More Insurers Scale Back on Prior Authorizations

Some of the nation’s largest insurers have announced plans to roll back their prior authorization requirements for medical services, and some are doing this in their Medicare Advantage plans as well.

The moves come as states and the Centers for Medicare and Medicaid Services are implementing rules that aim to streamline prior authorizations for Medicare Advantage plans.

Prior authorization — or prior approval — has always been a thorn in the side of patients, often keeping them from accessing care in a timely fashion. The moves by these insurers come after the CMS announced earlier this year that it would require health insurers to automate prior authorization and return decisions more quickly.

These developments are good news for Medicare Advantage enrollees and should improve their health care experience and access to timely care. Many of these changes took effect immediately and some will start in 2024.

While original Medicare, including Part A, rarely requires prior authorization, Medicare Advantage plans, which are often preferred provider organizations and health maintenance organizations, may require it for certain procedures.

Under prior authorization, doctors and other health care providers must obtain advance approval from a health plan to qualify for coverage before they deliver a specific service to the patient. Health insurers have lists of services that require prior approval, in order to control their costs.

Nearly all Medicare Advantage enrollees (99%) are in plans requiring prior authorization. Often, the prior authorization is for more expensive services, such as an MRI or being transferred from a hospital to a skilled nursing facility.

In 2021, 6% — or 2 million Medicare Advantage prior authorization determinations — were denied, according to a report issued by the Kaiser Family Foundation in February 2023.

What insurers are doing

Here are what a few of the nation’s largest health insurance players are doing:

  • Cigna — In August 2023, Cigna announced with immediate effect that it would no longer require prior approvals for nearly 25% of medical services, and it plans to cut another 500 or so codes that require prior authorization for its Medicare Advantage plans before the end of this year.
  • UnitedHealthcare— UnitedHealthcare, starting in Spring 2023 and lasting through the end of the year, aims to eliminate almost 20% of its current prior authorizations. It also plans to eliminate a code for cardiology stress test prior authorization for Medicare Advantage members, eliminating the need for some 316,000 prior authorization requests a year.
  • Aetna — In 2022, The insurer rolled back prior authorization requirements on cataract surgeries, video EEGs and home infusion for some drugs. Aetna said that it had also reduced automated prior authorizations by more than 10% in 2022, with plans to more than double that this year, according to press reports.

States, regulators taking action

Three states — Louisiana, Michigan and Texas — already have “gold card” laws on their books that except from prior authorization rules certain doctors whose requests are routinely approved. This year, another 24 states have introduced similar legislation, according to a report by the Wall Street Journal.

Meanwhile, in April 2023, the Biden administration implemented a final rule designed to ensure people with Medicare Advantage plans get access to the same necessary care — prescriptions, medical tests, equipment and procedures — as they would receive in traditional Medicare.

The new rules, which require that plans automate their prior approval procedures, are slated to take effect in 2024. The final rule also requires that approval of a prior authorization request for a course of treatment must be valid for as long as medically reasonable and necessary to avoid disruptions in care. 

The new rules would also prevent patients from having their medical care discontinued just because they’ve switched Medicare Advantage plans or moved from traditional Medicare to Medicare Advantage.

EEOC Posts New Guidance on Visual Disabilities under the ADA

The Equal Employment Opportunity Commission has issued new guidance for employers to provide reasonable accommodations for visually impaired workers who request it.

About 18.4% of all American adults have at least some difficulty with their vision, even when wearing corrective lenses, according to the U.S. Centers for Disease Control and Prevention.

The new guidance addresses what employers who have a vision-impaired job applicant or worker can and can’t do under the Americans with Disabilities Act and what to do if they request, or if you want to offer them, specific accommodations to help them perform their jobs better and more safely (or help them complete the application process).

Under the ADA, if a worker with a disability asks for accommodation so they can better perform their job, their employer must enter into an interactive process with them to discuss ways that accommodation would be possible. You do not have to provide accommodation if doing so would be an “undue hardship.”

