What travel assistance services (e.g. worldwide travel and medical assistance 24 hours a day) do group life policies typically offer to employees and their families?

Travel Assistance services included in most group life policies provide employees and their families with several helpful services when traveling more than 100 miles from home (including international travel) whether it’s for business or personal reasons. These services provide peace of mind to travelers, supplementing other coverage by further protecting against an unforeseen medical emergency that happens while traveling away from home.

Typical services include, but are not limited to:

General Travel Information

• Visas, Passports
• Immunization Requirements
• Local Customs
• 24-hour pre-Departure Information on Weather and Currency

Lost Documents and Lost Article Assistance

Legal Referrals

Emergency Cash and Bail Assistance

Medical Assistance Services

• Medical and Dental Referrals
• Coordinate Hospital Admission
• Critical Care Monitoring
• Dispatch of a Prescription Medication Eyewear

Indemnified Medical Transportation Services

• Emergency Medical Evacuation:
  Medical team will determine if care is best provided locally or if the patient needs to be moved to a facility that can provide the required level of care. If evacuation is required, the medical team will recommend the appropriate method of transportation (air ambulance, commercial flight, ground transportation, etc) and make arrangements, including a medical escort when needed.
• Transport of Family Member:
  When a member is traveling alone and is hospitalized, the vendor makes travel arrangements for a friend or family member to join him/her. If a parent or legal guardian is unable to complete a trip with his/her children, arrangements for the children’s return home with an escort are handled.
• Return of Mortal Remains:
  The carrier vendor will arrange the transportation of the mortal remains to the member’s location of permanent residence. They help obtain and organize documentation and authorization for such transportation, as well as assist in the preparation for the transport of the remains, including arrangements for an appropriate container.
• Vehicle Return Services:
  In the event that a traveler needs to be medically repatriated or evacuated to the traveler’s home, the carrier will coordinate and manage all arrangements needed for the return of your unattended vehicle. There is a maximum benefit tagged to this service, see contract for details.

For information, download the following marketing materials:

• Blue Shield
• UnitedHealthcare
• MetLife
• Principal
• Reliance Standard

For a group life quote, including travel assistance services, contact us at 800.696.4543 or quotes@claremontcompanies.com.

What can you tell your client or prospect when a payroll company tries to win their group benefits business?

It happens a lot this time of year. Payroll companies, that sell benefits on the side, know that the beginning of the year is the best time to win clients looking to make a change. They sell the ease and convenience of having one entity responsible for both payroll and benefits. So, what do you tell your client or prospect who gets the hard sell from a payroll company wanting to be the broker of record?

Here are the talking points you can use if you find yourself in this situation:

• Payroll companies approach the client relationship as transaction-based. Brokers take a holistic approach and strive to be a trusted advisor for the employer.
• Benefits brokers are experts in benefits services, plans and what works best for their clients. Payroll providers are in the business of selling and servicing payroll and benefits are a sidekick.
• It is not in a payroll company’s DNA to provide personalized, customized support. They support their clients through call centers and websites. Benefits brokers recognize the personal and customized nature of selecting and using benefits and provide a higher level of service.
• Payroll companies may require the employer to bundle other lines of coverage or services (401K, Workers Compensation, extra payroll-related services) that the employer may not want to purchase from the payroll company:
  • The employer should pay for only what they will use. Brokers can craft a tailored solution that fits the employer’s need exactly.
  • The payroll vendor is often not an expert in these lines.
  • Employers can find themselves stuck if they’ve subscribed to a suite of services from the payroll vendor and then want to unbundle them.
• Payroll companies often have high turnover and can’t provide consistency for clients.
• Benefits brokers understand compliance, which is a big issue for clients. Payroll vendors don’t understand benefits compliance as well. Do they understand WRAP, Section 125, ACA and other compliance matters?

In our view, independent brokers provide a superior experience. It is clear that your client or prospect should let you, the expert, help them structure the best benefits solution possible and then provide the best service possible throughout the year.

Which small business exchange in California offers full-network PPO plans?

Covered California for Small Business (CCSB) is the only small business exchange that offers full-network PPO plans. The other small business exchange, California Choice, only offers limited-network PPO plans.

