Stay Informed & Prepared

Health Plan Compliance

Segal offers a range of compliance services and publications to help multiemployer fund trustees navigate the maze of federal, state and local laws and regulations related to benefit plans. Our services include:

  • Reviewing documents, policies and administrative processes to ensure that the fund is in compliance with HIPAA
  • Preparing the Summary of Material modification/Summary of material reduction in Covered Services of Benefits
  • Preparing annual notices to participants, including:
    • Summary Annual Report
    • Women's Health and Cancer Rights Act Annual Notice
    • Notice of Creditable Coverage for Medicare Part D
    • Summary of Material Modifications
  • Reviewing claims and appeals policies, and discussing any complaints from participants
  • Creating plan documents and COBRA policies for plans with and without HRAs
  • Reviewing subrogation and reimbursement policies, workers compensation and third party liability recovery procedures
  • Reviewing plan design for compliance issues
  • Reviewing Medicare and Medicare Secondary Payer policies, and Coordination of Benefits (COB) in general
  • Ensuring that federally-required policies and procedures are complete and up-to-date, including Uniformed Services Employment and Reemployment Rights Act (USERRA), Qualified Medical Child Support Order (QMCSO) and Family and Medical Leave Act (FMLA) notices and policies
  • Enabling electronic delivery of notices and plan communications
  • Reviewing policies and procedures meant to safeguard the plan in the event of a Retiree Drug Subsidy (RDS) audit
  • Ensuring that reporting and disclosure notices are up to date and have been sent out as required
  • CrosscheckSM — a benefit administration review for multiemployer plans
  • Addressing the various aspects of the ACA, from assistance in applying for reimbursements under the Early Retiree Reimbursement Program, to modeling the potential impact of the Premium Assistance Tax Credit, and evaluating the Health Insurance Exchanges.

Health Care Reform

Segal can help your fund assess options and determine next steps for your health benefit programs. Our compliance, compensation and communications experts can help plan sponsors in evaluating the impact of important Affordable Care Act (ACA) changes on future medical benefit choices, costs and strategies. We can guide plan sponsors through the maze of new federal regulations and our communications experts can help explain these rules to plan participants. Speak to your local benefits consultants for more information regarding any of the services outlined below.

Plan sponsors will need to make sure that their current and future benefit offerings comply with new rules that address:

  • Whether and when a plan loses grandfather status — implementing the additional mandates for non-grandfathered plans, such as new internal and external appeals rules and 100% coverage for preventive benefits
  • Non-grandfathered plan mandates for 2014, such as new limits on out-of-pocket maximums and payment for clinical trial-related services
  • New 90-day maximum waiting periods and new guidance on “variable employees”
  • New Summary of Benefits and Coverage (SBC) statements
  • Elimination of annual dollar limits on essential benefits (and no waivers of existing limits) for plan years beginning on or after January 1, 2014
  • Reporting requirements for plans and employers concerning both quality and plan eligibility/enrollment, and new W-2 reporting for employers and specific guidance for multiemployer plans
  • Notices — grandfather, waiver, March 1 notice about exchanges, etc.
  • Medical Loss Ratios evaluation (for insured plans only)
  • Assuring that plan documents are updated correctly
  • HIPAA Electronic Data Interchange (EDI) certification

Segal offers several applications to help clients test their plans to determine:

  • Pay or Play Mandate Modeling: What does the pay or play mandate mean to plan participants, plan sponsors and contributing employers? Segal’s models allow decision makers to make informed decisions about public state health exchanges. Models assess the impact of federal premium assistance subsidies available to low and moderate income participants and the employer shared responsibility penalty on plan costs and aggregate financial gains or losses.
  • Excise Tax Testing: Modeling the probability and amount of paying the new 40% excise tax on high cost plans, now delayed to 2020. Segal models whether and when a plan would hit the excise tax threshold and the cost of the tax from 2020 to 2027 using several different assumptions of plan cost trends.
  • Affordability Testing: For plan sponsors that require participant contributions for health benefits, Segal offers models that determine, based on current contributions and W-2 income levels, how many eligible members could fail the affordability test and create new penalties for contributing employers
  • Other Fees: Analyze the impact of other ACA fees, including increased Medicare taxes on high-income earners, comparative effectiveness research fees, transitional reinsurance fees, etc.

