Healthcare reform and the wellness connection

By Dorothea Allen

Dorothea Allen discusses the importance of building out preventative programming to help address healthcare reform.

With the passing of the Patient Protection and Affordable Care Act (H.R. 3590) this past spring, many significant changes were set into motion that impact employers, employees and insurers. Can you outline the primary changes as they relate to wellness programming?

Dorothea Allen. It goes without saying that this law will have more impact than nearly any federal law in the past 50 years. From a high level, the law really affects accessibility of healthcare (the health insurance exchanges and expanding dependent care coverage are examples,) and accountability for healthcare (the Patient Bill of Rights is an example). In both cases, the focus comes down to taking preventative action for overall wellness.

For insurance carriers, the requirement to offer preventative care services impacts the Medical Loss Ratio (MLR). The MLR requires that 85 percent of premium fees must be dedicated to medical/preventative services, leaving only 15 percent from administrative services. Therefore, insurance carriers will need to expand or develop their current wellness and preventative service offerings.

For employers that are trying to mitigate rising healthcare costs by shifting some of the cost-sharing to employees, the resulting benefit plan changes could impact their ability to receive "grandfather" status for PPACA. As a result, these employers won't be able to charge a co-pay for preventative services. For smaller employers (those under 100 employees) that want to develop a wellness program, there will be some grant opportunities available in 2011. Additionally, employers can now offer greater premium incentives for employees that participate in a wellness program (changing from 20 percent to 30 percent, and may go up to 50 percent). And, if the Health Workforce Act passes, employers will have the added incentive of a tax credit.

All of these changes translate to exciting opportunities for employees to benefit from an expanded array of wellness programs and services.

How has Ceridian responded to these changes? 

DA. Ceridian is already well positioned to address healthcare reform through our benefits administration and health and productivity solutions. Beyond monitoring regulations and the US Preventative Care Task Force, Ceridian is ensuring that its comprehensive wellness offerings are not only compliant but will bring the best value to employers and employees. This involves looking at new and innovative ways for delivering service, such as online coaching. By partnering with employers and carriers, Ceridian is also able to provide the program consultation and support for each unique environment.

What action should employers take right now in regards to wellness?

DA. Many employers already have some wellness initiatives in place, so now would be an excellent time to really assess these programs and ensure that they are meeting your objectives. Since the PPACA incentives focus on outcomes-based programs, employers should look at their program structure. Are you only rewarding participation in the HRA? Is there an opportunity to encourage engagement in a coaching program that will get you and your employees the results you desire? Have you set realistic program goals with a two to three year horizon? These are the questions employers should explore with a trusted consultant or provider that can offer guidance on the best actions to take.

What can we expect to see from Ceridian Health & Productivity Solutions in the coming 12 to 24 months?

DA. In addition to delivering programs in more innovative ways, Ceridian is developing resources that will help employees navigate the complexities of the healthcare system and truly advocate for their needs. Because Ceridian has always recognized the strong connection between mental and physical health, you'll see more offerings that truly integrate the delivery and reporting of these programs. And, Ceridian will continue to enhance the tools that clearly articulate the value of these programs to the organization. Everyone benefits when we can prove that wellness programs do make a difference. 

Biography

Dorothea Allen is Vice President of Marketing and Product for Ceridian Health & Productivity Solutions and is responsible for product development, management and marketing related to employee assistance, work-life and wellness programs.