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Employer Vaccination Mandates and Medical Premium Surcharges

Jeff Griffin

Many employers are struggling to increase COVID-19 vaccination rates among their workforce, concerned not only about the safety of the workforce but also the costs of COVID-19 treatment that could be avoided through vaccination.

Some, like Delta Airlines, are turning to higher premium costs, or a surcharge, for any group health plan participants who remain unvaccinated. This decision by Delta, taken once an FDA-approved vaccine came on the market, should by no means be interpreted as a full-throated endorsement of this action. In fact, it’s quite likely that Delta’s decision will be tested in the courts.

Challenges are likely to come in three areas: wellness positioning, surcharge amounts, and possible discrimination. Nevertheless, Delta’s decision has prompted some employers to consider doing something similar.

Here are issues employers need to consider if they decide to take similar action.

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Topics: Compliance, Cost Containment, wellness, COVID-19

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Shopping for Healthcare Services - 8 More Ways to Save Through Pricing Transparency

Jeff Griffin

As employee benefits consultants, we take our responsibility seriously to educate employers and employees on resources available to help reduce employee benefits program costs and out-of-pocket healthcare expenses.

This is especially true for those enrolled in High Deductible Health Plans (HDHPs), but even for those who aren’t. For without any effort, as a collective, to become more price-conscious consumers, healthcare providers will have no reason to reign things in.

In a recent blog, we discussed how consumers can save on prescription medications, including comparison shopping, manufacturer rebates and discounts, drug substitution, pill splitting, bulk buying, mail-order, and more.

As a complement to that blog post, today we’ll discuss various ways consumers can save on healthcare services and procedures. After all, when combined, hospitals and physician/clinical services account for 48% of healthcare expenses.

With nearly half of medical expenses centered around these areas, it makes sense for healthcare consumers to focus on these cost centers as target-rich environments for possible savings.

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Topics: Cost Containment, Consumer Driven Healthcare

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8 Ways Employers and Employees Can Save On Prescription Medications

Jeff Griffin

With over half of today's workforce enrolled in high-deductible health plans (51%), a majority of insured individuals are now on the hook for deductibles of at least $1,400. In addition, those with family coverage are responsible for at least $2,800.

While these higher deductibles are offset by cheaper monthly medical premiums and often by employer contributions to Health Savings Accounts (HSA), HDHP plans are nevertheless structured in such a way as to promote heightened "healthcare consumerism."

Judging by the sticker shock most consumers experience the first time they pay for medical services or prescription drugs without a copay, this heightened awareness of the "true cost of care" seems to be making an impact. As a result, consumers are indeed becoming more proactive about shopping for services and comparing prices, just as they would for any other consumer good.

Many employers, especially those that are self-funded, encourage this type of behavior since it can help them control costs and ultimately save significant dollars for both the company and its employees. (Employers with fully funded medical plans also have plenty of reasons to control their medical claims, though the potential savings often aren't recognized as immediately.)

And while consumers seem to have a love/hate relationship with HDHPs, many of those who take the time to fully calculate the total out-of-pocket cost of medical coverage and care realize that HDHPs, even with higher deductibles, can often save them money.

This isn't to say that HDHPs are for everyone, and if a company isn't helping its workforce adequately prepare for this change in consumer behavior, they are setting themselves up for failure.

Since we wouldn't want that to happen, here are eight suggestions to offer your workforce to help them save money on prescription drugs. In a future post, we'll offer tips on how to save money on common medical procedures.

Please share this information with your workforce. In doing so, you'll be helping them to become better consumers of healthcare and more satisfied enrollees in high deductible health plans.

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Topics: Cost Containment, Prescription Drugs

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Prescription Drug Pricing Trends

Jeff Griffin

As prescription drug costs continue to increase, it’s important for employers to understand the trends behind the rise and what they can do to better manage their health care expenses.

This blog post sets out to provide context for why prescription prices continue to rise and offers cost-cutting solutions for employers and employees.

