ST. OLAF COLLEGE 2014 Employee Benefit Meeting May 2014

Transcription

1 ST. OLAF COLLEGE 2014 Employee Benefit Meeting May 2014 Sarah Dahl Client Advisor 7225 Northland Drive North, Minneapolis, MN 55428

2 Disclaimer The benefits outlined throughout this presentation reflect a summary of coverage only. For specific plan details including coverage levels and benefit exclusions, please refer to the certificate of coverage. 1

3 Agenda Dental Plan Life/AD&D and Voluntary Life Long Term Disability Medical Plans New plan option for 2014 Health Savings Account (HSA) Flexible Spending Account (FSA) 2

4 Dental 3

5 Dental Insurance Dental plan remains administered by Delta Dental no plan changes! Combined increase of 4.94% Employee only: +2.46% Employee + 1: +4.82% Family: +6.00% The disparity across enrollment tiers is based on usage 1% of this is leftover from the addition of implant coverage from last year This is your open enrollment opportunity employees can come on or go off the plan effective 9/1/14. Participating provider search , or

6 Dental Premiums Coverage Election Expiring Monthly Contribution* Monthly Contribution* Effective 9/1/14 Employee only $17.02 $17.44 Employee + 1 $34.82 $36.50 Family $52.82 $56.00 *Contributions shown above are for.75 and above FTE. Contributions for FTE employees are prorated. Dental premiums are deducted from your paycheck on a pre-tax basis. 5

7 LIFE, AD&D, VOLUNTARY LIFE & DISABILITY 6

8 Employer Paid Life/AD&D Benefits remain with CIGNA No cost to employees 2x annual earnings to $500,000 Remember to update your beneficiary information You may update your beneficiary at any time. 7

9 Voluntary Life and AD&D Employee Spouse Benefit Options 1 to 2 times annual compensation to a max of $500,000; increments of $10,000 Up to $100,000 not to exceed 50% of the employee amount; units of $10,000 Child(ren) Birth to 6 months: $2,500 6 months to 19 years: $10,000 (25 if full time student) Guarantee Issue newly eligible employees only < of 2 times annual compensation to max of $500,000 $50,000 All amounts 8

10 Long Term Disability CIGNA Benefit Elimination Period 180 days Benefit Amount 60% of Covered Monthly Earnings up to $7,500 Maximum Benefit Period To Social Security Normal Retirement Age St. Olaf College pays the premium for this coverage on your behalf. If you pay the tax on the premiums, any benefit you receive will be taxfree. If you do not pay the tax on the premiums, any benefit you receive would be taxable. You may change your election only at annual enrollment. 9

11 MEDICAL 10

12 2014 Medical Renewal Overview Medical trend in the marketplace BCBS: 6.5% HealthPartners: 6.8% Medica: 9.02% PreferredOne: 8.43% Medical plan is renewing with BCBS St. Olaf premium increase is 3.62% - Reminder, 2013 premium increase was approximately 5% No plan changes to current plan Adding Health Savings Account (HSA) compatible high deductible plan as an option - Refer to handout for plan comparison 11

13 Employee Medical Premiums Expiring Monthly Contribution* Monthly Contribution Effective 9/1/14* Traditional Plan HDHP Plan Employee only $ $ $ Employee + 1 $ $ $ Family $ $ $ *Contributions shown above are for.075 and above FTE. Contributions for FTE employees are prorated. Medical premiums are deducted from your paycheck on a pre-tax basis. 12

14 Fitness Discount Reminder Fitness Discount Program Go to participating fitness facility 8x per month and receive a $20 credit applied toward membership dues!!! To participate, you must complete an enrollment form and turn it in to your workout facility Go to members.bluecrossmn.com to find a participating facility. 13

15 Online Care Anywhere See a physician online, 24/7 including holidays Use it for: Sinusitis / Laryngitis / Pharyngitis Fever / Flu Ear infections / Eye infections Skin conditions For more information: -

16 BLUE CROSS/BLUE SHIELD VALUE ADDS Online health and wellness resouces on mybluecross Online health assessment Online coaching Stop-Smoking Support Fitness Discounts (up to $40) 24-Hour Nurse Advice line Employee Assistance Program Healthy Start Prenatal Support Chronic Condition Management June 12,

17 Online Care Anywhere Availability 16

18 Online Care Anywhere Fee for online care is subject to the deductible and coinsurance Fee is $45 per visit; any prescriptions are subject to prescription charges per your plan You may reimburse yourself with either Flex or Health Savings Account money. RECOMMEDED: Pre-register before you get sick!

