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1. What are the primary services you offer as part of your HSA product?

Aetna: Compatible high deductible medical plan, HSA administra­tion. HSA investment services.

Anthem Blue Cross: We offer Medical HSA Health Plans and an op­tion to in an integrated Banking system through our contracted part­ners; NY/Mellon.

Blue Shield: Blue Shield offers an integrated eligibility and claims experience for clients that choose an account based health plan (i.e.. health plans wrapped with an HSA,

HRA or FSA account). 2013 will be a year of choice. Members can choose a HDHP PPO and couple it with a health savings account or choose a regular PPO or HMO plan and wrap a health reimbursement account around the product. In either case the member will be em­powered to manage their health and wealth.

Cigna: Cigna Choice Fund health savings account (HSA) is an inte­grated HSA, combining the plan's entire healthcare and financial management features into one easy- to-use healthcare product. It includes several features, such as health coaching, medical and HSA claim capabilities, a diverse range of mutual fund choices, employee education, and medical and pharmacy cost transparency tools. hospi-03I quality comparison tools, and online health risk assessments.

HSA Bank: HSA Bank provides HSA administration. Complimentary business support is offered to employers and brokers including imple­mentation planning, enrollment meeting support, remote Webinars, and communication planning. Through free online banking, accoun­tholders can view and download real-time transactions and year-to-date account information, transfer HSA funds to an investment ac­count or other accounts, and more. HSA Bank also funds each new HSA with a penny to meet OS establishment, enabling accounthold­ers to be reimbursed for qualified medical

expenses on day one.

HSA California: The HSA California Exchange is the only small-group, fully integrated HSA program with multiple carriers. Each employee can choose from a menu of HSA- qualified high deductible health plan benefits from Health Net, Kaiser Permanente, and Western Health Ad­vantage with no minimum participation requirements.

HSA banking and savings programs are offered through The Bancorp Bank, with accounts FDIC insured to at least $250,000. Accounts in­clude a free debit card, access to hundreds of investment options, personalized checks, and 24/7 secured online banking access. There is no application or fee to open an NSA with The Bancorp Bank.

HSA California also offers dental, vision, hearing, HR support, life, and Section 125 POP plans, as well as prescription discounts of up to 75% through the California Rx Card Program, and amusement park, movie ticket, and other discounts through the Cal Perks Employee Discount Program (offered at no cost to enrolling groups).

Kaiser Permanente: Kaiser Permanente offers HSA-qualified deduct­ible HMO plans (available to the Individual and Family market, Small, Mid and Large employer groups), PPO plans (available to Small busi­ness, and large groups), EPO plans for Individuals and Self-Funded EPO plans. We have selected Wells Fargo as our preferred financial administrator to provide HSAs in connection with our HSA-qualified health plans.

Wells Fargo offers to all Kaiser Permanente customers a competi­tively discounted monthly administrative fee, an FDIC-insured tiered interest rate account, HSA Visa debit cards, investment options, online account management, and dedicated customer service.

SeeChange Health: SeeChange Health Insurance offers high-deduct­ible health plans compatible with HSAs that financially reward mem­bers for taking actions to manage their health.

Sterling HSA: Sterling offers education, implementation and account management services through personal sales and service teams, as well as online for brokers, employers and accountholders. Among our primary services are HSA education, enrollment assistance, a review of the EOB, bill paying, record keeping, scanning and archiving of bills, receipts, and other critical information in case of an IRS audit.

We also offer options for self-directing investments and flagging ex­penses submitted as qualified and non-qualified for NSA distribution. Our online services include online enrollment, banking, account trans­action information, and the ability to make changes to the HSA ac­count. Our most recent satisfaction survey found that among the Ster­ling services valued most by our HSA accountholders, online services are at the top of the list with 91% of Sterling accountholders respond­ing favorably. We offer educational materials and services in English and Spanish. Our trans- created Spanish Website includes HSA online enrollment for individuals and employer groups. Our forms and collat­eral have also been trans-created for clients who prefer Spanish and we have many Spanish bi-lingual customer service representatives to help them.

UnitedHealth Group: Unitedl-lealthcare is the largest provider of consumer-driven health plans in the country with nearly 3 million members enrolled in consumer- driven health plans that incorporate a health savings account or health reimbursement.

Additionally, UnitedHealth Group uses its own financial corporation, OptumHealthBank, for its HSA program administration. OptumHealth-Bank, an FDIC-insured financial institution focused solely on health care banking, is the nation's largest HSA administrator. Account hold­ers receive market competitive interest rates on their deposits, online bill payment options. and direct debit card access to their accounts. Additionally, once they get a qualifying account balance, they also can invest in a range of highly regarded no-fee, non-proprietary investment options.

2. Do you offer an FISA-qualifying high deductible health insurance plan?

Aetna: Yes.

Anthem Blue Cross: Yes

Blue Shield: Yes, Blue Shield offers predictable qualified High Deduct­ible Health Plans that can be wrapped with a health savings account.

Cigna: Yes, Cigna offers a full suite of account-based medical plan designs that meet the definition of a qualified high deductible plan.

HSA Bank: No, HSA Bank offers direct health savings administration. HSA Bank is an independent bank and can administer HSAs for any qualified high deductible health plan offered by any regional or na­tional carrier. If the employer decides to switch carriers, they can keep their HSA with HSA Bank. There's no need to transfer accounts.

HSA California: Yes, HSA California only offers HSA-qualified health plans; our portfolio includes seven different HSA-compatible plan de­signs.

Kaiser Permanente: Yes, Kaiser Permanente offers an array of HSA-Qualified Deductible HMO plans for the Individual, Family and Employ­er group markets, PPO plans for Small and large business groups, EPO plans for Individuals and Self Funded EPO plans.

SeeChange Health: Yes. to the best of our knowledge we offered the nation's first value-based benefit HSA-compatible plans in the coun­try.

Sterling HSA: As an independent HSA administrator, Sterling can work with all HSA compatible plans — fully insured and self-insured. In mid-2011. we launched Sterling level funding and traditional self-insurance products that do include NSA-qualifying high deductible health plans as an employer option.

3. Are you providing a health spending arrangement or a savings vehicle?

Aetna: Yes.

Anthem Blue Cross: We have partnered with BNY/Mellon and their

support staff -ASC/Mellon to provide banking and investment options for the financial piece of our HSAs. Our integration allows members to login to and be linked to their BNY/Mellon account.

Blue Shield: Blue Shield offers choice. Our clients and members can choose to have an integrated HSA model or a stand-alone HSA bank account. Both options promote pre-tax deposits and after-tax depos­its; when the member reaches a certain dollar amount, he/she can choose to invest the savings in mutual funds. Cigna: Cigna has an extensive offering of consumer products that include an HSA, HRA, healthcare flexible spending account, dependent care flexible spend­ing account, and incentive health reimbursement accounts (Healthy Awards).

HSA Bank: For spenders, the health savings account is an easy and tax-advantaged way to save and pay for healthcare costs before and after the deductible is met. For savers, an HSA is a great way to build savings for retirement.

HSA California: HSA California and The Bancorp Bank have partnered to create a seamless, online approach for employers and employees to fund an HSA with a wide array of savings and investment options. Kaiser Permanente: Members who enroll in one of our HSA-Qualified Deductible HMO plans can open a health savings account through our preferred financial administrator, Wells Fargo. However, members are also free to open a health savings account with a financial institution of their choice. Our HSA-Qualified Deductible HMO plans are designed to work with HSA administration from any financial institution. In terms of other spending arrangements, Kaiser Permanente also offers dif­ferent deductible HMO plans paired with health reimbursement ar­rangements (HRAs).

SeeChange Health: No. Members have the flexibility to use the HSA administrator, which delivers the most value.

Sterling HSA: Yes, in addition to HSAs, Sterling also provides admin­istration services for HRAs, FSAs, POPs and COBRA.

UnitedHealth Group: Yes, UnitedHealthcare offers several HSA-qual-ified HDHPs. In addition to administering the medical plan, United-Healthcare offers a wide variety of health care services, tools, and tips for its HSA customers.

4. What size employee group is the HSA available for?

Aetna: All sizes of groups.

Anthem Blue Cross: All employee groups are eligible.

Blue Shield: We offer qualified HDHP to be used with an HSA for all markets, including individual and family, small groups (from 2 to 50 employees), midsize groups (51 to 299 employees), and large groups (300+ employees).

Cigna: Our HSA product is available for employers with 50or more eligible employees.

HSA Bank: An HSA at HSA Bank is available to employee groups of all sizes with no minimum or maximum number of participants. Our HSA is also available to individuals not connected to an employer group.

HSA California: HSA California is available for employers with 2-50 employees.

