Important – ACA 1095 update

With 2017 rapidly approaching, last week we received some good news from the IRS. The IRS released, notice 1015-70 which highlights some of the changes to come with ACA’s information reporting. One of the biggest changes is a date extension.

Form 1095-B for Health Coverage and form 1095-C have been extended from January 31st, 2017 to March 2nd, 2017.


This won’t affect the employees’ ability to file their tax returns, but it does delay their receipt of the forms for their own records.

“This deadline was especially challenging because it coincided with Form 1099 and W-2 processing schedules,” said Mike Downey, executive vice president of BenefitScape. “A 30-day extension, while short, moves the printing and distribution to a more opportune time.”

It’s important to note, the filing deadlines remain unchanged, this is just an extension to furnish the forms to employees.  It’s still just as important for employers to get the rest of their filings completed on time, and trust me, this extra month will fly by.

There are only 21 business days left in 2016 and its filled with holiday closures. Your clients need to make their ACA compliance a top priority.

Self-Funded health plans, the new standard

self-funded-health-plans-the-new-standardDue to rising health insurance premiums, more and more employers are opting to self-fund their employee health benefit plans. According to a report done by the Employee Benefit Research Institute (EBRI) the percentage of U.S. private sector employers offering at least one self-funded health plan rose from 28.5 to 89 percent from 1996-2015. Small and midsize employers all over the country are opting out of their traditional benefit plans in favor of self-funding their employee health plans.

It is important to note that just from 2013 to 2015:

Small Employers rose from 13.3% to 14.2% and Midsize Employers rose from 25.3% to 30.1%.



It’s hard not to draw a connection between the implementation of the Affordable Care Act (ACA) and the increase in self-funded employers. Under the federal Employee Retirement Income Security Act of 1974 (ERISA), which provides the legal framework for the uniform provision of health benefits by employers doing business anywhere in the country, state laws (other than insurance laws) are generally pre-empted. This means that self-funded health plans may not have to satisfy state health insurance laws, including state-mandated reserve, benefit, claims, premium, and other requirements, which results in ease of administration and lower expenses. In contrast, fully insured plans are required to cover state mandated benefits and pay state insurance premiums.

Not only that but the ACA identifies 10 benefit categories that must be included as essential health benefits for fully insured small-group market plans. But self-funded plans are not required to cover each of these essential health benefits.

When self-funded arrangements are properly designed, like the ones FreedomCare offers, there are several ways an employer can benefit.

Help your clients join these savvy employers from around the country and take control over their plan by self-funding their employee health benefits. By choosing FreedomCare, we take the leg work out of self-funding, we handle all administration, paying of claims and reinsurance. The ease of a traditional plan with the value of self-funded.

Beyond the ACA, the top 5 reasons to offer employee’s health benefits

Beyond the ACA, top 5 reasons to offerThe Affordable Care Act has been around for several years now, the employer mandated penalties regulated by the IRS are in full effect. Most employers are offering at least Minimum Essential Coverage plans to their employees. If we look past the law, beyond the $2,000 and $3,000 penalties, why should employers offer health benefits to their employees?

It’s simple, one of the most vital components of running a successful business is attracting and keeping great employees. While there are different ways to accomplish this, offering your employees benefits tends to be one of the most cost-effective ways.

We’ve gathered the top 5 reasons for employers to offer coverage below.

  1. Attract top talent.

    • A survey by McKinsey Quarterly showed that attracting and retaining talent was the biggest reason that companies offered employee benefits. 46% of employees say their company’s health care program was an important reason they chose to work for their current employer. It helps to attract top talent by having tangible benefits that differentiate your business from your competitors.
  2. Minimize your turnover rate.

    1. It’s difficult for a business to make serious progress when employees are constantly coming and going. 55% of employees say their company’s health care program is an important reason they stay with their current employer. By investing in your employees and offering benefits, it shows that you have their best interest in mind and value their job performance. This also helps to improve your stability as a company.
  3. Better morale.

  4. Healthier employees.

    • When your employees have health coverage, there is a higher likelihood that they will have regular checkups and take preventative medical steps, which will lead to fewer unexpected sick days.
  5. Better job performance.

