Building a Benefits Suite that Fits Your Unique Business Needs

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1 Building a Benefits Suite that Fits Your Unique Business Needs TriNet Webinar CJ Gregorios & Marla Cussen Senior Benefits Consultants TriNet 2015 TriNet Group, Inc. All rights reserved. Reproduction or distribution in whole or part without express written permission is prohibited.

2 Meet Our Subject Matter Experts CJ Gregorios is a member of the TriNet Senior Benefits Consulting team. With 13-years of benefits experience, she has managed a variety of benefits initiatives including Plan Renewals, 401k Operations, and Global Service Awards Programs. CJ holds a Bachelor of Business Administration with a concentration in Human Resources and sits on the Board of the Orange County Compensation and Benefits Association (OCCABA). Marla Cussen is also a member of the TriNet Senior Benefits Consulting team. She has worked in the PEO industry for 18 years, holding a variety of positions that have been focused on benefits and the customer experience. She is a member of The Society for Human Resource Management (SHRM), and holds a New Jersey Life and Health Insurance Producers license. 2 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

Options Competitive Benefit Analysis Q&A

Total Rewards Defined Total rewards involve the integration of five key elements that effectively attract, motivate, and retain the talent required to achieve a company s business

5 Total Rewards Defined Total rewards involve the integration of five key elements that effectively attract, motivate, and retain the talent required to achieve a company s business objectives. Compensation Benefits Work-life Performance and Recognition Development and Career Opportunities 5 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

6 Determining Your Total Rewards Strategy Determining the right focus and mix of these elements creates a custom total rewards package that: Attracts and retains key talent Motivates worksite employee performance Should be adjusted as your company evolves through the business lifecycle All five elements are important, but our focus today is on helping you assess how your benefit suite contributes to your total rewards strategy and overall philosophy. 6 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

7 POLL What was the highest Total Rewards priority for 2012: Improve ability to attract talent Improve ability to retain talent Improve alignment with business objectives Improve worksite employee engagement Take a more holistic view of rewards Source: Aon Hewitt 2012 Survey 7 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

8 Total Rewards: What Other Companies are Doing Companies aspirations for total rewards are high: Total Rewards Priorities for 2012 Percent of Companies Improve worksite employee engagement 58% Improve alignment with business objectives 52% Improve ability to retain talent 48% Improve ability to attract talent 44% Take a more holistic view of rewards 40% Reduce benefit costs 39% Improve alignment to individual performance 37% Create a roadmap to manage total rewards for 3 5 years 35% Improve the return on total rewards investments 25% Create or improve programs targeted to top performers 22% Introduce new/innovative programs 22% Introduce more choice 8% Segment rewards by employee groups 6% Source: Aon Hewitt 2012 Survey 8 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

9 Developing Your Total Rewards Strategy Key Questions to Ask: What are your business objectives? What is your compensation philosophy? What do your employees value? How do benefits fit into the total rewards strategy? 9 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

10 Using Your Total Rewards Strategy to Shape Benefits Selections and Funding What drives the benefits selections and funding? Business Objectives Compensation Philosophy Employee Needs & Wants What are short-term objectives for spending on health care and other benefits selections? What are long-term objectives? What can the business afford to spend? 10 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

13 Designing the Appropriate Strategy Many factors impact how your company should fund its benefits selections, including considerations around cost and culture. Cost Do you need to limit your company s costs due to budget constraints or need to control expenses? Do you want to be cost-conscious, but also limit employee out-of-pocket costs? Culture Are benefits a key competitive differentiator in attracting and retaining top talent? Do you see benefits funding as a significant component to your total rewards strategy? Do you value employees, but need a structured, predictable formula? 13 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

14 Designing the Appropriate Strategy Another factor to consider is the Affordable Care Act (ACA). Small Employer (under 50 full time equivalent employees) Cannot provide pre-tax or post-tax cash to employee to purchase individual coverage Medical plans/packages must provide minimum essential coverage Large Employer (50+ full time equivalent employees) Medical plans/packages must > Provide minimum essential coverage > Meet actuarial value > Meet one affordability safe harbor > Offered to 70% (95% in 2016) of full time employees and eligible dependent children 14 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

15 Funding Benefits Four common methods to fund benefits: Percentage Contribution Company Fixed-Dollar Contribution Employee Fixed-Dollar Contribution Benefits Supplement Funding 15 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