Kaiser Permanente: Kaiser Permanente offers HSA-qualified deduct­ible HMO plans to any group size. PPO plans are available to any group size, and Self Funded EPO plans are available to groups with 500 sub­scribers.

SeeChange Health: Our fully insured plans are available to groups of 2-to-200 or more employees. Our sister company, SeeChange Health Solutions offers value-based benefit ASO services that support HSAs.

Sterling HSA: We work with groups of all sizes, including large, me­dium and small companies. We also work with individuals, many of whom sign up for our HSA online.

UnitedHealth Group: Yes, UnitedHealthcare has partnered with Op-tumHealthBank for HSA administration, savings and investment op­portunities.

5. Is your management team experienced in health insurance, financial services, or both?

Aetna: Health insurance.

Anthem Blue Cross: Anthem has subject matter experts in health insurance and the financial services for our FISAs plans. These as­sociates can work with the client and agent/broker to explain all pro­cesses.

Blue Shield: Blue Shield's management team is experienced in healthcare services, but works closely with our preferred vendors-Health Equity, which provides the integrated model; and Wells Fargo, for stand-alone accounts.

HSA Bank: HSA Bank's leadership and national sales force is highly experienced and trained in both health insurance and financial ser­vices. David Drzymkowski, the Regional Vice President - California & Hawaii, has held his insurance license since 1988.

HSA California: Both.

Kaiser Permanente: Kaiser Permanente's management team is experienced in health insurance and HMO plans. Our preferred HSA administrator, Wells Fargo, brings the appropriate financial services expertise.

SeeChange Health: Our leadership has extensive experience in health insurance and financial services as well as with value-based benefit plan designs.

Sterling HSA: Sterling HSA's executive team has extensive experi­ence in healthcare, insurance, and consumer directed account man­agement. We have complemented those skills with staff and advisory board members who have experience in financial services to optimize support of our dents during enrollment and to manage their accounts with us long-term.

UnitedHealth Group: Both.

6, Do you provide training for brokers about HSAs?

Anthem Blue Cross: We provide ongoing broker communications, newsletters, and product demonstrations as new products are intro­duced.

Blue Shield: Yes, Blue Shield provides a continuing education semi­nar on HSAs to our IFP brokers periodically. Brokers also have access to educational programs and tutorials through Health Equity and Wells Fargo Websites:

Cigna: Cigna provides consumerism education on products including the HSA to brokers via forums and through highly skilled sales manag­ers.

HSA Bank: Yes, Our Business Relations department serves as a valu-

able resource for HSA-related questions by phone and email. Our team is also pleased to schedule training Webinars for brokers. Plus, your regional vice president David Drzymkowski is happy to visit your office and host a Lunch and Learn on a variety of HSA topics.

HSA California: Yes, HSA California has dedicated HSA experts ready to provide personalized training and HSA education to brokers. We can be reached between 8 a.m. and 5 p.m.. Pacific Time, Monday-Friday at sales@hsacalifornia.Corn or toll-free at (866) 251-4625. HSA Cali­fornia also provides ongoing seminars to provide brokers with the nec­essary information and tools to explain High Deductible Health Plans and HSAs to clients.

Kaiser Permanente: Yes, we provide training to our brokers. In addi­tion, our preferred financial administrator for HSAs, Wells Fargo, has a dedicated support line to assist our brokers with questions. Wells Fargo also has an online flash educational presentation for our cus­tomers about HSAs online at:

SeeChange Health. Yes. We provide extensive training on our prod­ucts, including HSA-compatible plans. We also work with the state's major general agencies to help educate brokers.

Sterling HSA: Yes, Sterling offers a variety of training options, includ­ing CE courses, Webinars, "lunch and learn" meetings for large region­al brokerage groups, and individual sessions pairing Sterling account representatives with brokers and consultants.

7. What commissions are paid to brokers and when?

Aetna: Standard commission levels, monthly.

Anthem Blue Cross: Brokers are paid the standard medical commis­sion for the HSA compatible medical plan.

Blue Shield: Blue Shield does not pay commissions for HSAs because we administer the HDHP.

Blue Shield: Enrolling online eliminates the need to complete and mail in paper enrollment forms. provides an efficient enrollment pro­cess that is accurate and secure, and delivers immediate enrollment confirmation to employees. During the Blue Shield group installation for our integrated program, the client will be seamlessly set up with HealthEquity_ Esiue Shield will pass employee eligibility information to HealthEquity, which will automatically set up bank accounts. The cli­ent will be able to fund its employees' HSA through payroll deduction. Employees enrolling in a Wells Fargo health savings account (HSA) through their employer are able to conveniently enroll online directly with Wells Fargo.

Cigna: Cigna pays its standard commissions for HSA sales.

HSA Bank: We recognize the important role you play in our success. To show our appreciation, we created a producer recognition program that rewards brokers on three levels. For more info, visit bank/AgentsBrokers.

HSA California: HSA California pays standard commissions monthly.

Kaiser Permanente: Brokers are paid the standard medical commis­sions on all of our HSA-qualified health plans.

SeeChange Health: We pay 7% level commissions for groups of 2-to-50 employees and 5% level for groups of 51 or more employees.

Sterling HSA: Commissions far our HSA business are 10% of the fees for all new and renewing groups and are paid quarterly. We also pay commissions on HRA, TSA, FSA, POP, and self-insurance business.

8. Are electronic enrollment forms accessible through your Website?

Aetna: Yes.

Anthem Blue Cross: Yes.

Blue Shield: Enrolling online eliminates the need to complete and mail in paper enrollment forms, provides an efficient enrollment pro­cess that is accurate and secure, and delivers immediate enrollment Confirmation to employees.

During the Blue Shield group installation for our integrated program. the client will be seamlessly set up with HealthEquity. Blue Shield will pass employee eligibility information to HealthEquity, which will auto­matically set up bank accounts. The client will be able to fund its em­ployees' HSA through payroll deduction on the HealthEquity Employer Portal. Training Webinars occur every Wednesday; to sign up. clients go to: and click the link under LAUNCH AND BEYOND titled HSA Employer Portal Webinars.

Cigna: Cigna provides an online and paper version of the HSA bank enrollment application. Employers can provide online or paper enroll­ment options for their employees.

HSA Bank: Yes. HSA Bank offers a variety of online enrollment op­tions for the employer. With our Auto Enrollment File process, employ­ers can easily enroll all HSA-qualified employees in an HSA by upload­ing a Microsoft Excel file. With HSA Bank's Group Online Enrollment system, the employer can easily facilitate the HSA-enrollment process by providing their employees with a custom enrollment link to an on­line application.

HSA California: PDF enrollment forms are available on our Website at . Employers and employees can open and fund an HSA on our Website through a simple process driven by our partner, The Bancorp Bank. Employers can even maintain employees' membership information online.

Kaiser Permanente: Individuals and Families can apply for Kaiser Permanente health plans online by logging on to: . RSA Employer and Individual applications can be downloaded at wellsfargo.corn/hsa. Kaiser Permanente health plan enrollees from companies whose employer is not sponsoring an HSA, and individuals enrolled in Kaiser Permanente's individual and fami­lies health plans. can open and fund an HSA account online.

SeeChange Health: We expect to add this functionality in 2013.

Sterling HSA: Yes. We provide online enrollment for individuals who are part of employer groups, individuals seeking a HSA administrator on their own, and for employer groups to manage the HSA enrollment of employees. Sterling account enrollment and management forms are also available on our Website at in a fill-able PDF format to download, complete, and email, mail or fax to Sterling. Our online enrollment and paper forms are available in English and Spanish.

9. How do you assist account holders with paying medical bills?

Aetna: We provide cost estimator and quality assessment tools. Anthem Blue Cross: High Deductible Health Plans engage the mem­bers to be knowledgeable about their healthcare treatment and man­agement of funds.

Members manage their own bank accounts, pay for their medical and Rx needs with their HSA account. Members can view online their bank­ing balances and their claim activity.

Account status and explanation of benefits documents are available

10. How does the administrator help the accountholder with insurance-related questions?

Aetna: Customer service representatives are available by phone and through our Website.

Cigna: Cigna offers integrated customer service via our Website and 24/ 7/365 toll-free telephone service to respond to ques­tions about the member's health insurance and the HSA. Anthem Btue Cross: Anthem provides online resources as well as a customer ser­vice support line for all members. Support numbers are listed on the member's health insurance card.

Blue Shield: All HDHP-related questions are referred back to Blue Shield.

HSA California: Both HSA California and The Bancorp Bank have customer support teams with expert knowledge available by phone or e-mail from 8 a.m. to 5 p.m., Eastern Time, Monday-Friday. (866) 271­2649 or .

