I still laugh out loud when I see clips of Will Ferrell's impression of George W. Bush in an old "Saturday Night Live" skit depicting the presidential debates of the 2000 election. When asked by the mock debate moderator to share his best argument for his presidential campaign, Ferrell-as-Bush turned directly to the camera and replied, "Strategery." The moment was just plain funny, and the term strategery took on a life of its own.
As I watch the outcome of yet another presidential election with interest, I'm reminded that regardless of who wins (still unknown at presstime), the landscape of employee benefits will change dramatically over the next presidential term. Those of us who manage group health plans will have to look to a very different future and prepare to apply a little "strategery" of our own as we hone our craft under a new set of rules and standards.
Tweaking and adjusting
As we prepare for our 2013 plan year, we've all become quite accustomed to tweaking and adjusting our health plans to ensure compliance with the Patient Protection and Affordable Care Act.
This year's open enrollment period will contain the unfortunate news that employees will lose half of their tax-favored benefits under their flexible spending account plans, but that bad news will be tempered with additional employee-friendly prevention benefits for women. But 2013 marks the end of the preliminary steps to full compliance with PPACA. 2014 is very close on the horizon and we all know by now that is the year the rubber meets the road!
Make a plan
At this point, it is absolutely essential for all benefits managers to map out a strategic path for years 2014 through 2018 (and beyond). For a government employer like Palm Beach County, this will require a significant amount of creativity and "strategery" to ensure that the County's self-insured health plan remains competitive, yet priced below the "Cadillac" threshold defined by PPACA to avoid that nasty 40% excise tax which takes effect in 2018 and could add millions of dollars to the bottom line of the plan.
The purpose of the excise tax is to ensure plan benefits aren't too rich. But many employers with so-called rich benefit packages have traditionally used them to supplement less-than-rich salary packages.
A number of polls have shown that an average of 85% to 90% of American employers will continue to offer health insurance to their employees for the foreseeable future. But the polls have failed to identify if those employers will be offering that coverage to employees in 2015 or beyond.
If PPACA doesn't significantly affect the cost of medical inflation, employers will find their plans reaching that Cadillac threshold quickly. My prediction is that, at that point, a much larger percentage of employers will opt out of employer-sponsored health plans and offer some type of alternative to employees in their place.
Role of exchanges
Recently, corporate exchanges have popped up as a potential alternative to traditional employer-provided health insurance.
This approach has been likened to the growing shift away from defined benefit pension plans to defined contribution plans, wherein employers would provide employees with a certain dollar amount and a menu of available health plans bargained through the purchasing power of partnering corporations.
This type of plan reminds me of the health insurance consortium I evaluated about 10 years ago - a good concept, but difficult to bargain with so many players at the table. However, the stakes weren't as high back then.
No doubt, creative minds will bring many alternatives and bright ideas to the table as we head into the sunset of employee benefits as we've grown to know them. Perhaps our greatest challenge (particularly for those of us in the public sector) will be in changing the employee's perception of programs that have become ingrained in the fabric of their livelihood. It will be our job to educate, inspire and lead them into that unfamiliar horizon. It's not too soon to start developing our well-defined (and correctly pronounced) strategy.
Contributing Editor Nancy L. Bolton is the director of risk management for the Palm Beach County Board of County Commissioners in West Palm Beach, Fla.