16 Percentage Contribution Company funds a set percentage of the premium with employees responsible for the remaining percentage Example: Company pays 90% of employee-only level of coverage, 50% of employee+ levels of coverage Very popular funding strategy for companies Companies who elect this strategy usually cap their total contribution To a specific plan (if more than one plan is offered) To a budgeted amount, for example $400 for employee-only, $750 for employee+ levels of coverage Employees who choose a less expensive plan pay less, but those who choose a more costly plan receive a larger dollaramount subsidy (up to cap amount, if set) 16 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

17 Company Fixed-Dollar Contribution Companies elect to contribute a flat amount for each employee s coverage, no matter which plan is chosen Companies on a fixed benefits budget can more easily identify maximum potential health care expense Provides equal company subsidy per employee no matter which plan is chosen Company dollar amount contributed needs to be evaluated each year at renewal to ensure alignment with plan premiums Employees can reduce their cost by selecting a lower-cost plan 17 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

18 Employee Fixed-Dollar Contribution Company sets a dollar amount that employees will pay for coverage Easy for employees to understand how much their benefits elections will cost, but shields them from true cost of coverage No incentive for employees to select lower-cost plan, therefore it may encourage employees to select more robust medical plan Harder for companies to predict their overall benefits spend before employees elect coverage This strategy is rarely used given the current healthcare climate 18 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

19 Benefits Supplement Funding Company provides a pool of money to employees to be spent on medical, dental, and vision coverage Encourages employees to select benefits wisely Company needs only to choose one supplement amount to be applied to health care benefits Any excess subsidy paid to the employee is considered taxable 19 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

20 Which Funding Method is Right for you? Do you want to Establish a simple strategy that adjusts for trend each year? Limit client costs? Limit WSE costs? Choose benefits selections that are generous and flexible? Move to a defined contribution strategy? Percentage Contribution Strategy Company Fixed-Dollar Contribution Strategy Employee Fixed-Dollar Contribution Strategy Benefits Supplement Strategy* Adjust amount each year for trend Adjust amount each year for trend Adjust amount each year for trend Set caps to limit costs Fund a higher percentage of cost of coverage Fund a higher percentage of cost of coverage Fund lower amount that limits cost Fund higher amount Fund higher amount that gives WSEs a chance to use funds toward TriNet s dental and vision coverage 20 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

21 POLL Which benefits funding method is right for you? Percentage Contribution Company Fixed-Dollar Contribution Employee Fixed-Dollar Contribution Benefits Supplement Funding 21 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

Typical Benefits Costs 23 TriNet Webinar Series

Employee Contributions to Benefits 24 TriNet Webinar

Employee Contributions to Benefits 25 TriNet Webinar

26 Poll Which Group Health Plan do you think is selected and funded most by TriNet Clients? Medical and Dental Medical and Vision Medical Only Medical, Dental, Vision 26 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

TriNet Client Survey Data: Group Health Plans Selected and Funded 27

TriNet Client Survey Data: Benefit Funding Strategy Method 28 TriNet

TriNet Client Survey Data: Group Disability Plans Funded 29 TriNet

TriNet Client Survey Data: Group Life Insurance Plans Funded 30

31 Voluntary Benefits Supplemental Insurance: Complements employer s core benefit offering Premiums paid by employees through payroll deductions Many voluntary benefits are post-tax and offer flexibility in enrollment, which can be attractive to employees 31 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

Voluntary Benefits 32 TriNet Webinar Series 2015

33 Benefits Beyond Medical Health benefits is just one component of your Total Rewards Strategy. Other benefits that blend into Work-Life Programs: Employee Assistance Programs PTO Flex Time Telecommuting 33 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

34 Summary 1. Ensure benefit suite aligns with your: Total rewards strategy Business objectives 2. Confirm benefits funding method and level supports your: Budget Business objectives Desired worksite employee experience and behaviors 3. Re-evaluate your strategy each year: Cost vs. culture Competitive position Ability to attract and retain key talent 34 TriNet Webinar Series 2015 TriNet Group, Inc. All rights reserved. 9/16/2015

PPACA Implementation and the Marketplaces aka Exchanges. Presented by: Cathy Cooper November 15, 2013

PPACA Implementation and the Marketplaces aka Exchanges Presented by: Cathy Cooper November 15, 2013 Today s Agenda 2014 Provisions Groups over 50 in 2014 Groups under 50 in 2014 Marketplaces aka Exchanges