Here are the main points of the EEOC guidance:

Reasonable accommodation

The guidance lays out a number of accommodations that employers can provide for workers or job applicants with visual impairments, including:

  • Guide dogs,
  • Assistive technology, including:
    • Screen readers (or text-to-speech software). These are software applications that can convert written text on a computer screen into spoken words or a Braille display. These tools can allow individuals to quickly review written text.
    • Optical character-recognition technology that can create documents in screen-readable electronic form from printed ones, including an optical scanner (desktop, handheld or wearable).
    • Systems with audible, tactile or vibrating feedback, such as proximity detectors, which can alert individuals if they are too close to an object or another person.
    • Website modifications for accessibility. This entails taking steps to ensure that job applicants and employees can access and timely complete job applications, online tests or other screening tools.
  • Documents in Braille or large print.
  • Ambient adjustments (such as brighter office lights); and sighted assistance or services (such as a qualified reader).

Asking about vision impairment

According to the new guidance, applicants are not required to disclose they have any type of vision impairment or disability unless they are seeking a reasonable accommodation to assist with some aspect of the application process, such as a larger font or Braille on the written application.

Employers cannot generally ask questions about obvious vision impairment. However, if you “reasonably believe” the applicant will need an accommodation to perform the job, you may ask if one is needed, and if so, what type.

For example, if a job applicant uses a white cane when entering the room for a job interview, you can ask if they would need a reasonable accommodation in the workplace.

Once someone is hired or after they’ve received an offer, you may ask certain questions such as:

  • How long the applicant has had the vision impairment.
  • What, if any, vision the applicant has.
  • The applicant’s specific visual limitations and what reasonable accommodations may be needed to perform the job.

The takeaway

The EEOC guidance is expansive, and this article focuses on the main parts of it. Among the other areas it covers are:

  • How an employer should handle safety concerns about applicants and employees with visual disabilities.
  • How an employer can ensure that no employee is harassed because of a visual disability.
  • The importance of keeping medical records of workers with a vision disability confidential.
  • How to avoid discriminating against individuals who are vision-impaired.

Finally, considering that nearly one in five U.S. adults has some form of visual impairment, this guidance aims to help employers find a solution for reasonable accommodation. Many accommodations can be implemented with little cost to a business.

If you have questions about the new guidance, please call us.

Group Health Plan Affordability Level Cut Significantly for 2024

The IRS has significantly reduced the group plan affordability threshold — which is used to determine if an employer’s lowest-premium health plan meets the Affordable Care Act rules — for 2024.

The threshold for next year has been set at 8.39% of an employee’s household income, down significantly from 9.12% this year. The lower threshold will likely require employers to reduce their employees’ premium cost-sharing level for their lowest-cost plans in 2024, to avoid running afoul of the ACA.

This is happening just as group health plan premiums are expected to climb at a much faster clip in 2024 than the last three years.

Under the ACA, “applicable large employers” — that is, those with 50 or more full-time or full-time equivalent employees (FTEs)— are required to offer at least one health plan to their workers that is considered “affordable” based on a percentage of the lowest-paid employee’s household income.

The lowest level yet

The new level is the lowest affordability threshold since the ACA took effect, and almost one-and-half percentage points lower than the 9.89% threshold in 2021. The new threshold will apply to all health plans when they incept in 2024. For plans that incept after Jan. 1, the 2023 threshold will apply and change to the new rate when they renew later in the year.

Employers can rely on one or more safe harbors when determining if coverage is affordable:

  • The employee’s W-2 wages, as reported in Box 1 (at the start of 2022).
  • The employee’s rate of pay, which is the hourly wage rate multiplied by 130 hours per month (at the start of 2022).
  • The federal poverty level.

Example: The lowest-paid worker at Company A earns $25,987 per year. To meet the 2024 affordability requirement, they would have to pay no more than $2,180 a year in premium (or $181 a month).

Employers with a large low-wage workforce might decide to utilize the federal poverty level ($14,580 for 2024) affordability safe harbor to automatically meet the ACA affordability standard, which requires offering a medical plan option in 2024 that costs FTEs no more than $101.94 per month.

If an employee’s coverage is not affordable under at least one of the safe harbors and at least one FTE receives a premium tax credit for coverage they purchase on an ACA exchange, the employer may have to pay a penalty, known as the “employer shared responsibility payment.”

The shared responsibility payment for 2024 will be $4,460 per employee that receives a premium subsidy on an exchange, up from $4,320 this year.

