your health insurance impacts your budget over the course of the year. If you had a high deductible plan with a lower premium, did that work well for you? Or, did you have an expensive medical event that caused you to dip into your savings?
If that’s the case, it’s possible a low deductible plan with a higher monthly premium would better spread out your health care costs over the course of the year.
If you have expensive prescriptions, be sure to review the prescription benefits your company offers. Your employer might work with a prescription discount company that can help reduce your out-of-pocket costs.
More Than Just Health Insurance
Your employer may also offer additional coverage during open enrollment such as life insurance, short-term disability, long-term disability, or even pet insurance. These benefits can be valuable, especially if your employer is willing to contribute to the premium.
To determine whether or not you should participate, consider your circumstances; for example, if you are pregnant and know that you will be away from the office on maternity leave next year, you may benefit greatly from a short-term disability plan. Or, if you recently adopted a puppy, this could be a great time to look into pet insurance.
Timing Matters
Your employer will set the timing for the open enrollment period, determining the start and finish dates.
Generally, employers hold open enrollment during the fall, and your benefits will kick in on January 1 of the following year.
You should expect to receive several email notices from Human Resources – make sure to pay attention so you don’t miss any important signup details.
If you don’t believe your employer has sent anything out, make sure to ask directly. It’s important to sign up for the coverage you want by the close of open enrollment, otherwise, you may have to wait until next year to do so.
If you have a qualifying life event that occurs during the course of the year, your employer will offer you another window of time where you can adjust your benefits. Qualifying events include birth, divorce, or a spouse’s job loss. If you need to change your benefits during the year, feel free to ask questions and find out if your life event qualifies you to make a change.
During open enrollment, your employer is offering you the chance to make potentially critical adjustments to your health insurance — make sure you take advantage! Consider your options carefully and keep your eye on the clock.
Healthcare Premiums Drop Slightly As 2021 Open Enrollment Period Draws Near
Even with the election and oral argument in California v. Texas looming, the 2021 open enrollment period will soon be upon us and it’s all about healthcare premiums. In all states except California (where the open enrollment period began on October 15), the 2021 open enrollment season begins on November 1, 2020, with a deadline of December 15 in the 36 states that use HealthCare.gov. States with their own marketplaces—including New Jersey and Pennsylvania, which newly opened their own marketplaces—have set their deadlines later in December 2020 or January 2021.
Ahead of open enrollment, the Centers for Medicare and Medicaid (CMS) released new data on HealthCare.gov marketplace premiums and insurer participation for 2021. CMS’s analysis includes an issue brief on premiums, landscape plan data, and a map on insurer participation. (Public use files do not appear to be posted yet but will be available here when they are.) CMS also released the scheduled maintenance windows for HealthCare.gov for the 2021 open enrollment period.
Healthcare Premiums Drop 2%
Overall, healthcare premiums are expected to drop by 2 percent for a 27-year old for a silver benchmark marketplace plan sold through HealthCare.gov. This builds on a 4 percent decline for 2020 and a 2 percent decline for 2019. The unsubsidized average benchmark plan premium for a 27-year old will be $369/month for 2021 (compared to $388/month for 2020). In four states, silver benchmark premiums will decline by double-digits: Iowa (29 percent), Maine (14 percent), New Hampshire (18 percent), and Wyoming (10 percent). Only North Dakota will see an average benchmark plan premium increase of 10 percent or more (29 percent).
Lower Healthcare Premiums Ahead
Lower premiums are expected even with the pandemic. First, Congress repealed the health insurance tax beginning with 2021, which should result in premium savings that are passed along to consumers. Second, insurers continue to owe record-high medical loss ratio rebates in the individual market. This suggests that insurers are overpricing their products and those premium reductions are warranted. Third, more states have adopted state-based reinsurance programs: currently, 14 states have received a waiver to operate a reinsurance program. Fourth, the pandemic has led to higher profits for many insurers, further incentivizing premium reductions. These factors made it unsurprising that many insurers would reduce their premiums for 2021.
Insurer participation continues to increase.
