consumer checklist: helping small business navigate healthcare reform
Post on 15-Jul-2015
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CHECKLIST:
HEALTHCARE REFORM
CONSUMER
HELPING SMALL BUSINESS
NAVIGATE
THIS CHECKLIST WILL ASSIST YOU WHEN NAVIGATING HEALTHCARE REFORM.
Let’s get started.
WE. LIKE. THAT.
It’ll help you understand the important things… the things that will help you save time, money, and improve coverage.
By the time we finish, you’ll know exactly what you’re looking for. It’s JUST like running errands.
SO LET’S BEGIN. THIS PRESENTATION WILL HELP SMALL
BUSINESSES MORE EFFECTIVELY WORK THEIR WAY
THROUGH HEALTHCARE REFORM.
This is NUMBER ONE. You want to
establish this right away.
WHY? Because there are costly tax
penalties that may be incurred if you’re
actually a “large business” and don’t
provide health coverage to your
employees.
#1: DETERMINE IF YOU’RE A SMALL BUSINESS.
CHECK.
BUT SMALL BUSINESSES… ARE NOT.
YOU’RE CLEAR.
As it stands, “large
businesses” ARE
mandated to provide
health coverage to
their employees.
KNOWING WHETHER-OR-NOT YOU’RE A SMALL BUSINESS
WILL ALSO HELP YOU DETERMINE YOUR STRATEGIES
WHEN DESIGNING A PLAN. A SMALL BUSINESS’ HEALTH
PLAN WILL DIFFER GREATLY FROM A LARGE BUSINESS’.
That’s small biz.
QUESTION: WHAT IS THE DEFINITION OF “SMALL BUSINESS” WITH REGARD TO THE HEALTHCARE REFORM LAW?
Small businesses are
businesses with LESS than 50
fulltime equivalent employees
for the previous calendar year.
You’ll sometimes see “fulltime
equivalent employee” abbreviated
as “FTE.”
AND DON’T FORGET THIS IMPORTANT NOTE:
THEY COUNT.
YOUR FTE COUNT DOES INCLUDE
PART-TIME EMPLOYEES.
A part-time employee is defined as
working less than 30 hours per
week, and there’s a calculation
when determining their “fulltime
equivalency.”
…YOU’LL WANT TO MAKE SURE TO HAVE THIS ALL SORTED OUT. WHY?
BECAUSE THERE ARE COSTLY TAX PENALTIES FOR EMPLOYERS THAT ARE
OVER 50 FTE AND DON’T PROVIDE HEALTH COVERAGE.
So if you’re anywhere
NEAR 50 FTE…
LET’S MOVE ON TO THE NEXT ITEM ON OUR
CHECKLIST.
If you know anything
about health insurance,
you’ll know that these two
parts of the industry are
completely different.
#2: KNOW THE DIFFERENCES BETWEEN
INDIVIDUAL HEALTH PLANS AND SMALL GROUP
HEALTH PLANS.
CHECK.
THE LIST GOES ON.
• They have different
characteristics.
• There are different rules.
•There are different tax
incentives.
• There are different
eligibility criteria.
SMALL GROUP
Depending on your business, your objectives, your budget, and other considerations…
Decisions. Decisions.
… You’ll want to
determine what
kind of health
insurance plan
you want to
work with. INDIVIDUAL
The good news: because of healthcare reform, it’s now easier than ever before to work with individual health insurance
plans to provide coverage to your employees.
You’ve got
OPTIONS.
And in certain cases:
IT MIGHT EVEN MAKE MORE
SENSE.
So: know how individual health
insurance plans can work for
small business ALONG WITH
health insurance exchanges.
ONE REASON: Small group plans usually have the best tax incentives, especially if employees are contributing.
Yes.
TAX-FREE DOLLARS.
WITH ALL OF THAT BEING
SAID ABOUT INDIVIDUAL
HEALTH INSURANCE
POLICIES:
SMALL GROUP HEALTH
INSURANCE PLANS CAN STILL
BE AN IMPORTANT OPTION.
ANOTHER REASON: PHYSICIAN NETWORKS CAN SOMETIMES BE BETTER WHEN WORKING WITH GROUP HEALTH INSURANCE PLANS.