The takeaway

As 2024 nears, you should review your health plan costs and premium-sharing to ensure that your lowest-cost plan complies with the affordability requirement.

We can help you assess affordability to ensure you don’t run afoul of the law. It will be particularly crucial in 2024, considering the significant drop in the threshold.

Report: Group Health Plan Cost Inflation to Pick Up Steam

A new report by Aon warns employers to expect average group health insurance costs to increase 8.5% in 2024, as inflation starts hitting the cost of delivering care as well as pharmaceuticals.

The report predicts that employers will pay an average of $15,088 in 2024, compared to the average this year of $13,906. The cost hike is almost double the 4.5% increases employers saw in 2022 and 2023.

Despite the large expected premium increases, employers still seem to be reluctant to pass on more of the premium cost to their covered workers. For example, for this year, employees saw their premium payments increase an average of just 1.7%.

The challenge will be for employers to properly budget for these cost increases, while not pushing too much of the hike onto their employees, particularly in this highly competitive job market.

The cost drivers

There are a few reasons rates are climbing:

Health care inflation — This is the main culprit behind the expected rate hikes. While health care providers have been contending with inflation since 2021, they’ve been unable to pass them on to health insurers because they usually enter into three-year contracts with locked-in rate hikes.

As these contracts are renewed, health care providers are demanding higher fees for services due to their own costs increasing, particularly for staff wages, equipment and supplies. For example, the cost of emergency services supplies, including ventilators, respirators and other critical equipment, increased by almost 33% between 2019 and 2022.

New technologies — New technologies that hospitals use are also increasing in cost, as is the cost of servicing and installing the equipment.

Catastrophic claims — Every catastrophic claim requires varying levels of intervention and care. Many will require specialized medical care, extensive rehabilitation, advanced medical equipment and potential vehicle and home modifications. Catastrophic claims costs are increasing due to:

  • Hospital staffing shortages
  • More high-cost injectable drugs
  • Increasing cancer rates
  • Longer hospital stays resulting from multiple conditions, complications and complex procedures
  • Higher medical equipment costs
  • Skyrocketing costs of home modifications.

Pharmaceutical costs — There are two significant drug cost drivers:

  • Specialty drugs: These are significantly more expensive than their traditional drug counterparts, often costing more than $2,000 per month per patient. However, some pharmaceuticals cost much more. The drug Tretinoin, which can help manage complications of leukemia, costs $6,800 a month. Others cost upwards of $100,000 per year. The cost and utilization of these drugs is growing, according to Aon.
  • New weight-loss drugs: The newest pharmaceutical cost driver is the proliferation of trendy new weight-loss drugs like Wegovy, Saxenda and Ozempic, which cost more than $1,000 a month. These have proven to be highly effective in helping people lose weight and are in high demand. Insurers typically won’t cover these medications if someone simply wants to lose weight, though.

Cost-shifting hesitation

The report predicts that employers will be hesitant to make significant changes to how much their employees contribute to their health plan premiums.

Aon estimates that the average employee premium contribution in 2023 is $2,682, while they pay out another $1,993 in deductibles, copays and coinsurance.

“We see employers continuing to absorb most of the health care cost increases,” Farheen Dam, North American Health Solutions leader at Aon, said. “In a tight labor market, plan sponsors are hesitant to shift significant cost to plan participants and make benefits less affordable.”

Talk to us about your options as 2024 approaches. We can help you with different plan designs and cost-sharing arrangements that may reduce your firm’s premium outlays.

Budgeting and Prepping for Open Enrollment

If you are running a business, you need to get an early start on preparations for your small group health plan open enrollment, particularly now as so much confusion abounds about the state of health insurance in the country.

With recent new regulations, options have changed for employers and you need to stay focused on maximizing your outcomes within your budget. You also want to drive participation, as that too can reduce overall rates for you.

Understand your options

Familiarize yourself with the various options that you have:

Health maintenance organizations – HMOs are typically the least expensive plans because they require enrollees to visit their personal physicians and tightly controlled in-network doctors. Going out of network is discouraged with high out-of-pocket costs. An HMO will usually only pay for care outside of the plan network when it’s an emergency or another unusual situation.

Preferred provider organizations – PPOs contract with hospital and provider networks to help control costs. While they will cover services outside of the network, the cost is higher than going in-network. PPOs are more flexible than HMOs, but premiums are often higher – as are some out-of-pocket costs.

