The Employee Benefit Research Institute reports that nearly 20% of mid-sized employers made the jump to self-insurance from 2013 to 2015. A major attraction is the availability of data and analytics, enabling the employer to learn how healthcare dollars are being spent. A growing number of employers are using this data to incentivize employees who lower claim costs by choosing more efficient hospitals or free standing imaging centers when tests such as an MRI are needed.
Press Release from Education and the Workforce Committee Chairwomen Virginia Foxx on April 5, 2017.
The House today passed the Self-Insurance Protection Act (H.R. 1304), legislation that would protect access to affordable health care options for workers and families. Introduced by Rep. Phil Roe (R-TN), the legislation would reaffirm long-standing policies to ensure workers can continue to receive flexible, affordable health care coverage through self-insured plans. The bill passed by a bipartisan vote of 400 to 16.
“By protecting access to self-insurance, we can help ensure employers have the tools they need to control health care costs for working families,” Rep. Roe said. “Millions of Americans rely on flexible self-insured plans and the benefits they provide. Federal bureaucrats should never have the opportunity to limit or threaten this popular health care option. This legislation prevents bureaucratic overreach and represents an important step toward promoting choice in health care.”
“This legislation provides certainty for working families who depend on self-insured health care plans,” Chairwoman Virginia Foxx (R-NC) said. “Workers and employers are already facing limited choices in health care, and the least we can do is preserve the choices they still have. I want to thank Representative Roe for championing this commonsense bill. While there’s more we can and should do to ensure access to high-quality, affordable health care coverage, this bill is a positive step for workers and their families.”
BACKGROUND: To ensure workers and employers continue to have access to affordable, flexible health plans through self-insurance, Rep. Phil Roe (R-TN) introduced the Self-Insurance Protection Act (H.R. 1304). The legislation would amend the Employee Retirement Income Security Act, the Public Health Service Act, and the Internal Revenue Code to clarify that federal regulators cannot redefine stop-loss insurance as traditional health insurance. H.R. 1304 would preserve self-insurance and:
- Reaffirm long-standing policies. Stop-loss insurance is not health insurance, and it has never been considered health insurance under federal law. H.R. 1304 would reaffirm this long-standing policy.
- Protect access to affordable health care coverage. By preserving self-insurance, workers and employers will continue to benefit from a health care plan model that has proven to lower costs and provide greater flexibility.
- Prevent bureaucratic overreach. Clarifying that regulators cannot redefine stop-loss insurance would prevent future administrations from limiting a popular health care option for workers and employers.
For a copy of the bill, click here.
For a fact sheet on the bill, click here.
As Florida Gulf Coast University prepares to celebrate 20 years since it opened its doors, Self Insured Plans is celebrating 20 years of serving the Naples business community. In honor of these two auspicious anniversaries, the business has made a $20,000 pledge to FGCU for its Master of Physician Assistant Studies program.
The program, which is now accepting applicants and will launch in the fall, will help fill the need for these in-demand health professionals. The gift from Self Insured Plans will ensure that students with the desire to pursue this career will have the means to do so.
Self Insured Plans is an independent third party administrator specializing in employee benefits administration. It is a family owned business led by Steve Rasnick, its president and founder, and his son, Brian, who serves as executive vice president.
The family has taken an active interest in FGCU, with Brian Rasnick serving as a member of the FGCU Foundation Board and as chairman of the Eagles Club Advisory Board. It is a rare basketball game at which you won’t see the whole family energetically rooting for the Eagles.
“All of us at Self Insured Plans are very proud to celebrate this milestone,” says Steve Rasnick. “We have much to be thankful for and enjoy being involved in and supporting the community we serve. This gift to FGCU is one way to demonstrate our appreciation and our support for the important role the university serves in training the skilled professionals our workforce needs.”
“We are also pleased to be celebrating our 20th anniversary at the same time as this great university to which we have become so attached.”
The Self Insured Restricted Scholarship will award $5,000 for each of the next four years to an FGCU student enrolled in the Master of Physician Assistant Studies Program.
“This program, operated in our College of Health Professions and Social Work, is extremely important, providing a pathway to a career in which demand is growing exponentially,” says Chris Simoneau, vice president for University Advancement. “Partnering with a well-respected company such as Self Insured Plans, which understands the dynamics of health care, is ideal. It’s especially meaningful as both the university and the company celebrate two decades in Southwest Florida.”
Demand for physician assistants is expected to grow by 30 percent from 2014 to 2024, according to the U.S. Department of Labor.
For details, contact Chris Simoneau at (239) 590-1067. To learn more about Self Insured Plans, visit selfinsuredplans.com today.
