Health Care Reform, Benefits, Financial

3 Takeaways from the Indiana Chamber Board Meeting

May 17, 2013

This morning, our CEO, Bryan Brenner, was a part of a Health Care Reform panel at the Indiana Chamber Board of Director’s Meeting. Lots of meaningful discussion surrounded Health Care Reform and what’s next for employers. Below are three key takeaways from the morning:

1. On the surface, deciding to “pay” rather than “play” is financially attractive. The $2,000 per full-time employee annual penalty is generally less expensive than providing group health coverage to employees. However, we find employers making the decision to “play” based on the following factors:

  • Ability to recruit and retain top talent
  • Desire to maintain a culture of wellness and employee engagement
  • Uncertainty about available alternatives (public exchanges are undeveloped and the impact of community ratings are unknown)

2. Private exchanges are a “hot topic” these days. Employers are intrigued by the idea of providing benefits to their employees via online marketplaces. But, don’t jump aboard too soon. Here are two concepts you may not have thought about yet:

Myth #1. Private exchanges will:

  • Offer large inventory of medical plans from different carriers
  • Allow access to pooled underwriting and economies of scale

Fact: Choice among a variety of carriers will likely be limited to large employers (think 2,000 lives or more). Smaller employers must choose one carrier, choose available options (or have them chosen for the employer), and be separately underwritten.

Myth #2. Private exchanges will relieve employers from certain responsibilities and liabilities.

Fact: Employers providing ERISA benefits (such as health coverage) through a private exchange remain as plan sponsors, with all of the legal requirements that go along with it (similar to 401(k) plan sponsors).

3. The PPACA legislation is here to stay. We can choose to complain about it, or we can see Health Care Reform as an opportunity for disruptive innovation. Are you willing to approach Health Care Reform as a chance to refocus your approach to benefits, wellness, engagement, and branded communication? Choose to move forward. Choose to be innovative. And you will find your employees are more engaged by doing so.

Bottom line: Health Care Reform increases the need for employers to focus on stronger partnerships that bring clinicians closer to their employees. When clinicians and employees are brought together, better health outcomes happen. Who you choose as your partner(s) has never been more important!