19 HIGH DEDUCTIBLE PLANS (HDHP) & HEALTH SAVINGS ACCOUNTS (HSA) 18

20 What is a Health Savings Account (HSA)? A health savings account (HSA) is an account that you can use to pay eligible expenses with pre-tax dollars. Must be in conjunction with a qualified high-deductible health plan (HDHP) You own the account you control how you use the money in your HSA it stays in the account until you spend it. Tax-advantages pay your qualified expenses with pre-tax money. An HSA is not the same as your medical insurance. It is a separate account owned by the individual. Our administrator for the Health Savings Account (HSA) will be SelectAccount. 19

21 Benefits of an HSA Triple tax advantage means you save money on your health care expenses You contribute pre-tax money, Interest accrues tax-free Funds are withdrawn tax-free if used for qualified expenses Funds rollover each year, so you can use your HSA to save tax-free money for retirement Use it or lose it does not apply to HSAs! You may change your contribution amount throughout the year You own the account (and keep the money), even if you leave St. Olaf, or are no longer covered by a qualified HDHP. 20

22 High-Deductible Health Plan According to IRS regulations, HSAs can only be offered with a qualified high-deductible health plan (HDHP). As determined by the IRS, the minimum deductible for an embedded plan is $2500. On the qualified high-deductible plan, all medical and prescription charges are subject to the deductible. (Preventive visits are the one exception.) You can find out more information on the true cost of your office visits, and prescriptions and more at mybluecrossmn.com Don t be afraid to shop around, especially for prescriptions! 21

23 How Does the HSA / HDHP Work? You contribute money to the HSA (either a lump sum payment or via payroll deductions). You can use HSA dollars to pay your health insurance deductible, along with other qualified expenses such as dental, orthodontia or vision services. Just like with the Flex, dental and orthodontia expenses, and vision supplies like contacts or glasses do NOT count towards your medical plan deductible or out of pocket. Once you meet your deductible, St. Olaf College pays additional eligible covered expenses in accordance with the plan. 22

24 Who is Eligible to contribute to an HSA? Anyone who is: Covered by a qualified HDHP Not enrolled in Medicare Not covered under other non-qualified health insurance* Not covered by another full medical Flexible Spending Account (FSA) Not another person s dependent for tax purposes An employer may also make a contribution on your behalf. * Other health insurance does not include: specific disease or illness insurance, accident, disability, dental care, vision care and long-term care insurance 23

25 HSA Contributions For the 2014 plan year, St. Olaf s annual employer HSA contribution will be: Employee only $500 Employee + 1 $1,000 Family $1, FTEs will receive a pro-rated amount. If you are eligible, you will receive 50% of the employer contribution in September, and the remaining 50% distributed evenly with the first paycheck each month for the following 11 months. REMEMBER: If you are ineligible to contribute to an HSA, it is your responsibility to notify St. Olaf that you are also not eligible to receive the employer contribution. 24

26 HSA Contribution Limits Each year, the IRS sets HSA annual contribution limits *includes +1 enrollment Employee only $3,300 $3,350 Family* $6,550 $6,650 Limits are per tax year, which is January December Limits include any employer contribution i.e. Your contribution + St. Olaf contribution cannot exceed IRS limits in any given tax year. 25

27 HSA Contributions You are allowed to contribute the entire year s limit when you first become eligible for the HSA, as long as you pass the 13 month rule. Don t forget to allow for the St. Olaf employer contribution. For individuals ages 55-plus, the IRS allows additional catch-up contributions. Eligible individuals may contribute an extra $1,000 for the year This rule is meant to help save additional money for retirement. 26