Kaiser Permanente: Our preferred financial administrator for HSAs, Wells Fargo, refers insurance-related calls back to Kaiser Permanente (KP). KP member service representatives are trained to answer any insurance related questions our members may have. At , we also have a Website for deductible plan members to educate them­selves about what to expect pre/during/post visits with our providers, including decision support tools (e.g., preventive services list, sample fee list, interactive treatment fee tool) that may facilitate better under­standing of their insurance coverage and optimize the wide range of health related services offered by KP. Visit to find out more.

SeeChange Health: Questions related to plan coverage are handled by SeeChange Health.

Sterling HSA: Our customer service representatives are available Monday - Friday from 7 am to 6 pm Pacific. Clients and brokers can reach us toll-free at 800-617- 4729 and via e-mail at .

UnitedHealth Group: LlnitedHealthcare's Customer Care Profession­als are available by phone to respond to all insurance and account-related questions; a number of resources, including calculators and FAQs are also available online at.

11. Is the administrator integrated with the health plan?

Aetna: Yes

Anthem Blue Cross: Yes, BNY/ Mellon provides consumers with: Online Checking Activation Services through Antherricom/ca Interest-bearing checking account Anthem-branded MasterCard debit card Checkbook (Consumer receives the HSA debit card, checkbook, etc. after completing the activation process.)

·                 Online Monthly HSA Statements (bank statement)

·                 Annual Tax forms: 1099s (January), 5498s (May)

·                 Online Investment opportunities through its subsidiary Dreyfus

·                 Online Bill Pay for the member's medical fees

Blue Shield: Blue Shield offers a fully integrated experience through our partnership with Health Equity. Our new Account Based platform offers a completely integrated healthcare experience for both mem­bers and clients. All accounts are on one platform with integrated en­rollment and claims information, and flexible contribution models. We will also provide clients with an Employer Portal with access in real time to eligibility information, contributions, fee payments, and more

Clients will also be able to run reports for easy reconciliation..

Cigna: Yes, the HSA is fully integrated with the high deductible health plan.

HSA California: HSA California is completely integrated with The Ban­corp Bank. Eligibility is automatically transferred to The Bancorp Bank, so that account set-up is simplified; employers can set up employee HSAs, fund employee HSAs, and complete other administrative capa­bilities - all online.

Kaiser Permanente: No, Kaiser Permanente provides the health plan Services and Wells Fargo. our preferred financial administrator for HSAs, provides the financial account.

SeeChange Health: No as members are free to select any HSA ad­ministrator they choose.

Sterling HSA: We are an independent administrator available to work with all health plans across the nation. We have the ability to pull EOB information from the carrier for payment on behalf of our accounthold­ers.

UnitedHealth Group: Yes, in 2002, UnitedHealth Group chartered Op-tumHealthBank to help advance the growing convergence of health­care and financial services and to give consumers a more integrated experience.

12. Are investment choices limited by the admin­istrator?

Aetna: The administrator provides a diverse fund selection by asset classes supporting a range of investment objectives.

Anthem Blue Cross: There are over 20 investment opportunities Through BNY/Melion's subsidiary Dreyfus.

Blue Shield: Under the Health Equity program, employees can invest their HSA dollars directly from the Website after reaching the $2,000 minimum balance; investments are on the same, single platform. There are no fees to invest and members can access up to 12 dif­ferent mutual funds and each fund prospectus. Tax statements are also available on the Website. Wells Fargo has 13 mutual fund options available for investment options.

Cigna: Cigna offers a customized slate of diversified HSA investment options through JP Morgan Chase as part of our Cigna Choice Fund HSA.

HSA Bank: Accountholders can select from two self-directed invest­ment platforms based on their unique approach to investing. The Mu­tual Fund selection offers a professionally, pre-selected group of no-load mutual funds covering a range of fund families and asset classes. The Direct Brokerage option offers stocks, bonds and thousands of mutual funds. There's no minimum HSA balance to begin investing. And, there's no default or proprietary investment based on account balance.

HSA California: The Bancorp Bank offers an extensive investment portfolio. from FDIC-insured savings accounts to more than 7,000 in­vestment options.

Kaiser Permanente: The Wells Fargo HSA offers both an FDIC-insured Interest bearing deposit account plus the option to direct funds into pre-selected investments and mutual funds.

SeeChange Health: That will vary based on the HSA administrator chosen by the member.

Sterling HSA: Not at all. Our accountholders can choose any IRS qual-

through our Website. Members can use their debit card or Mellon checks to pay for their out of pocket responsibility. The customer ser­vice advocates are available to help members understand their finan­cial responsibility.

Blue Shield: With our new account based platform with Health Equity. there are just five simple steps from visit to reimbursement:

1.Member visit to healthcare provider

2.Claims sent to HealthEquity by Blue Shield

3.Automatic notification of responsibility

4.Claim and account information on the same screen

5.Provider paid directly or reimbursement from CDH account

When employees are notified of a claim with member responsibil­ity, they just access the Website to process payment and reimburse­ment. After viewing the claim detail, members can choose the action to be taken: pay provider, reimburse themselves, or close expense. The medical expense payment process is easy and flexible. Members can directly pay a provider from their HSA pre-tax account or add an additional external bank account; both pre- and post-tax distributions are tracked and housed on the member portal for tax reporting pur­poses.

Cigna: Cigna helps account holders manage their healthcare expens­es with information decision support tools and ready access to HSA funds, Cigna provides cost and quality information according to the individual's plan for more than 200 procedures performed by special­ists, in hospitals and in outpatient facilities. The pharmacy price quote tool compares actual real time out-of-pocket costs for brand name, generic and over the counter medications at 57,000 pharmacies na­tionwide.

HSA California: Our carrier partners - Kaiser Permanente, Health Net. and Western Health Advantage - have created special units within their organizations to help members enroll in HSA California.

Kaiser Permanente: Money in the HSA can be used to pay for a va­riety of qualified medical expenses ranging from routine physicals to prescription drugs. To pay for expenses, the member can simply pres­ent their HSA debit card to the provider, and money will be deducted directly from their HSA. However, if the member wants to pay for ser­vices out of pocket and submit an HSA reimbursement claim manu­ally, they can. Kaiser Permanente's Member Service Unit can support our members with any medical bill question or concern. A member can also write their HSA debit card number on their Kaiser Permanente bill and remit for payment.

SeeChange Health: We help our members understand their share of medical treatment and how they can offset those costs by completing health actions designed to help them manage their health. Expendi­tures from their HSA are handled directly between the member and their account administrator.

Sterling HSA: Sterling reviews the EOB and medical bills for health plan discounts to insure that our accountholders do not spend more for a healthcare service or product than the insurance company would pay. We also alert accountholders when we spot disbursements that do not appear to comply with IRS rules. A number of our clients come to us for help with payment plans in the event there are insufficient funds to pay a medical bill. This service is especially valuabfe in this difficult economy. We also partner with Medical Cost Advocate to help our accountholders negotiate medical costs before and after they are incurred.

ified investment for their HSA funds. including stocks, bonds, mutual funds, and CDs. We made arrangements with Partnervest Securities LLC to offer investment services at a discounted fee for Sterling ac­countholders. Partnervest also provides Sterling with monthly account balance information to ensure the outside investment information contained in Sterling HSA account records is current. Partnervest con­tact information is available on our Website at investmentservices/

13.         What forms are needed to submit an HSA case?

Aetna: Aetna's standard enrollment processes are used. There are separate medical and HSA elections. Eligibility/enrollment options are electronic batch enrollment, paper enrollment. and Web enrollment. Anthem Blue Cross: An HSA Addendum and Agreement need to be completed. The HSA Addendum captures how the Employer wants to fund their employees' accounts.

The HSA Addendum is stating you will or will not use our integrated banking option.

HSA Agreement must be signed if the Employer chooses our inte­grated partner BNY/Mellon.

Blue Shield: There are no extra forms needed; ail questions are in­cluded in your Blue Shield group installation paperwork.

Cigna: Cigna's standard processes and forms are used for all Cigna products including the HSA.

HSA Bank: To make enrolling in an HSA convenient for employers and their employees, HSA Bank offers several enrollment options in­cluding electronic file format, online enrollment and paper application. Each enrollment option provides unique capabilities and is designed to work best for different types of groups.

HSA California: Standard application forms are needed to submit an HSA California case. These forms are available at www.hsacalifornia. corn.

Kaiser Permanente: We require our standard application and enroll­ment process plus necessary forms to set up the Wells Fargo HSA. Wells Fargo: A broker must complete the "HSA Broker Supplement ­Application for Services" form and an "HSA Employer Application." You can find copies of the applications at

SeeChange Health: No special forms are required when applying for an HSA-compatible plan.