Prescription Drug Cost Drivers

In 2019, the United States spent nearly $370 billion on prescription drugs, keeping trend with significant increases year over year. Although prescription drug spending has historically been a small proportion of national health care costs compared to hospital and physician services, it has grown rapidly in recent years—comprising about 10% of national health care spending.

A multitude of reasons led to this steady rise in prescription drug costs, including the following.

Influx of Specialty Drugs

Specialty medications account for a smaller portion of U.S. prescriptions than non-specialty drugs, yet they commanded nearly half of the pharmaceutical market in 2016 ($180 billion). And that dominance is likely to remain. Specialty drug spending is projected to experience rapid growth over the next several years, due to pricing increases.

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Topics: Cost Containment, Prescription Drugs

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5 Telehealth Trends to Watch in 2021

Jeff Griffin

Employers that are interested in cutting their health care expenses are likely familiar with telehealth. This is the process of communicating with a doctor via an app, or a webcam and computer. During the COVID-19 pandemic, telehealth usage skyrocketed, making it one of the most popular ways to receive health care.

As such, employers should stay apprised of notable telehealth trends to ensure they stay competitive and provide the best health care options to their employees. This article discusses five telehealth trends to watch for in 2021.

1. More Patient Utilization of Telehealth

As was stated, telehealth exploded in popularity during the COVID-19 pandemic. To put that into figures, nearly half (43.5%) of Medicare primary care visits in April 2020 were made using telehealth, according to the Department of Health and Human Services. And even before the pandemic, year-over-year utilization was up 33% in early 2020, according to Medical Economics.

If these statistics aren’t enough to prove that telehealth is here to stay, look instead at market projections. The telehealth market is estimated to surmount $185 billion by 2026, according to Fortune Business Insights. Considering the market was only worth around $34 billion in 2018, this shows how much of an impact telehealth has made on the health care industry.

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Topics: Cost Containment, Telemedicine, COVID-19

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Why Your Employees Aren’t Enrolling In Your HDHP

Jeff Griffin

Employers looking to decrease their healthcare costs often rely on workforce adoption of High Deductible Health Plans (HDHPs), which offer both employers and employees lower premiums. Unfortunately, if employees are given a choice, this strategy doesn’t always work if enrollment in HDHPs fall short of forecasts.

Rightly or wrongly, HDHPs have been saddled with some baggage. Many people have difficulty making the cognitive leap from traditional healthcare plans to HDHPs for a variety of reasons; in part because change is generally difficult for people, but sometimes, it’s simply a fear of the unknown and a matter of not understanding how they work.

While we certainly aren’t advocating that HDHPs are suitable for everyone, they’re a great fit for some. Particularly, those who are otherwise overpaying for health insurance, meaning that they’re paying high premiums, but rarely using their plans.

Here are some reasons your employees might not be enrolling in your HDHP — and how you can increase HDHP enrollment.

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Topics: Cost Containment, Education, HSAs, High Deductible Health Plans

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The Financial Impact of COVID-19 On Self-Funded Employer-Sponsored Group Health Plans

Jeff Griffin

Employers are understandably confused when it comes to trying to predict how the coronavirus epidemic will impact their group health plans. Utilization is way down for preventive, elective, and non-emergent services, while expenses directly relating to the testing and treatment of COVID-19 are way up.

Employers aren't the only ones who are perplexed; many employee benefits experts are also in disagreement as to how all this will play out. Willis Towers Watson estimates that employer health care costs might increase by 4 to 7 percent for calendar year 2020, while Gallagher is predicting just the opposite, suggesting that a 15% decrease in medical expenses is possible. Others, as you'll read about later, are suggesting the potential for a staggering 40 percent increase in premiums next year. 

Employers, most notably those with self-funded group health plans, must be mindful of these wide swings in predictions. Regardless of which way things play out, they need to take careful steps to ensure the financial viability of their health plans during this crisis.

So how can employers forecast and prepare for these shifts in cost? It's especially difficult because the impacts of this pandemic are highly dependent on the geographic, demographic, and economic risks which impact every employer quite differently.

