by Admin. | Sep 20, 2019 | group health insurance, healthcare, PEO
ROI of Using a PEO
The ROI on a PEO is 27.2% according to a new 2019 study released today by the National Association of Professional Employer Organizations (NAPEO) .
The new report focused solely on costs and calculated savings for PEO clients in five HR-related areas:
- HR personnel costs
- Health benefits
- Workers’ compensation
- Unemployment insurance (UI)
- Other external expenditures in areas related directly to HR services (payroll, benefits, etc.)
An annual per employee savings of $1,775 is reached according to the study. Notable findings are lower employee turnover, higher rates of both employee and revenue growth, and enhanced employee benefit offerings.
PEOs provide HR, payroll, benefits, workers’ comp, and regulatory compliance assistance to small and mid-sized companies. By providing these services, PEOs help businesses improve productivity, increase profitability, and focus on their core mission. Through PEOs, the employees of small businesses gain access to employee benefits such as 401(k) plans; health, dental, life, and other insurance; dependent care; and other benefits typically provided by large companies. A copy of the full study is available here.
Save Your Seat
For a quote call our PEO Team (855)667-4621 or info@medicalsolutionscorp.com for immediate answers. Sign up for the latest news updates.
by Admin. | Jul 28, 2019 | healthcare
Medical tourism is on the rise. But what’s driving it and what are the effects on governments and individuals? A helpful article on international insurance by our partners, Aetna International.
The global market is expected to grow at a rate of 21.4% between 2017-2023 and is just one of the reasons the international private medical insurance market (iPMI) is burgeoning.
Thousands of patients benefit from access to cheaper treatment, as do the governments of many developing nations who can earn millions by offering cheaper procedures. But even this latter benefit brings a difficult conundrum to the governments of many developing nations: to provide the best health care for nationals by sending them abroad for treatments unavailable at home, or retain that money to invest in national health systems at home? Those that choose the former, are placing increased pressure on their national health services as much-needed investment is going abroad. This is also a driver of medical inflation: flying a patient to another country can mean higher costs than if it were carried out at home. This means there is less to invest in the national system and costs are driven up.
And for those nations making a virtue of selling cheaper treatment, the cost is often reduced levels of care for nationals, as tourists use up national resources and the private sector attracts the best clinicians.
Leading the health tourism charge is the U.S., closely followed by Europe, where thousands of patients fly abroad to receive treatment, avoiding domestic waiting lists and potentially enjoying reduced treatment costs. Asia Pacific and South and Central America currently dominate the market, where Americans can save up to 60% on treatment.
Driving this global trend are a number of factors, explored below, from aging populations and medical inflation to inadequate domestic care and health care cuts.
This article explores some of the implications of the rising numbers of people travelling for treatment. It also begins to explore how health and wellness systems and institutions – from national health services to health insurance companies — are responding to this trend.
Why?
The root causes of this increase are cuts in national health funding, ageing and affluent populations, staff shortages and a range of lifestyle factors.
Cost and access are the main drivers for travel.
- Company executives, the C-suite and those on assignment are travelling to access better treatment in the country of their choice, and not just when they’re unwell or managing a condition, but in pursuit of preventative wellness care as well.
- Many people travel to countries that offer lower-cost medical treatment because they can’t afford them at home or don’t have access to the treatment at all. 1.7 million Americans live in households that will declare bankruptcy due to their inability to pay their medical bills; while savings of 65-80% can be saved on medical bills if Americans fly to Malaysia (December 2017). Many around the world are in the same situation. Others are flying for cheap elective surgery and treatments for things such as cosmetic surgery and dentistry.
- The third contributing factor is certain nations’ reliance on foreign countries for specialist treatments. Nigeria’s national health service sends many patients abroad for treatment, paying other countries for access. In an effort to “reduce our dependence on foreign medical tourism” Nigeria announced the construction of a N7.5 billion (£14.9m, $20.7m) ultra-modern specialist hospital in Kano Statein (February 2018).
- Another reason for travel is national health care system waiting times. The UK’s Telegraphreported in 2017 that many UK citizens are travelling abroad to receive immediate treatment as NHS waiting times can be long — waiting times in Wales have gone up by 400% since 2013.
- The aging populations of developed nations are also having an impact — and continues to grow. Aging is a concern for costs to health care systems, with increased care needs over longer lifespans. Also of concern are health care costs for older people. As national health services buckle under the pressure of increased demand from an aging population, waiting lists expand and medical inflation drives up costs. As such, many older people seek alternative, cheaper treatments abroad.