Employers sponsoring certain self-insured plans that use a third-party administrator in connection with claims processing, claims adjudication, and enrollment functions (“contributing entities”) must submit their 2016 Annual Enrollment and Contributions Submission Form and schedule a payment for the 2016 benefit year no later than November 15.
Reinsurance Contribution Process
To successfully complete the reinsurance contribution process, contributing entities (or third-party administrators or administrative services-only contractors on their behalf) must register on Pay.gov (or confirm a password if such entities registered for the previous benefit years of the program) and submit their annual enrollment counts of the number of covered lives of reinsurance contribution enrollees for the 2016 benefit year using the 2016 form.
2016 Contribution Amounts
The 2016 reinsurance contribution rate is $27.00 per covered life. For the 2016 benefit year, contributing entities have the option to pay:
- The entire 2016 benefit year contribution in one payment, no later than January 17, 2017 reflecting $27.00 per covered life; or
- In two separate payments for the 2016 benefit year, with the first remittance due by January 17, 2017 reflecting $21.60 per covered life, and the second remittance due by November 15, 2017 reflecting $5.40 per covered life.
Our Transitional Reinsurance Program section features additional information on the reinsurance contribution process.
Employers that do not comply with certain requirements under a number of federal labor laws will face increased fines beginning with civil penalties assessed after August 1, 2016 (whose associated violations occurred after November 2, 2015).
Key Penalty Increases
Penalty increases announced by the U.S. Department of Labor that may be of particular interest include:
- Repeated or willful violations of the Fair Labor Standards Act (FLSA) minimum wage or overtime pay requirements will be subject to a penalty of up to $1,894 per violation (formerly $1,100);
- Willful violations of the Family and Medical Leave Act (FMLA) posting requirement will be subject to a penalty not to exceed $163 for each separate offense (formerly $110) (note: covered employers must post this general notice even if no employees are eligible for FMLA leave);
- Failure to provide employees with a Children’s Health Insurance Program (CHIP) notice will be subject to a penalty of up to $110 per day per violation (formerly $100);
- Failure to provide a Summary of Benefits and Coverage (SBC) will be subject to a penalty of up to $1,087 per failure (formerly $1,000);
- Failure or refusal to file a Form 5500 will be subject to a penalty of up to $2,063 per day (formerly $1,100); and
- Violations of the Occupational Safety and Health Administration’s posting requirement will be subject to a maximum penalty of $12,471 for each violation (formerly $7,000).
Our Compliance by Company Size chart features a summary of key federal labor laws that may apply to a company based on its number of employees.
Annual Notice Requirement
Employers that provide coverage in states with premium assistance through Medicaid or CHIP must inform employees of potential opportunities for assistance in obtaining health coverage.
The employer CHIP notice must be provided annually before the start of each plan year. An employer may provide the notice applicable to the state in which an employee resides concurrent with the furnishing of:
- Materials notifying the employee of health plan eligibility;
- Materials provided to the employee in connection with an open season or election process conducted under the plan; or
- The summary plan description.
The updated model notice includes information on how employees can contact their state for additional information and how to apply for premium assistance, with information current as of January 31, 2016.
Our section on CHIPRA (the Children’s Health Insurance Program Reauthorization Act) contains additional information on employer responsibilities related to the state Children’s Health Insurance Program.
The Affordable Care Act (ACA) has sparked a renewed interest and growth in self-funding as more organizations look for ways to continue to offer quality healthcare benefits to their employees, but also create opportunities for savings. Self-insured plans are not new. In fact, they have been around for decades. However, many businesses have simply been unaware of their advantages and the differences between self-funded and fully insured plan options.
Organizations of many sizes have turned to third party administrators, such as Self Insured Plans, to help design, administer and manage a self-funded plan that manages risk and promotes wellness while keeping costs in line.
As Obamacare gives employers even more reason to identify and manage plan costs, TPAs can provide greater access to health plan data and work closely with you and your plan participants to build individualized programs that manage both cost and quality.
In this FREE whitepaper we examine 5 reasons why it’s time to consider self-funding your employee healthcare plan.
Still trying to get a handle on the differences between a self-funded and fully-insured plan? Click to watch our short video, “Discover the Benefits of Self-Funding,” and in less than 2 minutes we will explore those differences, give you the advantages of self insured health benefit plans and help you understand how self-funding works.
MINNEAPOLIS, Minn. – January 28, 2016 – The Health Care Administrators Association (HCAA), a leader in advocacy, education and networking for the self-funding industry, announced Steve Rasnick, a seasoned TPA veteran with more than 35 years’ experience in the private insurance sector as its new Vice President. Currently President of Self Insured Plans, LLC, Rasnick has been appointed to this new role by the 2015-2016 Board of Directors, and will be responsible for strategic planning and leadership, as well as contributing to the future growth of the association.
