05 Aug How to Best Inform Employees About PPACA

Originally posted July 29, 2013 by Thom Mangan on https://eba.benefitnews.com

Benefit education has long been considered a key component of a successful employee benefit program. However, engaging employees and helping them recognize the value of their program is not easy.  It takes ongoing efforts of HR Managers with support from senior management.

The Affordable Care Act creates another new wrinkle for HR managers. I caught up with UBA Partner, Greg Smith of R.W. Garrett Agency, to find out how best to get your employee’s attention — and why it’s so important.

Thom: In addition to the mandated communication material and benefit changes, how does PPACA affect an employer’s communication efforts?

Greg: With the new health insurance marketplaces and Medicaid expansion in most states, the government has a daunting task of educating and informing millions of the nation’s uninsured of the new coverage and subsidies available to them.

To get the word out, the government will spend hundreds of millions of dollars in a broad and expansive advertising campaign starting this month (July).

Employers are also participating in the campaign, as they are required to send out a Model Notice regarding coverage and options in the New Health Insurance Marketplaces.

The Marketplaces and corresponding advertising campaign are focused on the uninsured, who may be eligible for “free” coverage (through Medicaid) or subsidized, reduced premium coverage (in the New Insurance Marketplaces).  However, if the employer’s plan provides adequate and affordable coverage, the employees eligible for the plan will not qualify for any subsidized coverage in the New Insurance Marketplace (unless eligible for Medicaid).

Thom: So where does the trouble come in?

Greg: The wrinkle comes from two sources – confusion and human nature:

1.   Confusion – Unless explained adequately, the employee may be confused as to why his employer is sending him notice of a New Insurance Marketplace with subsidized coverage, when, in fact, he is not eligible for a subsidy.

2.  Human Nature – Employees may misinterpret or misunderstand the message of the government’s advertising and think that by dropping coverage, they may get a better deal in the Marketplace or, worse, believe that their benefits are not as valuable as they are.

Thom: So what is an employer to do to get around these problems, or “wrinkles”?

Greg: I believe employers can get out ahead of the “wrinkle” by pre-empting the government’s advertising with communications of their own. They can lay out the facts of the advertising campaign and reinforce the quality of their own plan.

Just because the White House has delayed the implementation of the employer mandate part of the Affordable Care Act doesn’t mean employers don’t have to communicate options to employees. On the contrary, they would be wise to use the extra year to make sure they and their employees are adequately prepared for the pending changes of 2015.