The PAINLESS GUIDE TO HRPS

Transcription

1 The PAINLESS GUIDE TO HRPS How a Healthcare Reimbursement Plan Works foryour Small Business SUCCESS

2 Hello. We re glad you re checking out our content. We just wanted to let you know that this content is a little bit behind the times. It s still useful but it s not our freshest material. For more timely resources, visit Wondering why PeopleKeep is showing up in your Zane Benefits content? PeopleKeep was created to personalize benefits for small business. Zane Benefits and PeopleKeep worked in parallel for a short time, but as PeopleKeep grew, we decided they should function as one company. Zane Benefits is now part of PeopleKeep. Copyright PeopleKeep, Inc., PeopleKeep is a registered trademark of PeopleKeep, Inc.

3 Our story Offering traditional group benefits sucks. Why? They re too expensive, too complex, and too one-size-fits-all. PeopleKeep is a new way to offer benefits called personalized benefits. Most people believe benefits are the services a company offers, such as a health insurance plan or 401k. With personalized benefits, it s the opposite. Companies give people tax-free money to spend on the consumer services they find most valuable. It s as simple as wages. For small businesses that think offering traditional group benefits sucks, PeopleKeep is personalized benefits automation software that makes offering benefits simple, painless, and personal for everyone. Today more than 3,000 companies use PeopleKeep to hire and keep their people across the United States. PeopleKeep is based in Salt Lake City, Utah. To learn more about PeopleKeep, visit www. peoplekeep.com. Ready to see how PeopleKeep can work for your company? Visit to preview our software or click below to have a Personalized Benefits Advisor contact you. contact sales Copyright PeopleKeep, Inc., PeopleKeep is a registered trademark of PeopleKeep, Inc.

4 1 What is Zane Benefits? Zane Benefits is the leader in individual health insurance reimbursement for small businesses. Since 2006, Zane Benefits has been on a mission to bring the benefits of individual health insurance to business owners and their employees. Zane Benefits' software helps businesses reimburse employees for individual health insurance plans for annual savings of 20 to 60 percent compared with traditional employer-provided health insurance. Today, over 20,000 customers use Zane Benefits' software, services, and support to reimburse individual health insurance plans purchased independent of employment. Zane Benefits' software has been featured on the front-page of The Wall Street Journal, USA Today, and The New York Times. Zane Benefits was founded in 2006 and is based in Salt Lake City, Utah. Zane Benefits' Partner Program is an opportunity for insurance professionals to provide clients with custom Zane Benefits solutions. Request a Partner Evaluation. DISCLAIMER The information provided herein by Zane Benefits is general in nature and should not be relied on for commercial decisions without conducting independent review and analysis and discussing alternatives with legal, accounting, and insurance advisors. Furthermore, health insurance regulations differ in each state; information provided does not apply to any specific U.S. state except where noted. See a licensed agent for detailed information on your state.

5 2 The Painless Guide to HRPs How a Healthcare Reimbursement Plan Works for Your Small Business Introduction Understanding different healthcare benefits to offer your employees can be overwhelming Healthcare Reimbursement Plans (HRPs) are no exception. And because group health insurance premiums have increased 148% (for family coverage) over the last 16 years, many small business owners are transitioning to individual health insurance reimbursement as an affordable alternative (source). As such, a common vehicle being used to reimburse employees premiums is an HRP. Knowing this, do you understand the steps to implement an HRP and make it part of your small business s healthcare benefits? It s okay if you don t that s what we re here for! This is a start-to-finish guide and will be the only reference you ll ever need when implementing an HRP. Not only do we want you to feel confident in your HRP knowledge, but we want to ensure you re able to provide the very best to your small business employees. So grab a notebook, a pen, and get ready to learn you ll be surprised how painless HRPs really are, and how much they can benefit you and your employees.

6 3 Why an HRP Benefits You and Your Employees HRPs are employer-funded, tax advantaged employer health benefit plans used to reimburse eligible employees for individual health insurance premiums and preventive care. HRPs are beneficial to you, the employer, because they allow you to: Control costs. Recruit and retain employees. Receive tax advantages for your business. Employees benefit from HRPs because: They are a fixed allowance to put towards monthly individual health insurance premiums. Individual health insurance costs 20 to 60 percent less than group health insurance. Most employees are eligible for premium tax credits to lower their monthly health insurance premiums.

7 4 Crossroads for HRPs Your First Step to Implementation Welcome to the crossroads for HRPs! Here you ll be directed to your appropriate section of our guide. Don t worry, it s easy. Simply follow the arrows below based on your current situation and you ll see just how simple and painless setting up an HRP for your small business really is. If you re currently offering health insurance, flip to Pg. 5 If you re NOT currently offering health insurance, flip to Pg. 7 Remember, you don t need to read the entire ebook. All you have to do is follow the signs for your specific situation. This way, you ll get exactly what you need. Let s get started.

8 5 Currently Offering Group Health Insurance As you approach your first step towards implementing an HRP you may have a few questions don t worry, it s normal. One of your questions may be, Is an HRP going to be as good as the group health plan we currently have? The simple answer is, absolutely. Here s why: The individual health insurance your employees will purchase is as good, and in some cases better, than group health insurance. Individual health insurance is 20 to 60 percent less expensive than group health insurance. Individual health insurance is safe. Policies cannot be cancelled so long as employees make their payments. You and your employees will be able to choose doctors and hospitals that fit your needs. You and your employees can customize your plans by choosing the deductible and co-pays. With individual health insurance, eligible employees can access $2,000 to $12,000/year in tax credits. You can provide one allowance amount to all employees, or vary the allowance amounts by classes of employees. Is an HRP going to be as good as the group health plan you currently have? The simple answer is, absolutely. Now, knowing that implementing an HRP into your business is not only a smart way to save money, but is safe and reliable, your first step is to cancel your current group health coverage.

