Corporate Wellness: Choosing the Right Program

According to a RAND survey, approximately half of U.S. employers with 50 or more employees sponsor some type of health and wellness program. As the issues of rising health care costs and increased absenteeism due to health problems grow, corporate wellness programs are seen as an effective method of improving employee health and morale and decreasing health-related costs for employers.

In order to realize improved employee health and a good return on investment (ROI), you need to choose the right wellness program for your company. Success is dependent on both employee engagement and support from all levels of management. To choose the right program, you will need to determine your organization’s needs and resources, then match that with the appropriate type of wellness program.

Determine Your Needs and Resources

If your company is considering implementing a wellness program, you will need to consider several factors before deciding what type of wellness program will be most effective for your company and its employees.

Employee Needs and Interest

Assess your workplace to determine your employees’ health problems and fitness levels, as well as their interest in different types of wellness programs. Consider using surveys, focus groups and health risk assessments to learn more about the health status and interest areas of your employees. You will need a solid idea of the areas of interest and level of anticipated engagement from your employees to help you decide what type of wellness program is best suited for your workforce.

Areas of focus for a corporate wellness program may include disease prevention, fitness, smoking cessation, alcohol and substance abuse counseling, nutrition education, mental health help, weight loss and stress management. In order to engage employees, your wellness program must fit what they perceive to be a need and must be something that they are willing to participate in. If your employees don’t see a benefit, you will have extremely low engagement and participation.

Resources and Management Support

For wellness programs to succeed, leadership on all levels must also buy in to the wellness program idea. To ensure the support of management, inform managers about the program early on and encourage them to participate. Communicate the program’s goals and benefits clearly and often.

Gaining upper-level management support will give you easier access to sufficient resources and staff time to develop and implement your wellness program. You also need support from upper management in order to set an example through their participation in the program. The participation of direct managers throughout your organization is also important because they will be able to encourage more engagement among all your employees, increasing the ROI of your program through widespread participation.

Types of Wellness Programs

Once you have assessed your needs and available resources, you can choose the type of program that best suits your organization. Wellness programs, as mentioned above, can focus on various areas such as physical activity or nutrition, and they can be designed with different levels of time commitment and needed support.

Corporate wellness programs encompass an extremely broad range of activities and initiatives in the workplace, and universally accepted definitions or categories have not yet emerged. However, wellness programs can generally be categorized based on the level of effort and time commitment necessary to make them successful and based on the type of activities included in the program. Following are three general categories of wellness programs.

Screening events – The least-involved types of wellness programs are screening activities. These are health risk assessments which can be self-administered questionnaires or biometric screenings. The goal of these programs is to give employees information on their health status and possibly prompt changes to achieve better health. Biometric screenings can often be set up through your health plan provider, making the screenings one of the least costly and time-consuming programs available.

Health education and promotion activities – These wellness programs will require a little more investment in time and financial resources because they may require corporate changes and outside resources. You can consider providing educational sessions and materials for employee groups, or you might provide individual or group counseling sessions for such topics as smoking cessation or alcohol or drug abuse. Other types of wellness promotion programs may include changing policies or procedures around the workplace, such as switching to healthier cafeteria or vending machine offerings, or promoting walking meetings instead of meetings in a conference room. These wellness programs aim to improve employee morale, educate and possibly prompt some behavioral changes.

Prevention and intervention measures – Wellness programs that attempt to reach wellness goals and achieve lifestyle changes are the most involved and resource-laden type of program. These wellness programs might include a weight-loss initiative, a walking competition or similar ideas that attempt to influence employee behavior. Typically these programs require up-front investment by the employer in planning, potentially bringing in outside counselors or resources, providing any necessary equipment (such as pedometers or a scale for weigh-ins) and offering various incentives or rewards for participants as they meet their fitness goals. This type of highly involved program will likely see the best ROI, but it needs a high level of support from management and high employee engagement in order to be successful.