One difference from an HMO: PPO enrollees don’t need a referral from their primary care physician if they are going to a specialist.

Point of service – A POS health plan is a mix between an HMO and a PPO-style health insurance policy. With a POS health plan, your staff has more choices than with an HMO, but they will usually need to select a primary care provider and need a referral to see a specialist.

Exclusive provider organizations – The EPO is also a PPO-HMO hybrid. Enrollees need to receive covered services inside of the network, except in a few instances, but they can also see a specialist without a referral from their primary care doctor. 

Besides the above, you will also need to decide if you want to reduce the premium for your organization and staff by offering high-deductible health plans. These plans can be either an HMO or a PPO, but they have the same feature of having a high deductible that needs to be met before benefits really kick in.

For 2024, for a plan to qualify as an HDHP the deductible must be at least $1,400 for an individual and $2,800 for a family. The average HDHP deductible is $2,349, but many plans exceed $3,000.

These plans usually have an attached health savings account to which your workers can transfer funds pre-tax from their paychecks to use for paying deductibles, copays and other medical expenses.

Check your budget

In 2022, group health insurance premiums averaged $659 a month ($7,911 annually) for single coverage, and $1,872 per month – or $22,463 per year – for a family, according to a survey of employers by the Kaiser Family Foundation.

You can reduce your premium outlays by imposing higher premium cost-sharing requirements on your staff. But, make sure you stay within the guidelines of the Affordable Care Act, which requires that plans be “affordable,” meaning they cannot cost more than 9.12% (in 2023) of an employee’s household income. This number changes each year, and the percentage has not yet been set for 2024.

Be mindful, though: if you try to unload too much of the premium on your workers, you may see people leave your plan and, if too many decide not to participate, you may not be able to offer the policy. Try to offer plans that will be valuable to your staff as well as affordable.

Maximizing enrollment

If you want to find out what your employees expect from their benefits, you can run a survey of all your staff. It can cover the basic elements of the plans you are going to choose from, and ask them which ones they would find most valuable. Then, move forward organizing your plan based on their response.

Your goal is maximum participation, and you can work with us to start disseminating materials and reaching out to those who may need plans explained to them. Give them some time to look the plans over. Employees want to know what changes are being made to their benefits packages in advance, so make sure you give them time to look through the offerings.

Next, plan to hold a meeting a month before open enrollment starts, in order to go over the plans and options with your staff, as well as any significant changes you’ve made.

During the meeting, highlight the value of each of the plans you are offering. Unfortunately, there will be those among your staff that haven’t really paid attention at all to the plan documents you gave them earlier.

Focus on the basics:

  • What each plan costs them.
  • What’s covered under the plan, and
  • When and how to use it.

Handling Health Insurance for Remote Workers

Since the COVID-19 pandemic, more employers are allowing their staff to work remotely on a permanent basis, often allowing them to never have to set foot in the office again.

This newfound freedom for American workers has allowed many of them to leave the cities they were living in for small towns or even more remote areas around the country. But for employers who have instituted work-from-home policies, they are faced with navigating a more confusing employee benefits landscape.

This is becoming more common as more people work from home. The ranks of remote workers have boomed in recent years, increasing to 27.6 million (or 17.9% of the working population) in 2021 from 9 million (5.7%) in 2019, according to the 2021 “American Community Survey” conducted by the U.S. Census Bureau. 

Employers will typically purchase group health insurance with networks that are mainly local or regional. This makes sense for a company with one location or multiple locations in a city or region, since all the employees will be living near work.

But when an employee moves, they can’t take the network with them, and the employer will need to make new coverage arrangements.

If you allow your employees to work remotely, you have a few options for those who plan to move out of state.

The PPO option

If they are currently enrolled in a health maintenance organization, they would have to give up their plan, since HMO plans contract just with medical providers in a specific area. Preferred provider organizations also have networks with which they contract, but some of the nation’s largest PPOs offer more flexibility.

The main thing is having a way out of the HMO contract, as that usually requires a “qualifying event.” If an employee moves out of state or out of an HMO’s service area, that would likely be considered a qualifying event to allow them to choose a new health plan.

