When looking for a suitable benefits package, your client advisor works through an exhaustive checklist of considerations and requirements to ensure the plan you choose is optimal for your business, your employees, and their families. There are compliance regulations, carrier requirements, geographic restrictions, and more to consider when choosing a group health plan.

Whether you are shopping for group benefits for the first time or you are conducting your annual benefit review, here’s an overview of the most important details your advisor considers as well as some frequently asked questions we receive from our clients.

What are some considerations to keep in mind when choosing a plan?

1. The state you’re in geographically. For fully insured plans, the state a group is headquartered in generally drives what products are available. For example, groups with fewer than five employee lives in Ohio have more options than groups with fewer than five in Kentucky. It’s also a challenge if your company is headquartered in one state but all your employees live in another or if there are “pockets” of employees in other areas or states.

Believe it or not, it also matters what part of the state you’re in. There are regional players that can come into play along with “rating areas” that dictate costs in various parts of the state based on access to care and its cost.

2. Your group’s health. If there are serious, ongoing conditions in your covered population, the cost of those are factored into most options, except for Affordable Care Act (ACA) plans. This is called medical underwriting.

ACA plans are for groups with fewer than 50 employees (full-time plus part-time) and are guaranteed issue, which means that they are not medically underwritten so employer groups can purchase these plans regardless of health status. In some states, ACA options are predominantly all that are available.

Medical underwriting emerged in some states as a way for healthier groups to save premiums by banding together. Sponsored by Chambers or by trade associations, Multiple Employer Welfare Arrangements (MEWAs) have become fairly common in many states. For example, Ohio has four major MEWAs and counting, Indiana has several, and Kentucky has one.

All states have level-funded options available. Level-funded products are designed to give employer groups the benefits and advantages of self-funding, while limiting the disadvantages by offering a “pre-packaged” hybrid of self-insurance for small employers (down to five enrolled locally).

3. Group size. Options for quoting vary based on the average total number of employees (ATNE) for the prior calendar year, which includes full-time and part-time employees. This is how most carriers determine the quoting process and the products available.

• • Quote processes. Group size (ATNE) will also determine the process we follow for obtaining quotes and what information must be provided. Some carriers have been able to embrace census-only quoting, which uses a large database of claims history and algorithms to determine future costs with only basic information about a group. We call this census quoting. Census quoting generally requires the name, ZIP code, date of birth, gender, and coverage type for every member enrolling. This is often only available to groups of 10 or more enrolling. ACA quotes are also done with a member census for groups of two or more.
  • Products available. If you’re a group made up of either a husband and wife, sole proprietor, solely covering family members, or, owner-only coverage, this can limit your options. We have to ask a lot of nosy questions to figure out what you can be offered.
  • Participation. ACA rules require that, if you offer coverage as an employer, you have to offer it to all full-time, eligible employees working 30 hours or more. There are a handful of exceptions. We attempt to confirm this up front whenever possible. You might feel the questions are intrusive when you just want a quote; however, if possible, we try to determine up front if the option we present is even available to you.

How does medical underwriting work?

If the group is unsure of their population’s overall health or if they know they have a healthy group, your client advisor will need to get applications from all full-time employees so that they can present the group to underwriting to determine if the group is an acceptable risk for the carrier. If the group is not healthy or is declined by the carrier, don’t worry, we still have options.

How do we collect the applications?

We use a data collection site called FormFire. FormFire has each employee create their own account and then it will ask them a series of questions to set their account up and determine if they want to be included in the group quote or if they are waiving coverage. All full-time eligible employees complete the FormFire application. Once the entire group is complete, you just let your client advisor know and we will then send the requests for quotes to all appropriate carriers.

How long will it take to get quotes back?

Every carrier is different, and the time frame is different depending on the time of year you are looking for coverage. During the last three months of each year, it takes the longest to get quotes back as January 1 is the most common date for plans to start and carriers receive a lot more requests. Generally, we can start collecting medical applications as early as September for January 1 effective dates.

Once your quotes come back from the carriers, your client advisor will review each option for the best offers to review with you with a recommendation for what they feel will best fit your group. However, the decision is always yours. If you are able to decide on your plan within 30 days of its effective date, the client advisor will have enough time to conduct employee meetings and preparation of employee materials. For January 1 dates, we like to have decisions around Thanksgiving. If you decide later than that, you run the risk of having a longer “blackout period” where you’re waiting for benefits to be loaded.

From start to finish, we like to have at least 45 to 60 days to get a quote for you and set up your group with a new carrier or work with you on a renewal. If we are looking during the fourth quarter, it is best to start at least 60 to 90 days prior to when you want you plan to be effective.

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Group health insurance can be complicated and overwhelming, but your client advisor is there to help take the administrative load off of your plate. After all, you have a business to run.

If you’re interested in finding a health insurance plan for your group or if you’re considering a change, contact ARC Benefit Solutions today!

When offering employee benefits polices, it is crucial to review your monthly invoice to ensure your policy is up to date and that you and your employees are properly covered. Groups receive an itemized monthly invoice that includes the due date, the total premium amount due, past due amounts, and any fees that apply. It is important to check the accuracy of each monthly invoice and pay the premium amount listed on your bill. If you have made changes to your policy (adds, terminations, other changes), it’s important to review your invoice to ensure those changes are reflected. Many groups miss adding new hires to employer-paid coverage, such as disability income or life insurance.

A common policy for carriers is that you have a 30-day window to submit any enrollment changes to them for processing. If you have an employee that is newly hired on or leaves your company, then you have 30 days to submit the enrollment paperwork to the insurance carrier. If that enrollment paperwork is submitted after the 30-day window, it can cause administrative issues for the carrier’s billing department, as well as for you. In the case of an employee’s enrollment being sent more than 30 days after their effective date, the carrier could refuse to enroll the employee due to not being submitted in a timely fashion.

If the carrier does approve the enrollment, then they may either (1) retroactively add the for the original effective date, which results in a large invoice adjustment for you, or, (2) if the original effective date is long past, the carrier may only enroll the employee going back 60 days from the request date, which would result in a gap in coverage for the employee.

If the carrier decides to decline the enrollment request, then that employee would have to wait until the plan’s next Open Enrollment Period to then join the policy. Neither of these scenarios have positive impacts for the employee or for your business.

Another common situation that can arise with invoices is adding employees during the end of the month. Many carriers finalize their monthly invoices around the middle of the prior month (usually between the 10th to 15th). If you have an enrollment request that is close to or comes after when the carrier finalizes their invoice, then the enrollment change for that employee may not show up on the following month’s invoice. If it is a new enrollment, then you will typically see two months’ worth of premiums charged for that employee, resulting in a higher than normal invoice. In the event of an employee termination, the following month’s invoice would then display the appropriate credits for that termination.

Reviewing your invoices for accuracy is an important task and responsibility when offering employee benefits, not only for your business, but for your employees. It is recommended that you audit your invoices at least quarterly, if not monthly.

If you encounter any anomalies on your invoice, or if you have any questions, please contact your ARC client advisor for guidance.