Legal Compliance

When deciding on and planning your corporate wellness program, you also need to consider how the program is classified for the purpose of legal compliance. Based on regulations under the Health Insurance Portability and Accountability Act (HIPAA) and the Affordable Care Act (ACA), a wellness program can fall into one of two basic categories that determine what guidelines it must adhere to. These categories are participatory and health-contingent wellness programs, with the health-contingent category additionally broken into two subcategories: activity-only and outcome-based.

Participatory wellness programs simply require an employee to join the program; for example, an employee may attend a session about nutrition or participate in a health screening, with no regard to whether the employee actually changes any behavior or meets any health standards.

A health-contingent wellness program requires the participants to satisfy a standard related to a health factor in order to obtain a reward. For an activity-only wellness program, the employee would complete a health-related activity, such as walking or following a specified diet. For an outcome-based wellness program, the participant must meet a health-related goal, such as not smoking or satisfying certain exercise goals. Both types of health-contingent wellness programs must follow additional requirements—such as providing a reasonable alternative standard and not exceeding specified incentive limits—in order to be in legal compliance.

Download the PDF version of this article. To learn more about corporate wellness programs or if you need help developing your own, contact Clark & Associates of Nevada today.

Federal Courts Issue Conflicting Rulings on Subsidies in Federal Exchanges

Several lawsuits have been filed by individuals and employers to challenge the ability of the federal government to provide tax credits under the Affordable Care Act (ACA) to individuals in states that did not establish their own Exchanges (that is, in states with Federally Facilitated Exchanges, or FFEs). These lawsuits were filed in response to an Internal Revenue Service (IRS) rule that authorizes subsidies in all states, including those with FFEs.

On July 22, 2014, two federal appeals courts— the District of Columbia Circuit Court and the 4th U.S. Circuit Court—issued inconsistent rulings on the availability of subsidies in states with FFEs.

Download the full Health Care Reform Bulletin to learn more.

2015 Compliance Checklist

The Affordable Care Act (ACA) has made a number of significant changes to group health plans since the law was enacted over four years ago. Many of these key reforms became effective in 2014, including health plan design changes, increased wellness program incentives and reinsurance fees.

Additional reforms take effect in 2015 for employers sponsoring group health plans. In 2015, the most significant ACA development impacting employers is the shared responsibility penalty and related reporting requirements for applicable large employers. To prepare for 2015, employers should review upcoming requirements and develop a compliance strategy.

This Legislative Brief provides a health care reform compliance checklist for 2015. Please contact Clark & Associates of Nevada, Inc. for assistance or if you have questions about changes that were required in previous years.

Download the PDF version of the 2015 Compliance Checklist.

Employer Reporting of Health Coverage: Code Sections 6055 & 6056

The Affordable Care Act (ACA) created new reporting requirements under Internal Revenue Code (Code) Sections 6055 and 6056. Under these new reporting rules, certain employers must provide information to the IRS about the health plan coverage they offer (or do not offer) to their employees.

On July 24, 2014, the Internal Revenue Service (IRS) released draft versions of the following forms that employers will use to report under Sections 6055 and 6056:

  1. Form 1094-B: Transmittal of Health Coverage Information Returns;
  2. Form 1095-B: Health Coverage;
  3. Form 1094-C: Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Return; and
  4. Form 1095-C: Employer-Provided Health Insurance Offer and Coverage.

Forms 1094-C and 1095-C will be used by applicable large employers (ALEs) that are reporting under Code Section 6056. Forms 1094-B and 1095-B will generally be used by entities reporting as health insurance issuers or carriers, sponsors of self-insured group health plans that are not reporting as ALEs, sponsors of multiemployer plans and providers of government-sponsored coverage under Section 6055. However, a reporting entity that is reporting under Section 6055 as an ALE will file under a combined reporting method, using Forms 1094-C and 1095-C.

According to the IRS, these draft forms are intended to help stakeholders (including employers, tax professionals and software providers) prepare for these new reporting provisions.

These forms are draft versions only, and should not be filed with the IRS. In addition, these draft forms should not be relied upon for filing. The IRS may make changes to the forms prior to releasing final versions.

