2021-Employee-benefits-planning

How and Why to Start Planning Your 2021 Employee Benefits

Have you ever wondered what keeps you motivated even after working for hours? Did you ever give a thought to how employee benefits bring about a difference outside your work life? If you did not, I believe it’s high time that you do because it notably has a significant impact on you, your family as well as your lifestyle!

Employees of all ages seek security and that too originating from your employer is a plus. In the modern fast-paced world of today, where competitiveness is at its peak, a driving factor to attract and retain individuals like you is by offering Employee Benefits. It portrays the organizations are not only investing in the short-term but the organization, as an employer are looking out and concerned for your future that lies ahead of you as well.

Now let us have a deeper understanding of the much familiar term ‘Employee Benefits’

 

What Are Employee Benefits?

Employee Benefits, also commonly known as fringe benefits are non-financial compensation that is provided to you as part of an employment contract other than your salary. It may be required by law, depending upon the country you currently reside in, or could be also due to a risk that is associated with your job. The purpose of employee benefits is to increase your economic security as an employee.

Below is a check-list of the employee benefits commonly being provided by organizations:

  •       Health Insurance
  •       Disability Insurance
  •       Casual Leaves
  •       Sick Leaves
  •       Vacation Leaves
  •       Retirement Plans
  •       Well-being Program
  •       Tuition Reimbursement
  •       Gym Reimbursement
  •       Loan Contribution
  •       Transportation Facility
  •       Employee discounts
  •       Free lunch

 

Why Are Employee Benefits Important For You

Employee Benefits acts as security. This is where above 70% of the population is willing to settle for their security and wellbeing, even in comparison to high salaries being offered.

Here are some reasons why employee benefits are important to you:

  •       They ensure your security
  •       They ensure to facilitate you will all resources at their disposal
  •       They have a strong impact on your motivation towards your work
  •       They contribute towards increased satisfaction while being at work

Note: If an organization is offering a good salary along with additional benefits, it is the right moment for you to grasp the opportunity before it’s too late!

 

Why Is 2021 Benefits Planning Important?

We are all aware of the global pandemic and the unfortunate events that it brings along. As it continues to wage on, the COVID-19 pandemic has been a wake-up call for all employees to get themselves secured. This is observed as a reflection in the employees being super concerned about the additional benefits and support provided by their employer to help create ease in such tough times.

On this account, all employees need to start focusing on their concerning employee benefits to get themselves secured for any unfortunate causality that could occur as a result.

Here are some common reasons to why you should step ahead into employee benefits planning for the year 2021:

 

Healthcare Coverage

You have probably heard the common phrase ‘Health is Wealth’. Yes, your health is the most important factor and should be your top priority, especially in such times. You need to consider the maximum amount of opportunities from where you could get medical coverage as part of employee benefits.

 

Telehealth facility:

It is an additional sub-category that is on the rise nowadays. Telehealth is where you could get connected to a doctor through a telephonic call or video chat. As the graph for COVID-19 increases, there has been observed an increasing trend toward telehealth services, with over 60% population being dependent on it.

Therefore, it is extremely important to consider the benefits of health coverage in employee benefits planning for the year 2021.

 

Mental Health

A survey in 2020 investigated the after-effects of COVID-19 on employees where there was a significant increase in individuals linking the global pandemic as one of the most stressful times of their lives. This is where employees were not sure about job security where each one of us felt threatened that our organization might be laying us off.

It is hence important, to consider your mental health before even giving a second thought to any of the factors. For this reason, you should start looking into organizations and programs that cater to these in addition to the usual benefits being provided.

 

How To Start Planning Your 2021 Employee Benefits

Planning employee benefits has become essential in the world of today. Having the right employee benefits will give you a distinct advantage in addition to other facilities provided by either your organization or the law of your state itself.

Take into consideration the following steps while planning on your 2021 employee benefits:

 

Prioritize what’s benefits are important to you

As an employee, it is important to evaluate what matters to you. You should be the one deciding what is important, what is relevant, and what is it that will facilitate you in the longer-run as well. Until and unless, you do not have a goal or determination inside of you, it will be far impossible to benefit both, you and your dependents as a result.

