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What is the Average Employer Contribution to Health Insurance Premiums?

Jeff Griffin

One of the most common questions we receive as an employee benefits broker is how much the average employer contributes to their employees’ health insurance premiums. It’s a tough question because there are a lot of different factors involved, but luckily, there are some excellent resources available to help us source reliable answers.

In addition to our own proprietary client roster, one of our favorite resources is the annual Kaiser Family Foundation (KFF) Health Benefits Survey because it succinctly summarizes data from an accurate (and broad) representation of employers across the country and provides charts and graphs to make the information more easily digestible. This allows us to show our clients trends over long periods of time and perhaps help predict what they can expect for the upcoming year.

Here’s what the 2017 KFF Health Benefits Survey reported for employer contributions to health insurance and how the data compares to the previous benefits year.

Employer vs. Employee Contributions to Health Insurance

While these averages vary based upon a number of factors (including, but not limited to, the size of the firm, revenue, and overall cost of premiums) looking at this data can give employers a good idea of what their competitors may be offering. Remember that your employee benefits broker can help you obtain more in-depth, geographically relevant benchmarking data.

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Topics: Employee Benefits, Affordable Care Act, ACA, CFO, CHRO, PPACA

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How to Provide Benefits for a Multigenerational Workforce

Jeff Griffin

Today, many employers are facing an interesting phenomenon companies have never experienced before. There are at least three generations making up the bulk of workforce, with two other generations filling things out at both ends of the age spectrum. Each of these generations has a different set of priorities, which presents unique management and employee benefits challenges for employers. Each of these generations is influenced by the period of time in which they were raised; their work lives are shaped by world events, cultural phenomena and personal experiences.

How is one employer supposed to make three (or even five) generations of people happy? Managing employee benefits across a multigenerational workforce might not be easy, but it’s certainly not impossible.

Defining the Generations

Whether you have 50 employees or 500, chances are you have a mix of generations working for you. So let’s first discuss the various generations before diving into multi-generational benefit design. Here's a breakdown of these five groups.

The Silent Generation

Born between 1928 and 1945, a good portion of this generation grew up (or was born) during the Great Depression and were named such because, at the time, it was believed children were meant to be “seen and not heard.” The older portion might have served toward the end of World War II. People in this generation are at least 72 years old as of 2017. This portion of the workforce is rather small at this point — about 2 percent.

Because this entire generation is above the traditional “retirement age,” most of the people still working in this age bracket are in high level positions, while others are running their own businesses or still working in a family-run company. That said, there are some who work in part-time, hourly and seasonal positions primarily to keep themselves busy and to interact with people.

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Topics: Employee Benefits, millennials, Multi-Generational

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Employee Benefits Issues in Mergers and Acquisitions

Jeff Griffin

When your company is healthy and growing, it’s not uncommon for the subject of a merger or acquisition to come into play. They can be excellent strategic moves to help you gain additional distribution, capital, access to patented processes, or simply broaden your customer base.

But while the CEOs, CFOs, and COOs are working out the details of the sale, your HR department will be dealing with the day-in-day-out human component. They’ll be fielding questions from concerned employees, figuring out how your employee benefits will be affected, and looking for possible solutions.

CHROs have a tough job ahead of them during mergers and acquisitions and we have some experience in assisting employers through the process. Here’s what we’ve learned and how you can apply it to your own employee benefits issues in mergers and acquisitions.

The Role of HR in Mergers and Acquisitions

Mergers and acquisitions are complicated endeavors, involving an incredible amount of work and attention to detail. Because HR departments are the ones who deal with the human component (arguably the most valuable in any company), they’re tasked with some of the most difficult pieces of the puzzle.

After all, a case can be made that human resources is far more complex than most other departments because every person is different. Each employee has different needs, motivations, and goals, which will cause each person to feel differently about the merger or acquisition. Some may feel apprehensive or scared, while others may be excited at the new possibilities.

As such, the failure to reach objectives after a merger or acquisition is oftentimes blamed on the human resources department. Reasons such as “incompatible cultures, [differences in] management styles, poor motivation, loss of key talent, lack of communication, diminished trust and uncertainty of long-term goals” are typically cited as barriers to success.

But if HR-related issues can be blamed for failure, there’s no reason they can’t be praised for the successful merger of two companies or acquisition of another. We’re willing to bet that the objectives behind such business strategies couldn’t be obtained without talented HR professionals easing the transition.

And of course, one of HR’s biggest responsibilities is employee benefits, which is bound to be at the forefront of employees’ minds during either a merger or an acquisition. Every aspect of employee benefits affects employees’ families, from health insurance and paid time off (PTO) to retirement benefits and childcare subsidies.

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Topics: Employee Benefits, CFO, CHRO

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Are Employers Required to Offer Family Health Insurance?