Segal’s team includes underwriting specialists, behavior modification experts, communications and compliance experts. Our consultants help clients develop new wellness plans that both generate meaningful participation and comply with new federal rules:

  • If applicable, using the loss of grandfathered status and new 100% preventive benefit coverage rules to redesign a new wellness program
  • Adapting wellness programs to comply with the new 30% reward/penalty maximums (effective for plan years beginning on or after 1/1/2014)
  • Designing effective tobacco cessation programs, particularly in light of new regulations that will allow a 50% reward/penalty maximum for tobacco use (effective for plan years beginning on or after 1/1/2014)
  • Communications strategies and campaigns to improve member education and engagement rates

The presence of both public and private exchanges increases the opportunity to convert defined medical plans to defined contribution health account strategies. Segal can help multiemployer clients:

  • Evaluate the feasibility and affordability of transitioning active and retiree health benefits into a defined contribution approach, including the challenges facing health insurance exchanges such as readiness, effectiveness and product choice
  • Assess individual plan selection decision priorities (premium vs. coverage)
  • Establish account-based plans (e.g., HRA, HSA)
  • Address segmentation of multistate group enrollment into state-by-state elections
  • Evaluate local health insurance options versus national options
  • Evaluate member exchange support services, websites and third party administrative vendors
  • Integrate supplemental coverage offerings

Exchange Modeling Services

Although the Supreme Court decision resolved the constitutionality of the Affordable Care Act, many issues remain for sponsors of multiemployer plans. Segal’s experts have been carefully monitoring and participating in the dialog about health care reform and the impact on multiemployer plans.

The main purpose in creating the State Exchanges was to provide a “marketplace” for affordable medical coverage to individuals without such coverage — not to replace multiemployer funds. Multiemployer plans can continue to operate “as is” but there are many implications to consider. Segal has communicated frequently with our multiemployer clients about regulatory topics including:

  • How the 90-day waiting period will apply to multiemployer plans
  • How the employer shared responsibility penalty applies for contributing employers
  • Whether participants in multiemployer plans may receive access to the premium assistance tax credit that allows individuals to purchase subsidized coverage in the state health insurance exchanges

We understand the many questions and uncertainties our clients face. Our health care reform experts and actuaries can assist clients with modeling the economic impact of the ACA on union members who participate in and employers who contribute to multiemployer health and welfare funds. Through economic modeling, Segal helps clients estimate the value of the subsidies and determine whether it makes sense to pursue an Exchange strategy for some or all members.

Our modeling incorporates our comprehensive knowledge of the requirements of the ACA, the function and role of the exchanges, the individual mandate and subsidies, and the employer penalties.

Segal’s customized modeling provides our clients with:

  • An estimate of household income and why it is critically important
  • The difference between tax credits for single vs. family coverage
  • The impact of the plan costs
  • The relationship of the plan’s actuarial value to the silver plan
  • The characteristics of participants and the impact of those characteristics on the value of the subsidy
  • The significance of employer size
  • The sensitivity of the results to these various characteristics

The ACA is having a major impact on the relationship between providers and insurers/network administrators, with Accountable Care Organizations (ACO) resulting in more “capitation-like” arrangements and health care providers taking on more risk for the cost of care. Segal can help plan sponsors assess the impact of these new ACO models, as well as other new payment approaches, on future claims costs for budgeting, projections and during the RFP process when selecting a carrier.

Segal can help funds analyze the feasibility of setting up public/private partnerships, Co-Ops, Accountable Care Organizations and other structures to maximize the effectiveness of health benefit programs.

Insurance Market Trends

Segal has a dedicated team that focuses specifically on insurance organizations, and therefore closely monitors industry trends in order to offer insight and intellectual capital specific to this industry. Insurance markets are adapting to the constantly-changing economic times and it is vital to stay ahead of these changes. Segal will keep you informed of current trends and help predict future ones by applying our expertise to the insurance marketplace.

Surveys and Normative Data

Segal has placed a long-standing emphasis on the importance of research and development that keeps our clients informed on all aspects of participant benefits programs. We have extensive experience in preparing comprehensive studies and reports on benefits-related topics involving legislative and regulatory issues. Segal periodically creates, delivers and tabulates surveys, and then reports on survey results. These include:

  • Segal Health Plan Cost Trend Survey: Changes in the costs to plan sponsors can be significantly different from projected claims cost trends, reflecting such diverse factors as group demographics, changes in plan design, administrative fees, reinsurance premiums and changes in participant contributions. Segal conducts and publishes an annual survey of managed care organizations, health insurers, pharmacy benefit managers and third-party administrators that examines trends for active participants and retirees.
  • Periodic Surveys and Studies: In addition to this ongoing research, we periodically conduct studies relevant to health benefit plans on subject matters, including Medicare Part D, dental plans, and medical and prescription drug plan design for active employees and retirees.