28 How HSAs and FSAs Work Together If you do not participate in an HSA you can enroll in a full medical expense FSA account which covers all eligible expenses. If you are participating in a HSA you can enroll in a FSA account called a Limited Purpose FSA, which typically only allows dental and vision expenses to be reimbursed. EXAMPLE: You contribute to an HSA that you want to save for future expenses. At annual enrollment, you know you re going to need a root canal / crown You can put $2,500 into a Limited FSA to use for your crown, and save the funds in your HSA. 27

29 How HSAs and FSAs Work Together Important information about the FSA grace period In order to contribute to (or receive your employer contribution to) an HSA beginning September 2014, you must spend down your FSA to $0 by August 31, If you do not have a $0 FSA balance as of August 31, 2014, you cannot contribute to (or receive your employer contribution to) an HSA until November 1, In this scenario, you still have until October 31, 2014 to incur expenses reimbursable by your FSA, and until November 30, 2014 to submit expenses. (These expenses cannot be reimbursed by the HSA.) 28

30 HSA Distribution Rules Distributions from your HSA are tax-free if they are taken for qualified medical expenses. SelectAccount Health Savings Account holders will receive a debit card. You may also request a distribution online. Much like a standard checking account, HSA funds may be used as long as funds are deposited in the account. i.e. you aren t allowed to overdraw your HSA. NOTE - this is unlike Flexible Spending Accounts (FSAs) Your HSA can only be used for expenses that are incurred on or after the date the HSA was established. HSA funds can be used for expenses from a prior year, as long as the expenses incurred on or after the date the HSA was established. 29

31 HSA Distribution Rules HSA distributions can be taken for qualified medical expenses for the following people: The account holder (person covered by the qualified HDHP) Spouse of that individual (even if not covered by the qualified HDHP) Tax dependents of that individual (even if not covered by the qualified HDHP) You may use your HSA dollars even if you are no longer covered by a qualified HDHP. You may use HSA money for non-qualified expenses BUT You ll pay income taxes, AND A 20% tax penalty 30

32 Distributions Age 65+ For individuals age 65 and older, HSA distributions can be used for nonqualified medical expenses without facing the 20% penalty. Income taxes will apply for non-medical distributions. This rule is regardless of whether the individual is enrolled in Medicare. 31

33 Qualified Medical Expenses HSA eligible expenses are the exact same as FSA-eligible expenses Examples of qualified medical expenses include Most medical care that is subject to your deductible (doctor visits, inpatient or outpatient treatment etc.) Prescription drugs Insulin (with or without a prescription) Dental / Orthodontia care Vision care (glasses, contacts, exams, LASIK) Select insurance premiums - COBRA, qualified long-term care insurance, health insurance premiums paid while receiving unemployment benefits, health insurance after you turn 65 except for a Medicare supplemental policy 32

34 Ineligible Medical Expenses Expenses that are not considered qualified medical expenses include: Insurance premiums (other than the exceptions listed on the previous slide) Over-the-counter drugs (unless a prescription is retained from a physician insulin is an exception) Surgery purely for cosmetic reasons General health items such as tissues, toiletries, hand sanitizer 33

35 Recordkeeping Whenever you use HSA funds to pay for a medical expense, you should keep your receipt / billing statement. Explanation of benefits (EOB) is not the same as a receipt You may need to demonstrate to the IRS that HSA distributions were for qualified medical expenses. Failure to provide receipts could result in a penalty. Health Savings Account holders will also need to file Form 8889 with their 1040s at tax time. 34

36 HSA vs. FSA How HSA and FSA are similar: Both are funded with your pre-tax contributions Same expenses are reimbursable - i.e. dental, medical, prescriptions, glasses, contacts, LASIK, etc. How HSA and FSA are different: FSA = use it or lose it HSA = money is yours until you spend it FSA = contribution is locked in until next annual enrollment or a family status change HSA = you may change your contributions at will See handout 35

37 HSA vs. FSA REMEMBER if your spouse contributes to a full flex plan, you are likely to be ineligible to contribute to an HSA for the remainder of that tax year in which your spouse s Flex plan ends. If you are ineligible to contribute to a Health Savings Account (HSA) you are also ineligible to receive an employer contribution 36