    • By offering benefits, you give employees more of a reason to care about your company and remain loyal. According to a survey done by the Society of Human Resource Management, 71% of employees who are satisfied with their benefits reported that they are more loyal to their employer. As a result, they will be motivated to work harder, which can lead to greater productivity and a higher quality of work.

These all sound like no brainers but what if my client’s company is barely scraping by and can’t afford health benefits from traditional carriers? Check out our article about self-insuring your health benefits, you might be surprised what a small business can afford with the help of FreedomCare.

Voluntary Benefits – A lifeline for the American worker

“Voluntary benefits have developed into a lifeline for the American worker, as employees seek to meet their needs for financial protection and benefits not provided as part of a group structure by employers.” - Rich Williams, senior vice president of growth markets at Colonial Life and Accident Insurance Co.

Voluntary Benefits - A lifelineIn a survey done by MetLife, nearly 40 percent of employees say a wide selection of benefits would make them feel more loyal to their employer, and 55.5% are willing to bear more of the cost in order to have a choice that meets their needs.

The top 4 Voluntary benefits for 2015 were:

  1. Life-Insurance
  2. Disability
  3. Dental
  4. Accident

With employee retention gaining importance to maintain the success of businesses, voluntary, employee-paid benefits give employers a way to offer a competitive benefits package without impacting their bottom line.

The problem is, voluntary benefit programs were previously primarily available to employees of large companies. Williams says, “Our research shows the concerns of their employees aren’t that much different than larger firms when it comes to personal finances. Employees in companies of all sizes tend to worry about having enough savings to retire, to cover an emergency or to cover being out of work if they’re injured or sick.”

Smaller employers no longer have to settle for small benefits packages. Here at FreedomCare, we have a large selection at different price ranges to fit an employer’s needs.

Telehealth – employee perk & innovative cost savings

Telehalth BlogTelehealth programs have the ability to connect patients with doctors no matter where they are located. Virtual visits, both by phone or online video chat, are more convenient and may be as effective as in-person doctor visits. Doctors and Therapists are able to diagnose and prescribe treatment without the patient having to leave their home.

The average number of telehealth visits per patient is 1.3 times per year. 5.6% of patients who used the virtual visits would otherwise have gone to an emergency department while 45.8% to urgent care. 83% of the conditions were resolved by a virtual visit. The most common diagnoses made during a telehealth visit are sinusitis, followed by cold/flu and UTIs.

These programs aren’t just convenient and cost-saving for employees. According to Modern Healthcare, “Advocates of the virtual-visit model argue that expanding access to telehealth services would reduce costs by heading off more expensive urgent care and emergency department care, and that consumers increasingly will substitute virtual visits for in-person visits.” This could mean fewer high-dollar urgent care and emergency room claims for an employer’s self-funded plan.

A 2014 Towers Watson survey found that 37% of employers planned to offer their workers telemedicine consultations in 2015, with another 34% planning to do so by 2017. FreedomCare has partnered with the leading telehealth providers to include unlimited 24/7 telehealth access, with many of our programs, to every employee at no additional cost. Give us a call to learn more.

7 tips to keep your top talent!

It’s expensive, time consuming and something all business owners struggle with..constant employee turnover. The service industry struggles the most with trying to instill loyalty and encourage their employees to stay more than a couple of months. As a business owner or manager, what can you do to change that? Here are 7 ways you can change your habits to reduce turnover and hang on to your top talent.

  1. Be choosy with who you hire.

    • Before you can even think about keeping your employees, you have to make sure you’ve hired the right people to begin with. Be sure to interview and vet candidates carefully, you want to make sure they fit well with the company culture, managers and co-workers.
  2. Offer a benefits package.

    • A salary isn’t always the deciding factor when employees begin to seek employment elsewhere. Many times they are looking for health benefits. Providing health insurance, life insurance and even a retirement savings plan can increase loyalty. Check out our previous blog, “Could the employer mandate help you reduce turnover?” for more.
  3. Provide a comfortable working environment and culture.

    • Employees want and need to feel safe and comfortable at work. Your culture needs to match your industry, engage your employees, and motivate them.
  4. Offer preventative and wellness programs.Offer preventative and wellness programs

    • Many companies have instituted wellness programs to engage their employees and encourage a healthier workforce. Doing so can also reduce your claims on self-insured health benefits plans.
  5. Offer training.