You might have
better access.
ADDITIONALLY, THERE IS NOW A GROUP HEALTH INSURANCE PLAN CALLED SHOP (SMALL BUSINESS HEALTH OPTIONS PROGRAM).
LOWER YOUR
COSTS.
SHOP is available through
the public health
insurance marketplaces.
It can provide substantial
tax-credits for qualified
small businesses to help
with premiums. Sometimes
up to a 50% reduction.
HERE’S THE MORAL OF THE STORY. YOU’LL WANT TO DECIDE
WHICH SEGMENT WILL WORK BEST FOR YOUR BUSINESS:
INDIVIDUAL HEALTH INSURANCE PLANS, OR A GROUP HEALTH
PLAN. AND NOW… ON TO THE THIRD ITEM ON OUR CHECKLIST.
HEALTH
INSURANCE
REMEMBER:
Small businesses (with less than
50 FTE) are NOT required to
provide health coverage to their
employees.
#3: DECIDE IF YOU’RE GOING TO PROVIDE
HEALTH INSURANCE FOR YOUR ENTIRE GROUP
OR JUST YOURSELF.
CHECK.
HOWEVER, IF YOU’RE NOT GOING TO PROVIDE COVERAGE…
There IS a tax.
…You and your employees will
STILL need to find a health
insurance plan somewhere on
your own.
Why? Everyone has got to
have health coverage or
pay a tax penalty.
SO: Determine whether-or-not you have a budget for your entire group. There could be strategies that are surprisingly affordable, especially based on the size
and average income of your group.
EASY PEASY. UP NEXT: THE FOURTH ITEM ON
OUR CHECKLIST.
#4: UNDERSTAND THE DIFFERENT PLANNING
STRATEGIES FOR SMALL BUSINESS.
CHECK.
THERE ARE A VARIETY OF
DIFFERENT PLANNING
STATEGIES THAT ARE
AVAILABLE TO SMALL
BUSINESSES.
REMEMBER TO KEEP IT SIMPLE.
TWO concepts.
Your strategies will only utilize:
• Individual health
insurance plans.
• Or… a group health
insurance plan.
WEIGH
DECISIONS.
So if you determine that you’d
like to help provide coverage
for your employees, you’ll want
to come up with a program that
fits your objectives best.
AND DON’T FORGET: HEALTH INSURANCE IS A VERY BASIC BENEFIT
THAT CAN HELP YOU ATTRACT AND RETAIN QUALITY EMPLOYEES.
FOR EXAMPLE, YOU COULD USE A DEFINED CONTRIBUTION STRATEGY.
You’ve GOT to
strategize.
“Defined Contribution”
is a retirement
planning phrase. It’s
been around for a long
time. You can Google it
and read all about it.
HEALTH BENEFITS PLANNERS ARE NOW USING THIS “DEFINED CONTRIBUTION” CONCEPT TO FUND HEALTHCARE.
JUST like an
allowance.
And it’s simple.
It’s EXACTLY what it says it is:
You “define a contribution” (ie:
$300/month), and employees
then purchase their own
individual insurance plans.
EMPLOYEES THEN PICK FROM INDIVIDUAL INSURANCE PLANS THAT ARE BOTH ON AND OFF THE PUBLIC HEALTH INSURANCE
EXCHANGES. THEY SIMPLY BUY THEIR OWN PLAN.
AND DEPENDING ON INCOME: they
might also receive SUBSTANTIAL
subsidies.
WHICH
PLAN?
THIS STRATEGY CAN ACCOMPLISH THREE BIG THINGS:
• Simplify. All it is, is an allowance.
• Budgetable. It’s easy
to decide on a fixed
amount to offer.
• Selection. It gets
business owners out of
the “insurance
business” and allows
employees to make
their own decisions.
OR… HERE’S ANOTHER SMALL BUSINESS STRATEGY:
“CONSUMER DIRECTED HEALTH PLANNING.”
IT’S ALSO REFERRED TO AS “ACCOUNT-BASED” OR “EQUITY BASED” PLANNING.
FIRST: SMALL BUSINESS OWNERS PROVIDE THEIR EMPLOYEES ACCESS TO A HIGH DEDUCTIBLE HEALTH PLAN.
