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Evolving Benefits Landscape

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Learn how health care reform is changing the employee benefits landscape for brokers, employers and employees.

Evolving landscape for brokers

Health care reform has introduced substantial changes to the way health insurance is purchased, and brokers are at the forefront of that change. Due to the self-service nature of the new marketplace exchanges, consumers rely less on local brokers to help them shop for insurance. As a result, the broker’s role of negotiating and managing employee health and group benefits is changing.

Brokers recognize that meeting employer’s needs is the key to staying relevant in this era of health care reform. More transactional brokers have already left the business, and the brokers who stayed have adopted a more consultative approach, expanding what they can do for clients. Investing in technology and compliance tools has enabled them to function more like advisors. And, offering voluntary benefits products has given them traction with cost-conscious clients.

Brokers also have to contend with an increased demand for transparency of costs in all aspects of the health care industry. To reduce administrative costs, insurance companies may reduce broker fees or cut them entirely. And, government-managed plans have structured commissions to discourage selling plans with excessive levels of coverage. These limits affect how brokers will function in the future marketplace, and may result in further consolidation.

The bottom line is, employers can expect more from their brokers – compliance assistance, stronger client service, ideas, and innovations – all at a manageable cost. And, if employers are not getting this kind of attention from their current brokers, they have an open marketplace to find what they need.

Evolving landscape for employers

In spite of all the recent debate around health care reform, employers must still conform to the Affordable Care Act (ACA) requirement that companies with 50 or more full-time employees provide health insurance and adhere to strict reporting requirements.

For employers with less than 50 employees, there’s no requirement to offer benefits, but it is something to consider. Since recruiting new employees cost time and money, employers want to attract and retain the best talent possible, and offering group benefits insurance gives them the best chance to do so.

Finding the right broker can be the first step in providing a strong benefits package. Brokers are evolving to become more consultative to help employers understand benefits plans as well as the complex laws and regulations of the benefits industry. Employers should take advantage of this expertise and work with skilled brokers who appreciate innovation and can design appropriate benefits packages at a reasonable cost that comply with new rules and regulations.

Evolving landscape employees

Under the Patient Protection and Affordable Care Act (PPACA), most Americans are required to purchase health insurance that meets the minimum essential coverage (MEC) standard, or pay a penalty. Even with all the recent debate around health care reform, this law is still in effect, so employees must select coverage either from their employer or via an exchange.

The first step in choosing benefits coverage is to access information. Employees should identify what their benefits needs are, and figure out which plans will meet those needs. The good news is, employers want to help. Educating employees about group benefits coverage has become a top priority for employers as they work to attract and retain talent. Satisfying a diverse set of employee benefit needs is an increasingly important way for employers to stay competitive.

Employees can use digital tools to access health care information anytime, anywhere. Patients can use their mobile devices to contact doctors, share test results, and get immediate treatment answers and referrals. Digital health tools give employees the convenience of on-demand care.

Employees continue to struggle with the financial aspect of their group benefits plans. Hefty premiums and out-of-pocket costs can cause employees to ignore the care they need. In fact, nearly half of middle-class workers admit that they have gone without medical services due to the expense1.  Going forward, employees will have to make sacrifices and manage their finances so they can pay for the coverage and treatments they need.

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