Six more insurers will offer marketplace coverage through HealthCare.gov, increasing the total number of participating insurers to 181 for 2021. (Even so, this metric continues to lag earlier years in ACA implementation, remaining well below the high of 237 participating insurers for 2016.) Of the 36 states that use HealthCare.gov, 16 states will have more insurers compared to 2020 and 27 states will have counties with more insurers relative to 2020. Only Arkansas, New Mexico, and Wyoming will have an additional insurer offer statewide coverage. Four states have counties with fewer insurers in 2021 relative to 2020 while Delaware is now the only state with just one insurer (down from two states for 2020). Only four percent of enrollees will have access to only one insurer compared to 12 percent of enrollees for 2018 and 20 percent of enrollees for 2019.
Average premium reductions and higher insurer participation are encouraging. The uninsured rate was on the rise long before the pandemic, and robust individual market coverage options will be especially important in 2021 with millions of people losing their job or health insurance. Fortunately, many low-income consumers will continue to have options in 2021. CMS estimates that 30 percent of subsidy-eligible enrollees can find a marketplace plan for $10/month or less, and 71 percent can find a plan for $75/month or less. Of those not eligible for subsidies, 27 percent can find a plan for $300/month or less.
Deductibles Continue to Rise
At the same time, deductibles continue to rise. For bronze plans, the median individual deductible increased from $6,755 for 2020 to $6,992 for 2021. For silver plans, deductibles rose from $4,630 to $4,879. And gold plan deductibles rose from $1,432 to $1,533. Consistent with prior years, nearly all enrollees will have access to a health savings account-eligible marketplace plan in 2021.
Finally, potential maintenance for HealthCare.gov has been scheduled for early morning on November 1 (to make final preparations ahead of the start of open enrollment) and each Sunday from 12 am to 12 pm ET except on November 1 and December 13. Federal officials selected the Sunday morning time period because this is when the website receives the least amount of traffic. During any website downtime, HealthCare.gov will be unavailable for consumers to select a plan and enroll in coverage. As in prior years, CMS anticipates that actual maintenance periods will be much shorter than the scheduled slots. Despite the maximum allocation of 72 hours of maintenance last year, the website was down for only 24.5 hours and HealthCare.gov was reportedly available 96.9 percent of the time.
Whether you’re reviewing your Medicare coverage during open enrollment through Dec. 7 or are signing up for the first time, there are some key considerations to factor into your decision-making, advisors say.
Although Advantage Plans often come with low or no premiums, the out-of-pocket maximums for in-network coverage can be as much as $7,550 in 2021.
So-called Medigap plans, whose monthly premiums can be pricey, provide more flexibility.
For the nation’s older residents, the stakes can’t be higher when it comes to choosing health-care coverage.
That’s partly because under Medicare — you’re eligible at age 65 — changing plans can be challenging in some circumstances and costly if you get your choices wrong. So whether you’re giving your coverage an annual checkup during open enrollment (Oct. 15 through Dec. 7) or signing up for the first time, financial advisors say there are some key considerations to factor into your decision-making.
“I encourage people to get the best plan they can because you don’t know what will happen with your health,” said certified financial planner Carolyn McClanahan, a physician and founder of Life Planning Partners in Jacksonville, Florida.
“The most important thing when it comes to health-care costs is to be adequately insured,” McClanahan said.
Roughly 62.8 million individuals are enrolled in Medicare, the majority of whom are age 65 or older (the remainder are younger with disabilities or individuals with end-stage renal disease).
About a third choose to get their benefits delivered through Advantage Plans, which are offered by private insurers and typically include Part D prescription drug coverage. The remainder sticks with original Medicare: Part A (hospital coverage) and Part B (outpatient care). Those beneficiaries often pair that with a stand-alone Part D plan and a Medicare supplemental plan (aka Medigap), both of which also are offered by private insurance companies.
The most important thing when it comes to healthcare costs is to be adequately insured. Dr. Carolyn McClanahan
The current open enrollment period is for making changes related to those stand-alone drug plans and Advantage Plans: You can switch, drop or add them.
This window is different from your initial sign-up for Medicare when you get a seven-month period that starts three months before the month in which you turn 65 and ends three months after it. During that time, unless you meet an exception — i.e., you have acceptable coverage elsewhere — you generally must sign up for Parts A and B.
When deciding on your coverage, it’s important to consider all associated costs. In addition to things like premiums, copays or coinsurance through Medicare, be sure to consider aspects of your care that may not be covered. For example, dental, vision, and hearing generally are not covered under original Medicare, which also comes with no out-of-pocket maximums.