1. The blessing and the curse for governments
While some countries are benefitting from an influx of patients keen to exploit cheaper care, some national health services are feeling the pressure. For example, while Costa Rica earned $338 million from the trade in 2012, the UK’s National Health Service (NHS) said in 2016 that 0.3% of NHS spending went to “deliberate health tourism” and those taking advantage of free NHS services. Another estimate in the same year came from Lord Bates who said the cost of visitors to the NHS in 2012-13 was £2bn — approximately 2% of the NHS budget. Though increased immigration health surcharge has been proposed to tackle this.
This is proving a challenge for many governments who want to provide the best health care for nationals. Sometimes this means using specialist care in other countries, but flying a patient to another country can mean higher costs than necessary — contributing to medical inflation. This in turn means that governments have less to invest in their own national system… and costs go up again.
A quick sweep of recent news shows many countries are getting in on the action, building pay-to-play services and promoting them. For example:
One nation making the most of the opportunity is Cuba. Speaking at the ITIC in Barcelona in November 2017, Humberto Barreto Nardo, Director General of Asistur SA explained how Cuba wanted to build a strong infrastructure which offered basic medical care and the best medical standards for its population and medical tourists. He detailed how, in addition to this, the Cuban Medical Services Market Developer — a corporate entity created to guarantee medical care with best means and human resources
2. The blessing and the curse for individuals
Nations and private enterprise tapping the market isn’t helping patients because it’s contributing to global health care inflation — the cost of health care — and not addressing the prevention and intervention of diseases and conditions.
The results are: health insurance premium increases, higher costs to governments (budget/target shortfalls and/or potential tax increases) and, most importantly, fewer healthier people.
And that’s if it all goes well… Many patients fly for lower cost treatment, only to find there are subsequent complications. But, having not budgeted for it and finding themselves miles away, are unable to deal with them.
A 2013 report found that: “Researchers examining outbound medical tourism from Oman found that 15% of 45 surveyed medical tourists experienced complications following treatment abroad, while a survey of the British Association of Plastic, Reconstructive and Aesthetic Surgery found that 37% of members had seen patients with complications resulting from medical tourism.”
The role of the expat
Demands on the system from expats traveling back to their countries of origin is also causing waiting lists to lengthen and costs to rise.
For many expats, international Private Medical Insurance (iPMI) is the best way to ensure you have access to good quality care and treatments wherever you are. This has its own effect as increased pressure on private resources can drain national health services of staff and hospitals.
Best practise
It is something of a truism in the West that the best health care is preventative, not curative. For too long, health services focused on reducing pain, exchanging organs and curing diseases. The 21st century has seen the blossoming of what Aetna International calls, value-based care. This approach puts the whole patient at the centre of their health journey (not their condition, not their disease), making it easier for people to get quality care, while keeping medical inflation in check. Many governments are investing in keeping people healthy with nutrition information, quit smoking campaigns and other initiatives. In a pay-to-play system, everyone loses out: nations have less money to spend on keeping their population healthy, medical inflation effects insurers, which then puts premium costs up for individuals.
Our value-based system aims to put the patient at the centre of their plan to keep them healthier and keep premiums low. Recognising that, individuals are increasingly demanding global access to care, it’s important that they can choose the regions in which to access care. Each region offers a carefully maintained network of care providers and the area of cover chosen helps shape the plan and premium. Our in-house Care and Response Excellence (CARE) team of specialised clinicians and multilingual case managers available 24/7/365 to support individuals pre-trip, post-trip, and anytime in between.
The medical tourism trend looks set to continue as more people look to travel for treatment. While this means that the iPMI industry is booming, it’s important for employers and individuals to rely on a health benefits and wellness partner that ensures the right care and outcome, at the right time, in the right place and at the right cost. At Aetna International, our strength lies in our global network of health care providers and our in-depth local knowledge and our ability to provide access to quality care no matter where they are.
If you’re looking to better understand iPMI market trends or for international health and wellness benefit solutions, contact us for more information.
Learn more about international travel insurance and iPMI. We are successfully helping navigate SMB for 20+ years. Please contact us at 855-667-4621 or info@medicalsolutionscorp.com.
by Admin. | Jul 23, 2019 | Health Care Reform, HSA
Last week, the IRS added care for a range of chronic conditions to the list of preventive care benefits that may be provided by an HSA compatible high deductible health plans (HDHP). Notice2019-45, lists the new types of medical care that may be treated as preventive care for this purpose.
Individuals covered by an HSA compatible HDHP generally may establish and deduct contributions to a Health Savings Account (HSA) as long as they have no disqualifying health coverage or not enrolled in Medicare. To qualify as a high deductible health plan, an HDHP generally may not provide benefits for any year until the Federal (not health plan) minimum deductible for that year is satisfied.
The IRS together with the Department of Health and Human Services, has determined that certain medical care services received and items purchased, including prescription drugs, for certain chronic conditions should be classified as preventive care. The following services and items for individuals with the specified chronic conditions listed are treated as preventive care.
