Have You Reviewed
Your Plan
Administration?
- Page 1
Encouraging
Employees to Live
Healthier Lifestyles
- Page 2
Controlling Health
Benefit Costs: What
We Can Learn from
the Best Employers
- Page 3
Carefully Consider
Cancer When it
Comes to Disability
Claims - Page 4
Another year has come and gone. With
annual enrollment out of the way for
most plans, now may be an excellent
time to schedule a comprehensive
review of your benefits administration
policies and procedures.
The regulatory environment is changing
fast, particularly in the area of health
care plan administration. Indeed, the
closing weeks of 2013 and the beginning
of 2014 included an array of changes,
as the federal government struggles to
implement the Patient Protection and
Affordable Care Act (PPACA). Meanwhile,
the Department of Labor (DOL)
continues to update its regulations
covering ERISA plans, etc. Below are a
few items each plan sponsor should
look at when reviewing their benefits
administration procedure.
Benefit
Insights
A Newsletter for Clients and Friends of
BancorpSouth Insurance Services, Inc.
Have You Reviewed Your
Plan Administration?
Update Plan Documents. ERISA
mandates that employers maintain a
formal written plan document. Plan
sponsors should review their benefit
plan documents regularly and update
them to comply with new laws and
regulations, including PPACA. Disclaimer
materials included in smaller or less
detailed materials distributed to your
employees should reference your plan
documents. In case of any discrepancies,
your formal written plan document will
provide final benefit details, limitations,
exclusions.
were never or who are no longer eligible
under the plan. Employers should clearly
define eligibility requirements under
their plan and pay careful attention to
independent contractors or “leased
employees.”
Update Summary Plan Descriptions.
ERISA rules mandate that all employees
receive a summary plan description
(SPD) each year, covering each benefit
plan. You can provide SPDs on a
company intranet as long as it complies
with the DOL electronic distribution
requirements.
Ensure Section 125 Compliance.
You must have a Section 125 plan, or
“cafeteria plan,” in place if you allow
employees to pay for benefits pre-tax.
This includes health premiums as well
as contributions to flexible spending
accounts (FSAs). Note that rules for
FSAs recently changed. Double check
to ensure your plan observes the new
limits.
Ensure Eligibility. You should ensure
that all individuals covered by your
plan meet the eligibility requirements.
For example, some plans allow only
full-time employees and their lawful
dependents to be covered under the
plan. Performing a dependent audit
can also help identify individuals who
Welcome to the BancorpSouth Insurance
Services, Inc. Newsletter!
We are pleased to present to you our agency newsletter. This newsletter is
designed to give you timely and important information regarding employee
benefits, government regulations, new products, and other areas of interest
to employers and their employees. We value you, your employees, and your
business and continue to strive to provide you with the very best products and
service available.
Thank you again for your business.
March 2014
Ensure Distributions are Calculated
Correctly. You must account for the
definition of compensation in the plan,
including commissions and bonuses,
if applicable, and correctly apply profit
sharing contributions and employer
matches.
Ensure 401(k) Deposits are Timely.
You must keep your employees
401(k) contributions, made via payroll
deduction, separate from your general
funds. Employers must deposit them
with the fund, investment company or
continued on page 2
To locate an office near
you, please visit us
online at www.bxsi.com
or contact us at
info@bxsi.com.
Encouraging Employees to Live
Healthier Lifestyles
In today’s world, Americans have
grown accustom to a culture of instant
gratification. In past decades, people had
to reheat food on the stove or in the oven
before microwaves appeared. Black and
white television sets took a long time to
warm up in the past, but modern devices
now display a vivid color picture almost
instantly when powered on. The concept
of putting forth some effort and patience
seems to be quickly dying.
When it comes to adopting healthy
habits, a person’s gratification will
certainly take time. Diet pills, miracle
creams and other concoctions promise
quick or instant results for various health
issues or conditions, but the truth is that
quality results take time and effort. For
employees, changing health behaviors
such as quitting smoking takes a great
deal of commitment and determination.
Employers can encourage employees to
adopt healthy habits through workplace
wellness programs and challenges. Many
employers host wellness events where
they see a good turnout and temporary
results that seem promising. However,
they often notice that after a few months,
employees slip back into their old habits
or routines. This is common, but it
certainly confirms that most individuals
are not as self-motivated as they are wellintentioned beings.
Workplace wellness programs need
flexibility and a way to continue
employee motivation. In order for
workplace wellness program to be
successful, employers must actively
engage employees. Employers should
put motivation at the top of their list of
key elements to include in any wellness
program. The following tips are helpful
for motivating workers to live healthier
lifestyles:
l If possible, make the wellness or
exercise experience personalized for each
employee. Employers can use information
obtained from employee health risk
assessments to customize wellness
program activities to address specific
health issues.
