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Showing posts from 2023

Wrap Documents for Welfare Benefit Plans

As an employer, you may be asking yourself, “What is a wrap document, and why is it important?” Before we get into the full definition, let’s review the history behind wrap documents to better understand how they originated and why they’re important. The federal Employee Retirement Income Security Act of 1974 set minimum standards for employee benefit plans maintained by private-sector employers. Under ERISA, employer-sponsored welfare benefit plans, such as group health plans, must be described in a written plan document. In addition, employers must explain the plans’ terms to participants by providing them with a summary plan description. The insurance certificate or benefit booklet provided by an insurance carrier or other third party for a welfare benefit plan typically does not satisfy ERISA’s content requirements for plan documents and summary plan descriptions. However, employers may use wrap documents in conjunction with the insurance certificate or benefit booklet to satisfy E

The 2024 ACA pay or play penalty will increase: What to know

The IRS has updated penalty amounts for 2024 related to the employer shared responsibility (pay or play) rules under the Affordable Care Act. For calendar year 2024, the adjusted ACA pay or play penalty amounts increased as follows: $2,000 penalty amount is now $2,970; and $3,000 penalty amount is now $4,460. Pay or play penalty calculations Under ACA pay or play rules, an applicable large employer is only liable for a penalty if at least one full-time employee receives a subsidy for exchange coverage. Employees who are offered affordable, minimum value coverage are generally not eligible for these exchange subsidies. Depending on the circumstances, one of two penalties may apply under the pay or play rules: the 4980H(a) penalty or the 4980H(b) penalty . Under Section 4980H(a), an applicable large employer will be subject to a penalty if it does not offer coverage to “substantially all” (generally, at least 95%) of its full-time employees (and dependents) and any one of its full-time

5 Top reasons to offer employee mental health benefits

In fast-paced and demanding work environments, the importance of employee mental health benefits cannot be overstated. Employees who are mentally well are more productive, engaged and satisfied with their jobs. Mental health treatment, including therapy, medication and self-care, can help people who are experiencing mental illness. However, taking that first step toward recovery or seeking help can be challenging. The National Alliance on Mental Illness’ Mental Health By the Numbers finds that the average delay between the onset of mental health symptoms and treatment is 11 years. Factors such as cost, access and stigma can hold workers back from receiving the mental health support and treatment they need. However, there are employer solutions that can help employees overcome these barriers, understand available treatment options and start their recovery journey. This article explores barriers to mental healthcare and ways employers can help break them down to support employees holist

December 2023 Benefits Buzz: IRS employee benefit plan limits

IRS Announces Employee Benefit Plan Limits for 2024 On Nov. 9, 2023, the 2024 IRS employee benefit plan limits were released. Employers should review the increase in annual dollar limits, as many employee benefits are subject to annual dollar limits that are updated for inflation before the beginning of each calendar year. Note that some benefit limits are not adjusted for inflation, such as the contribution limit for dependent care flexible spending accounts and the catch-up contribution limit for health savings accounts. Employers should confirm that payroll systems are updated for the 2024 limits and that the new limits are communicated to employees. The following benefit limits apply for 2024: HSA Contributions Single coverage: $4,150 (up $300 from 2023) Family coverage: $8,300 (up $550 from 2023) Catch-up contributions: $1,000 (not adjusted for inflation) Health FSA Limits Employee pre-tax contributions: $3,200 (up $150 from 2023) Carryover of unused funds: $640 (up $30 from 202

Will employer healthcare costs boom in 2024? 4 driving trends

With 2024 right around the corner, ongoing inflation will likely mean higher employer healthcare costs in the new year. A report released by Aon , a global professional services firm, predicted 2024 employer healthcare costs will grow by 8.5%, totaling more than $15,000 per employee. This figure nearly doubles what Aon reported in 2023. Meanwhile, the Business Group on Health’s 2024 Large Employer Health Care Strategy Survey predicted a 6% increase . While this is 2.5% less than Aon’s report, both predict a potentially sizable increase in healthcare costs. In this article, we’ll explore the four primary drivers of healthcare costs and ways that employers plan to manage them. Driver #1: Mental health challenges The COVID-19 pandemic’s impact on mental health continues. Many employees still have symptoms related to depression, anxiety and substance use disorders. This is echoed in the findings from the Business Group on Health survey: Three-quarters of employers (77%) reported an increa

Identity theft insurance coverage

Americans have reported nearly 560,000 cases of identity theft nationwide so far in 2023 according to the Federal Trade Commission. Identity theft victims can be impacted in various ways, including not being able to use their credit cards or obtain a new loan — or, in more severe cases, becoming subject to criminal investigations. ID theft is one of the fastest-growing crimes in America and it can cost a victim a significant amount of time and money to recover their information and repair their credit. As business increasingly moves toward e-commerce and away from face-to-face transactions, the risk of ID theft will only continue to grow. What is identity theft? ID theft occurs when personal information such as Social Security numbers, credit card or bank account information are obtained without permission. Once thieves have this information, they can use existing credit cards or open new ones to make purchases in the victim’s name, write bad checks or take out loans. If the theft is