Employers want to provide the widest range of options to employees and often require that agents design solutions that include broad-network PPO plans alongside traditional HMO plans. CCSB’s robust portfolio of full-network PPO plans, from both Blue Shield of California and Health Net, allows brokers and employers to better meet the needs of employees.

Does the benefit for group life insurance always decline as the subscriber ages?

No. Most group life insurance plans start reducing the benefit according to an age-reduction schedule, however, MetLife’s voluntary life plan does not. A little nugget that may be helpful for you to discuss with your clients.

Typically, the benefit for group life insurance (both employer-sponsored and voluntary) declines starting at age 65. Below is the average reduction schedule for the most common group plans (the reduction is expressed as a percentage of the original benefit amount):

Age                       Benefit Reduction

65                                     30%

70                                     55%

75                                     75%

Retirement                       100%

As you can see, starting at age 65, the benefit declines dramatically. For example, a basic life policy with a $50,000 benefit will decline to $35,000 at age 65 and will only pay $12,500 by age 75.

On the other hand, the benefit amount of MetLife’s voluntary life insurance plan does not decline as the subscriber ages. A $50,000 benefit established at age 60, stays at $50,000. In addition, the plan:

• Is portable (the employee can continue the plan as an individual even after termination, voluntary or involuntary, from the employer).
• Is convertible into a whole or universal policy.
• Benefits can be increased (to certain levels) without submitting a statement of health.
• Is bundled with no-cost services such as will preparation and estate resolution.

As with most ancillary coverage, terms are flexible if you are willing to pay. Carriers will allow the contract owner to “buy out” the age reduction schedule by paying more in premium. This is true of most plans, including MetLife’s employer-sponsored plans, but the beauty of MetLife’s voluntary life plan is that there is no cost for eliminating the age reduction schedule.

Are there participation requirements for voluntary benefits plans?

Yes. Voluntary benefits (those for which the employee pays 100% of the premium) can be a great way for employers to begin offering benefits if they currently do not. And for those that have a robust offering, “voluntary” can round out that offering by giving employees access to coverages not available on an individual basis. Keep in mind though that there are participation requirements for voluntary plans just as there are for employer-sponsored plans.

The following are examples showing how participation requirements differ between voluntary and employer-sponsored Dental and Life plans from carriers in the small group market:

Dental Coverage

Delta Dental

• Voluntary: A minimum of five eligible employees must participate, except if there are less than five eligible, then a minimum of two must participate.
• Employer-Sponsored:
  – If the employer pays 100% for both employees and dependents: 100% of eligible employees and 100% of their dependents must participate.
  – If the employer pays 75-99%: 75% of eligible employees and 50% of their dependents must participate.

Principal

• Voluntary: Must have 10 or more eligible employees, 25% of whom participate, but with no less than five participating.
• Employer-Sponsored:
  – If the employer pays 100%: 100% of eligible employees and 50% of their dependents must participate.
  – If the employer pays 50-99%: 75% of eligible employees and 50% of their dependents must participate.

Humana

• Voluntary: Two must participate.
• Employer-Sponsored: 50% of eligible must participate.

Life Coverage

MetLife

• Voluntary: 25% of, but no fewer than 10, eligible employees must participate.
• Employer-Sponsored: 100% of eligible must participate.

Principal

• Voluntary: 20% of, but no fewer than five, eligible employees must participate.
• Employer-Sponsored:
  – If the employer pays 100%: 100% of eligible employees must participate.
  – If the employer contributes <100%: 75% of, but no fewer than three, eligible employees must participate.

Reliance Standard

• Voluntary: 10% of, but no fewer than five, eligible employees must participate.
• Employer-Sponsored: 100% of eligible must participate.

As you can see, the participation requirements for voluntary plans are quite reasonable, making them a good solution for employers looking to offer coverage for the first time or to expand on what they currently offer.

Is it too early to start preparing for Q4?