Sterling HSA: It's very simple. Just a completed employer group ap­plication (for groups) and an individual accountholder application for each accountholder, along with a list bill and employer preferred form of contribution. Online enrollment and forms are available at .

UnitedHealth Group: Employers contributing to the HSA account are required to complete an employer discovery document. Individuals es­tablishing an HSA account.

14.         Do you plan to offer an HSA-eligible plan to your own employees?

Aetna: Aetna Inc. offers several HSA-eligible plans to our employees. Anthem Blue Cross: All Anthem Blue Cross and WellPoint eligible em­ployees have the option to choose a Lumenos HSA plan.

Blue Shield: Blue Shield employees have been offered a High Deduct­ible Health Plan and HSA since January 1, 2007.

Cigna: Yes, Cigna has offered employees HRA and HSA plan options since January 2005.

HSA Bank: Absolutely.

HSA California: CHOICE Administrators, the company behind HSA California, Cal iforn iaChoice, Ca I iforniaChoice 51+, Kaiser Permanente Choice Solution, Contractor's Choice. and Choice Builder, currently of­fers its employees access to HSA- compatible plans.

Kaiser Permanente: We consider our entire portfolio of health plans for our own employees.

SeeChange Health: Members are free to choose their own HSA ad­ministrators and, consequently. their own trustees.

Sterling HSA: We have offered our employees an HSA plan since Ster­ling was founded in 2004.

UnitedHealth Group: All UnitedHealth Group employees have the op­tion of enrolling in all an HSA or HRA.

15.   Are you using a trustee? If so, how long have you been with the trustee?

Aetna: Yes. since May 2004

Anthem Blue Cross: Anthem has partnered with BNY/Mellon FDIC to offer all of your banking needs for your HSA account.

Blue Shield: Blue Shield has vendor relationships in place today with Wells Fargo (since 2004) and, for our integrated model, Health Equity (new for 2011). Both vendors are qualified trustee and custodians that administer health savings accounts.

Cigna: JP Morgan Chase has been the trustee for our Cigna Choice Fund HSA product since January 1. 2005.

HSA Bank: Webster Bank, N.A. provides trust services and serves in a capacity as the custodian. HSA bank has been a division of Webster Bank. N.A. since 2005.

HSA California: Yes, the Bancorp Bank handles HSAs directly; HSA California's relationship with Bancorp dates back to the start of HSA California, but the bank has been offering services to customers since 2000. The HDHP insurance plans are fully insured products from Health Net, Kaiser Permanente, and Western Health Advantage.

Kaiser Permanente: We first began selling HSA-Qualified Deductible HMO plans with an optional HSA through Wells Fargo in our Colorado, Georgia and Northwest regions in 2005, Mid-Atlantic States in 2006, and California and Ohio in 2007.

SeeChange Health: We strive to provide excellent service on all of our health plans.

Sterling NSA: Sterling does not use a trustee. BNY Mellon Corpora­tion is the custodian of assets of accountholders of health savings ac­counts administered by Sterling Health Services Inc. and is investment manager of assets in accordance with the Sterling Health Services Inc. Administrative Services Agreement.

UnitedHealth Group: Yes. UnitedHealthcare partners with Optum Health Bank for trustee services. UnitedHealthcare's parent company, UnitedHealth Group chartered OptumHealthBank in 2002 to help ad­vance the growing convergence of health care and financial services.

As seen in January 2013 issue of California Broker Magazine

Consumer Driven Plans Continue to Grow

Ten percent of the population was enrolled in a consumer driven health plan (CDHP) in 2012, up from 7% in 2011. Enrollment in HDHPs remained at 16%, according to a study by the Employee Benefits Research Institute (EBRI). Fifteen percent of 21- to 64-year olds with private insurance were in a CDHP or an HDHP that was eligible for an HSA. When their children were counted, about 25 million people with private insurance,were in a CDHP or an HSA-eligible plan — representing about 14.6% of the market.

CDHP enrollees were more likely to evaluate provider cost information compared to traditional plan enrollees. They were also more likely to look outside their health plan for information about their doctors’ costs and quality. CDHP enrollees were also more likely to participate in wellness programs, such as health-risk assessments, health-promotion programs, and biometric screenings. In addition, financial incentives mattered more to CDHP enrollees than to traditional-plan enrollees.
Compared to those in traditional plans, adults in a CDHP were much more likely to say they were in excellent or very good health, much more likely to exercise, and much less likely to smoke. CDHP and HDHP enrollees were also more likely to be highly educated. For more information,
visit  www.amsinsure.com

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Alert Medicare Tax Increase

Federal Law eAlert

Please take note of the following:   Effective January 1, 2013, an additional Medicare tax will impact employers and payroll service providers. The Patient Protection and Affordable Care Act (PPACA) increases the Medicare tax rate on wages by 0.9% (from the current rate of 1.45% to 2.35%) for higher-income individuals starting in 2013. This Medicare payroll tax increase applies to wages over $200,000 for single tax filers and $250,000 for couples filing jointly ($125,000 for a married individual filing separately). The Internal Revenue Service (IRS) plans to release revised Forms 941, 943 and the tax return schemas for the Form 94X series of returns. For additional information, contact your payroll provider, a Certified Public Accountant (CPA) or visit the HR Support Center.     Provided courtesy of your HR Pros.

Obama moves ahead with health care law

President Obama, promoting his health care plan in 2009.(Photo: Charles Dharapak, AP)

With re-election safety behind them, President Obama and aides are moving forward with new rules governing their landmark 2010 health care law.

The Department of Health and Human Services said Tuesday it is putting in place provisions that would make it illegal for insurance companies to discriminate against people with pre-existing conditions, enable consumers to compare health plans, and encourage employers to promote employee wellness.

 

"The Affordable Care Act is building a health insurance market that works for consumers," said HHS Secretary Kathleen Sebelius.

Republican presidential nominee Mitt Romney and GOP congressional candidates had made repeal of the law a major part of their campaigns; the president defended the law he referred to as "Obamacare."

The administration described Tuesday's actions:

 

-- A proposed rule that, beginning in 2014, prohibits health insurance companies from discriminating against individuals because of a pre-existing or chronic condition. Under the rule, insurance companies would be allowed to vary premiums within limits, only based on age, tobacco use, family size, and geography. Health insurance companies would be prohibited from denying coverage to any American because of a pre-existing condition or from charging higher premiums to certain enrollees because of their current or past health problems, gender, occupation, and small employer size or industry. The rule would ensure that people for whom coverage would otherwise be unaffordable, and young adults, have access to a catastrophic coverage plan in the individual market.

 

-- A proposed rule outlining policies and standards for coverage of essential health benefits, while giving states more flexibility to implement the Affordable Care Act. Essential health benefits are a core set of benefits that would give consumers a consistent way to compare health plans in the individual and small group markets. A companion letter on the flexibility in implementing the essential health benefits in Medicaid was also sent to states.

 

-- A proposed rule implementing and expanding employment-based wellness programs to promote health and help control health care spending, while ensuring that individuals are protected from unfair underwriting practices that could otherwise reduce benefits based on health status.                         

Employers’ See Smallest Healthcare Cost Increases in 15 Years

In 2012, employers saw the lowest average annual cost increase in healthcare costs since 1997, according to a Mercer survey. Growth in the average total health benefit cost per employee slowed from 6.1% last year to just 4.1% in 2012. Cost averaged $10,558 per employee in 2012. Large employers (500 or more employees) experienced a higher increase (5.4%) and higher average cost. Employers expect another relatively low increase of 5% for 2013. However, this increase reflects changes they plan to make to reduce cost; if they made no changes, cost would rise by an average of 7.4%.

