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2015 Employee Benefits Outlook

Feb 11, 2015 6:30:00 AM

2015_EB_Outlook2014 was one for the employee benefits history books! The roll-out of the individual mandate, modified community-rating for individual and small group policies, and the public exchanges.

2015 will be yet another chapter in the revolution of employer-provided health insurance with the employer mandate taking effect and additional compliance and reporting responsibilities placed on employers. Throughout all of this, the overriding themes will continue to be creating and maintaining a culture of health within the workforce and the evolution of technology.


Health care and human resources compliance will continue to be a focal point. Tracking and reporting of eligibility goes to a new level - think Forms 1094 and 1095. The Department of Labor will likely make increasing “introductions”. Although there are many new laws and regulations to follow, don’t forget those that have been around for years: COBRA, ERISA, FMLA, and HIPAA. Be confident in the processes and procedures you have in place, and seek guidance for those areas that you are not.

Cadillac Tax

Although the Cadillac tax is still three years away, it is a big topic of conversation and strategic planning. Employers will go from being penalized for not offering health insurance to their employees, to being penalized for paying too much for the health insurance they are providing. Keep in mind, paying too much for health insurance is NOT a direct correlation to the value of the benefits provided. If the tax stays in its current form, this could play out to be one of the biggest catch-22s the industry has seen in quite some time.

Educating employees and providing a healthy environment, equipping them to maximize efficiencies of Consumer Driven Health Plans, and partnering with networks and providers, including onsite/near site clinics, who provide the deepest discounts and lowest price points possible will help mitigate the exposures the Cadillac tax will create for employers.

Private Exchanges

The early adoption of private exchanges for active employees has been relatively slow to pick up, compared to projections. Those who were promoting lofty projections were typically those with a vested interest in the market reception of these oft-referred to as “glorified enrollment systems.” The ultimate goal of private exchanges is to drive consumers into high deductible health plans. In Indiana, the vast majority of employers have already achieved this milestone without the added cost of the technology. Although the timing of these platforms may not be the best in our market, the future is still bright for the solutions they provide as greater personal accountability is inevitable.

Individual Accountability And A Culture Of Health

As an employer, it makes sense that you want your employees to be healthy. Why? Healthy individuals are more productive, cost less in terms of health care and workers’ comp, and are likely more loyal employees. However, there are other avenues to make employees happy such as compensation, time off, and work-life balance.

But as an employer, why are you responsible for the poor lifestyle choices your employees make? At this point you might be rolling your eyes, but it’s a fact that you don’t roll your eyes when discussing another double digit health care cost increase…! In the not too distant future, employer-responsibility will turn to individual accountability.

In order to enable individual accountability, consumers need access to resources to make better decisions: eating habits, financial management, health care purchasing, etc. Health care transparency resources are widely available to compare costs and quality. Education and ease of access to information will continue to be paramount.

Further, as an employer it is important to note that unhealthy workplace cultures often lead to unhealthy employee behaviors. Research by Jeffrey Pfeffer, Professor of Organizational Behavior at Stanford University’s Graduate School of Business, has indicated that unhealthy workplaces can cause up to 125,000 employee deaths per year and cost businesses in excess of $130 billion. Pfeffer discussed this topic at the 2014 Great Place to Work conference and had this to say:

“Many of the individual behaviors you are focusing on in your health and wellness programs (such as) stop smoking, eat better, exercise more, are in fact consequences of the environments in which they (employees) are working. If you work people to death, of course they are going to smoke more, drink more, and eat worse.”

2015 will be full of many milestones, some more memorable than others. There are many moving parts that were completely foreign and unanticipated 5 years ago. A new wave of technology in its infancy stage may not only change how employee benefits are administered and distributed, but also how health conditions are diagnosed and care is accessed. Not a fan of soap operas, but the next chapter in the industry appears to be the making of a new series of As The World Turns!



Written by Gibson

Gibson is a team of risk management and employee benefits professionals with a passion for helping leaders look beyond what others see and get to the proactive side of insurance. As an employee-owned company, Gibson is driven by close relationships with their clients, employees, and the communities they serve. The first Gibson office opened in 1933 in Northern Indiana, and as the company’s reach grew, so did their team. Today, Gibson serves clients across the country from offices in Arizona, Illinois, Indiana, Michigan, and Utah.