Health Coverage at the spa or wellness facility is a much needed benefit that some practitioners, managers and owners are struggling to figure out. No matter the dynamic of health coverage it is a measurable, sometimes painful, addition to any budget. Learning how to best configure group insurance or your own insurance now could offer a significant savings annually.
By this time if you are an employer in the US with at least one employee and $500,000 in annual revenue you have notified your employees in writing of your health policy. The FLSA or Fair Labor Standards Act, requires that employers let their employees know that: Health exchanges are open and even if they have coverage through work, they may be able to get less-expensive coverage on the exchange, thanks to potential cost-sharing subsidies and premium coverage. It is the responsibility of the employer to inform their employees of their option to choose.
If you are like most spas or wellness centers you have a combination of full and part time employers. You may also have legitimate contractors functioning within your facility. If you have 50 or more fulltime equivalent employees (FTE’s) your organization is considered a “large employer” and are required to offer health coverage. 95% of American businesses have fewer than 25 employees and are exempt of the changes in policies. An FTE is an individual who works an average of at least 30 hours a week. Part timers are added together to compile units of full timer’s. For example, 30 full-timers and 60 who put in an average of 15 hours per week amounts to 60 FTE’s. As such, if you don’t offer health coverage to your full time employees in 2015 your organization will likely be penalized.
If your company isn’t required to offer insurance or if your company will expand or downsize significantly in 2014, you may want to wait to decide which scenario works best for you. Many of those now receiving employer-sponsored insurance would be better off considering other forms of coverage on public exchanges. Those opting for employer-sponsored plans may require that the employer supply rather expensive coverage for the entire family—spouse and dependents. While the employer is eligible for subsidies and tax breaks the learning curve is rather steep and can be expensive. Employees are typically expected to contribute to their plan. Typically this contribution is 30-38%. In some instances offering employees an allowance is better for both the employee and the employer.
The biggest change immediately are the multiple ways to shop for insurance. Those companies with 49 or less employees can use the new Small Business Health Options Program, or SHOP, exchanges run by the states or the federal government. Many offer ancillary programs such as dental, vision and prescription coverage.
Employers can select from different carriers, which are given a designation of bronze, silver, gold or platinum designated by the number or level of benefit offered by each. While in a transitory state 36 exchanges have been set up by the federal government. After this stage; however, employers will be asked to choose one plan to offer employees. This change can reduce significantly the options for selection of doctors and primary care organizations as well as hospitals. Larger employers have human resource consultancies that do the math for them and offer larger and more flexible exchange options. Most companies in our industry are too small to fall into a category of “larger employer. With many employees and employers falling in between the gaps individual or self-funded plans are becoming more of the norm for small and medium sized companies.
Many companies already had in place a cafeteria styled benefit plan whereby individuals could select a dollar value amongst the options available. For those who are in need of childcare, for example, the $300 per month allowance could go to their choice of child care providers. In the health care scenario, families might choose to be covered under one spousal health insurance package leaving the other spouse or significant other available to work as a domestic partner or use their occupational benefit in some other way of use to the family, like contributing to advanced education or training for the children of the partnership.
Under this new paradigm, pre-existing health conditions or health history will no longer be a consideration at use by insurers. Instead insurers must set premiums for individuals and smaller groups health insurance deals based on geographic region. Limited adjustments are allowed only for age, family size (individual or family) and tobacco use.
Younger and healthier demographic groups will pick up the slack for the aging population and those who are experiencing health conditions like cancer. While this may seem unfair in the short term, as the younger decades of individual’s age there will be a system in place for their care that allows for those conditions that associated with aging such as arthritis, dementia, and sight or hearing impairments.
In self-funded plans, an employer sets aside funds to cover employee health claims, rather than paying per-employee premiums to an insurance company. These plans aren’t subject to the standards set by the community rating requirements or ACA’s. Insurance known as “stop-loss” insurance which protects employers from higher than expected claims in any given year. If actual claims are less than the amount funded, the individual or the company paying into the plan is offered a refund for the amount remaining unused. More and more carriers are offering self-funded options for consideration by individuals or smaller companies.
No matter your situation, health insurance in the United States is now a must. With many options available to employers and employees this is an area that we must all understand enough to embrace the new opportunities and avoid the penalties and pitfalls. Whether by employer-employee consultation or by family meeting find out where your care lies in the coming years. You will rest easier and may even be able to budget a wellness-directed escape during your days or weeks off.