38 Good candidates for HDHP with HSA You may be a good candidate for an HDHP with HSA if one or more of the following applies to you / your family: Low consumer of medical services Do not need expensive prescriptions Wouldn t experience a cash-flow hardship if the full deductible were due before the HSA balance was built up Want to minimize your income tax liability You like the flexibility of the variable HSA contribution You like the carryover / portability of the HSA 37

39 Poor candidates for HDHP with HSA The traditional plan might be a better choice if one or more of the following applies to you / your family: Are high users of Tier 2 providers (coinsurance applies after deductible) Require expensive prescriptions - i.e. Prescription copay is essential Potential liability of the full deductible before HSA is established is too much of a financial burden / risk 38

40 Examples Sam is enrolled as a single member. He generally only goes to the doctor once or twice a year, and when he does, he uses a Tier 1 provider. Eligible charge Traditional HDHP Office visit for sinusitis $120 $120 $120 Prescription for sinusitis $12 $10 $12 Office visit for allergies $120 $ Prescription for allergies $70 $10 $70 Total charges $322 $260 $322 St. Olaf contribution to HSA $500 Employee liability* $260 $0 *Does not include tax benefits of using FSA or additional HSA deductions 39

41 Examples Jill is enrolled as a single member. She had an office visit, urgent care visit and an ER visit, using Tier 1 providers. Eligible charge Member liability Traditional Member liability HDHP Office visit for sinusitis $120 $120 $120 Prescription for sinusitis $12 $10 $12 Urgent care visit $180 $180 $180 Urgent care Rx (brand Rx) $120 $30 $120 ER visit $850 $410 $850 Total $1,282 $750 $1,282 St. Olaf contribution to HSA $500 Employee liability* $750 $782 *Does not include tax benefits of using FSA or additional HSA deductions 40

42 Requesting your claim history You can request your claim history from BCBS 1) Call either or to speak with a service representative 2) Request a claims resume, including medical and pharmacy costs. 3)The time period of the claim resume should be Sept 1, 2012 through Aug 31, 2013, and a separate resume for Sept 1, 2013 through April 2014 (or as recent as possible). 4)If you have covered spouse/children, be sure to ask for a claim resume for each covered member. Your spouse s resume will be sent under separate cover Your child s resume may be send under separate cover 41

43 FLEXIBLE SPENDING ACCOUNT 42

44 Health Care Flexible Spending Account Healthcare Reimbursement Full FSA or Limited FSA Employees can contribute up to $2,500 per year Funds are available on September 1st Must incur expenses during plan year (9/1 8/31) Traditional plan participants / Full FSA Section 213D expenses HSA plan participants / Limited FSA - vision and dental Use it or lose it applies! 43

45 Flexible Spending Account - Continued Debit cards are available Members who currently use crossover will remain in crossover. Those who do not use crossover will receive a debit card. This allows members who have chosen crossover to continue with this option, and allows members without crossover an automatic payment option. If you wish to change from crossover to the debit card option contact SelectAccount at / or BCBSM customer service /

46 Dependent Care Reimbursement Pre-tax program for dependent care expenses Employees can contribute up to $5,000 per year per married couple You can withdraw up to your current contribution balance but no more With every paycheck new funds are deposited and are available for withdrawal Use it or lose it applies! 45

47 ENROLLMENT PROCEDURES 46

48 Enrollment Procedures A new, online enrollment process will be used for the 2014 annual enrollment period and will be available wherever you have internet access. More information will be provided on this closer to enrollment time. July 21 August 1 will be your annual enrollment period This is the OPEN enrollment period for medical, dental, and medical/dependent care reimbursement (FSA) New FSA plan elections for the 2014 plan year will be required If you wish to change your LTD funding pre-tax or post-tax, this will be the time to do so Elections are locked for the entire plan year unless you have a qualified change in status All requests for changes must be received by no later than noon on Friday, August 1,

49 Questions??? --May 15, May 20, May 22, June 19, July 15 --Viking Theater, 9:00 am and 1:00 pm Thank you! 48