Jeff Griffin

At this point, everyone knows the Affordable Care Act (ACA) requires all employers with 50 or more full-time equivalent (FTE) employees to offer affordable coverage to their workforce. This requirement is called the employer mandate.

What’s less clear for some employers is to whom the coverage must be extended. Do employers have to offer family health insurance coverage? Dependent health insurance? What about coverage for spouses? The answer is pretty straightforward, so let’s dive right in and clear up all that confusion.

ACA Requirements for Employers

The ACA requires that applicable large employers (ALEs) offer affordable coverage to their full-time employees and their dependents up to age 26. However, the law makes no requirement for spousal coverage, nor does it mandate that employers pay for any portion of the premium for dependents.

So in short — employers are not required to offer family health insurance. That being said, many employers choose to offer coverage for spouses and families, regardless of whether dependents are older or younger than 26 years of age. In addition, most choose to subsidize a portion of the premium as well.

One trend picking up steam in the past decade is to only offer spousal coverage if the spouse isn’t able to obtain health insurance through his or her own employer (or if the spouse doesn’t work).

Another common practice is for an employer to levy an additional surcharge for spouses who can obtain insurance through their own employers, but prefer to be on their spouses’ insurance instead. The reasons for doing so are often wide and varied. Nevertheless, the surcharge is often relatively minimal — perhaps around $100.

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Topics: Employee Benefits, Affordable Care Act, Plan Design, employers

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Workforce Social Media Guidelines On & Off the Clock

David Rook

At this point, nearly every business, regardless of size, has a social media presence — as does nearly every single one of their employees. Like it or not, social media isn’t an option for your company anymore. It’s basically a must-have.

Customers not only expect you to have an easy-to-use website, but they want to see you on social media sites such as Facebook, Twitter, Instagram, Snapchat, and plenty of other platforms you probably wish you didn’t have to think about. Of course, this means you need to develop strong social media guidelines for your employees to follow, while they’re on and off the clock.

Social media creates an obligation on the behalf of your company to have trusted, well-trained, and responsible staff representing your business online. It’s so easy for an employee to misspeak or get baited by an annoying internet troll. Social media also provides ample opportunity for your workforce to talk about your business when they’re off the clock. This can be a good thing, but it can also backfire if people believe your employees are speaking on the behalf of your company, even while on their personal pages.

While social media can be a frustrating venture for any business, it also creates an environment where you can interact on a more personal and immediate level with customers (both current and prospective). It expands the reach of your brand while increasing brand interactions.

Social media is here to stay. Because of this, many companies have developed social media guidelines  — both for staff members who work in the marketing and customer service departments (who will be speaking on the behalf of the company), as well as employees outside of those departments who simply engage in social media on a personal level. Social media guidelines don’t tell employees how to use social media in general, but rather describe how it’s appropriate to use social media when talking for, or about, the company. You can download some excellent sample policies here

Why Social Media Guidelines are Important

It’s safe to assume the vast majority of your employees are on social media. Some will be more active than others, but nearly everyone will have a presence on at least one channel — more than likely, multiple social platforms, with the most popular being Facebook, Twitter, and Instagram for personal use and LinkedIn for professional networking.

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Topics: Compliance, Employee Communications, Corporate Communication, Culture, Social Media

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Employee Benefits Glossary: Insurance Terminology Defined (with downloadable asset!)

Jeff Griffin

Insurance terminology sometimes makes discussions about healthcare feel like we’re all speaking in different languages. The jargon insurance companies use is oftentimes confusing for the average person to understand, only further exacerbated by the legalese in which everything insurance-related is written. It feels like we all need a translator just to figure out what insurance policies cover and what participants will be responsible for.

The truth of the matter is that people understand less about health insurance than they like to believe. A 2016 survey by PolicyGenius found that just 4 percent of those polled could correctly identify four common insurance terms: copayment, copay (some people think they mean something different), deductible, and coinsurance. And while 83 percent of people believed they understood the word “copay,” only 52 percent could actually define it correctly. To make matters worse, only 36 percent of millennials could define any of the four terms properly.

As a member of the human resources team, the responsibility of bridging this knowledge gap and educating your workforce oftentimes falls to you. An educated workforce will make better employee benefit enrollment decisions, and will be less of a burden on your employee benefits hotline.

With that in mind, we’ve put together a glossary of common insurance terminology that you can easily slip into your employee benefits enrollment guide or your employee handbook. While we’ve included 11 of the most common terms here, you can download another 52 by clicking here.  

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Topics: Employee Benefits, Education, Employee Communications, employee communication, CHRO

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4 Best Small Business Health Insurance Options

Jeff Griffin

As much as we hear about large companies and their impact on the economy, small businesses employ nearly half the workforce. According to data from the Small Business Administration, small businesses employed 58.9 million people (or 47.5 percent of the workforce) in 2015, creating 1.9 million net jobs in 2015 alone.