Read more here: Health Care Reform Bulletin

Know Your Benefits: Preventive Care

According to the U.S. Centers for Disease Control and Prevention (CDC), 7 out of 10 Americans die each year from chronic diseases, many of which are preventable. When preventive care is used and illnesses and diseases are caught early enough, individuals can avoid or better control their health problems.

But what exactly is preventive care?

Preventive care is a type of health care whose purpose is to shift the focus of health care from treating sickness to maintaining wellness and good health. Preventive care occurs before you feel sick or notice any symptoms and is designed to prevent or delay the onset of illness and disease. The CDC asserts that treatment for chronic diseases works best when they are detected early.

Read the full article to learn more about preventive care.

Supreme Court Rejects Contraceptive Mandate for Some Companies

On June 30, 2014, the U.S. Supreme Court issued its ruling in two related cases challenging the Affordable Care Act’s (ACA) contraceptive coverage mandate. In these cases, three closely held for-profit corporations—Hobby Lobby Stores, Mardel and Conestoga Wood Specialties—argued that they should not be required to comply with the contraceptive mandate, because covering certain types of contraceptives under their health plans violates their sincere religious beliefs.

Read the Health Care Reform Bulletin for more details.

Final Rule Released on ACA Waiting and Orientation Periods

The Affordable Care Act (ACA) provides that group plans or health insurance issuers offering group health insurance coverage may not apply any waiting period that exceeds 90 days.

On June 23, 2014, the Departments of the Treasury, Labor and Health and Human Services (the Departments) released final regulations clarifying the maximum allowed length of any “reasonable and bona fide employment-based orientation period” as it relates to the waiting period limit.

The final regulations apply to group health plans and group health insurance issuers for plan years beginning on or after Jan. 1, 2015. Until then, employers can comply with the proposed regulations issued earlier this year.

Read the Health Care Reform Bulletin for more information about the final rule on ACA waiting and orientation period.

HIPAA Security Risk Assessment (SRA) Tool

The Department of Health and Human Services (HHS), through its Office of the National Coordinator for Health Information Technology (ONC), has developed an interactive Security Risk Assessment Tool (SRA Tool) to assist covered entities in performing and documenting Health Insurance Portability and Accountability Act (HIPAA) security risk assessments.

Although HHS designed the SRA Tool for health care providers in small- to medium-sized offices, it is a helpful resource for all covered entities and business associates to review their implementation of the HIPAA Security Rule.

Learn more about the HIPAA Security Risk Assessment Tool.

Pay or Play: Penalties for Failing to Offer Dependent Coverage

Beginning in 2015, the Affordable Care Act (ACA) generally requires applicable large employers to offer affordable, minimum value health coverage to their full-time employees (and dependents) or pay a penalty. These employer mandate penalties are also known as “shared responsibility” or “pay or play” penalties.

On May 13, 2014, the Internal Revenue Service (IRS) released FAQs addressing consequences under the employer shared responsibility rules for applicable large employers that offer health insurance coverage to all full-time employees, but do not offer dependent coverage.

In general, an employer will potentially be liable for an employer shared responsibility penalty only if a full-time employee:

  • Enrolls in coverage through an Exchange
  • Receives a subsidy to help pay for the Exchange coverage

Whether or not one or more of its full-time employees’ dependents enrolls through an Exchange and receives a subsidy does not affect an employer’s liability.

Read the full Health Care Reform Bulletin to learn more about:

  • Liability for Employer Shared Responsibility Penalties
  • Transition Relief for Offering Dependent Coverage in 2014

Consequences of Reimbursing Individual Insurance Premiums

Affordable Care Act (ACA) reforms that took effect this year may make purchasing health insurance in the individual market more accessible. Due to these reforms and the rising costs of health coverage, some employers have considered helping employees pay for individual health insurance policies instead of offering an employer-sponsored plan.

On May 13, 2014, the Internal Revenue Service (IRS) issued FAQs addressing the consequences for employers that do not establish a health insurance plan for their employees, but instead reimburse employees for premiums they pay for individual health insurance (either inside or outside of an Exchange). These arrangements are known as employer payment plans. Read the full Health Care Reform Bulletin to learn more about:

  • Background on Employer Payment Plans
  • Consequences for Employers