SMART MONEY.
THEN:
They pair it up with a health
reimbursement arrangement
(HRA) or health savings
account (HSA).
The HRA or HSA becomes an
asset (account) that builds
equity over time.
YOU RETAIN FUNDS THAT WOULD NORMALLY GO TO THE INSURANCE COMPANIES IN THE FORM OF PREMIUMS.
And THAT.
Is rad.
AND, DEPENDING ON YOUR
STRATEGY, OWNERSHIP OF THE
ACCOUNT STAYS IN ONE OF TWO
PLACES:
• With your company.
• With your employee.
THERE YOU HAVE IT. A COUPLE OF EXAMPLES OF
STRATEGIES THAT CAN HELP SMALL BUSINESSES OFFER
HEALTH BENEFITS TO THEIR EMPLOYEES. NOW LET’S MOVE
ON TO THE LAST ITEM ON OUR CHECKLIST.
CHECK.
SIMPLY:
Know where you
can find help.
#5: KNOW WHERE YOU HAVE ACCESS TO
PRODUCTS, ADVICE, CUSTOMER SERVICE,
AND CONSULTATION.
FIND EFFECTIVE ADVISORS THAT CAN HELP YOU SORT EVERYTHING OUT.
JUST like having your
own HR Department.
A “ONE-STOP-SHOP” CAN
HELP YOU SAVE TIME, MONEY,
AND A LOT OF HASTLE BY
“OUTSOURCING” YOUR
SMALL BUSINESS HEALTH
BENEFITS PLANNING.
And the good news: brokers are compensated by the insurance companies.
Done.
So you don’t have to worry
about broker fees, etc.
Compensation is built into
every single health
insurance plan regardless of
whether-or-not you decide to
work with an adviser.
ADDITIONALLY, A BROKER WILL KEEP YOU “IN THE KNOW” ABOUT NEW PRODUCTS, STRATEGIES, AND REFORMS.
THEY SHOULD OFFER A BROAD RANGE OF PRODUCTS AND SERVICES THAT WILL MAKE YOUR PLANNING CONVENIENT.
HERE ARE SOME OF THE QUALITIES THAT YOU SHOULD LOOK FOR IN A BROKER/CONSULTANT.
Look for
quality folks.
LICENSED, ACCREDITED,
ETHICAL.
Find consultants that are licensed by
the Department of Insurance to do
business in your state.
Take it a step further and find advisers
who have professional designations.
People with these designations will
provide advanced knowledge, and
adhere to strict ethical standards.
FIND A BROKERAGE WITH A STRONG SELECTION OF REPUTABLE PRODUCTS.
Gotta’ have
choice.
Your broker/consultant
should offer you a wide
variety of choices from
reputable insurance
companies like those to
the right… plus others.
SEARCH FOR AN ADVISER THAT OFFERS CONSULTATION IN “NON-INSURANCE” AREAS TOO.
MORE than just
insurance policies.
Your broker/consultant
should also be offering
products and services
that are considered
“non-insurance”
products.
Things like: HSAs (health savings accounts), HRAs (health reimbursement arrangements), COBRA
administration, knowledge of tax incentives, etc.
Find a well rounded
broker.
After-all, the goal is to fund
healthcare as efficiently
as possible. There are
other tools that help
accomplish this besides
just insurance plans.
AND THAT’S IT. THAT’S YOUR HEALTHCARE REFORM CHECKLIST
FOR SMALL BUSINESS. BY UNDERSTANDING THE POINTS WE’VE
MADE, YOU’LL BE ON THE RIGHT PATH TO DRAFTING A HEALTH
BENEFITS PROGRAM THAT FITS YOU OR YOUR BUSINESS BEST.
TYSON J LESTER, RHU, REBC
President, Policy Advantage Insurance Services
Toll Free: (800) 617-0089
Los Angeles Area: (424) 442-0170
Email: info@policyadvantage.com
www.policyadvantage.com | CA Insurance License #0F22799
ARTICLE WRITTEN BY
We help individuals and businesses sort out all of the aspects
when designing an individual or business health plan.
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Los Angeles Area: (424) 442-0170
Email: info@policyadvantage.com
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