Additionally, higher-income beneficiaries pay extra each month for their Part B and Part D premiums through so-called income-related monthly adjustment amounts or IRMAAs. Your tax return from two years before the coverage year is generally relied on to determine whether you’re subject to the extra charges. However, if your financial situation has changed, you can appeal the decision. The charts further below show the 2020 amounts to give you a sense of how the IRMAAs are applied (income thresholds and monthly charges for 2021 have not been released yet).
Here are some tips from financial advisors when it comes to determining which type of coverage is most suitable for you.
Advantage Plan considerations
Enrollment in Advantage Plans has more than doubled over the last decade, to 24.1 million beneficiaries in 2020 from 11.1 million in 2010, according to the Kaiser Family Foundation.
These plans often come with low or no monthly premiums (although you usually still pay your Part B premium). As mentioned, they also typically include prescription drug coverage, as well as extras such as dental or vision.
However, “just know that it might look good on the surface at first, but it can be very limiting,” McClanahan said.
For example, you may have to see a doctor or other provider in the plan’s network. This means if you have a health crisis, you might be unable to see the specialist you want. And while Advantage Plans also come with out-of-pocket maximums, they can be as high as $7,550 (in 2021) for in-network coverage before the plan pays 100% of covered services.
Nevertheless, one of these plans may be suitable, depending on how much you use the health-care system. Keep in mind that generally speaking, the lower the premium, the more you’ll pay in copays or other cost-sharing.
If you’re already enrolled in an Advantage Plan, you can switch to another during this open enrollment if you find one that’s more suitable. If you take no action, your current coverage will continue next year.
“Just make sure your prescriptions and doctors are still being covered under your current plan,” said CFP Joe Boden, senior wealth advisor, and partnerat EP Wealth Advisors in Seattle.
If you want to drop your Advantage Plan during this enrollment period and are planning to pair original Medicare with a Part D plan and Medigap, be aware that getting the latter may involve medical underwriting. And if you have underlying health issues, you may be charged more or denied coverage altogether (more on that below).
Also, if you discover after open enrollment ends that you aren’t happy with the Advantage Plan you chose, you can switch to another, or drop it and return to original Medicare, during a separate window that runs from Jan. 1 to March 31.
Medigap considerations
So-called Medigap policies either fully or partially cover some cost-sharing aspects of Parts A and B, including copays and coinsurance and, perhaps, deductibles.
Each is simply assigned a letter: A, B, C, D, F, G, K, L, M and N. Some states also offer high-deductible versions of Plan F and G. While they are standardized from state to state, coverage between each plan varies. And the premiums can vary widely among locations and insurers.
For instance, the difference among the highest- and lowest-cost Plan G policies in various markets can be stark, according to the American Association for Medicare Supplement Insurance. In one Dallas ZIP code, the lowest cost is $99 per month for a 65-year-old female and the highest was $381 monthly for that same consumer. So yearly, that would be $1,188 vs. $4,572.
Nevertheless, many Medicare beneficiaries like the lower out-of-pocket predictability that can come with a Medigap plan. For example, if you get Plan D, you know that all of your Part B copays (usually 20% of covered services) would be picked up by Medigap. The same goes for the Part A deductible charged per benefit period (in 2020, that amount is $1,408).
Sticking with original Medicare also comes with flexibility in choosing where to get care. For example, if you’re vacationing far from your home state, most providers accept original Medicare. Some Medigap plans will even partially cover care if you’re traveling overseas.
“If you want to make sure you’re covered no matter where you are, a Medigap plan may be more advantageous than an Advantage Plan,” Boden said. Joe Boden SENIOR WEALTH ADVISOR AND PARTNER AT EP WEALTH ADVISORS
It’s important to know that if you don’t get a Medigap plan during your six-month “guaranteed issue” period — which starts when you sign up for Part B — it could be hard to get one down the road.
After that window, unless you live in a state with different rules, you would have to undergo medical underwriting, which could result in a higher premium or being denied coverage altogether if you have underlying health issues.
One exception: If you try out an Advantage Plan for the first time and decide within the first 12 months that it’s not for you, you generally would get a special enrollment period to purchase a Medigap policy without any underwriting.
Additionally, be sure that if you definitely want Medigap, pick the one that would be suitable long term, McClanahan said.
“Once you pick a Medigap plan, it can be really difficult to change because there might be underwriting,” she said.