No. In fact, there are many steps you can take to prepare for Q4 during this relatively quiet time of the year:

• Review your list of clients to determine who will be renewing in Q4.
• Map out a rough timeline of how you would like to manage “busy season.” Factor in holidays and how they reduce your clients’ availability, especially if Q4 is their busy season.
• Begin working early with those who have complex needs or who need extra assistance.
• Identify clients who could benefit from a switch in plans or carriers. Start working early on crafting solutions.
• Interested in learning about new products or services that could benefit your clients? Now is the best time to familiarize yourself so you have that knowledge or service lined up when your clients need it.
• Identify clients who should be offering ancillary benefits and start presenting those options early. The labor market is highly competitive and offering ancillary benefits could help your clients retain and attract good employees.
• Start running market check quotes to get an idea of what your clients’ renewals will look like…well before they receive their renewal packets.
  – Kaiser, Sutter, Sharp, and CCHP (Chinese Community Health Plan)
  have already published rates through the end of 2018.
  – Anthem and Blue Shield will publish by the first week in July.
  – All others should publish between early July and early August.

If you execute a plan for completing Q4 renewals early, you will see benefits, including:

• Despite the best of intentions, it’s inevitable that there will still be a scramble for certain clients in November and December. You will be far less stressed if you’ve completed renewals early for your other clients.
• Locking down Q4 renewals early takes away the possibility that a competitor could poach.
• Conversely, the time that you free up allows you to pursue new business, at exactly the right time – when so many prospects are renewing and when other brokers are busy and are not prospecting.

Need assistance preparing for Q4? We’re standing by to help – yes even now. Want to learn about new Claremont products and services that can help you win clients?

Contact your Claremont sales representative at 800.696.4543 or info@claremontcompanies.com.

What’s the best way to conduct “virtual meetings”?

Let’s say you have the following scenarios with your clients or prospects:

1. You want to review documents or proposals with a prospect who is not located nearby.
2. You want to host a meeting for your client’s employees, but they work in different locations and it’s not practical to bring them to the same location.
3. You want to show your client how to use a carrier’s online portal but can’t make it to their office.

What’s the most effective solution for these scenarios where you can’t arrange an in-person meeting? The ideal solution is a virtual meeting; a combination of screen-sharing and either a direct call or conference call.

Everyone knows how conference calling works, but you may be less familiar with screen-sharing. If you’ve ever attended a webinar, then you have seen screen-sharing at work. It is the ability to view, in real-time, what is on someone else’s computer screen and it is a powerful tool that can boost efficiency for you and your prospects and clients. Let’s see how this solution can work in each of the above scenarios:

1. Instead of driving long distances, set up a call and email your client a link that allows your prospect to connect to the screen-sharing web site. At the appointed time, you call them, they log in (at no cost) and you start sharing your screen. This allows you to talk to your prospect while you are both seeing the same documents at the same time and most importantly allows you to use your cursor to “point to” each section of the document on which you want to focus the conversation. You can even edit documents together in real-time.
2. Similar to #1, but instead of a direct call, you set up a conference call. Employees dial-in and then log in. You can show them a presentation or review documents with them (plan brochures, descriptions of services that carriers offer, etc.)
3. Similar to #1, you arrange a virtual meeting with your client, log into the carrier portal, share your screen and take them through a demo of how to use the portal.

There are numerous companies that offer conference calling and screen-sharing capabilities: GoToMeeting, Join.Me and Zoom are just a few. With most services, you can experiment with a free trial and with some, you can even use a basic version at no cost, indefinitely. The basic versions typically limit the number of participants and exclude more advanced capabilities.

One really useful feature, available with the advanced version of these services, is the ability to pass control of the presentation to someone and allow them to share their screen. For example, in scenario three above, if the client wants to show you a problem they are having in the carrier portal, you can set up a quick call and screen-share, pass the control to them and now you can look at what is on their screen to determine where they are having problems and help solve them.

There are many more capabilities offered by these services, but even using the most basic features can help you collaborate with clients and colleagues in real-time. Once you start using virtual meetings enabled by screen-sharing services, you will find them irreplaceable and well worth the cost. Here at Claremont, if we want to quickly review documents with a colleague, we’ll sometimes set up a virtual meeting even if they are just down the hall!

Should clients contribute to their HSA before contributing to their 401K or IRA?