Here are some steps self-funded employers should take, along with some predictions on what might happen to various cost-drivers of medical plans.

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Topics: Cost Containment, Legislation, self-funding, COVID-19

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Three COVID-19 Financial Relief Programs For Small Business

Jeff Griffin

While we've fielded thousands of questions these past few weeks about the COVID-19 pandemic, the vast majority of inquiries most recently have been about emergency financing relief for small business.

Here is what we know about three financial relief programs, each made possible by the CARES Act recently signed into law; 

  • CARES Paycheck Protection Program (PPP)
  • CARES Business Debt Relief Program
  • CARES Economic Injury Disaster Loans (EIDL) & Emergency Economic Injury Grants (EEIG)

As a reminder, we update both of our COVID-19 Download Resource Centers daily with regulatory briefs, legislative summaries, newsletters, flyers, and posters for you to use as you see fit.

Make sure to bookmark this resource area for ease of reference later.

CARES PAYCHECK PROTECTION PROGRAM (PPP)

What is the Paycheck Protection Program?

The PPP is a program designed to minimize layoffs during the coronavirus pandemic. The PPP provides businesses with fewer than 500 employees with 100 percent federally-guaranteed loans, which may be forgiven, if borrowers maintain their payroll during this pandemic.

Must a PPP loan be paid back?

No, providing an employer maintains their payroll, the loan will be forgiven. We'll address the amount of loan forgiveness available later in this article.

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Topics: Cost Containment, Legislation, COVID

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Employer Impact; The $2 Trillion COVID-19 Stimulus Package

Jeff Griffin

To say that the Coronavirus (COVID-19) pandemic has put a significant strain on every aspect of daily life around the world would be an understatement. As the spread of the disease shows no sign of slowing down, there remains steadily increasing concern in this country, not only about the health of our citizens, but also our economy, which is now in tatters, through no fault of its own.

In response, on Friday, the United States Congress passed a $2 trillion package to provide a jolt to our economy, reeling from the deadly virus. This is the third aid package from Congress and is it designed to keep businesses and individuals afloat during an unprecedented freeze on the majority of American life.

This will most likely not be the last stimulus package Congress will have to enact. This is especially true given that President Trump, just yesterday, extended his administration's social-distancing guidelines through the end of April, as the peak death-rate from the virus is expected to hit in two weeks. (The death toll from COVID-19 past 2,000 over the weekend.)

Most economists are in agreement that last Friday's $2 trillion package isn't a stimulus plan at all, but rather a relief package. Senate Majority Leader Mitch McConnell (R-KY) described the legislation this way; "No economic policy can fully end the hardship, so long as the public health requires that we put so much of our commerce on ice. This isn't a stimulus package. It is emergency relief. Emergency relief. That's what this is."

All Americans would do well to understand the provisions of this latest stimulus/relief package, as it will offer direct relief to businesses and individuals alike. Here are the details.

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Topics: Cost Containment, Legislation, COVID-19

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Is Medicare-for-all Good for Business Owners and Employees?

Jeff Griffin

Today the first official votes will be cast, both in Iowa and California, for the 2020 presidential election. A hot button topic in the discourse leading up to this moment has been whether the country should migrate to a single-payer healthcare system commonly referred to as "Medicare-for-all."

While every Democratic candidate still in the running supports some level of change to the current healthcare system, Medicare-for-all is a solution championed primarily by Vermont Senator Bernie Sanders and Massachusetts Senator Elizabeth Warren.

Both are pushing for a single-payer solution where Americans would be enrolled automatically in a government-run medical insurance plan. Both of their policies call for essentially disbanding private insurance, or relegating it to something only needed to supplement care outside of the provisions provided in their single-payer solutions.

Should Employers Embrace Medicare-for-all?

Would this transition to Medicare-for-all be a good thing for employers, 4.5 million of which are providing employer-sponsored group health insurance to over 160 million Americans representing 49 percent of the country's total population?

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Topics: Cost Containment, Disruption, Legislation

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