Focus on the employees who express
a desire to make positive changes in
their lives. Employers should not ignore
employees, but place the heaviest focus
on employees who are ready, willing
and able to change their bad habits.
Employers should not push or force
employees who are not ready to make
changes and take an active role in their
health.
l
Incentives are often a great way to
encourage employee participation.
Incentives can be items such as cash
prizes, gift cards or other merchandise.
Rewards can be tied to participation in
a wellness activity or based on health
outcomes such achieving a certain body
mass index (BMI).
l
l Education is an important part of
achieving a healthy lifestyle. Just as
employees perform better in their job
when they are knowledgeable, they are
more adapt to make better choices if
they are well-informed. Employers can
help educate employees by posting
charts or infographics with helpful
tips for preventing or reducing certain
health risks. Education is key in getting
employees to appreciate the value and
importance of healthy living.
Employers should offer incentives
or rewards for anyone who completes
a health risk assessment or any
recommended follow-up tasks. One
example of promoting healthy
living is offering a
l
reduced health plan premium for
participating in a worksite wellness
program. When employees become
actively engaged in their health, they
will soon realize the financial benefits of
staying healthy.
Offer support by way of
encouragement. Some examples include
weight loss contests, employee-based
walking clubs, newsletters and discounts
for health club memberships. Employers
should provide a variety of channels for
employees to maintain a healthy lifestyle.
Employer should introduce new wellness
challenges periodically in order to keep
employees motivated.
l
Change is certainly not easy for
anyone, and making a major lifestyle
change is bound to present problems
and challenges. Employer can make a
difference in their workforce’s health
through proper incentives, support,
education and tools. Employers must
understand that behavior change is not
something that happens overnight, but
is a long-term commitment that will
ultimately lead to a healthier, happier
and more productive workforce. With
less turnover and sick time, healthier
employees are better for the bottom
line. The quality of work from a healthy,
engaged mind is better than the quality
of work from tired or ill employees.
When employees feel healthy and active,
they tend to have better attitudes in
the workplace. These are just a few of
the many benefits of having a healthy
workforce. To learn more about employee
engagement and worksite wellness
programs, contact a BancorpSouth
Insurance Services representative.
continued from page 1 ... Have You
Reviewed Your Plan Administration?
administrator on a timely basis.
Ensure COBRA Notices. PPACA did
not alter an employer’s responsibilities
under COBRA. You must make sure
that all qualified beneficiaries receive all
required notices.
Failure to comply with these federal
laws can result in fines and lawsuits.
Review your employee benefit plans
thoroughly each year to ensure you
are compliant with the new rules and
regulations. If you have any questions
or concerns regarding employee benefit
plan compliance, please contact your
BancorpSouth Insurance Services
representative.
Controlling Health Benefit
Costs: What We Can Learn
from the Best Employers
With the challenging rollout of the
Patient Protection and Affordable
Care Act (PPACA), there is some good
news. The rate of increase in health
care spending has slowed to about 5.1
percent between 2012 and 2013 which
is more than the rate of inflation. This
is actually the slowest rate of growth
in 15 years. Nevertheless, the average
employer in the United States is now
shelling out over $9,000 per employee
each year in medical insurance costs.
l
Towers Watson, a global human
resources consulting company, surveyed
over 500 large employers about
their health insurance and employee
benefits offerings and strategies. The
survey captured how employee benefit
programs fit into what they call their
employee value proposition (EVP).
l
They invested in communication and
educational resources for employees
including leveraging social media
such as blogs to bring information to
employees.
l
They expected employees to take
more responsibility.
Towers Watson analysts identified
companies who were most successful
at controlling their employee benefit
cost increases. Specifically, they took a
closer look at those companies whose
increases were half of the mean increase
for other large employers or less. Towers
Watson identified the key measures
these companies were taking to rein in
costs.
l
Many of these companies had a large
enough pool of employees that they
chose to self-insure their employee
benefits program. Although, this is not
always an option for small employers,
business owners working with a health
insurance carrier to provide medical
insurance can still use several of the
same cost saving strategies. Below
are a few of the cost-saving measures
implemented by these successful
companies.
l
The most successful companies at
controlling costs also frequently
consolidated health and productivity
programs under a single vendor.
l
They adopted “account-based” health
plans such as health savings accounts
that give employees additional
flexibility and responsibility for their
own health care costs.
l
They contributed to health
savings accounts (HSAs) on
behalf of employees.
l
They emphasized the tax and other
benefits of HSAs in communications
to their employees.
They provided meaningful incentives
to employees to lose weight or quit
smoking and involved spouses in the
effort.
continued from page 4 ...
Carefully Consider Cancer When
it Comes to Disability Claims
employee’s recovery. Besides,
cancer there are additional causes
of long-term disability claims.