The answer for most employers is to place the worker in a nationwide PPO. One of the most common choices is Blue Cross/Blue Shield because of the breadth of its coverage. But some other large players may also offer a good PPO plan that can be used anywhere in the country.

As your health insurance broker, we can help you with this process and ensure that your employees are set up with coverage, wherever they are moving.

Another option

Some employers are taking another approach to out-of-state remote workers. They are setting up individual coverage health reimbursement arrangements (ICHRA), which they fund with pre-tax money that the employees can use to purchase a health plan on an Affordable Care Act exchange.

ICHRAs were made legal during the Trump administration to give employers another option for helping their workers secure health coverage. Some ICHRA administrators are also available to help ensure that the contributions comply with the ACA affordability test and to help plan enrollees choose coverage that is best for them.

Employees moving out of state?

During your next open enrollment, if you have workers who live out of state, you’ll want to ensure they have a plan that they can use in their area. If they are already enrolled in a PPO, that’s a good start, as they are more likely to have dispersed networks.

We can help you review your current plan offerings, and in particular your PPOs. We’ll look for PPOs that have networks that allow enrollees to use in-network benefits in any state.

It’s important that you have a policy requiring your remote staff to notify you if they plan to move out of state, so you can start the process of changing health plans. Both you and the employee (and their family) will want to ensure that they have continuity of coverage if they move.

SCOTUS Sets High Bar for Rejecting Religious Accommodation Requests

A recent decision by the U.S. Supreme Court will make it more difficult for employers to deny employees’ requests for religious accommodations in the workplace.

The unanimous decision by the court in the case of Groff vs. DeJoy basically upends a standard for accommodating religious beliefs that has been in place since 1977.

The case concerns a mail carrier who asked not to work on Sundays due to his religious beliefs, after his employer, the U.S. Postal Service, contracted with Amazon to deliver its packages on Sundays.

The ruling will require that employers take a new approach to handling their employees’ requests for religious accommodations in the workplace. Legal experts say the decision could spur a slew of new requests as well as renewed ones from employees whose requests had been declined.

The case

When mail carrier Gerald E. Groff’s U.S. Postal Service location started requiring its staff to work on Sundays to fulfill the Amazon contract, he was able to swap shifts with co-workers. But they grew resentful and stopped swapping shifts with him. After a number of shifts went unfilled, the USPS informed him that it could not reasonably accommodate his request not to work on Sundays.

Groff quit and sued U.S. Postmaster General Louis DeJoy alleging Title VII religious discrimination and the case made its way to the Supreme Court, which sided with him in his appeal.

In its decision, the court wrote that an employer must accommodate an employee’s religious practice as long as the proposed accommodation does not create “substantial increased costs in relation to the conduct of [the company’s] particular business.”

The decision jettisons a standard that has been in place since SCOTUS’s 1977 decision in Trans World Airlines, Inc. vs. Hardison: That if making accommodation constitutes more than a de minimis cost to the employer, then the request was considered an “undue hardship” and the employer could deny the request. Even the Equal Employment Opportunity Commission deferred to this standard.

How it changes the equation

“Substantially” increasing costs in relation to the company’s operations is a significantly higher bar and burden of proof for employers that reject religious accommodation requests.

One of the key takeaways from the decision is that employers must explore all of their options, like voluntary shift-swapping.

It also warned that “a hardship that is attributable to employee animosity to a particular religion, to religion in general, or to the very notion of accommodating religious practice cannot be considered ‘undue.'” In other words: If other employees don’t like the fact that their colleague is getting a certain day off, that is no excuse for denying the request.

In light of this ruling, you should revisit your workplace policies for dealing with religious accommodations. If you receive a request and are unsure how to proceed, consider consulting with counsel.

New Mental Health Parity Rules Would Expand Care

With mental health in the forefront as patients demand greater access to psychologists and psychiatrists, the Biden administration in July 2023 proposed new regulations aimed at requiring health insurers to expand their mental health coverage.

The proposal aims to bring insurers into compliance with existing law requiring that they cover mental health benefits in parity with physical health services.

Despite that law, many insured Americans struggle to access mental health care, often because they need a referral or a health plan does not have enough psychologists and psychiatrists in its network, forcing them to go to providers outside of the network and paying significantly more.