“Over the past decade, employers have figured out how to stabilize cost increases for health benefits through cost-shifting and other cost management techniques. Now we’re seeing a move toward even greater control through defined contribution strategies,” says Sharon Cunninghis of Mercer.
Employers have been moving more employees into low-cost consumer-directed health plans and beefing up their health management programs. Julio Portalatin, president and CEO of Mercer said, “Employers are very aware that, in 2014, when the health reform law’s provisions kick in, they will be asked to cover more employees and face added cost pressure. They’ve taken bold steps to soften the impact and it’s paying off already.”
Success in controlling cost growth in recent years may be contributing to employers’ commitment to providing health coverage. Few expect to terminate their employee health plans in the next five years even though state-based health insurance exchanges will provide another source of health coverage for individuals beginning in 2014. Just 7% of large employers and 22% of small employers (10 to 499 employees) believe it is likely or very likely that they will do so.
In fact, there was a slight increase in the percentage of employers offering coverage in 2012: it rose from 55% to 59% after falling in each of the previous two years. Most of the increase was among the smallest employers (10 to 49 employees), which are the least likely to offer coverage and the quickest to drop it when cost goes up.
Employee enrollment jumped from 13% to 16% of all covered employees in 2012 with a growing number of employers now positioning a high-deductible, account-based consumer-directed health plan as their primary plan or even their only plan. Many employers see these plans as central to their response to health care reform provisions that will raise enrollment. Over the past two years, offerings of CDHPs have risen from 17% to 22% of all employers and from 23% to 36% of employers with 500 or more employees.
Fifty-nine percent of very large organizations (20,000 or more employees) now offer a CDHP. “If we’re not already at the tipping point for CDHPs – and we may well be – at this rate of growth it’s coming soon,” says Cunninghis.
Moving even a small number of employees out of a more expensive plan into a CDHP can result in significant savings for an employer. The cost of coverage in a CDHP with a health savings account is about 20% lower, on average. While employers have been reluctant to offer the CDHP as the only medical plan, attitudes are shifting. Eighteen percent of large employers expect to offer a CDHP as the only plan, up from 11% in 2011. Average enrollment rose from 25% to 32% among large employers that offer an HSA-based CDHP.
The ACA requires that health plans cover, at a minimum, 60% of eligible health plan expenses. Some employers are resetting their health plan value to move closer to that minimum, and saving money as a result. Some employers are offering a lower-cost CDHP in 2012 while others simply raised the deductible of an existing PPO plan. The average PPO in-network deductible reached $1,427 for an individual in 2012. Although large employers typically require much lower deductibles, the average deductible among employers with 500 or more employees rose by about $80 in 2012, to reach $666.
An example of a defined contribution strategy is determining the employer’s contribution to the cost of coverage and requiring employees to pay anything above that amount. Employees can save money by choosing a lower-cost plan. Forty-five percent of the employers say they use or are considering using a defined contribution strategy.
Offering a wellness plan has emerged as an employers’ top long-term strategy for controlling health spending. Seventy-eight percent of large employers say that senior leadership is supportive of health management programs to encourage more health-conscious behavior.
Most employers believe that health management programs are making a difference, but proving the return-on-investment (ROI) remains a challenge. The largest employers are the most likely to have measured the ROI of their health management programs (53% of employers with 20,000 or more employees). More than three-quarters of those say that their programs have had a positive effect on medical plan trend.
Forty-eight percent of large employers with health management programs provided financial incentives or penalties, up from 33% last year. When non-financial incentives (recognition, gifts or lotteries) are included, this figure reaches 54%. In 2012 18% of large-employer health management programs include incentives for achieving, maintaining, or showing progress toward specific health status targets. These incentives were rare in 2011.
With the future of health reform secured by the re-election of President Obama, employers will be focusing on the next generation of cost management strategies. One approach that is increasingly in the spotlight is the use of private exchanges, a private-sector alternative to the state health insurance exchanges. Private exchanges give employers a way to offer employees a broader choice of benefits while allowing carriers to compete for their business and manage their risk. Fifty-six percent of employers would consider a private exchange for active or retired employees.
The use of high-performance (or narrow) provider networks rose from 14% to 23% in 2012 among very large employers (5,000 or more employees) while the use of surgical centers of excellence rose from 18% to 35%. There was also strong growth in the use of medical homes (from 3% to 9%), which also promise to save money by improving care.
Twenty four percent of large employers offer an ongoing plan to retirees under age 65 and just 17% offer a plan to Medicare-eligible employees, which is essentially unchanged from 2011. An additional 15% stopped offering a plan for which new hires will be eligible, but they continue to offer coverage to a closed group of employees retiring or hired before a specific date.
Forty-seven percent of large employers include same-sex domestic partners as eligible dependents, up from 39% in 2010. This varies significantly based on geographic regions, from 73% of employers in the West to 30% in the South.
Very large employers are adopting special provisions concerning spouses of employees with other coverage available. In 2012, 18% of employers with 5,000 or more employees had such a provision in place, up from 15% in 2011. They imposed a surcharge for spouses with other coverage available (14%) or denied them coverage entirely (4%).
Nineteen percent of large employers vary the employee contribution amounts based on tobacco use status or provide other incentives to encourage employees not to use tobacco – up from 17% in 2011. Growth was especially strong among very large employers: 46% of employers with 20,000 or more employees now use an incentive, up from just 35% in 2011. For more information, visit www.amsinsure.com.

Medicare Program Announces Premium Rates

 

The Centers for Medicare & Medicaid Services (CMS) announced monthly actuarial rates for beneficiaries age 65 and over and disabled beneficiaries under age 65 who are enrolled in Medicare Part B. The monthly actuarial rates for 2013 are $209.80 for aged enrollees and $235.50 for disabled enrollees. The standard monthly Part B premium rate is $104.90 for all enrollees for 2013. That is equal to 50% of the monthly actuarial rate for aged enrollees or approximately 25% of the expected average total cost of Part B coverage for aged enrollees. (The 2012 standard premium rate was $99.90.)
The Part B deductible is $147 for all Part B beneficiaries for 2013. If a beneficiary has to pay an income-related monthly adjustment, they may have to pay a total monthly premium of about 35%, 50%, 65%, or 80% of the total cost of Part B coverage.

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Alliance of Health Groups Offers Plan to Lower Costs, Improve Care

The National Coalition on Health Care (NCHC) recently released a plan for health and fiscal policy at the National Press Club in Washington. The national alliance of consumers, providers and payers introduced a plan that pairs nearly $500 billion in spending reductions and health-related revenues with longer-term policy changes designed to make health care affordable in the public and private sectors.

The 50-page plan, “Curbing Costs, Improving Care: The Path to an Affordable Health Care Future,” outlines a seven-part strategy:

1. Change provider incentives to reward value, not volume.
2. Encourage patient and consumer engagement.
3. Use market competition to increase value.
4. Ensure that the highest-cost patients receive high-value, coordinated care.
5. Bolster the primary care workforce.
6. Reduce errors, fraud, and administrative overhead.
7. Invest in prevention and population health.

NCHC’s recommendations include $220.97 billion in reduced federal spending and $276 billion in health-related revenue. However, NCHC proposes pairing budget savings with broader reforms. “Ten-year budget savings have to be coupled with strategies for long-term sustainability: transitioning from fee-for-service, engaging consumers in their care and coverage choices, investing in our non-physician workforce as well as doctors, and crafting a medical liability system that supports patient safety,” said Former U.S. Senator David Durenberger, past chair of the Senate Finance Committee’s Subcommittee on Health and a member of NCHC’s Board of Directors.

Drug Companies Conspire to Keep Generics Off the Market

If it seems harder to get a generic medication it’s not your imagination. With pay-for-delay tactics, brand prescription drug manufacturers pay generic drug manufacturers for not creating generic versions of their medication. This limits the number of prescription options available to patients and contributes to the growth in health care costs, according to the American Medical Assn. (AMA), which has adopted a policy to work toward ending the practice.

Pay-for-delay agreements are estimated to cost American consumers $3.5 billion per year. The Federal Trade Commission (FTC) has recommended that Congress pass legislation to protect consumers from such – agreements. But www.foxbusinessnews.com reports that Congress has failed to stop pay-for-delay and generic drug makers and big-name pharmaceutical companies have been winning court rulings that allowed it.

The Federal Trade Commission recently filed an amicus brief in the U.S. District Court for the District of New Jersey stating that a branded drug company’s agreement not to launch an authorized generic drug “provides a convenient method for branded drug firms to pay generic patent challengers for agreeing to delay entry.” The FTC also filed a brief in the case of Lamictal Direct Purchaser Antitrust Litigation. In the case, the private plaintiffs alleged that GlaxoSmithKline paid Teva Pharmaceuticals to delay entry by promising not to compete with authorized generic versions of the drug Lamictal.

New Discount Program for Anthem Members

New discount from 1-800 CONTACTS and Glasses.com for all members

 

Starting November 1, 2012, all members will receive $20 off the price of their contacts or glasses when they spend a minimum of $100. Plus, free shipping. Best of all, members don't need to have vision coverage to take advantage of this discount.

Business Owners and Retirement Planning

As a business owner, you have invested a great deal of time and effort into building your company over the years. You know the amount of planning needed to maintain daily operations and grow your business. Now, you may be ready for retirement. But, the planning does not end. What you do next, and how you navigate potential tax issues and regulatory pitfalls, can make a big difference in the long-term success of your retirement.

Here are some of the more "taxing" concerns you may face associated with retirement:

Early retirement and early withdrawals. If you take withdrawals from your qualified retirement plan before age 59½, you may be subject to a 10% Federal income tax penalty. There are certain instances in which early withdrawals may be taken without penalty, such as death, disability, or substantially equal periodic payments. Otherwise, at 10%, the penalty tax can be significant, so it is important to plan accordingly.