Below are a few examples:
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They emphasized the transparency of
health care costs by providing actual
costs per service to employees.
They extended incentives for
maintaining good health to spouses
of employees as well.
l
They leveraged corporate
communication resources to create a
“culture of health.”
l
They offered telemedicine for some
professional consultations.
l
They retained a pharmacy benefit
management (PBM) vendor or took
other steps to reign in increasing
exposure to soaring pharmaceutical
costs. A PBM vendor is a company
that oversees pharmacy benefits
within the organization. The PBM can
arrange pharmacy networks, leverage
volume for discounts, take advantage
of cost savings by using mailed
prescriptions and e-prescribing and
negotiate volume discounts with
drug manufacturers. These can be
separate companies or operations
within larger health insurance
and health care organizations.
BancorpSouth Insurance Services’
in-house pharmacy division offers
a consultative relationship helping
manage your pharmacy benefit costs.
We help quickly diagnose underlying
issues, build the right plan of attack
for your company and recommend
the best way to implement it. To learn
more about our pharmacy benefits
expertise, contact your BancorpSouth
Insurance Services representative.
Employee injuries
Behavioral health issues
Disorders of the circulatory
system
Joint disorders
As mentioned before, maternity
leave and non-back injuries were
the main reasons for short-term
disability claims. The following are
also common reasons for shortterm disability claims:
l
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Employee injuries
Pregnancy complications
Digestive problems
Back disorders
Cancer
It is important for both employers
and employees to understand their
disability programs. Employers
should review their disability
programs regularly. For more
information about short-term
or long-term disability options,
contact your BancorpSouth
Insurance Services representative.
The keys to success in controlling your
costs is understanding your employee
value proposition (EVP), how your
medical benefits fit in to your overall
compensation package and you overall
employee health profile.
That said, some companies are taking
concrete steps to improve their
employee health profile. For example,
some companies no longer hire smokers
at all, and some impose a cap on body
mass index on new hires. The military
has been actively releasing overweight
service members for generations with
the express purpose of limiting later
health care costs, particularly with regard
to retirees.
The full Towers Watson report, the
2013 18th Annual Towers Watson/
National Business Group on Health,
Employer Survey on Purchasing Value in
Health Care, is available at http://www.
towerswatson.com.
Carefully Consider Cancer When it
Comes to Disability Claims
For 12 years in a row, cancer topped
the list as the main reason for long-term
disability claims for employee benefits
providers. The second common cause of
long-term disability was back problems.
For short-term disabilities, maternity
leave was the most common reason at
almost 19 percent. Non-back injuries
made up close to 11 percent of shortterm disability claims.
Employers should stress to employees
the importance of having adequate
disability coverage. Experts recommend
highlighting the valuable advantages it
offers to employees. Employees need to
understand how it will help them while
they are recovering until returning to
work is possible. Both of these phases
are very important for cancer patients.
The majority of people who are living
with cancer are motivated to return
to work. Working gives individuals a
sense of peace, control and normalcy
when they might otherwise constantly
feel overwhelmed. Scientific advances
for cancer treatments are helping the
survival rates climb. The estimated
number of survivors in the United States
is expected to reach 18 million by the
year 2022. Another important focus area
for families and friends helping a cancer
patient is the transition process from
patient to survivor.
accommodations can help ensure a
smooth transition:
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Many providers of long-term disability
coverage work closely with employees
who are out of work on disability or
returning to work. People who have
cancer face a wide array of treatment
side effects. Some of these include
cognitive problems and fatigue
from chemotherapy sessions.
When employees return
to work, the following
Creating a reduced or flexible work
schedule
Providing clear definitions of work
limitations and expectations
Providing feedback or coaching on
work performance
Altering work stations to keep an
employee from standing or sitting for
too long
Permitting extra time for naps or
breaks due to fatigue
While cancer is a major area of focus
for most companies, some are seeing
dramatic changes with work returns
and recovery processes. Companies
understand that looking past the
diagnosis is important for aiding in the
continued on page 3
Information contained in this newsletter about product offerings, services, or benefits is illustrative and general in description, and is not intended to be relied on as complete
information. While every attempt is made to ensure the accuracy of the information provided, we do not warranty the accuracy of the information. Therefore, information
should be relied upon only when coordinated with professional tax and legal advice.
BancorpSouth Insurance Services is powered by BancorpSouth Bank; a wholly-owned subsidiary
of BancorpSouth Inc., a $13.4 billion-financial holding company based in Tupelo, Mississippi.
BancorpSouth Insurance Services is annually ranked as one of the nation’s largest brokers
by Business Insurance magazine. Equipped to service clients across the globe through our
Worldwide Broker Network relationship, we have over 30 offices with almost 600 insurance and
risk management professionals ready to serve.
Benefit
Insights