It's just around the corner... open enrollment season is upon us.
Health care benefits are one of the greatest incentives corporations have to attract and retain talent. Every fall, America's corporations go through the annual ritual of offering and explaining benefits packages to employees. This year, 150 million people will select health care plans paid for by their employers. Companies will spend an average of $10,522 per employee for health care, open enrollment this year. That's $1 trillion worth of health care purchased at one time. Open enrollment is health care's trillion-dollar moment.
This year, however, selecting health care plans during open enrollment will be different. The Affordable Care Act (ACA) and its baked-in wellness incentives will play a major role in redefining corporate health care, adding elements of complexity unseen in years past. According to a new survey of HR Executives from Keas, enterprises are actually more ready for the changes than one might think -- 58 percent of responders have indicated that they are still on track to become ACA compliant by the original January 2014 deadline.
Among the complex policy changes, both health risks and lifestyle choices will impact premiums. Currently, tobacco use is the only lifestyle factor that the ACA allows to be considered in rating criteria, but many believe this will soon change to include a wider range of criteria. As it stands now, tobacco users will pay up to 1.5 times the premium of non-tobacco users. However, there are arguments in various dissenting states (such as California), that evaluating lifestyle choices to determine health care coverage is discriminatory -- something that the ACA will have to iron out in the future.
The ACA rules will continue to support the corporate participatory health and wellness programs that employees can choose to opt in to, such as reimbursement for gym memberships or rewarding employees for taking a health risk assessment. There are also newly amended standards for nondiscriminatory "health-contingent wellness programs," which include rewarding employees for achieving a specified weight or eliminating tobacco use.
While we can debate the fairness of the new rules there is no question that, for the first time, open enrollment will bring 'health' to health benefits and health care. The popularity of television programs such as The Doctors and The Biggest Loser, as well as innovative 'quantified self' gadgets like iHealth and Fitbit, are indicative that the overarching concept that 'health' is more relevant than ever before.
It's clear that Americans want to take control of their health, but what can their employers do to help create a culture of health and wellness? An additional survey find was that 60 percent of HR executives identified "lowering overall health care costs" and "improving overall employee health" as top priorities for 2014. Frankly, this is overdue, and the changes mandated by the ACA are positively impacting these priorities. It's one thing to promise these changes, and certainly another to deliver.
To achieve corporate goals of improving employee health and lowering costs, companies must provide resources to educate their work force about health care benefits and health-related programs that they've made available.
There are incentives for employers who achieve early adoption of and compliance with ACA policies, including adopting and offering health programs to employees. Some are jumping on board quickly, and are going the extra mile to link their employee health program with the open enrollment process to make the navigation process smooth, understandable, social, fun and engaging. This also makes HR's life easier, by spending less time hunting their employees down to complete the open enrollment process.
This year's open enrollment is a pivotal event in terms of cost, but also in terms of changing corporate and employee views about preventative health care. There's no doubt about it: Changing attitudes, influenced by the ACA, are truly putting the 'health' back in health care.