“I am excited about my new role with HCAA, and look forward to continuing to grow the HCAA as the ultimate resource for the self-funding industry,” said Rasnick. “My goal is to help make HCAA become unique in a world of lookalikes, identify and strengthen the relationships with current and future business partners, and maintain a close working relationship with other industry organizations.”
Rasnick also commented on HCAA’s most anticipated event, the HCAA Executive Forum: “This is always an exciting time of year for the industry as our TPA, broker and other members gear up for what will prove to be another outstanding Executive Forum.” Often setting the tone for the year in self-funding, this year’s 2016 HCAA Executive Forum will be held February 9-11 at Caesar’s Palace in Las Vegas. Senator Tom Daschle will serve as this year’s keynote speaker, presenting, “An Insider’s View on President Obama’s Public Policy and Its Implications on the 2016 Election.”
Rasnick’s broad insurance background includes previous positions as President of Gem Insurance Company, President of Foundation Health National Life Insurance Company, managed care organizations covering more than 800,000 members; Chairman of ProAmerica, a national PPO organization; President of The Travelers Plan Administrators, the third largest national benefits administrator, covering more than 1,000,000 members; and President and Founder of Claims Administration Services Inc., at the time, the largest TPA in Illinois.
The Health Care Administrators Association is the nation’s most prominent nonprofit trade association that supports the advocacy, networking and educational needs of third-party administrators (TPAs), insurance carriers, managing general underwriters, audit firms, physician hospital organizations, brokers/agents, human resource managers and health care consultants. For nearly 35 years, HCAA has taken a leadership role in legislative advocacy, working to increase its influence with policymakers and other stakeholders in order to transform the self-funding industry and expand its role within healthcare.
The IRS has issued guidance which increases the applicable dollar amount used to determine the Patient-Centered Outcomes Research Institute (PCORI) fee. For plan years ending on or after October 1, 2015 and before October 1, 2016, the fee is $2.17 (multiplied by the average number of lives covered under the plan).
PCORI fees are imposed on plan sponsors of applicable self-insured health plans for each plan year ending on or after October 1, 2012 and before October 1, 2019. The fees support research to evaluate and compare health outcomes and the clinical effectiveness of certain medical treatments, services, procedures, and drugs.
For plan years ending on or after October 1, 2014 and before October 1, 2015, the fee for an employer sponsoring an applicable self-insured plan is $2.08 multiplied by the average number of lives covered under the plan. Details on how to determine the average number of lives covered under a plan, as well as various examples, are included in final regulations.
Pursuant to IRS Notice 2015-60, for plan years ending on or after October 1, 2015 and before October 1, 2016, the fee is $2.17 (multiplied by the average number of lives covered under the plan).
For plan years ending on or after October 1, 2016 and before October 1, 2019, the fee will be further adjusted to reflect inflation in National Health Expenditures (which will be published in future IRS guidance).
Our PCORI Fees for Self-Insured Plans section features additional information on calculating and paying the fee.
For what seems like forever, million dollar individual claims have been rare occurrences. Until recently, that is. Thanks to new, mega-cost technologies and a growing number of chronically ill, big claims have become far more common. Additional factors contributing to this trend are the elimination of preexisting conditions and coverage limits by ACA and the rapidly rising cost of specialty drugs.
While you might expect this to curb enthusiasm for self-funding, interest by small and mid-sized employer groups remains strong. We believe this is due to the availability of stop loss insurance and the risk management strategies that help keep stop loss premiums affordable. A few of these include:
Medical Cost Management: Nothing lowers health care costs like avoiding a claim altogether and identifying members at risk of chronic illness can often do just that. For the chronically ill, which the National Health Council estimates at 133 million Americans and growing, providing the required care in an efficient manner is what health and disease management programs are all about.
Utilization Review: A strong UR program, including hospital pre-certification, large case management and more, can have a dramatic impact on costs. Since large cases and a growing percentage of hospital admissions are associated with serious health conditions, the opportunity for savings is significant.
Worksite Wellness: Helping employer groups identify wellness strategies, evaluate incentives and develop positive employee communications can yield a significant return on investment for your organization and the employees it depends on.
Claims Management: Managing claims efficiently and being able to put the resulting data to use are critical today. Not only does claims management influence stop loss premiums, but access to timely information enables a self-funded plan to avoid overcharges and alter plan designs as needed.
Turn Variable Costs to Fixed Costs: Negotiating with providers in advance or using carve-out programs for high cost treatments such as transplants or dialysis can help contain costs. Pursuing these arrangements with centers of excellence can also assure quality, appropriate and efficient care.
As the frequency of large claims increases, managing health care risk requires robust capabilities in claims management, data analysis and plan performance. These are hallmarks of an experienced TPA and key ingredients for an effective self-funded plan.
In cooperation with NAEBA