There are compelling reasons to do exactly that:

• An HSA is triple tax-advantaged – contributions, earnings, and withdrawals are generally tax-free, whereas with traditional retirement accounts (401K, IRA) only two of those three are tax-free.
• The funds are portable should the account holder change employers.
• Funds can be used to pay qualified expenses for spouse and tax dependents.
• Funds can be used to pay for Medicare premiums and qualified long-term care premiums.
• Even if funds need to be withdrawn in an emergency for non-medical expenses, the penalty (only if prior to age 65) and tax consequences are the same as for traditional retirement accounts.

There is one situation where the decision becomes a bit more difficult. That is if the employer offers a matching contribution to a traditional retirement account. It’s tough to turn down that “free money.”

As with all matters related to tax and finance, it is strongly recommended that you do not provide advice unless you are certified to do so. That said, if you are not a tax or finance professional, you could certainly encourage your clients to solicit the professional opinion of their tax or financial advisor on this matter.

Please note that this FAQ is meant to be informational only. It is not tax advice and Claremont Insurance Services is not a tax advisor.

Resources
Employee Benefit News recently published two helpful articles: “The Case for an HSA-First Investment Strategy” and “How HSA Savings Can Be Used for Long-Term Care in Retirement.”

Why are some of my Covered California for Small Business clients receiving delinquency and termination notices?

CCSB’s processes on late payment notices and contract terminations are similar to that of other carriers in the small group market. When an employer does not make payment by the last day of the month for the following month’s coverage they will receive a Notice of Delinquency. The payment must be for the full amount of the invoice. It’s recommended that employers not “self-adjust” based on additions or deletions of plan participants. Employers should pay the invoiced amount.

• If your client receives a Notice of Delinquency, they will have until the end of the delinquent month (referred to as the “grace period”) by which to make full payment for that delinquent month, otherwise, their coverage will be cancelled.

Once an employer loses coverage with CCSB or any carrier and fails to have a replacement plan in place resulting in an unplanned gap in coverage, there are potentially serious consequences, including but not limited to:

• If deductions have been made from employees’ payroll for a plan that has been cancelled and not replaced there are potential ERISA violations and tax consequences by and for the employer. A tax advisor and employment attorney should be consulted immediately.
• If there is a gap in coverage, this may impact employees’ conformance with the individual mandate and may open them up to a penalty for 2018.
• CCSB or any carrier will still pursue the employer for reimbursement of unpaid coverage months.

If your client’s coverage is cancelled they may request that the coverage be reinstated. The decision to rescind the termination is made solely at the discretion of the carrier.

To help you and your clients, we have developed Advice to Agents About CCSB’s Payment Policies. However, the most important piece of advice we can provide: advise your clients to pay on-time and for the invoiced amount.

Finally, when you and your client are simply terminating coverage in order to move to another carrier, you should always notify the current carrier via a formal letter of intent to terminate prior to the termination date. CCSB and any other carrier will issue delinquency and termination notices if they have not been notified and will expect to be paid for any unpaid coverage months if they have not been notified in advance of a termination.

Is the Small Business Healthcare Tax Credit still available?

With all the talk about repeal, replace and changing regulations, you might have thought the Small Business Healthcare Tax Credit provision in the ACA would have been terminated, but it is alive and well and there is still money available for your clients if they are eligible. This is an excellent and sometimes overlooked financial reward for small employers in low wage industries to encourage them to offer coverage and may be a source of new clients.

To qualify for the tax credit, the business must:

• Purchase coverage through Covered California for Small Business (CCSB).
• Have fewer than 25 employees.
• Have average wages of approximately $50,000 or less.

If the employer meets these requirements, they could be eligible for up to a 50% tax credit (35% for non-profits). The dollar value of the credit is based on how much the employer contributes towards the employees’ (and dependents’) premiums. The credit works on a sliding scale; companies with 10 or fewer employees and average wages of $25,000 or less qualify for the maximum, while companies with employee counts and average wages near 25 and $50,000, respectively, will qualify for the least.

Claremont has been working with CCSB since its inception in 2014 to help assist agents and their clients in understanding the tax credit. We will even provide an estimate of the potential tax credit for which your client may qualify. And don’t forget a tax credit is far more valuable than a tax deduction or a deductible expense. A credit allows the for-profit employer to reduce their tax bill by the amount of the credit earned.

We have a crafted this Health Care Tax Credit Solution and posted it on our web site. It provides all the information you need in order to discuss this great program with your clients.