Employer Strategies

On July 1 - when fee disclosure regulations go into effect - there may be questions about advisers trying to reduce their fees. They should keep in mind that in some cases a plan sponsor's ERISA counsel may perceive that action as an admission of guilt that previous fees may have been excessive or unreasonable.

Smaller employers have historically been hesitant to self-fund their health plans because they commonly perceive it as suitable only for large companies. Done right, self-funding an employee health benefit plan can be a smart long-term strategy.

There are questions about the future of the group long-term care market, as two insurers have stopped offering the product in the past 17 months.

While the ever-rising cost of health care continues to be a top concern for employers and employees alike, there is at least one employee benefit headed in the opposite direction. "I always facetiously use the phrase 'life is cheap,' says Bob Harnett, vice president of Lutherville, Md.-based Silberstein Insurance Group. "Life insurance on an employer-paid basis has gotten to be very inexpensive."

Ellen M.* is a 47-year-old single mom whose four-year-old son is diagnosed with something called pervasive development disorder not otherwise specified, a disorder on the autism spectrum. While he's very verbal, he sometimes struggles with expressing his needs. He has behavioral issues and several other medical issues, such as vision and gastrointestinal problems.

Enrollment in health savings accounts and health reimbursement arrangements continues to grow, but contribution patterns to these account-based health plans are changing, according to a new report from the nonpartisan Employee Benefit Research Institute.

ERISA defines a multiple employer welfare arrangement as an employee welfare plan or any other arrangement which is established or maintained for the purpose of providing welfare benefits to the employees of two or more "unrelated" entities. Thus, if a welfare plan is maintained by an employer for the exclusive purpose of providing benefits to that employer's employees, former employees (e.g., retirees) or beneficiaries (e.g., spouses, former spouses, dependents) of such employees, the plan will be considered a "single employer" plan and not a MEWA.

Information commonly exits in silos: Pharmacy benefit managers, health plans, and absence management, disability and enrollment vendors generally all operate independently and invisibly to other health care entities that are caring for the same population of patients.

For large, self-insured employers, vendor management involves identifying and negotiating better arrangements with third-party vendors who administer benefits. A report from The Advisory Board Company shows that while vendor management is often overlooked by plan sponsors, the process can yield savings of between 5% and 10%.

As more U.S. employers hire international workers or extend their organization into foreign locations, benefits and tax issues have grown increasingly complicated when managing international assignees. Further complexity arises depending on the type of employee or independent contractor. U.S. multinationals have begun to fill more key positions with talent in other nations or third-country nationals, who work a position in a foreign country from the U.S., but are not from the U.S. or that foreign country, rather than implanting American expats to international positions.