Waiting too long. You must begin taking required minimum distributions (RMDs) from your traditional Individual Retirement Account (IRA) by April 1st of the year after the year in which you reach age 70½. If you fail to do so or do not withdraw enough, you will be subject to a 50% penalty tax, which will be incurred on the difference between your RMD and the actual withdrawal amount. Your RMD amount is based on the previous December 31st balance, divided by your life expectancy (or the joint life expectancy of you and your spouse, if applicable).

Working while receiving Social Security. If you receive Social Security and also continue to work, a portion of your benefits may be taxable. For more information, refer to Internal Revenue Service (IRS) Publication 915, Social Security and Equivalent Railroad Retirement Benefits, or consult with your tax professional.

You may be subject to the "give-back" if you are under full retirement age (based on the year of your birth), receive Social Security benefits, and earn income. The law requires a give-back of $1 for every $2 earned in excess of $14,640 in 2012 for those individuals between the ages of 62 and full retirement age who are receiving a reduced Social Security benefit.

For the year in which an individual attains full retirement age, the give-back is $1 for every $3 in excess of $38,880 for 2012. Starting in the month in which the individual attains full retirement age, the give-back is eliminated. If you are under full retirement age and thinking about taking Social Security benefits while still working, it is important to understand the potential tax consequences of doing so.

Where you live in retirement matters. Each state has its own rules on income, estate, sales, and property taxation. Your tax and legal advisors can help you assess the potential tax advantages and disadvantages of your retirement destination.

Planning Continues through Retirement

Your personal retirement plan probably involved building a nest egg with regular savings over decades. Now that you are preparing for retirement, continue with your planning. Your keen business sense will serve you well as you near retirement and enjoy your "golden years." Be sure to consult with your professional advisors for specific guidance.

Building the Value of Your Business

Caught up in the day-to-day operations of your business, you may not be thinking about how much your company could be worth when the time comes for a transition. But the choices you make now, both large and small, can add to or detract from the future value of the company.

There are many ways for a company to grow, including entering new markets, developing new products, acquiring complementary businesses, hiring more employees, and increasing sales and marketing expenditures. You can grow the business rapidly by tapping into outside financing or more slowly by using the company's own revenue. With so many strategies to consider, you may want to develop a long-term plan to guide the growth of your business.

Your decision regarding the ultimate disposition of the company may influence many aspects of your current business strategies, including your form of business ownership. You may want to consider a C corporation structure for a business that may go public or an S corporation structure if a private sale is planned. Be sure to consult with your tax and legal advisors about the implications of each form of business ownership.

Transferable Assets

To begin, work on building and maintaining your company's transferable assets. These may include tangibles like property and equipment, as well as intangibles, including a customer base, brand recognition, and business processes. Depending on the type of business you operate, your intangible assets, such as copyrights or trademarks, proprietary lists of customers or prospects, and long-term contracts, may have substantial value at the time of transition. An attractive location can also add on value beyond an owner's equity.

Companies also derive intangible benefits from a strong management team with the knowledge and connections required to maintain the business after the owner retires. In many cases, having a skilled and loyal workforce may also be considered a transferable asset in a sale.

Financial Performance

When growing your business, strive to establish a self-sustaining enterprise with steady revenue growth. The financial performance of a company is often measured by its free cash flow, or the cash that it generates before interest, taxes, depreciation, and amortization, less capital expenditures. In assessing the value of the company, a buyer may, for example, project a com-pany's earnings over the next five years based on the current cash flow. This projection will take into account any outstanding debt, as well as whether revenue growth and margins demonstrate a history of consistent growth.

Businesses are often more efficient when they focus on their core competencies, rather than diversifying too broadly. So, if your company has product lines or offers services not closely aligned with the firm's core business, consider whether these areas are profitable or represent a drag on the company's resources. Selling off non-core assets may provide funds to help pay off debt.

You may also want to restructure agreements or contracts that may be objectionable to a potential buyer, such as a long-term lease, licensing contracts, employment contracts, and loan agreements. Long-term leases may be an asset provided the terms are favorable, the location is suitable, and the size is right. If, however, the company is likely to outgrow its facilities before the lease is up, or if potential buyers want to move the firm's operations, a short-term lease may be more appropriate. Or, you may seek to formalize certain verbal agreements to ensure the company's relationships with key customers or suppliers continue after the transition.

For a detailed analysis of your company's value, contact a professional business appraiser who is familiar with your industry. Even if you have no immediate plans to leave the company, an estimate can help you identify ways to maximize the value of the business in preparation for a future exit strategy.

Read other articles in: Business Edge Newsletter:

More than 15 million Americans are severely obese, data show

About 6.6%, or 15.5 million, U.S. adults were severely obese in 2010, compared with 3.9% in 2000, according to RAND Corp. data published in the International Journal of Obesity. Data showed the rate of severe obesity -- which is a BMI of 40 or higher or roughly being 100 pounds or more over a healthy weight -- was 50% higher in women than in men and twice as high for blacks as for Hispanics and whites. USA TODAY (10/1)

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Consumers Need to Be Aware of Tax Issues that Come With the ACA

As the Affordable Health Care Act rolls out, there are tax implications, potential penalties, and other considerations that may affect consumers, says John Beyer, CLU , president of AMS Benefit Consultants. To pay for the benefits associated with the healthcare mandate, Congress has imposed new taxes and penalties on the wealthy, the healthcare sector, and on those who refuse to purchase health insurance (an estimated 32 million Americans).

Those who don’t buy insurance are subject to the following penalties, which grow more severe in time:

• 2014 – $285 per family or 1% of the family’s income, whichever is greater.
• 2015 – $975 per family or 2% of income, whichever is greater.
• 2016 and beyond – $2,085 per family or 2.5% of income, whichever is greater.

Next year, the individual payroll tax for Medicare will increase from 1.45% to 2.35% for every dollar earned over $200,000 ($250,000/year for married couples). A 3.8% tax may be imposed on unearned income generated by dividends, interest income, capital gains and other forms of passive income, depending on your modified adjusted gross income.

Employee Demand For Voluntary Benefits Exceeds Supply

 

At smaller businesses, economic conditions are making one-half of Gen Y and Gen X workers look more toward employee benefits as a solution to financial security – even if they have to fund 100% of the cost themselves, according to a MetLife survey.

“Younger workers have a different benefit perspective than older generations, particularly those in many smaller organizations that were hit very hard by the recession and are unsure about the future of Social Security,” said Anthony Nugent, executive vice president, Group, Voluntary & Worksite Sales, at MetLife.

Two-thirds of Gen Y and Gen X employees, who work for small businesses, are willing to pay more for their benefits rather than losing them. Fifty-four percent want a wider array of benefit options, even if it means paying all of the cost of voluntary benefits, such as life, dental, vision, disability, critical illness, or homeowner/auto insurance coverage, for example.

Fifty-seven percent of companies with 500 employees or more say that providing voluntary benefits is a key element of their benefit strategy compared to 43% who said so a year earlier. Smaller firms saw an increase to 31% from 26%. The survey also reveals the following:

• 44% of younger workers are interested in voluntary home/auto while 2% of small businesses offer this benefit.
• 41% of younger workers are interested in voluntary life while 20% of small businesses offer this benefit.
• 40% of younger workers are interested in voluntary disability while 8% of small businesses offer this benefit.
• 38% of younger workers are interested in voluntary dental while 11% of small businesses offer this benefit.
• 38% of younger workers are interested in voluntary vision while 9% of small businesses offer this benefit.
• 38% of younger workers are interested in voluntary critical illness while 10% of small businesses offer this benefit.

Almost three out of four small business employees would like their employer to offer financial education, but only 29% of employers offered these programs. Seventy-two percent of younger employees who are very satisfied with their benefit have a very strong loyalty to their employers compared to 46% of younger workers overall.

For more information, visit www.amsinsure.com or call 800-334-7875 to request more information.

What Will Employers Do, As Health Care Reform takes hold?