Legal Plans: How Your Employees Could Benefit

Studies reveal that employees suffering from legal problems are typically absent from work five times more than average. These absences harm their productivity. Group legal plans can alleviate stress and reduce the time it takes for employees to resolve legal issues, enabling them to focus on their jobs. What are legal plan benefits? Group legal plans are voluntary benefits employers can offer to give their employees better access to legal services. Employees pay into the program through payroll deductions so that when they need legal assistance, they have access to an attorney to help them, without the usual high cost of legal fees. Legal plan benefits can help employees in a variety of situations, from phone consultations to courtroom appearances. Common service categories used by employees with group legal plans include: telephone advice and office consultations with an attorney; estate planning documents, including wills, trusts, living wills and powers of attorney; real estate ma

Attraction & Retention Newsletter - Q4 2023

The Attraction and Retention newsletter provides valuable insights into the employment market each quarter. It includes statistics on the current job landscape, expert tips for securing top talent and innovative strategies for attracting and retaining workers. The  fourth quarter edition  explores: the easing labor market; employee wellness as a recruitment factor; winning over Generation Z; and a workplace outlook. This July marked the U.S. economy’s lowest number of job openings since 2021, decreasing to 8.8 million. While the employment rate rose from 3.5% to 3.8% in the same month, a large labor supply helped ease the tight labor market. However, all eyes are on the Fed as another possible rate hike could disrupt what seems to be a resilient market. Employers should take note of this and continue to monitor employment trends in quarter four. Employers should also consider investing time in retention strategies to stay competitive. Download your copy   of  Attraction and Retention 

November 2023 Benefits Buzz: 2023 ACA reporting + more!

The IRS released the final 2023 forms and instructions for reporting under Internal Revenue Code Sections 6055 and 6056: 2023 Forms 1094-B and 1095-B (and instructions ) will be used by those offering minimum essential coverage, including self-insured plan sponsors that are not applicable to large employers, to report under Section 6055. 2023 Forms 1094-C and 1095-C (and instructions ) will be used by applicable large employers to report under Section 6056, as well as for combined Section 6055 and 6056 reporting by ALEs that sponsor self-insured plans. No major substantive changes were made to the final forms and instructions for 2023 reporting. However, the 2023 instructions include information on the new electronic filing threshold for information returns required to be filed on or after Jan. 1, 2024, which has been decreased to 10 or more returns (originally, the threshold was 250 or more returns). Employers should become familiar with these forms and instructions for 2023 calen

Q3 2023 Market Recap: A Tale Of Two Economies?

The first half of 2023 saw a red-hot rally in the stock market. However, this came to a halt in the third quarter due to concerns over inflation and central bank policy, leading to higher interest rates. The decline in consumer confidence, unrest among unions, weaker consumer pockets and mounting credit card defaults also contributed to a potentially volatile market in the final months of the year. The high-growth technology sector could be immediately impacted, as it faces pressure from higher discount rates impacting future cash flow. There appears to be a bearish trend forming around technology. Corporate earnings are expected to decline for the third quarter in a row, with many S&P 500 companies issuing negative earnings per share guidance. The American consumer is also sharing a dim outlook, as consumer confidence has dropped for the second straight month. Fixed income struggled in Q3 after experiencing a 2.09% gain in the first half of the year. The growing expectation that r

Dental Care: Oral Hygiene

Oral health problems — ranging from cavities to cancer — are painful and costly, affecting millions of people each year. This is alarming because almost all oral diseases can be avoided with proper oral hygiene. Tooth decay Cavities are a common problem for children. Untreated cavities can cause pain and infection, which can lead to difficulty eating, speaking, playing and learning. Tooth decay is also a problem for adults, especially for the increasing number who retain most of their teeth throughout their lives. Tooth loss can become an issue as adults get older — affecting self-esteem and contributing to nutrition problems by limiting the types of food that someone can eat. In addition, poor oral hygiene can lead to a number of diseases and conditions, including gum disease and oral cancer. Prevention Keep your oral health in good shape by practicing the following: Drink fluoridated water and use fluoride toothpaste. Take care of your teeth and gums. Thoroughly brushing and flossin

Report: Employers aren’t improving healthcare literacy

“Employees still are not getting the information they need to make informed choices about their healthcare coverage or how to use that coverage effectively.” - Optavise's 2023 Healthcare Literacy Report. In 2023, fewer employees were confident they understood how their healthcare plans work compared to last year, according to Optavise’s 2023 Healthcare Literacy Report . This is a concerning statistic for employers who strive to improve healthcare literacy. Notably, understanding of healthcare plans is linked to satisfaction. The 90% of employees who said they were extremely confident in understanding their plan reported more plan satisfaction. This is in comparison to the 13%-14% of employees who weren’t confident at all. These findings illustrate that investing in employees’ benefits education can reduce healthcare costs for employers and employees and increase employee satisfaction and engagement. Additional healthcare literacy survey observations   Of more than 1,000 surveyed U.

