PODCAST OVERVIEW
Host Jeana Goosmann and guest Cara Kirsch, Vice President for SilverStone Group in Omaha, NE, talk about how business owners have been impacted during COVID-19 and how their benefits provider can help. During this episode you will learn:
- The issues benefits provider are seeing during COVID-19.
- Advice for business owners and leaders.
- How your benefits provider can help.
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TRANSCRIPT
Goosmann Law Firm :
Do complex legal issues you back, let's get energized and bring clarity to your top legal questions. This is Law Talk With The Flock by Goosmann Law Firm.
Jeana Goosmann:
Hi, I'm Jeana Goosmann, your host for Law Talk With The Flock. CEO, managing partner, business owner, and author here to help you walk your way through your life as a leader, business owner and overall leadership in this crazy time of COVID-19 and I am so excited to have with me a special guest today. I have Cara Kirsch, Vice President of SilverStone in Omaha, Nebraska. Cara, welcome.
Cara Kirsch:
Hi Jeana. Thanks for having me.
Jeana Goosmann:
Happy to have you on and Cara is actually my benefits provider here at Goosmann Law Firms. So we've been working together and I'm just so excited to have you on and share your knowledge with our listeners so that we can kind of talk about some of these hot topics.
Cara Kirsch:
Yeah, that sounds great. I'm looking forward to it.
Jeana Goosmann:
Yes, absolutely. And I was just saying that we had Cara and her team help us with our benefits overview on our full team meeting just last week because people are really wanting to know what's going on with benefits right now because employment and employees is just the hottest topic I think that there is with all these sweeping changes and everything that we're dealing with, with COVID-19.
Cara Kirsch:
Yeah, I totally agree. I think there were some really frequently asked questions that we received when the, you know, big outbreak started in the beginning of March around how will the testing be covered? Should we cover the treatment? How will this affect our disability plans? Will people be approved for disability? At what time in the COVID virus? And so for most companies they covered the testing, and for all fully insured customers, so if your medical coverage was fully insured, all of those carriers covered the testing and the treatment. For our self-funded clients, they had the option of deciding whether they wanted to cover the treatment. And for the most part, because there's a quite a bit of uncertainty around the cost, most of our clients did not cover the treatment at a hundred percent with no member cost share, like deductibles and copay's, etc. But they all covered the treatment and so now it's just really wait and see the impact of that on their plans. The other big thing was I need to let employees go in terms of layoffs or furloughs and how will that impact their eligibility for benefits? And for the most part, most insurance carriers said we will be flexible in terms of allowing people to remain covered even if they don't meet the eligibility criteria. So for example, if someone was furloughed, they would be allowed to remain benefits eligible when technically they weren't at work. And so that was one of the biggest questions that came initially because so many different industries were affected right away with downsizing.
Jeana Goosmann:
Right?
Cara Kirsch:
They weren't sure if that downsizing would be a permanent. And so how would they respond to it? So that was another big question that came up around how do I continue to provide my employees with coverage when they really aren't actively employed?
Jeana Goosmann:
And then what if they end up making those permanent layoffs? They turn our furlough into a permanently layoff. Does that kick in the Cobra coverage?
Cara Kirsch:
It does kick in the Cobra coverage and the Cobra process. And right now, you know, we're seeing some debate as to whether or not there'll be any subsidy on the Cobra premiums and those kinds of things because we know that Cobra is expensive and we know that typically people who take Cobra are in need of it in some way. And so how will people, American people respond to having to purchase Cobra coverage when it costs a lot of money and how will employers respond to the administration of significant Cobra population? So we don't know yet on that front, but absolutely when this, when this is more final from a headcount perspective, we will see employers have to respond to that.
Jeana Goosmann:
Absolutely. Well, and just looking at the unemployment rates right now, there have to be a lot of people starting to address the Cobra issues and it is, like you said, significant population that's going to be dealing with this.
Cara Kirsch:
Most definitely. The other thing I would say is we're starting to see insurance companies offer premium credits, for their coverage. And really on the medical side, you know, their are subject to the ACA minimum loss ratio requirements. So we think they're making adjustments in an effort to prevent having to pay dividends from beating the MLR amounts. So basically because claims are down, their loss ratios are going to be down and they don't want to have to pay those dividends right after this year is over knowing that those costs are going to spike back up. So I think that's pretty interesting too. Um, in the ancillary market, we're seeing dental and vision providers do that too. Some, you know, life insurance and disability markets as well, but not all in, it's not a uniform reduction, but I would image we'll see more of that.
Jeana Goosmann:
What is a premium credit, what does that mean?
Cara Kirsch:
Premium credit just means it can mean lots of things, but basically it's just a reduction in the amount that the employer pays in the premiums they pay to an insurance company. So if you pay an insurance company a dollar and they're giving you a credit of 2 cents on your next bill, you'll pay them 98 cents. That credit is sort of being positioned as, Hey, we're doing this great thing for the market because we know cost and expense is being looked at and their expenses are down. And so they're basically passing that expense reduction back to the employer.
Jeana Goosmann:
And how come their expenses are down?
Cara Kirsch:
Their expenses are down because the elective procedures that would normally go through the healthcare system. So I'm going to have knee surgery and now I can't because of COVID. So the claim that would have been paid for that knee surgery is not being paid right now. And elective procedures drive a significant amount of cost in the insurance industry. And so when you strip all that out because there was no access, those claims don't get paid. And we know that insurance companies base their premiums on claims that were to be paid and you strip out a big piece that's not getting paid well, their loss ratios are guaranteed to be favorable.