Health Plan Compliance

Segal offers a range of compliance services and publications to help public sector entities navigate the maze of federal, state and local laws and regulations related to benefit plans. Our services include:

  • Reviewing documents, policies and administrative processes to ensure that the plan is in compliance with HIPAA
  • Preparing the Summary of Material modification/Summary of material reduction in Covered Services of Benefits
  • Preparing annual notices to employees, including:
    • Summary Annual Report
    • Women's Health and Cancer Rights Act Annual Notice
    • Notice of Creditable Coverage for Medicare Part D
  • Reviewing claims and appeals policies, and discussing any complaints from employees
  • Creating plan documents and COBRA policies for plans with and without HRAs
  • Reviewing subrogation and reimbursement policies, workers compensation and third party liability recovery procedures
  • Reviewing plan design for compliance issues
  • Reviewing Medicare and Medicare Secondary Payer policies, and Coordination of Benefits (COB) in general
  • Ensuring that federally-required policies and procedures are complete and up-to-date, including Uniformed Services Employment and Reemployment Rights Act (USERRA), Qualified Medical Child Support Order (QMCSO) and Family and Medical Leave Act (FMLA) notices and policies
  • Enabling electronic delivery of notices and plan communications
  • Reviewing policies and procedures meant to safeguard the plan in the event of an Retiree Drug Subsidy (RDS) audit
  • Ensuring that reporting and disclosure notices are up to date and have been sent out as required
  • CrosscheckSM - a benefit administration review for public sector health and welfare plans
  • Addressing the various aspects of the ACA, from assistance in applying for reimbursements under the Early Retiree Reimbursement Program, to modeling the potential impact of the Premium Assistance Tax Credit, and evaluating the Health Insurance Exchanges.

Health Care Reform

Segal can help your organization assess options and determine next steps for your health benefit programs. Our consulting, actuarial, compliance, compensation and communications experts work with plan sponsors in evaluating the impact of important ACA changes on future medical benefit choices, costs and strategies. We can guide plan sponsors through the maze of new federal regulations and our communications experts can help explain these rules to plan participants. Speak to your local benefits consultants for more information regarding any of the services outlined below.

Plan sponsors will need to make sure that their current and future benefit offerings comply with new rules that address:

  • Whether and when a plan loses grandfather status — implementing the additional mandates for non-grandfathered plans, such as new internal and external appeals rules and 100% coverage for preventive benefits
  • Non-grandfathered plan mandates for 2014, such as new limits on out-of-pocket maximums and payment for clinical trial-related services
  • New 90-day maximum waiting periods and new guidance on “variable employees”
  • New Summary of Benefits and Coverage (SBC) statements
  • Elimination of annual dollar limits on essential benefits (and no waivers of existing limits) for plan years beginning on or after January 1, 2014
  • Reporting requirements for plans concerning both quality and plan eligibility/enrollment, and new W-2 reporting for employers and specific guidance for public sector plans
  • Notices — grandfather, waiver, March 1 notice about exchanges, etc.
  • Medical Loss Ratios evaluation (for insured plans only)
  • Assuring that plan documents and booklets are updated correctly
  • HIPAA Electronic Data Interchange (EDI) certification

Segal offers several applications to help clients test their plans to determine:

  • Pay or Play Mandate Modeling: What does the pay or play mandate mean to plan participants, plan sponsors and contributing employers? Segal’s models allow decision makers to make informed decisions about their future plan direction now that the public state health exchanges have begun to operate. Models assess the impact of federal premium assistance subsidies available to low and moderate income participants and the employer shared responsibility penalty on plan costs and aggregate financial gains or losses.
  • Excise Tax Testing: Modeling the probability and amount of paying the new 40% excise tax on high cost plans, now delayed to 2020. Segal models help assess whether and when a plan would hit the excise tax threshold and the cost of the tax from 2020 to 2027 using several different assumptions of plan cost trends.
  • Employee Affordability Testing: For plan sponsors that require participant contributions for health benefits, Segal offers models that determine, based on current contributions and W-2 income levels, how many eligible members could fail the affordability test and create new penalties for plan sponsors.
  • Other Fees: Segal has analytical tools to assess the impact of other ACA fees, including increased Medicare taxes on high-income earners, comparative effectiveness research fees, transitional reinsurance fees, etc.