 

Differentiate between required benefits and optional benefits

While organizations are increasingly providing employee benefits, it is important to focus on what is best suitable for you. You, as an employee, should be decisive and have the ability as well as a skillset to differentiate between what is necessary and what is not.

Often some startups offer small business benefits since they are not enough financially stable to offer you a range of benefits. For instance, small business benefits could include flextime, telecommuting, paid time off, or even well-being programs. For some, the above would be required benefits where in comparison some employees might have it on their optional benefits list.

Hence, now once provided with both options, you are free to select the one that fulfills your needs and requirements.

 

Dig Deeper into your budget constraints

Having a focused and realistic idea of your budget will aid in understanding and utilization of the benefits important to you and your family. It will provide you with a holistic overview of the employee benefits to plan on while also knowing the ones you can compromise on.

In summation, 2021 is almost here with a roaring start, that links back to employees making decisions about their benefits program and the option available. Where continued unemployment is at its peak, employees should wholeheartedly dedicate a great deal of time settling themselves for a brighter future!

Contact Claimlinx today to schedule a benefits consultation.

 

 

self-funded-merp

Advantages of Having a Self-Funded MERP

As a result of millions of people all around the world losing their jobs and subsequently their insurance due to the current public health crisis caused by COVID-19, which is also the case in the US, an alternative of health insurance that has come to the forefront is what is known as Medical Expense Reimbursement Plans or more easily referred to as MERP.

Predominantly, MERP has become very popular amongst employers lately. This is mainly because with MERP, organizations have the leeway to provide tax-free money, as opposed to providing conventional benefits such as group insurance. This entails the employees of the organization having the discretion to buy whatever product or service pertaining to health care as they prefer, which may also include health insurance for themselves. The employer, then, is responsible to reimburse their employees up to the allowance they have been given. 

To help you grasp the concept of what MERP exactly is, how they work, and what are the advantages associated with them, this article contains a breakdown of all the necessary details. 

Shall we begin?

What exactly is a MERP?

To start off, the term MERP stands for Medical Expense Reimbursement Plan. This is any sort of insurance plan that requires businesses and employers to reimburse their employees for the medical expenses that they or a dependant of their paid for out of their own pocket. When executed properly, a MERP will allow employees to be reimbursed for the entire medical expense, entirely free of any taxes.  

How do MERPs Work?

A MERP is any plan that allows businesses to give their employees without any taxes applied to the amount. The money that is given by the employer can only be used to pay off any medical expenses that an employee paid for out of their own pockets. The process of a MERP typically involves five main steps:

Step 1: Your employer will determine the allowance amounts- this means the set amount of monthly allowance that is allowed for each employee; should the medical expenses of an employee exceed the allowance limit, the employer will only be liable to reimburse the employee for the allowance that was predetermined. 

Step 2: As the employee, you will have to purchase your own health insurance plan- meaning you will have the discretion to choose whatever health care products best serve your needs and requirements. This purchase, however, will be paid for from your own pocket for the time being. 

Step 3: You will be required to provide proof of purchase- once you have made the purchase for your preferred health care products, you will be asked to provide documentation recording that a medical expense was incurrent. This document could be anything from a receipt to an explanation of benefits. However, regardless of the type of document, there should be three key pieces of information present in the document, including the date of the purchase, a description of the health care product or service that was purchased, and your name.  

Step 4: Once the document has been submitted, it will be put under review by your employer- this is done so that the employers can make sure that the amount of allowance is not exceeded, the type of product or service purchase qualifies to be reimbursed for under MERP and that all the important information is present. If the documentation is missing anything, you may be asked to submit additional records.

Step 5: You will be reimbursed by your Employer- after reviewing to make sure all information is present and valid and everything else is in, your employer will pay you up to the amount that was required by your predetermined allowance. 

What are the various types of MERPs?

Before this point in the article, we have discussed a MERP as an umbrella term for any plan under section 105 that dictates that the employer reimburse their employees for the medical expenses paid for out of their own pockets. In this following section, we will take a deeper dive into MERP and take a look at the various types of MERPs that exist out there. 

The following are a few of the most commonly used variations of MERPs:

Stand-alone MERP

A stand-alone MERP, otherwise also known as a stand-alone HRA, refers to any plan that is provided for by the employer where they reimburse employees for health insurance policies that have been purchase for their individual selves. These are MERPs that only cover personal medical expenses as opposed to group health insurance. This way, employers can offer their employees amazing benefits without having to raise their own costs and dealing with the intricacies of insurance.  