It’s hoped that by adding new provisions that would require insurers to regularly assess how well they are complying with the law, it will be easier to receive in-network mental health care. Additionally, the rules aim to eliminate barriers that keep people from accessing such care when they need it.

The Mental Health Parity and Equity Act has been on the books since 2007, but the COVID-19 pandemic provided the spark that ignited a brewing mental health crisis in the country. The sudden demand for counseling services caught insurers off guard with too few providers in their networks.

As well, many people who needed mental health services were unable to get them due to their insurers’ sometimes onerous prior authorization requirements. In announcing the rule, the administration cited an example of insurers approving nutritional counseling for diabetes patients, but not for people with eating disorders.

The regulations — proposed by the Departments of Health and Human Services, Labor and Treasury — would:

Require health plans to measure outcomes to make improvements. The rules require insurers to regularly analyze their coverage requirements to make sure their insureds have equivalent access between their mental health and medical benefits as required by law. The insurer will need to evaluate:

  • How much it pays out-of-network providers,
  • How often prior authorization is required, and
  • The rate of denials for prior authorization requests.

The goal is to help insurers identify areas where they are failing to meet the law’s requirements and require that they take steps to remedy those shortfalls, such as adding more mental health professionals to their networks or reducing red tape to get access to them.

Stipulate what health plans can and cannot do. The proposed rules will provide specific examples that make clear that health plans cannot use more restrictive prior authorization, other medical management techniques, or narrower networks that make it harder for people to access mental health and substance use disorder benefits than physical medical benefits.

The proposal would require health plans to use similar factors in setting out-of-network payment rates for mental health and substance use disorder providers as they do for medical providers.

The takeaway

The proposed rule is good news for any of your staff that have been having a hard time accessing mental health or substance abuse services.

The regulators are hoping that the legislation achieves their goals of:

  • Making mental health care accessible to more people,
  • Ensuring that mental health professionals’ pay is comparable to that of physical medicine practitioners, and
  • By ensuring comparable pay and boosting demand, attracting more individuals to pursue careers in mental health professions to increase the number of mental health providers.

The proposed regulations still need to be put out for public comment and will likely be changed as the agencies get to work writing the final version.

Budgeting and Prepping for Open Enrollment

If you are running a business, you need to get an early start on preparations for your small group health plan open enrollment, particularly now as so much confusion abounds about the state of health insurance in the country.

With recent new regulations, options have changed for employers and you need to stay focused on maximizing your outcomes within your budget. You also want to drive participation, as that too can reduce overall rates for you.

Understand your options

Familiarize yourself with the various options that you have:

Health maintenance organizations – HMOs are typically the least expensive plans because they require enrollees to visit their personal physicians and tightly controlled in-network doctors. Going out of network is discouraged with high out-of-pocket costs. An HMO will usually only pay for care outside of the plan network when it’s an emergency or another unusual situation.

Preferred provider organizations – PPOs contract with hospital and provider networks to help control costs. While they will cover services outside of the network, the cost is higher than going in-network. PPOs are more flexible than HMOs, but premiums are often higher – as are some out-of-pocket costs.

One difference from an HMO: PPO enrollees don’t need a referral from their primary care physician if they are going to a specialist.

Point of service – A POS health plan is a mix between an HMO and a PPO-style health insurance policy. With a POS health plan, your staff has more choices than with an HMO, but they will usually need to select a primary care provider and need a referral to see a specialist.

Exclusive provider organizations – The EPO is also a PPO-HMO hybrid. Enrollees need to receive covered services inside of the network, except in a few instances, but they can also see a specialist without a referral from their primary care doctor. 

Besides the above, you will also need to decide if you want to reduce the premium for your organization and staff by offering high-deductible health plans. These plans can be either an HMO or a PPO, but they have the same feature of having a high deductible that needs to be met before benefits really kick in.

For 2024, for a plan to qualify as an HDHP the deductible must be at least $1,400 for an individual and $2,800 for a family. The average HDHP deductible is $2,349, but many plans exceed $3,000.

These plans usually have an attached health savings account to which your workers can transfer funds pre-tax from their paychecks to use for paying deductibles, copays and other medical expenses.