Employer Workforce Testing

  • Public employers that wish to avoid paying the employer shared responsibility penalty will have to offer benefits to full-time employees (and likely to dependents as well). Employers with flexible workforces (e.g., part-time workers, contract workers, adjunct faculty) will have unique needs with respect to the penalty. These employers will need to test their workforces to determine which employees are full-time under the ACA rules, and which are receiving benefits.
  • Segal’s Compliance and Public Sector Compensation and Bargaining Practices can evaluate a public sector entity’s staffing policies to assure that full-time workers are accurately identified and offered benefits, in order to avoid being assessed the employer shared responsibility penalty.

Segal’s team includes underwriting specialists, behavior modification experts, employee communications and compliance experts. Our consultants help clients develop new wellness plans that both generate meaningful participation and comply with new federal rules:

  • Using the loss of grandfathered status and new 100% preventive benefit coverage rules to redesign a new wellness program
  • Adapting wellness programs to comply with the new 30% reward/penalty maximums (effective for plan years beginning on or after 1/1/2014)
  • Designing effective tobacco cessation programs, particularly in light of new regulations that will allow a 50% reward/penalty maximum for tobacco use (effective for plan years beginning on or after 1/1/2014)
  • Developing new communications strategies and campaigns to improve member education and engagement rates

The presence of both public and private health insurance exchanges increases the opportunity to convert defined medical plans to defined contribution health account strategies. Segal can help public sector clients:

  • Evaluate the feasibility and affordability of transitioning active and retiree health benefits into a defined contribution approach, including the challenges facing health insurance exchanges such as readiness, effectiveness and product choice
  • Assess individual plan selection decision priorities (premium vs. coverage)
  • Establish account-based plans (e.g., HRA, HSA)
  • Address segmentation of multistate group enrollment into state-by-state elections
  • Evaluate local health insurance options versus national options
  • Evaluate member exchange support services, websites and third party administrative vendors
  • Integrate supplemental coverage offerings

ACA is having a major impact on the relationship between providers and insurers/network administrators, with Accountable Care Organizations (ACO) resulting in more “capitation-like” arrangements and health care providers taking on more risk for the cost of care. Segal can help employers assess the impact of these new ACO models, as well as other new payment approaches, on future claims costs for budgeting, projections and during the RFP process when selecting a carrier.

Segal can help public employers analyze the feasibility of setting up public/private partnerships, Co-Ops, Accountable Care Organizations and other structures to maximize the effectiveness of health benefit programs.

Insurance Market Trends

Segal has a dedicated team that focuses specifically on insurance organizations, and therefore closely monitors industry trends in order to offer insight and intellectual capital specific to this industry. Insurance markets are adapting to the constantly-changing economic times and it is vital to stay ahead of these changes. Segal will keep you informed of current trends and help predict future ones by applying our expertise to the insurance marketplace.

Surveys and Normative Data

Segal has placed a long-standing emphasis on the importance of research and development that keeps our clients informed on all aspects of employee benefits programs. We have extensive experience in preparing comprehensive studies and reports on benefits-related topics involving legislative and regulatory issues. Segal periodically creates, delivers and tabulates surveys, and then reports on survey results. These include:

  • Study of State Employee Health Benefits: State governments continue to balance providing valuable health benefits that meet the needs of employees, retirees and their dependents with the ever-increasing cost pressure of these benefits on limited budgets. Examining what other states are offering can be helpful in making tough decisions about potential changes. Segal regularly conducts a study of all states and the District of Columbia that reflects benefits offered to active, full-time employees of these jurisdictions. We provide details about these and other findings in our published report.
  • Segal Health Plan Cost Trend Survey: Changes in the costs to plan sponsors can be significantly different from projected claims cost trends, reflecting such diverse factors as group demographics, changes in plan design, administrative fees, reinsurance premiums and changes in participant contributions. Segal conducts and publishes an annual survey of managed care organizations, health insurers, pharmacy benefit managers and third-party administrators that examines trends for active participants and retirees.
  • Periodic Surveys and Studies: In addition to this ongoing research, we periodically conduct studies relevant to health benefit plans on subject matters, including Medicare Part D, dental plans, and medical and prescription drug plan design for active employees and retirees.
  • Healthy Campus Survey, which captures information about current health and wellness practices at over 50 institutions of higher education. It examines the relationship between these practices and their outcomes, such as employee turnover, absence rates, health care costs and the use of short-term disability benefits.