Learn how our Agency is helping businesses thrive in today’s economy. Please contact us at info@medicalsolutionscorp.com or (855)667-4621.
by Admin. | Jul 21, 2019 | family health insurance, group health insurance, Health Care Reform, healthcare, Obamacare, Tax
Last week the House voted the unpopular Obamacare Cadillac Tax to be permanently repealed 419-6. However, much like a bad cold, the Health Insurance Tax (the HIT) is back for 2020. Website Stop The Hit calculates $5,000 as the average tax for a 10 man small business for example.
Who’s affected?
No one escapes the $16 billion HIT. The return of the Health Insurance Tax (HIT) means higher costs and fewer jobs for hardworking Americans. Absent immediate Congressional action to delay the HIT, small businesses and families will face $500 on average in higher premiums for 2020. To make matters worse, the increased cost burden on small businesses from the HIT could result in the U.S. workforce being reduced by 152,000 to 286,000 jobs over a decade. Te HIT is projected to increase premiums for seniors by $241.
How much for 2020?
For Small business, this translates to an estimated 2.5%-3% added surcharge. For States like NYS where there is already approx. 16% added surcharge to high premiums, this becomes daunting. It is no surprise the unpopular HIT was suspended. In 2017, payers escaped making $13.9 billion in payments due to the moratorium, according to a 2018 analysis by Oliver Wyman, commissioned by UnitedHealth Group. This may have saved consumers billions on their insurance coverage.“The taxes on health insurance are non-deductible for federal tax purposes for health insurers,” the report explained.
In some states, such as Vermont, the price of insurance would have more than quadrupled. The payer trade group published a fact sheet on this. “Allowing a tax to resume in 2020 valued at an annual level of $16 billion, would saddle individual market consumers, small businesses, state Medicaid programs, and Medicare Advantage enrollees with higher health care costs,
Can this be repealed?
Relief from the health insurance tax would result in real savings to the American people. We strongly urge Congress to provide an additional two-year suspension of the health insurance tax by passing H.R. 1398.
Learn more about how we are successfully helping navigate SMB for 20+ years. If you have any questions or would like additional information, please contact us at 855-667-4621 or info@medicalsolutionscorp.com.
by Admin. | Jun 16, 2019 | healthcare, individual health insurance, latest health insurance news, Tax
On June 13, 2019, the Departments of Labor, Health & Human Services and Treasury released final rules concerning Health Reimbursement Arrangements (HRAs). The 497-page rule includes the creation of two new types of HRAs, the “Individual Coverage HRA” and the “Excepted Benefit HRA.”
Advantages of the Individual Coverage HRA:
- Funds can be used to reimburse the employee’s premiums for an individual health insurance policy.
- Reimbursements made to employees do not count towards the employee’s taxable wages.
- The employer can choose to roll-over unused amounts into the following year.
- Coverage can be offered to different classes of employees (e.g.; full-time, part-time, seasonal, salaried, hourly)
- An offer of the Individual Coverage HRA represents an “offer of coverage” under the employer mandate, however, contributions must meet affordability guidelines. The IRS will release further guidelines regarding this later.
Individual HRA restrictions:
- An offer of an Individual Coverage HRA cannot be made to any employee that is offered a traditional group health plan.
- If an offer of coverage is made to a class of employees, there is a minimum class size that is required. Size is typically 10% of that specific class of employees. For example, if an employer has 200 employees, a minimum of 20 employees would have to be in a specified class.
- Contributions can be in any amount that the employer chooses, but contributions must be consistent for all employees in a specified class.
- The employer must provide notice of the Individual Coverage HRA to employees.
- The employer must be able to substantiate that the employee is enrolled in an individual plan or Medicare (model notices are available).
- The employer must notify employees on an annual basis that the individual health insurance is NOT subject to ERISA.
The final rule also created the “Excepted Benefit HRA” which, starting in January of 2020, will permit employers to finance additional medical care. Employees can use the HRA without having to be enrolled in the group’s traditional health plan.
“Excepted Benefit HRA” include:
- The annual contribution is capped at $1,800.
- It must be offered in conjunction with a group health plan, but there is no requirement for the employee to enroll in that plan.
- The “Excepted Benefit HRA” cannot be used to fund group health or Medicare premiums.
- It can fund premiums for dental, vision, or short-term limited duration insurance.
Effective Date:
Employers who want to offer the “Individual Coverage HRA” for January 1, 2020, can do so but employees will need to enroll in an individual plan during the 2019 open enrollment period (November 1, 2019 – December 15, 2019).
If you have any questions or would like additional information, please contact us at 855-667-4621 or info@medicalsolutionscorp.com.