    • According to Human Capitalist, 76% of employees want on-the-job training. Offering skills enhancement to all of your workers can help employees to feel appreciated and allows them to have a future within your company. New technology, new selling techniques, changes in employment laws, and the ever changing internet are all great reasons to encourage your employees to continue their education.
  6. Offer additional benefits for purchase.shutterstock_29717131

    • Offering limited medical, dental, vision, accident, critical illness and more can make your employees feel like they have options when it comes to their health. This can relieve a lot of the burden off of the employer having to provide expensive health plans.
  7. Recognize their accomplishments.

    • Praise goes a long way. Recognizing the accomplishments of employees creates loyalty and trust. This could be a simple thank you or a handwritten note. Praising employees for completing performance goals is one of the most effective ways to make them feel appreciated, which will make them want to stay with you for the long haul.

A lot of these tips sound expensive but one thing you can start with is self-insuring your health benefits plan. That one step will separate you from other employers competing for the same talent. Not sure how to even begin? Give FreedomCare a call today.

Seasonal Workers and Seasonal Employees – Clarifying Misunderstood Terms

Seasonal Workers & Seasonal Employees

Summer is here and that means the agricultural season will soon be in full swing. Unfortunately, we have heard of several non-compliant strategies being implemented throughout the agriculture industry. Part of the confusion is being generated from two terms with distinct meanings under the Affordable Care Act (ACA): seasonal workers and seasonal employees. The purpose of this article is to review the difference between seasonal workers and seasonal employees and to explain when each definition is applicable to an employer.

A seasonal worker is an employee who performs labor or services on a seasonal basis. The final regulations state this definition includes retail workers employed exclusively during holiday seasons and workers covered by 29 CFR 500.20(s)(1). A worker is covered by 29 CFR 500.20(s)(1) if ordinarily, the employment is of the kind exclusively performed at a certain period of the year and which, from its nature, may not be continuous or carried on throughout the year. A worker can still be covered by 29 CFR 500.20(s)(1) (and thus still be considered a seasonal worker) if the worker moves from one seasonal activity to another even if the worker is employed during a major portion of the year. Employees with comparable positions to the two examples included in the final regulations can also qualify as seasonal workers so long as the employer is making a reasonable, good faith interpretation of the term.

Seasonal workers are only applicable for the seasonal worker exception which determines if an employer is an Applicable Large Employer (ALE). Only employers who are ALEs have to comply with the Play or Pay Mandate. For the seasonal worker exception to apply an employer must satisfy two requirements:

  1. The employer must not be in excess of 50 full-time employees (including FTEs) for more than 120 days in the preceding calendar year; and
  2. The employees employed during the period that is no more than 120 days who cause the employer to exceed 50 full-time employees (including FTEs) must be seasonal workers.

If these conditions are satisfied, the employer will not be an ALE despite averaging 50 or more full-time employees (including FTEs) throughout the preceding calendar year. The seasonal worker definition is not relevant for any other determination under the ACA.

A seasonal employee is defined in the final regulations as “an employee who is hired into a position for which the customary annual employment is six months or less.”   The preamble to the final regulations provides further context to the definition saying the period that is six months or less should begin in approximately the same part of the year, such as summer or winter.

The seasonal employee definition can be broken into the following two factors:

  • The position must typically last for a period of six months or less; and
  • The position must begin in roughly the same part of the calendar year.

The seasonal employee is unique compared to part-time, variable hour, and full-time employees (the only other classification options for new employees) because it does not factor in an employee’s hours of service. A seasonal employee could work 80 hours a week and still be classified as a seasonal employee so long as the two factors discussed above are true. If an employee is classified as a seasonal employee, the employee is placed into an initial measurement period and treated the same way as a part-time or variable hour employee.

Employers need to be careful with the distinction between seasonal workers and seasonal employees. Remember, seasonal workers are only relevant for determining if an employer is an ALE. Seasonal employees are only relevant when determining if a new employee can be placed into an initial measurement period. However, make sure an employee classified as a seasonal employee meets the two criteria discussed above. Currently, there are no correction procedures for misclassified employees so an employee who is misclassified as a seasonal employee could trigger huge fines for an employer.