Prescription drug Medicare coverage
If you’re first signing up for Medicare and wonder why you’d need prescription drug coverage when you are healthy and take no medications, be aware that you may face a life-lasting late-enrollment penalty if you change your mind down the road. And, you could find yourself shelling out full price for medicines if you have a health event and no coverage.
“People hate paying for Part D if they don’t have health issues, but the problem is that you don’t know when something could happen,” McClanahan said.
If you already have a stand-alone Part D prescription drug plan alongside original Medicare (and, perhaps, a Medigap policy), you can change it during this open enrollment if you find one that better suits you. If you take no action, you generally will remain with the same plan — which could have changed its formulary and how it covers (or doesn’t cover) certain medicines.
Be sure that any medications you take are on your plan’s formulary and that you’re at peace with any additional requirements for the plan, such as step therapy (trying a lower-cost drug before a more expensive one). Also, know your deductible. While not all Part D plans have one, it could be up to $435 (for 2020).
The bottom line is that regardless of the Medicare coverage you choose, it’s important to consider the “what ifs” in addition to the cost.
“Insurance is always one of those things where you might be glad you paid an extra amount upfront,” Boden said. “Sometimes it’s about peace of mind, even if you’re paying a little more each month.”
Contact Shield Agency owner, Andy Simmons, to answer your questions on Medicare.
The pandemic has made everyone acutely aware of the need for healthcare Insurance coverage. Small businesses struggling to survive are challenged to find ways to offer health coverage as a fringe benefit to employees. Premium costs are high.
Nonetheless, there are several ways in which small employers can help employees get coverage for the upcoming year.
5 Things to Know About Healthcare Insurance Coverage in 2021
Don’t wait until the last minute to explore your options. Here are 5 things to keep in mind.
1. Coverage Requirements for ALEs
If you have at least 50 full-time and full-time equivalent employees, you are an Applicable Large Employer (ALE) subject to the employer mandate under the Affordable Care Act. This means you must offer minimum essential health coverage that’s affordable to your full-time employees or pay a penalty. What’s affordable Healthcare Insurance? The IRS has released this information for 2021. The cost to employees can’t be more than 9.83% of household income in 2021.
2. HSAs
Health savings accounts (HSAs) allow individuals to cover their out-of-pocket costs. But to make contributions—whether by employers or employees—to such accounts, individuals must be covered by a high-deductible health plan (HDHP). For 2021, this means insurance with a minimum deductible of $1,400 for self-only coverage or $2,800 for family coverage and a cap on out-of-pocket expenses (deductibles, co-payments, and other amounts other than premiums) not exceeding $7,000 for self-only coverage or $14,000 for family coverage.
If you have group insurance that is an HDHP, then you can decide whether to contribute to employees’ HSAs. If not, then employees can choose to make deductible contributions to their accounts for 2021. More information about HSAs is in IRS Publication 969.
3. HRA Options
Health reimbursement arrangements (HRAs) facilitate tax-free reimbursements to employees. While the business can deduct these reimbursements, they aren’t subject to employment taxes. For 2021, consider these HRA options:
Qualified small employer health reimbursement arrangements (QSEHRAs). These plans reimburse employees for premiums on their individually-obtained coverage up to a set dollar limit ($5,250 for self-only coverage or $10,600 for family coverage in 2020).
Individual coverage health reimbursement arrangements (ICHRAs). These plans also reimburse employees for their premiums on individually-obtained health coverage. The law doesn’t cap the reimbursement; it’s up to the employer to fix this amount (on a nondiscriminatory basis).
Excepted benefit health reimbursement arrangements (EBHRAs). These plans help pay for certain benefits, such as dental or vision care, not otherwise covered by a general insurance policy. Reimbursement is capped up to a set dollar amount. The cap for 2021 has not yet been announced (it was $1,800 for 2020).
If you don’t provide a Healthcare Insurance plan or do have a plan (including an HRA) but you don’t pay all of the cost, you can enable employees to pay all or the balance of premiums on a pre-tax basis. The plan must offer employees a choice between cash or reimbursement for health insurance coverage. If they choose the coverage, the amount of what they’d pay for premiums that are withheld from their paycheck is not treated as taxable compensation to them. There are no employment taxes on this benefit. If, however, they choose the cash option, it’s taxable compensation.
5. Notice Requirements
Employers offering a Healthcare Insurance plan are required to give notice to employees about their participation and what’s involved. Depending on the plan, notice may include providing a summary plan document.