9 6 Currently Offering Group Health Insurance (Cont.) STEP 1: Cancel Group Health Insurance When you cancel your group health coverage, you need to call a customer representative with the insurance company. By calling, an insurance representative can confirm the steps you must take to successfully cancel the group health insurance policy. For instance, some insurance companies may require that a fax or letter be sent confirming the cancellation. Correspondence via only may result in the company being obligated to pay for next month s premium. Your health insurance agent or broker will be able to assist you with the process, however the business needs to call directly. Most group health insurance plans are "unilateral contracts". This means that businesses can cancel a group health insurance plan at any point during the year. While most carriers request 30 days notice, this is not always required. Once you have canceled your group health coverage, you're ready to move on to step 2 of this simple process. To do so, flip to page 8 for step 2. Tip: When you cancel group health coverage, your employees will be eligible for a special enrollment period for individual health insurance. This means they will be able to purchase individual health insurance outside of the annual open enrollment period (ex: November 15, 2014 to February 15, 2015). Chapter 2: Training and Development When you cancel your group policy, you are giving eligible employees and their families, access to the premium tax credits (federal discounts on individual health insurance).

10 7 Not Currently Offering Health Insurance STEP 1: Deciding Why an HRP is For Your Small Business As you approach your first step towards implementing an HRP into your business you may have a few questions don t worry, it s normal. One of your questions may be, How is an HRP going to benefit my business over not offering anything at all? This is a great question, and the truth is, an HRP is a perfect start to becoming the small business you have always wanted to become. How? One word: benefits. You currently do not offer formal healthcare benefits, but did you know that healthcare benefits are one of the main reasons a candidate will choose to work with you and stay with you? Implementing an HRP allows you to recruit and retain the top talent in your industry that may not have looked at your company before. Now, knowing that implementing an HRP into your business is a perfect way to recruit and retain top talent, you re ready to move on to our next simple step. To do so, flip to page 8.

11 8 Remaining Steps to Set up an HRP STEP 2: Define Your Budget You need to decide how much you d like to contribute to your employees health insurance expenses. You can either provide the same amount to all employees, or offer different amounts by class of employee or family status. Did You Know? Without annual renewal increases or minimum contribution amounts, the business is free to set and control all costs. STEP 3: Set up an HRP Though it may sound easy to administer your own plan, experts recommend utilizing an HRP Software Provider for this important step. Why? An HRP Software Provider ensures a business remains compliant with the Affordable Care Act s Market Reforms and avoid potential costly fees. Did You Know? HRP Software Providers make administration easy and provide tools to educated employees.

12 9 STEP 4: Reimburse Employees on Payroll Employees purchase individual health insurance policies with their own money and submit a reimbursement request to your HRP Software Provider. The business reimburses employees on payroll. Did You Know? With an HRP, the business only reimburses employees for eligible premium expenses, up to the amount of their healthcare allowance. Your employees can work with a health insurance broker or agent to select plans. STEP 5: Educate Your Employees The last step is to educate employees about how individual health insurance and an HRP works, and how it benefits employees and their families. Educate employees about: How the HRP works Why the business has decided to offer health benefits in this way (remember, it is better for them too!) The benefits of individual health insurance such as plan choice, flexibility, and costsavings How to purchase individual health insurance for themselves and their family How to request reimbursement for their premium expenses Did You Know? Your employees will have access to the best and most affordable healthcare through the Individual Health Insurance Marketplace.

13 10 Conclusion You did it! You ve successfully accomplished what you need to do to incorporate an HRP into your small business. And while understanding HRPs isn t always easy, we hope this painless guide has given you the insight you need to enjoy reliable, affordable health benefits for your small business. Additional

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15 12 What is Zane Benefits? Zane Benefits is the leader in individual health insurance reimbursement for small businesses. Since 2006, Zane Benefits has been on a mission to bring the benefits of individual health insurance to business owners and their employees. Zane Benefits' software helps businesses reimburse employees for individual health insurance plans for annual savings of 20 to 60 percent compared with traditional employer-provided health insurance. Today, over 20,000 customers use Zane Benefits' software, services, and support to reimburse individual health insurance plans purchased independent of employment. Zane Benefits' software has been featured on the front-page of The Wall Street Journal, USA Today, and The New York Times. Zane Benefits was founded in 2006 and is based in Salt Lake City, Utah. Zane Benefits' Partner Program is an opportunity for insurance professionals to provide clients with custom Zane Benefits solutions. Request a Partner Evaluation. Like Us on Facebook Follow us on Twitter Join our Defined Contribution Group Watch our videos on YouTube DISCLAIMER The information provided herein by Zane Benefits is general in nature and should not be relied on for commercial decisions without conducting independent review and analysis and discussing alternatives with legal, accounting, and insurance advisors. Furthermore, health insurance regulations differ in each state; information provided does not apply to any specific U.S. state except where noted. See a licensed agent for detailed information on your state. (February 6, 2015)