For companies with 2-50 employees
As an employer, being able to offer your employees some base benefits on a pre-tax basis like group medical, dental, vision, life, disability, and accidents plans has always been a way to attract quality staff and retain them.
2014 will be a nervous and exciting year for business owners offering group medical insurance. For companies with less than 50 employees, new coverage will be available through the Oregon Insurance Exchange at CoverOregon.com, called The Shop. There are over 10 companies planning to offer nearly 100 new plans to business owners, with many new companies offering plans through Cover Oregon.
After completing the Cover Oregon Training, I’m excited to help your company enter into the new world of benefits available. Currently, smaller companies have been limited to just one company, or maybe two. This is changing for the good.
COVER OREGON: THE SHOP PLANS
As of January 1, 2014, if you bring your group health insurance to Cover Oregon, you can decide how much to offer your employees in benefit dollars instead of limiting them to one plan and hoping they like it. For instance, you can pay 75% of their premium up to $300 per person.
There will be many options, but Oregon allows the “Total Freedom” plan. This will allow each employee freedom to choose from any company, and every plan offered through Cover Oregon. The employee will then log in and sort the plans by price, provider, coverage options, deductible or another sort. You will receive an invoice showing the plan they selected and cost.
It will all be managed at the Cover Oregon “Dashboard”. You can add new employees there, and delete ones that you terminate. Each employee will have a log in where they can view their personal coverage and make changes to their personal information.
WHAT ARE SOME OF THE KEY ISSUES?
The first thing to be aware of is extremly important. Here’s a little background. Under the new Individual Exchange, children whose parents make under 300% of the Federal Poverty Level will be offered free health and dental insurance through the Healthy Kids program through Medicaid. Dependents making up to 400% of the FPL will also be able to buy individual plans and receive a tax subsidy.
Here’s the twist. If the employer offers group coverage to dependents deemed ‘affordable’ for his employee, then his dependents cannot purchase individual coverage on the Exchange and receive a tax subsidy–which can be a huge disadvantage for the employee. The employees children cannot qualify for the free coverage if they are middle income. The last thing you want is to penalize your employees by offering them group coverage that hurts them financially.
WHAT’S AN EMPLOYER TO DO?
There will be a great solution: Offer your employees new coverage under the Insurance Exchange as an “Employee Only” plan. Most employers only pay part of the premium for the Employee Only anyway. By limiting your group plan to employees only, this will free up your employees to insure their dependents under the Individual Exchange and receive a tax subsidy to help pay for it, or accept the free coverage offered to may children.
If your employees are all higher income, and wouldn’t qualify for tax subsidies anyway, then you should offer cover to dependents. This will allow the employee to purchase coverage on the group plan for their dependents, and receive the ‘pre-tax’ benefit they have now under your section 121 plan.
Here are the 2 options to consider:
1. Should we offer group medical coverage outside of the Exchange?
2. Or should we purchase a group plan within the Exchange?
MY ROLE AS YOUR INSURANCE BROKER
Should you choose to work with me as your Broker (which comes at no cost to you), here is my plan of action.
1. I will help you as Employer set up your group health insurance plan through Cover Oregon. Plans will be available outside of the Exchange, at the same rate as through Cover Oregon.
2. I will work directly with your employees to help guide them in understanding how to best insure their dependents through the Cover Oregon individual plans. This will save the time and energy of explaining the options, as I am your local expert.
3. I’ll help you set up other benefits you want may want to offer such as Accident Insurance, a group Dental policy, and a Disability Income insurance.
So will eligibility change to offer group insurance?
ELIGIBILITY TO OFFER GROUP MEDICAL
(A few basics)
1. You must have a minimum of 2 ‘eligible’ employees working at least 17.5 hours per week to offer group coverage. This can be a husband and wife who both work in the business and take payroll. Employee with other group coverage (like a spouse’s plan, Medicare, or the VA) are counted, by not required to enroll.
2. At least 75% or eligible employees must enroll in the plan (most companies), not counting those “waiving” to other group coverage (spouse, VA or Medicare).
3. The employer must pay at least 50% of the employee-only premium
4. New rule; You can have no longer than a 60 day waiting period once an employee becomes ‘eligible’ before you need to offer them the coverage.
YOU QUALIFY? GREAT! READ ON!
Preparing quotes for you:
1. The rates are based on the average ages of your employees, so I need a completed ‘Census Form’. Please contact me and request a census at firstname.lastname@example.org, and I’ll send one right away.
I represent Kaiser, Lifewise, HealthNet, Providence and Regence for group medical insurance outside the Exchange. Come January 1, I will represent every plan within Cover Oregon, and many plans in Washington State as well.
I will sit down with you to discuss the plan options and refine your benefit package. This can also be done via email and phone as I value your time. The Oregon Insurance Exchange plans will offer 12 other companies, so there will be many more choices.
If you decide to proceed I will help you enroll your group and provide follow-up support. Each year we continue to be available as needed to provide support, and review renewal options as needed during your “Open Enrollment” month.
125 POP AND 105 HRA PLANS:
If your employee’s pay a portion of the medical premium, or you withdraw premiums for dependents, Section 125 of the tax code requires you to have a Section 125 Plan for your group, also known as a Premium Only Plan (POP), or Cafeteria Plan. This allows the employer to withhold the dependent premiums on a pre-tax basis. I can help you set up this plan if you do not have one in place or you can set one up at www.coredocuments.com .
Another valuable tool is a Health Reimbursement Arrangement (Section 105 HRA under the tax code). You can set up an employer paid HRA that will reimburse employees a pre-set amount of medical, dental, and other unreimbursed expenses, say up to $500 per year. Once you understand this tool you will be amazed, and your employees will be grateful.
Learn more at www.coredocuments.com
CHECKING PROVIDER DIRECTORIES:
To check the Regence Provider Directory Online, click to the link below: Use the Preferred Provider Network (PPP):
To check the Providence Provider Directory Online, click to the link below:
To check the HealthNet Provider Directory Online, click to the link below:
To check the Lifewise Provider Directory Online, click to the link below:
To check the Kaiser Provider Directory Online, click to the link below: