< E-NEWSLETTER: Volume 9, Issue 2 (October 2007) NEW VOLUNTARY BENEFITS OFFERINGS EMS is excited to announce new voluntary benefit offerings. In the past, AFLAC has been made available to client companies. Although several clients have taken advantage of those programs, we are constantly searching for better options for employees, both in terms of cost and ease of issue. We have entered into an agreement with Voluntary Benefits Specialists, an Ohio-based company specializing in the communication and enrollment of “best of class” voluntary benefit programs. These programs are paid for by the employees via payroll deduction. In regards to insurance providers, we will be partnering with Transamerica to provide a short-term disability program, which will be offered to eligible companies on a “Contingent Guarantee Issue” basis, meaning only one health question on the application must be answered in order to qualify. Several employees were denied coverage with our previous program, due to the amount of health-related questions on the application. With the new program in place, we will be able to provide coverage to more employees. Transamerica also offers a highly competitive array of supplemental products including Accident and Cancer Insurance. In addition to Transamerica, we will also be working with Cincinnati Life Insurance Company, a local company that offers “Guarantee Issue” Life coverage to all eligible employees. Based on our employee size and the number of client companies within EMS, Cincinnati Life has agreed to offer “Guarantee Issue” to all client companies within EMS based on certain enrollment criteria. This means that all employees, regardless of their health history, will be able to purchase coverage without having to answer any health questions at all! More information on these exciting employee benefit options to follow. Flexible Spending Accounts Are you leaving money on the table? Section 125 (S125) is a voluntary plan that lets you convert part of your compensation into tax-free benefits. Contributions made through S125 are entirely free of federal, state and FICA taxes. Under S125 plans, you may elect to have part of your paycheck deducted before taxes are computed to use for healthcare and day care expenses. EMS has partnered with Chard-Snyder to offer clients preferred pricing for a Flexible Spending Account (FSA). Flexible Spending Accounts (FSAs) allow you to set aside up to $2,000 for medical reimbursements on a tax-free basis Dependant Care lets you contribute up to $5,000 per year, which includes funds for summer day camp programs A New Strategy High Deductible Health Plans (HDHPs) bring an entirely new strategy (and set of acronyms) to the table, especially for consumers who are more familiar with the traditional HMO and PPO options. With HDHPs, individuals must pay a significant amount for healthcare expenses before the plan will cover any benefits. Many employers will supplement their HDHP options with HSAs because HDHPs typically result in higher out-of-pocket costs for consumers. HSAs can provide a financial safety net for those expected and sometimes unexpected healthcare costs. According to a 2006 Watson Wyatt survey report on consumer-driven healthcare strategies for employers, 20 percent of companies now offer an HDHP, and 33 percent plan to add one in 2007. Those statistics are up from 2005 and will likely increase year after year as healthcare costs continue to rise. As a growing number of employers implement an HDHP strategy and grant workers control of their healthcare dollars, the more imperative it will be for employees to have access to vital healthcare quality cost, and health plan data—information that can help them weigh their coverage options more carefully. To fulfill these needs, employers are turning to online healthcare decision tools for support. The Internet Paves The Way Through simple Internet technology, online decision tools allow employers to seamlessly deliver easy-to-understand data on physician quality, hospital practices, treatment costs and health plan options to their employees via a password-protected intranet site. As a result, employers have a unique opportunity to: Facilitate organizational cost containment by giving employees access to actionable healthcare information Increase employee satisfaction and retention rates by clarifying the costs of specific benefit choices Reduce employee absenteeism by providing employees with comparative research tools and self-service options, so they can take a preemptive approach to their care with prevention information and other online resources While the Internet might appear as an unlikely source for important healthcare information, recent reports indicate that a growing number of consumers are relying on the Web to research specific health topics. A 2006 Harris Poll estimated that 80 percent of online U.S. adults, or 136 million people, would turn to the Internet during the year to learn about symptoms, conditions and diagnoses. However, that does not necessarily mean the information consumers aggregate over the Internet is of high quality. To address this issue, employers must insist that the data presented through their online decision tools are: Credible and impartial. Information on topics like pharmaceuticals, surgical processes, type of care and care providers should come from trusted and unbiased sources, such as federal, state and other industry-respected third-parties (e.g. The Leapfrog Group, NCQA and health plan claims). Easy-to-understand. It is one thing to present a plethora of comprehensive data to employees. It is another to present that same information in a consumer-friendly format that employees can learn from. Personalized. Information should be based on factors important to employees and other established criteria, such as geographic location, age, gender, specific medical condition, etc. This gives the user a more accurate and highly-customized online experience. Putting It To The Test Healthcare information companies and health plans have begun to create on and off-line information and tools to prepare members for the healthcare stewardship for their families. The focus has really been on aggregating as much good, credible and reliable data as possible and letting employers present the information in a format that best meets their employees’ needs. Wellness at Work Just as we are committed to offering valuable quality benefits to employees, we are committed to cost containment of those benefits. In pursuit of these goals, EMS is and will continue to focus on consumer-driven programs. Some of our clients took advantage of the Wellness Programs and benefited from encouraging employee responsibility and healthy involvement in their lifestyles. Continuing with that approach, EMS was pleased to offer an enhanced Employee Assistance Program (EAP). eni’s BalanceWorks® program is an enhanced work and family life benefit that provides quick online resources and guidance with day-to-day issues as well as major work and family life challenges. Led by a team of Mental Health professionals and specialized Personal Assistants, BalanceWorks delivers the individual attention your employees need and want to stay focused and lead a more productive and balanced life. EMPLOYEE ASSISTANCE PROGRAM (EAP) Studies confirm that an effective, established and well-promoted EAP is valuable in resolving workplace concerns. Some of the known cost savings include: Lower employee absenteeism Increased employee productivity Reduced workers’ compensation claims Lower healthcare costs Improved employee recruitment and retention An EPA is one offering available through the affordable, comprehensive benefit program for employees. EMS' network includes other resources for the various wellness strategies. CREDITS & RECOGNITION Employees need to be healthy to achieve their optimum productivity level. Healthy employees are less likely to have unexpected absences. Obesity and smoking have been linked to costly illnesses such as heart disease, diabetes, cancer and lung disease. According to a study by the National Business Group on Health, a smoker costs his/her employer an average of nearly $4,000 more than a non-smoker in added healthcare costs each year. Acknowledging an employee's choice for a healthy lifestyle is vital to the success of a wellness initiative. Your EMS HR Specialist can assist you in implementing smoking cessation, wellness credit and weight-loss programs to encourage your workforce to be healthier, more productive and help control these costs. Anthem’s Care Comparison Tool Your employees face important healthcare decisions everyday. Ultimately, their choices can make or break your health benefits budget, but unfortunately many make those decisions without all the facts. Hospital choice helps determine premiums and out-of-pocket expenses. Anthem’s Care Comparison Tool compares prices at specified area hospitals for common procedures and tests. It quickly shows your employees that one procedure can carry different price tags at different hospitals. Being aware of the associated costs is the first step to reducing these expenses and possibly reducing premiums. Employees can access the cost comparison tool by logging on to www.anthem.com and clicking on MyHealth, Healthcare Advisor or Anthem Care Comparison. Meet the EMS Team RACHEL KERNS, Business Development Manager Rachel Kerns graduated from Ohio State University in 1992 with a B.A. in Education. She has gained extensive experience in professional sales having worked in the industry for nearly 20 years as a sales representative in the copier industry and as a sales manager for a large, Internet job board. In 2006, Rachel joined EMS as a Business Development Manager and is responsible for new sales in the Columbus region. MARK WALTERS Business Development Manager Mark Walters earned his Bachelor’s degree in Business Management from Kent State University. He began his sales career in the telecommunications and hardware/software industry where he gained more than 12 years of sales experience. In 2002, Mark transitioned into the PEO/HRP industry and assisted with the opening of a PEO in Cleveland. In 2006, Mark joined EMS as a Business Development Manager and is responsible for new sales in the Cleveland region. Benefits Renewal & Open Enrollment Anthem has been EMS’ health plan carrier for more than 10 years and as with most businesses, the market has changed dramatically during this period. While EMS has utilized multiple carriers in addition to Anthem over this period, Anthem has maintained a vast majority of the health plan membership. The 2007 re-balancing of the HMO and PPO rates, and re-tiering of the single versus family rates, has been a priority for the last several years. The following are the results of this restructuring: Re-balancing Re-balancing the HMO versus PPO rates was necessary because the HMO rates were significantly under-priced while the PPO rates were over-priced. This phenomenon became visible when the Anthem plan was initiated over 10 years ago, when HMOs were still prominent in the market place. Today, HMOs have only approximately 25 percent market share. Originally, HMOs had smaller physician and hospital networks with deeper discounts, but due to this market trend, Anthem has made all PPO and HMO provider contracts, as well as their network of doctors and hospitals, the same. This re-balancing was performed because the market no longer requires the features that previously differentiated the two products. Re-tiering Today, EMS’ competitive data for both current customers and prospects indicates: The average competitors’ single rate for PPOs was in the mid to high $200s versus low $300s for the EMS PPO products The competitions’ family rate was in the high $800s or low $900s while the EMS family PPO rate was in the high $700s These rates placed EMS at a disadvantage for current customers who wanted to move to the more popular PPO plans and/or to better serve non-Cincinnati employees. Anthem’s HMO product only covers employees who receive services in Ohio, Kentucky and Indiana. In summary, EMS realizes the one time adjustment is difficult for existing HMO clients, but believes the resulting re-balanced and re-tiered PPO plans offer below-market premiums and renewals, as depicted for the last 6 years in the chart below. 435 Elm Street, Cincinnati, OH 45202 • Phone: 888.651.1536 • Fax: 866.596.1530 • Site Map • Contact Us © 2010 EMS.