A MERP that covers group health insurance

This type of MERP that is coupled with a group plan is also referred to as group coverage HRAs, Deductible HRAs, or Group HRA. This is where employers bundle a MERP with group health plans that typically come with high deductibles. In this variation of MERP, the employer will increase the deductible to an even higher amount on the group health plan. Then, you as the employee will be paid in the difference between the deductible and your allowance. This provides an effective avenue for employers to insure a part of their group plan through dollars before the taxes on them are paid, which allows for huge savings without compromise on the coverage being provided. 

MERPs that exclusively cover Vision and Dental expenses

Even in the case of MERPs, there are only certain types of medical expenses that qualify the employee to receive reimbursement. This type of MERP comes in handy if your employer wants to cover you for your vision and dental expenses without having to purchase expensive insurance plans. 

The Advantages of Self-Funded MERPs

Employees get choice and flexibility 

With MERPs, employees have the discretion to choose whatever health care products meet their needs the best so that the plans can be tailored to requirements and no coverage goes unused.

The company stands to gain financial benefits

Unlike in the case of fully-funded insurance plans where the employer will have to pay the entire premium, in MERPs, they are only required to pay for the expenses that were incurred without incurring any sunk costs.

Employees make better health care decisions

When employees are required to pay for their medical expenses out of their own pockets initially, and they are restricted to a set amount of allowance, they are better prone to learning how to make better and more informed decisions about their health and the health products they purchase.

Top-Health-Benefits-That-Employers-Can-Offer-Health-Insurance-Claimlinx

Top Health Benefits That Employers Can Offer

From an uninsured worker’s perspective, any healthcare benefits offer financial coverage and peace of mind essential to satisfactory work life. Now that the majority of companies must offer employer benefits to comply with government regulations, the more important question involves figuring out what the top healthcare benefits to offer are and how your organization can afford them.

 

Options in Healthcare Benefits for Employees

 

Different insurance options offer employers the chance to provide different levels of care at different price points for their workers.

 

HMOs – Health maintenance organizations allow workers to choose their doctor freely. They are responsible for copayments for appointments, procedures, prescription medications, and more.

 

PPOs – Preferred provider organizations have a set list of physicians to choose from. Appointments with outside network specialists or visits to off-plan hospitals will cost more.

 

Healthcare Savings – The money in these accounts is protected from federal income tax and can be used for a variety of medical deductibles or bill payment purposes.

 

Reimbursement Arrangements – These employer-funded benefit plans pay workers back for healthcare expenses they had to pay for themselves. A MERP (medical expense reimbursement plan) is a tax code provision that allows employers to save money on covering their workers.

 

What Employer Benefits Do Workers Want Most?

 

Without a doubt, more people want health insurance from their employers than any other type of benefit possible. The percentage of importance goes up based on the employee’s age. When it comes to the specific benefits offered under a worker policy, however, many options exist. In general, people prefer lower deductibles, minimal co-pays, and coverage for everything from a wellness visit to the family doctor to full coverage for hospital stays and long-term debilitating injuries.

 

Some of the specific healthcare benefits people want include:

 

  • Health savings accounts to save up for unexpected expenses
  • Reimbursement accounts for medical bills
  • Insurance for dental and vision coverage
  • Full disability insurance (often covered by worker’s compensation laws)
  • Coverage for preventative treatments or wellness programs

 

Discover Affordable Ways to Offer Top Healthcare Benefits

 

There are many excellent reasons to offer healthcare benefits to employees. While you may want to include every type possible with the widest range of providers at the lowest costs, you must temper your generosity with affordability. After all, if the business does not turn a sufficient profit, you will not be able to employ people at all.

 

While maintaining full compliance with all current Affordable Care Act regulations, you can discover ways to satisfy the people who need medical, dental, and vision coverage without compromising your ability to succeed in whatever industry or niche you represent.

 

Saving money on top healthcare benefits starts with knowledge and understanding of all the options and how things like tax benefits and group health insurance discounts can work for your company. A ClaimLinx options consultant provides these services for small, medium, and large businesses that need to find affordable ways to give their workers what they want and need.