Check your budget

In 2022, group health insurance premiums averaged $659 a month ($7,911 annually) for single coverage, and $1,872 per month – or $22,463 per year – for a family, according to a survey of employers by the Kaiser Family Foundation.

You can reduce your premium outlays by imposing higher premium cost-sharing requirements on your staff. But, make sure you stay within the guidelines of the Affordable Care Act, which requires that plans be “affordable,” meaning they cannot cost more than 9.12% (in 2023) of an employee’s household income. This number changes each year, and the percentage has not yet been set for 2024.

Be mindful, though: if you try to unload too much of the premium on your workers, you may see people leave your plan and, if too many decide not to participate, you may not be able to offer the policy. Try to offer plans that will be valuable to your staff as well as affordable.

Maximizing enrollment

If you want to find out what your employees expect from their benefits, you can run a survey of all your staff. It can cover the basic elements of the plans you are going to choose from, and ask them which ones they would find most valuable. Then, move forward organizing your plan based on their response.

Your goal is maximum participation, and you can work with us to start disseminating materials and reaching out to those who may need plans explained to them. Give them some time to look the plans over. Employees want to know what changes are being made to their benefits packages in advance, so make sure you give them time to look through the offerings.

Next, plan to hold a meeting a month before open enrollment starts, in order to go over the plans and options with your staff, as well as any significant changes you’ve made.

During the meeting, highlight the value of each of the plans you are offering. Unfortunately, there will be those among your staff that haven’t really paid attention at all to the plan documents you gave them earlier.

Focus on the basics:

  • What each plan costs them.
  • What’s covered under the plan, and
  • When and how to use it.

Report: Accommodations for Disabled Employees Are Inexpensive

The Americans with Disabilities Act, now more than 30 years old, requires employers to make reasonable accommodations for employees with disabilities. Many employers may be concerned about the cost of making those accommodations. However, a recent government study shows that the costs are typically minimal or non-existent.

The report, from an office of the U.S. Department of Labor, shows that the median cost of an employee accommodation was $300. The data came from a survey of more than 3,500 employers taken between 2019 and 2023.

The employers were in a variety of industries and comprised sizes from small to Fortune 500. Each of them contacted the department for information about workplace accommodations, the ADA, or both.

The report’s key findings are:

  1. More than half of the contacts were from an employer trying to retain an employee. On average, these were employees who had been on the job more than six years, with an associate college degree or better, and who earned $18 an hour or more.
  2. Almost half the employers reported that the workplace accommodations cost them nothing. Another 43% reported incurring a one-time cost, and the median cost was $300. Only one out of 14 incurred ongoing annual costs, with the median cost at $3,750.
  3. The accommodations worked. More than two-thirds of the employers surveyed said that they were very or extremely effective. Another 18% found them to be somewhat effective.
  4. Employers enjoyed several direct and indirect benefits from the accommodations. The direct benefits included:
  • Improved employee retention
  • Increased employee productivity
  • Increased employee attendance
  • Reduced new hire training costs
  • Increased diversity
  • Reduced insurance costs
  • Better new hires.

Indirect benefits included:

  • Improved interactions with the employee
  • Safer workplace
  • Better workplace morale
  • Better interactions with customers
  • Better company productivity
  • Better overall attendance.

Successful accommodations

The report gave examples of successful employer accommodations involving:

  • Employees suffering fatigue from long COVID. One employer provided frequent short breaks. Another agreed to a four-day work schedule. Neither reported direct costs.
  • A visually impaired employee suffering eye strain from using a computer to write reports. The employer purchased $600 dictation software.
  • A health care worker suffering from anxiety and attention deficit hyperactivity disorder (ADHD) was distracted by co-worker and patient noise. The employer spent $250 on noise-canceling headsets.
  • A grocery store permitted a clerk to bring a service animal to work at no cost.
  • For $150, an employer provided a one-handed computer keyboard for an employee who had lost the use of a hand.

Takeaways

Reasonable accommodations for disabled employees may be less expensive than you fear.

With some flexibility and perhaps the outlay of small amounts of money, you can attract and retain valuable employees, make your business more productive, hold down workers’ compensation costs, and give your business a reputation as a great place to work.

Employers who need help designing accommodations should contact the Labor Department’s Job Accommodation Network. At little or no expense, you can gain an edge in the war for talent.

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