The importance of dental care: Oral health and wellness

Did you know that poor oral health can lead to many seemingly unrelated medical conditions? In fact, oral bacteria and oral disease have been linked to a variety of serious illnesses, including heart disease, diabetes, stroke and pregnancy complications. That’s why it’s essential for employers to understand the importance of dental care and how it relates to their employees’ benefits. The importance of oral health The following examples illustrate the relationship between your oral health and general health. Tobacco, alcohol and illicit drugs affect both your overall and oral health. Dry mouth, or a lack of saliva increases your risk of tooth decay. Oral pain resulting in an inability to eat properly prevents you from getting the nutrition your body needs to stay healthy. Periodontal disease Oral health can often be used to diagnose underlying health issues. For example, the advanced form of gum disease, called periodontitis , causes tooth loss and is also sometimes associated with

Main difference between pre-tax and Roth contributions [Bonus SECURE 2.0 Act update inside]

As more employers offer a Roth 401(k) , it’s important that you know the main difference between pre-tax and Roth contributions. In this post, we’ll explain what each contribution is and how to decide the best option. We’ve even included the most recent SECURE 2.0 Act update, so you can stay up-to-date on Roth deferrals. What is the difference between pre-tax and Roth contributions? It can be tricky to choose between a pre-tax contribution vs. Roth 401(k). Roth and pre-tax contributions are two different ways to save for retirement in an employer-sponsored retirement account (401(k), 403(b), etc.). Each has its own tax implications and considerations. Pre-tax contributions  Pre-tax contributions allow individuals to contribute to retirement savings before taxes are taken out of their paycheck. Since taxes are deferred up front, the contributions and earnings in the account are taxed as ordinary income when the individual withdraws them during retirement. Roth contributions On the other

October 2023 Benefits Buzz: Medicare Part D & more!

Deadline for Medicare Part D notices is Oct. 15 Each year, Medicare Part D requires group health plan sponsors to disclose whether the health plan’s prescription drug coverage is creditable to eligible individuals. Plan sponsors must provide the annual disclosure notice to Medicare-eligible individuals before Oct. 15 — the start date of the annual enrollment period for Medicare Part D. The Centers for Medicare and Medicaid Services has provided model disclosure notices for employers to use. Notice requirement Medicare beneficiaries will likely pay higher premiums if they enroll at a later date if they: do not have creditable prescription drug coverage; and do not enroll in Medicare Part D when first eligible. Although no specific penalties are associated with the notice requirement, failing to provide the notice may be detrimental to employees. Employers should confirm whether their health plans’ prescription drug coverage is creditable or non-creditable and prepare to send their Medi

The importance of employer dental benefits: FAQ

As the Great Resignation continues, the importance of employer dental benefits has skyrocketed. A  Forbes study  found that 8% of respondents with health insurance left a job they liked because they wanted better health coverage. To help you prevent turnover and reinforce the importance of offering robust  employee benefits , we’ve put together answers to frequently asked questions. Consider it a quick refresher on the importance of employer dental benefits. Why should I offer employer dental benefits? It is relatively inexpensive to include dental benefits in an employer’s benefits plan, and it may help the employer attract and retain highly skilled employees. According to the  Employee Benefit Research Institute , employees made dental or vision insurance the third most important benefit in making a job decision.  Because dental hygiene is associated with overall health, employees with dental plans are often healthier. Employees without dental benefits may postpone or forgo dentist v

8 tips for effective 2024 open enrollment communication

Now more than ever, employees are looking to their employers for guidance on navigating available benefits and how to stretch their dollars further. As such, effective communication for open enrollment 2024 is critical. According to a Willis Towers Watson report , 84% of employers plan to expand their tools in 2023 to help employees navigate their enrollment decisions, compared with 70% last year. Employees are likely paying more attention this year as they navigate record-high inflation and work to maximize every hard-earned dollar. Many of today’s workers want help understanding how much money to put aside for retirement, emergency savings and healthcare expenses. Employers have an opportunity to shine by effectively communicating and guiding employees throughout the enrollment process and the rest of the year. As the 2024 open enrollment season approaches, employers are poised to provide their employees with resources and digital tools. Here are eight tips you can use to effectively