Many believe that employer behavior over the next few years will be what makes or breaks health reform. Over the last few years, with the economic downturn many employers have reduced or dropped coverage. PPACA and its underlying financial assumptions are built on the premise that employers will keep being the primary providers of private health insurance benefits in this country during the years to come. But expert opinions vary widely about how the new law will impact group coverage when fully implemented in 2014. Several surveys, studies and articles released this past week give a bit of a clue as to what employers are thinking when it comes to health reform and providing benefits to employees. For instance, this past week, a Gallup survey showed that of all groups of American voters, business owners who make our country's hiring and benefit decisions are the most disproving of President Obama and his policies. Ironically, their highly paid professional employees are the group most pleased with the President.  Those same employers are trying hard to manage their health care costs right now. A new study by America's Health Insurance Plans (AHIP) shows employers are increasingly likely to select consumer-directed plans as part of their employee benefit offerings, even though these same plans could be limited in the future by impending PPACA insurance market reforms. Meanwhile, some employers are trying to use PPACA benefits to their cost-advantage in perhaps an unintended way. Kaiser Health News reports this week that some employers are incenting their younger employees to stay on their parent's employer-provided plans as long as possible as a means of reducing their own healthcare costs. It seems like an uncertain future is just too much for some employers to handle. The headline from a Deloitte survey out this week shows that one in ten companies plan to drop coverage. But that’s not all the study revealed. Most employers say their company is “not well prepared” to implement the 2014 provisions of PPACA.  And while 30% think PPACA is “a good start,” 59% see it as “a step in the wrong direction.” Showing corresponding data with the Gallup poll referenced above, there was a wide range of opinions reported, from Human Resources who responded more positively to executive-level respondents who think it's a step in the wrong direction. Perhaps a reason why is that, despite a lot of rhetoric, neither Republicans nor Democrats have done much to make health reform an easier pill for employers to swallow during the 111th Congress. Yes, there are some House-passed measures to make things easier for businesses stacked up that the Democratically-controlled Senate won't consider. But most of them aren’t health reform-related, and other than the out-and-out repeal bills, not too much health reform legislation is moving through the House. There are a number of business-friendly health reform measures with widespread, and even bipartisan support, including straight repeal bills.  Most haven't even been allowed by the GOP leadership to make it through the committee process, let alone be voted upon on the floor. These would include, among others, H.R. 1744, which would repeal the employer mandate, H.R. 605, 369 and 2010, all of which would improve group access to consumer-directed health insurance options in the future, H.R. 436 to repeal the medical device tax, and H.R. 1206 to fix the MLR requirements for agents and brokers and H.R. 2077 to completely repeal them. It goes without saying, nothing to make it easier for businesses to deal with health reform is currently moving through the Democratically-controlled Senate either. Bottom line, policymakers on both sides of the aisle need to get a lot more business friendly if they want to fix our economy, reduce costs, and keep employer dollars in our healthcare system in the years ahead. Perhaps our nation's employers need to more clearly articulate the need for change. Some analysts believe they're the key to breaking the gridlock in Washington.

CBO Score: The Good, The Bad and The Ugly

The Congressional Budget Office (CBO) issued its much anticipated updated “score” of PPACA on Tuesday, July 24, as well as, a new cost estimate for repealing the legislation. Bottom line, the CBO’s projections of how much the law will cost the federal government over the next 10 years as a result of the Supreme Court’s ruling in NFIB v. Sebelius contained both good news and bad news for health reform supporters. It also contained the ugly news that the price of individual health insurance coverage is about to go up even more for everyone.  On one hand, supporters of the law must be pleased that the CBO found that completely repealing PPACA would increase the federal deficit by $109 billion between the years 2013 and 2022. Also, the office determined that as a result of the Supreme Court's ruling on Medicaid, the coverage provisions will be $1.168 trillion over the next 10 years, which is $84 billion less than what had been projected in March prior to the Court's ruling. On the other hand, people who like the new law can’t be happy that part of the reason why the law is now much less expensive is that it will provide coverage to far fewer people. The CBO clearly stated "fewer people will be covered by the Medicaid program, more people will obtain health insurance through the newly established exchanges, and more people will be uninsured. The magnitude of those changes varies from year to year."  While the CBO couldn’t predict the number of people who would no longer have access to coverage exactly, their best guess was about 3-4 million additional individuals remaining uninsured.  The CBO didn’t attempt to predict which states would or would not expand their Medicaid programs. However, they did take a stab at guessing how many people would live in states that will either completely or partially expand their programs, as well as guess how many will live in places that do not grow their programs at all.   The CBO concluded that about one-third of the potential newly eligible Medicaid population will reside in states that will fully expand coverage under the law’s parameters (i.e., up to 138 percent of poverty). These individuals will be enrolled in Medicaid, as they would have been prior to the Supreme Court ruling. The CBO also indicated about half of the population who could be newly eligible for Medicaid will live in states that will only partially expand their Medicaid programs (i.e., raising the eligibility level for populations higher than exists currently, but not up to 138 percent of poverty). This is an interesting assumption, because many policy wonks, including your Washington update author, didn’t feel that the Supreme Court ruling was clear on what happens in states that choose to only partially expand their programs and the Obama administration hasn’t been particularly forthcoming about its views as to whether or not the expansion is an all or nothing proposition for the states.   The CBO concluded that 1/6 of the population that was intended to be covered by Medicaid by the health reform law lives in states that will not expand their Medicaid program at all over the next 10 years. In total, the CBO assumes that about 6 million fewer people will be enrolled in Medicaid under the law due to the ruling. They feel that between 2-3 million of these people will receive via exchanges instead, meaning that 3-4 million will remain uninsured. Finally, the CBO included the following paragraph on page 15 of its analysis of the Court ruling, which we find to be particularly disturbing, given that this is the “Affordable Care Act”: “The additional enrollees [i.e., those previously projected to enroll in Medicaid, but who will now receive Exchange subsidies in light of the Court’s ruling] are likely to spend more on health care, on average, than those previously expected to purchase insurance through the exchanges because people with lower income generally have somewhat poorer health.  As a result, CBO and JCT now estimate that the premiums for health insurance offered through the exchanges, along with premiums in the individual market, will be 2 percent higher than those estimated in March 2012.” This increase comes in addition to the $2,100 per family premium increase the CBO previously predicted back in 2009.

Major Health Insurers Agree to Lower Rate Increases for Small Employers

Three of California’s major health insurers have agreed to lower their July rate increases. After review by the Department of Insurance, Anthem Blue Cross, Blue Shield, and Aetna agreed to modify their most recent small group rate increases for this quarter. Small group policies are available to small employers with two to 50 employees.
Anthem Blue Cross is withdrawing its 2.5% July 1st premium increase for small-group PPO products. The withdrawal will save about $25 million for 45,000 of Anthem Blue Cross’ small group policyholders, covering approximately 280,000 individuals. Anthem has raised rates 4.7% on its small group policyholders in the previous 12 months.
Blue Shield Life and Health Company will provide a credit to 58,000 small employers (covering approximately 265,000 individuals) equivalent to reducing its July 1st third quarter rate increase by 1.5%. As a result of the credit, the effective Blue Shield rate increase will be 1.6%, which is Blue Shield’s only small group rate increase for its small employer policyholders in the past 12 months. This modified rate increase will save policyholders approximately $15 million.
Aetna will lower its proposed small group rate from 2.6% down to 1.3% for its 9,200 policyholders (covering approximately 69,000 individuals), which saves about $8 million for small employers. Small employers have already been billed for July and August for the July 1st rate increases, but will see credits on their August or September bills.

One of the hidden pieces of Health Care Reform ACA

When does your home become part of your health care? After 2012! Your vote counts big time in 2012, make sure you and all your friends and family know about this ! HOME SALES TAX I thought you might find this interesting, -- maybe even SICKENING! The National Association of Realtors is all over this and working to get it repealed, -- before it takes effect. But, I am very pleased we aren't the only ones who know about this ploy to steal billions from unsuspecting homeowners. How many realtors do you think will vote Democratic in 2012? Did you know that if you sell your house after 2012 you will pay a 3.8% sales tax on it? That's $3,800 on a $100,000 home, etc. When did this happen? It's in the health care bill, -- and it goes into effect in 2013. Why 2013? Could it be so that it doesn't come to light until after the 2012 elections? So, this is ‘change you can believe in’? Under the new health care bill all real estate transactions will be subject to a 3.8% sales tax. If you sell a $400,000 home, there will be a $15,200 tax. This bill is set to screw the retiring generation, -- who often downsize their homes. Does this make your November, 2012 vote more important? Oh, you weren't aware that this was in the ObamaCare bill? Guess what; you aren't alone! There are more than a few members of Congress that weren't aware of it either. You can check this out for yourself at:http://www.gop.gov/blog/10/04/08/obamacare-flatlines-obamacare-taxes-home I hope you forward this to every single person in your address book. VOTERS NEED TO KNOW..

How Will Health Reform Affect Employers?