Generally, notice is required to be given 90 days before the start of the plan year. So, if the plan year starts on January 1, 2021, notice must be given by October 3, 2020.
Conclusion
Start shopping now for Healthcare Insurance. Contact the Shield Agency expert Carlos Garcia or another tax advisor to find ways to make this benefit available to employees without busting your budget. And be sure that whichever option you use that you do so in compliance with the law.
As a business owner, it can be challenging to keep up with changing rules and regulations, especially those related to health insurance.
What are the essential insurance requirements you need to know for this year? And what are the advantages of offering small business health insurance? Keep reading to learn what your employer obligations are for group health insurance requirements in 2020.
Are employers required to offer small business health insurance in 2020?
Even with the now-repealed Individual Mandate from the Affordable Care Act (ACA), employers were never required to provide small business health insurance. According to the insurance requirements of the ACA, employers with less than 50 full-time employees are considered to be small businesses and are still not required to provide group health insurance coverage to their employees in 2020. However, businesses with 50 or more full-time employees (applicable large employers, or ALEs) are still required to provide health insurance to their workers or face penalties in 2020.
How can employers qualify for the small business health insurance tax credit?
Although it is optional for small businesses to offer group health insurance, employers may be able to benefit from the health care tax credit. A small business can usually qualify for the tax credit if it meets the following insurance requirements:
The small business has 25 or fewer full-time equivalent (FTE) employees.
Employees are paid an average salary of no greater than $54,200 (in 2019).
The small business pays at least 50 percent of employee premiums.
The small business buys a SHOP Marketplace Plan on the Marketplace, or from a partner such as Ehealth.
Smaller businesses can generally be eligible for a higher health care tax credit. For instance, a business with less than 10 employees and an average salary of less than $25,000 would qualify for the highest tax credit. Overall, the health care tax credit may help make the purchase of group health insurance more affordable for small businesses while ensuring that their coverage meets ACA insurance requirements.
How can employees save money?
Small businesses can still purchase group health insurance even if they do not qualify for a health care tax credit. For instance, small employers may still be able to deduct the cost of contributing to monthly employee premiums from their federal taxes as a business expense.
Since group health insurance is employer-sponsored coverage, small businesses can also ask employees to pay for a portion of monthly premiums (typically 50 percent or less) from out of their paychecks while still fulfilling employer cost-sharing requirements and ACA health insurance requirements. Browse affordable small business health insurance plans with eHealth to find the best options for your business.
What are small business requirements related to tax reporting in 2020?
There are certain tax reporting requirements for small businesses to keep in mind for 2020.
If your company decides to offer group health coverage after meeting insurance requirements, you must report the value of the insurance provided to each employee. This information goes on the employee’s Form W-2 using the code DD, as per IRS requirements.
According to the IRS, your business is required to withhold and report an additional 0.9 percent on employee compensation that is greater than $200,000, as per the ACA.
Why should employers offer small business health insurance?
Although in some cases, offering health insurance is beyond typical employer requirements, there are several advantages to offering a group health insurance plan to your employees.
Retaining and attracting employees – Providing group health insurance coverage may help your small business recruit better employees while also helping keep your best current employees. In a competitive talent market, offering health insurance as part of a compensation package may be an appealing incentive for people to join your company.
Helping your business stand out – According to the Bureau of Labor Statistics, only about 55 percent of companies with less than 100 workers offered medical benefits through small business health insurance. Employees frequently sign up for group plans, even when they have to pay for part of the premiums.
Building a healthier workforce – When employees have health insurance, they may take less sick days and could help your small business be more productive. By having access to many health care resources, your employees can proactively attend to their medical needs with fewer disruptions to their work schedule.
Overall, offering group health coverage may be a worthwhile investment for your small business, regardless of your employer’s requirements.
Where can employers find small business health insurance?
As a small business employer, you quickly can find group health insurance coverage through eHealth. With eHealth’s online marketplace, you can easily compare group medical plans from multiple health insurance companies, including plans which may not be offered on the exchange. By quickly entering your number of employees and the company’s ZIP code, you can instantly get quotes for small business health insurance.
This article is for general information and may not be updated after publication. Consult your own tax, accounting, or legal advisor instead of relying on this article as tax, accounting, or legal advice.
For assistance with your small business health insurance, contact our specialist, Carlos Martinez Garcia | P: 616-777-3017 | Fax: 616-896-4601