Small businesses have a major impact on the economy and on the welfare of their employees’ lives, but they don’t typically have the resources (cash or otherwise) that larger employers do, limiting their options when it comes to providing health insurance (which is still the most important employee benefit).

Of course, small businesses with fewer than 50 full-time employees aren’t held to the employer mandate — it’s up to each employer to decide if they want to offer health insurance to their employees. However, many small business owners view health insurance as one of the most effective ways to attract and retain the best employees and improve productivity (by keeping everyone healthy).

But when the numbers game counts against them, what options are available to small employers?

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Topics: Employee Benefits, self-funding, CFO, CHRO, cost management, Association Health Plans, MEWA, QSEHRA

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What Baby Boomers Retiring Means for Your Employee Benefits

David Rook

Human resources personnel are used to helping older employees transition into retirement. But now that baby boomers are retiring en masse, it seems to be happening all the time. In fact, as many as 10,000 baby boomers are putting in their retirement papers every single day, and while not all 10,000 will be in your company, you’ll probably be dealing with quite a few.

As all these boomers retire, your employee benefits package may need to undergo some changes and you may experience a shift in the cost of providing medical benefits as well. Here are some of the things you need to keep in mind as the baby boomers on your staff begin to retire.

Employee Benefits and Medicare

As your baby boomer employees near retirement age, some of their spouses might be a step ahead of them. The way employee benefits work with Medicare is sometimes complicated — especially when it comes to HSAs, which may be a major theme of the bulk of questions posed by those looking to retire. If your employees need to learn more about how to navigate Medicare, and if they should drop their spouse from your employer-sponsored coverage, make sure you’re as informed as possible regarding the regulations at hand before advising them.  

A frequently asked question by those turning 65 concerns penalties. People who are still working and enrolled in an employer-sponsored health plan aren’t likely to incur penalties for enrolling in Medicare late. However, it’s common for people turning 65 to enroll in Medicare Part A even if they’re still enrolled in their employer-sponsored program because it’s free (provided that the person has worked and paid into Medicare for at least ten years).

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Topics: Employee Benefits, Multi-Generational, HSA regulations, Retirement Planning, Medicare

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Retirement Savings Options: Are HSAs better than 401(k)s?

David Rook

Retirement savings are on everyone’s mind these days, regardless of age or number of years in the workforce. Millennials are concerned they’ll never be able to retire, while baby boomers are choosing to delay retirement — in part because of employer demand for their expertise in the face of a low unemployment rate, but also because many of them haven’t sufficiently saved for retirement. In fact, according to Time’s Money division, 28 percent of boomers and seniors aged 55 and older don’t have any retirement savings whatsoever and just over half have less than $50,000 saved.

Even more surprising, the median amount Americans have saved for retirement is just $5,000, which means we have a long way to go in helping people prepare for their golden years. This number may seem staggeringly low — and it is. The average retirement savings among Americans age 32 to 61 is just under $96,000. However, averages are pulled up by super-savers, so this number seems artificially high.

With the prevalence of high deductible health plans (HDHPs), a lot of people are now enrolled in health savings accounts (HSAs). While people are mostly familiar with the short-term savings opportunities these accounts provide for healthcare expense reimbursement, many are also realizing that HSAs are a viable retirement savings option as well.

This begs the question — if people had to choose between investing in their 401(k) or maxing out their HSA for the year, which one is a better retirement savings option?

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Topics: Employee Benefits, HSAs, Retirement Planning

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Trump's Plan To Reduce Prescription Drug Prices

Jeff Griffin

So it was with great interest that we took note of last Friday’s White House Rose Garden announcement by President Trump to “bring soaring drug prices back down to earth” by promoting competition among pharmaceutical companies, and giving private entities more tools to negotiate better deals on the behalf of consumers, insurers and employers.

Somewhat surprising in his announcement was his abandonment of some of the more populist proposals which he boasted about during his presidential campaign, including his promise to authorize the Feds to negotiate directly with drug companies in an effort to lower Medicare drug prices and disallowing American consumers from importing low-cost prescription drugs from overseas.

Nevertheless, both Republican and Democrats (as well as all of us here at the JP Griffin Group) welcomed the President’s attention on combating high drug prices. The looming question remains just how the President’s promises to lower drug prices will play out and if the concepts proposed will ever come to pass.

We certainly hope the plan gains traction as both employers and employees alike could sure use a break from escalating drug prices which have now become a primary driver of health-related expenditures.

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Topics: Cost Containment, Legislation, CFO, Pharmacy, Prescription Drugs

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