David Levine, CEO of the American Sustainable Business Council: Measures taking effect in 2014 will create more competition among insurance companies, which will drive down prices. When the ACA is fully implemented, small businesses will no longer pay more than large corporations for their insurance. However, one element in the Court’s opinion could hurt small businesses. The Court said that states need not expand Medicaid to 133% of the federal poverty level, as required under the ACA. Small businesses would benefit from the expansion since it would reduce the number of employees needing to be covered by a company’s healthcare plan. AHIP: Employers will have more incentive to self-insure their health coverage — increasingly shifting the burden of the fees to smaller employers and individuals who must shoulder the cost of a statutorily fixed level of fees no matter the relative size of fully insured coverage markets. Edward Fensholt, JD, and Mark Holloway, JD — leaders of Lockton’s Compliance Services group: Employers will need to begin making significant decisions in the next several months. Regulations will be very complex, particularly on the employer mandate. We can expect a crush of complex guidance compressed into a very short time. The next stops on the health reform train include distribution of four-page plan summaries, W-2 reporting of health plan values, limits on health flexible spending accounts, new income, and capital gains taxes on executives. The Supreme Court opinion also adds a wrinkle to the expansion of Medicaid eligibility. The Court said the feds cannot hold a state’s Medicaid funding hostage if the state doesn’t play. That could mean that more people will seek subsidized coverage in an insurance exchange or-worse-that some won’t qualify for Medicaid or exchange-based subsidies. Julio Portalatin, president and CEO of Mercer: Any employer that has not conducted a health care reform check-up should make it their first order of business. Employers need to redouble their compliance efforts, especially for immediate requirements, such as providing summaries of benefits and coverage to employees. This court’s decision reinforces popular features, such as providing coverage of dependents up to 26 and eliminating exclusions for preexisting conditions. David Rahill, President of Mercer’s Health and Benefits business:Employers can expect a spike in plan enrollment for 2014 as a result of the individual mandate. But they may see enrollment level off once the state exchanges become operational. By 2014, health insurance exchanges will be operating in every state, offering community-rated insurance to certain small employers and individuals, with federal premium tax credits available to help some people buy that coverage. In the near term, employers must report the value of employer coverage on IRS Form W-2, cap dollar limits on health care flexible spending arrangements, and increase Medicare withholding for high earners (those earning more than $200,000 per year). They must also comply with the reforms already in effect, such as coverage of dependents up to age 26.

Here is a detailed analysis of today’s Supreme Court ruling from NAHU, courtesy of our retained counsel, Ernst & Young:

US Supreme Court Upholds Affordable Care Act

The US Supreme Court today (June 28, 2012) upheld the Affordable Care Act (ACA), ruling that the law’s individual mandate is a constitutional exercise of Congress’s power to impose taxes. With the Court’s decision, compliance efforts likely will move ahead at full speed with major provisions of the ACA becoming effective in 2013 and 2014.
In a 5-4 decision, Chief Justice Roberts, joined by Justices Ginsberg, Breyer, Sotomayor and Kagan, concluded, “The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness.”
In the Court’s analysis of the ACA’s Medicaid provisions, it held that it would be unconstitutional for the federal government to withhold all Medicaid funding in order to force states to comply with the Medicaid expansion. Chief Justice Roberts wrote, “Nothing … precludes Congress from offering funds under the ACA to expand the availability of health care, and requiring that states accepting such funds comply with the conditions on their use. What Congress is not free to do is to penalize States that choose not to participate in that new program by taking away their existing Medicaid funding.”
The Court ruled that the Anti-Injunction Act, which limits lawsuits challenging a tax before it is assessed, does not apply because Congress specifically provided that the penalty payment enforcing the individual mandate would not be treated as a “tax.” Notwithstanding acceptance of Congress’s penalty label for purposes of application of the Anti-Injunction Act, the Court ruled that for purposes of determining whether the individual mandate is constitutional, the penalty payment falls within Congress’s general power to tax and, therefore, is upheld.
The decision arises from cases brought by the state of Florida (and joined by 25 other states), the National Federation of Independent Business, and several individuals challenging the constitutionality of the individual mandate and the Medicaid expansion. The cases were later consolidated.
In their dissent, Justices Kennedy, Scalia, Thomas and Alito wrote that the law should have been struck down in its entirety.
With the exception of the limitation on the federal government’s authority to withhold Medicaid funding, all provisions of the ACA stand and compliance efforts likely will move ahead at full speed. In preparation for the major coverage expansion to occur under the ACA in 2014, the Administration is expected to release a host of regulations dealing with the definition of minimum essential coverage, employer coverage and reporting requirements, and an array of new taxes and fees. Clients should be aware of provisions of the law set to take effect in 2013 and 2014, including those listed in the table below.
Provisions of the Affordable Care Act That Take Effect in 2012, 2013 and 2014
2012
• Medicare hospital value-based purchasing program
• Increase in physician quality reporting requirements in Medicare
• Additional Medicare pilot programs on alternative payment methodologies, e.g., accountable care organizations
• Increased requirements for hospitals to maintain not-for-profit status
• Fees from insured (including self-insured) plans transferred to the Patient-Centered Outcomes Research Trust Fund
2013
• Increase Medicare payroll tax by 0.9% on high-income earners
• Impose a 3.8% tax on net investment income of high-income individuals
• $500,000 cap on health insurers’ deduction for executive compensation  
• Eliminate employer deduction for Medicare Part D subsidy
• FSA limitations
• Excise tax on medical device manufacturers and importers
• Medical expense deduction floor increases to 10%  
• Nationwide bundled payment pilot begins in Medicare
• Increased Medicaid reimbursement for primary care
• Medicare physician comparison data available to the public
• Reductions in Medicare payments for select hospital readmissions
• Expanded coverage of preventive services by Medicaid
2014
• Employer mandate and individual mandate
• Employer and insurer reporting requirements
• New health insurance market reforms take effect
• State health insurance Exchanges established
• Premium tax credits and cost-sharing subsidies available to certain individuals in Exchange insurance products
• Medicaid expansion to new populations (100% federal match to states for newly-eligible populations through 2016)
• Annual fee on health insurers
• Medicare/Medicaid DSH payment cuts begin
• Independent Payment Advisory Board (IPAB) issues first report to Congress if Medicare spending exceeds growth target
Post-2014
• Excise tax on high-cost employer-sponsored coverage (2018) 
Political reactions
The Court’s ruling will not end the political debate over health care, which will remain a central issue in the 2012 elections and beyond. The law stands as the centerpiece of the domestic record  of President Obama, who today said, "Whatever the politics, today's decision was a victory for people all over this country whose lives will be more secure because of this law and the Supreme Court's decision to uphold it." The President added, "With today's announcement it is time for us to move forward to implement and, where necessary, to improve this law."
In comments in response to the ruling, presumed Republican presidential nominee Gov. Mitt Romney said, "What the Supreme Court did not do on its last day in session, I will do in my first day in office. I will act to repeal Obamacare."
Following the release of the decision, House Majority Leader Eric Cantor (R-VA) announced that the House on July 11 will hold a vote on legislation to repeal the ACA in its entirety. The measure likely will pass the Republican-controlled House, but it is unlikely to advance in the Democratic-controlled Senate.
Repeal of the ACA has been a primary focus of congressional Republicans and remains a central objective of many Republicans’ campaigns in the November elections. Efforts to repeal all or part of the law will remain difficult unless Republicans maintain control of the House, win the presidency, and win at least a majority in the Senate in the November 2012 elections.
Republicans to date have not coalesced around a proposal to replace the ACA. Further efforts to control rising health care costs, including reforms to federal health entitlement programs and health-related tax expenditures, will be at the center of budget and deficit-reduction debates that are expected to dominate Washington after the November elections.
Background on the law
The Affordable Care Act was enacted in March 2010; it comprises the Patient Protection and Affordable Care Act of 2010 (which President Obama signed on March 23, 2010) and the Health Care and Education Reconciliation Act of 2010 (which the President signed on March 30, 2010).
The primary goals of the ACA are to: (i) expand coverage to an estimated 32 million Americans without health insurance; (ii) reform the delivery system to improve quality and drive efficiency; and (iii) lower the overall costs of providing health care.
To accomplish the goal of expanding coverage, the ACA mandates that all Americans maintain a minimum level of health coverage (the so-called individual mandate) or face a tax penalty. The law expands Medicaid coverage and provides federal premium tax credits and cost-sharing subsidies to assist low and moderate income individuals without affordable employer-sponsored insurance in obtaining health insurance through state-based insurance Exchanges. The ACA mandates, for the first time, that employers with 50 or more full-time employees provide certain minimum benefits or pay penalty fees.
The law also implemented insurance market reforms, including a ban on exclusions for pre-existing conditions, premium rate restrictions, extension of dependent coverage through age 26, and mandatory coverage of preventive services.
A mix of Medicare and Medicaid reimbursement cuts; provisions to reduce fraud, waste, and abuse in those public programs; other delivery system reforms; and a series of tax increases on individuals, corporations and the health industry are used to offset the cost of the law.