Jeana Goosmann:
Got it. And then how about you've mentioned, an acronym that start with an M like MCL or something like that when you were talking.
Cara Kirsch:
MLR
Jeana Goosmann:
There we go. What? Cara, what's an MLR?
Cara Kirsch:
We love our acronyms and benefits. But MLRs minimum loss ratio. So the ACA, the affordable care act said that insurance companies had to comply with minimum loss ratios. So the difference between premiums paid and claims paid for certain sized customers. And if they did better than the targets, they had to refund premium for the most part over the last few years that haven't been really any notable refunds.
Jeana Goosmann:
Employers like refunds.
Cara Kirsch:
Right, right. Dealing with this, the likelihood of there, you know, being an option to have one, you know, could be real because if you strip out those elective procedures, that's a significant portion of their claim costs.
Jeana Goosmann:
Awesome. Great information and thank you for boiling it down for everybody and breaking it down in that regard. Let's jump into some other topics that are really hot right now for consideration. Like medical plan funding. What are you seeing regarding medical plan funding?
Cara Kirsch:
Yeah. So you know, it's interesting because this time of year is a very busy time normally for employers to continue to work on their employee benefits strategy. And that's the work I do. So for the past two months that's really been put on hold because people have been forced to be dealing with COVID. Well one of the things that we would be doing with employers right now and I'm doing with my clients is that if you have 50 or more participants on your plan, your medical plan, you should be looking at alternate funding strategies. You might be fully insured today, but you may be eligible for benefits if you consider an alternate funding option. Well that takes time to evaluate. So if that's been put on the back burner for the last couple of months, that might be something that you should consider as we go into the 2021 plan year. Most, I think that the group of employers that was largely impacted by premium increases prior to COVID was that 50 to 200, 300 ish employee market. They're usually fully insured. They were subject to the increases that were provided to them by the insurance company and they didn't have a lot of room to negotiate or otherwise. And a lot of them are working with people, you know, my peers in the industry that may or may not be talking to them about those kinds of solutions. But this would be a good time to evaluate them.
Jeana Goosmann:
And what kind of solutions are we talking about?
Cara Kirsch:
We're talking about self-funded plans. We're talking about stop-loss captives. And we're talking about some alternative funding products. So some of the carriers have partially self-funded products, not all of them, but you should at least be evaluating them and understanding the components and how they might give you the ability to make strategic decisions in the future. Because the biggest challenge that that 50 to 99 group has, so 50 employees to 99 enrolled, they don't get any data about their utilization from the insurance company. So they never know if the renewal increase they got was actually warranted because they don't know what their claims are.
Jeana Goosmann:
Black hole.
Cara Kirsch:
Right. So as a self funded plan, you now know what's going on and can create your strategy. That's data driven. You can know, okay, I've got a significant population of diabetics, I've got a lot of people who have musculoskeletal issues. I can create strategy around that when I don't know what's going on. It's like operating in a vacuum. I can't do it. Anything I do may or may not work.
Jeana Goosmann:
Well let's, we could talk about each of these for the whole podcast. I have no doubt. Let's jump in and now talk a little bit about telemedicine and primary care utilization.
Cara Kirsch:
Yeah. So it's funny because I was talking to um, the CEO of a hospital recently and he said, you know, we've been talking about telemedicine for 20 years, but no one was really listening and he's right.
Jeana Goosmann:
They are now.
Cara Kirsch:
They are now though. And so I would encourage employers to figure out how they keep that telemedicine utilization high because it is a great point of service. It's more affordable. People aren't exposed to illness cause they're not going into their doctor's office. It is efficient cause they don't have to drive anywhere, they don't have to leave their families, etc. So you know, employers really need to hold on to this spike in utilization and telemedicine and figure out how to continue it through plan design or some kind of incentive, a way to get the employees to continue to use it.
Jeana Goosmann:
Got it. And what kind of incentives are there available to try and get employees to keep using it?
Cara Kirsch:
Oh gosh.
Jeana Goosmann:
Give them a water bottle if they do it.
Cara Kirsch:
I don't know. I think, you know, cost at time of care. So copays are you charging a copay? You know, that gets a little bit sticky when people have HSA's, You know, can they give it to them for free or not? But you know, I would say it's at the point of member pain, what's coming out of their pocket because the COVID crisis made it really easy for people to use that solution. So, you want to keep it as easy as possible. One of those ways is to make it free.
Jeana Goosmann:
Free always talks to people, right? So if I don't have to dip into my pocket and there's a free option, most people will choose that first.
Cara Kirsch:
You got it, you got it. So it forced people to use it because they couldn't go to their doctor's office or maybe they couldn't go somewhere and they still needed help with their chronic condition or sick baby. I just hope that they're able to get, keep that utilization as high as it was.
Jeana Goosmann:
Now while we're talking about employees, let's talk a little bit about employee engagement and what tips you have for people to stay engaged with their employees.
Cara Kirsch:
Yeah. So prior to COVID, you know, culture, was something that we were reading about everywhere. What do people feel like when they come to work? How do we engage them in being as excited about the work we do that you and I are because you and I wake up everyday and we're excited to do this work.
Jeana Goosmann:
We're Passionate.
Cara Kirsch:
Right, right. But not everyone is. And so how do you create an environment that responds to the needs of those employees? I think it's going to be different. Right? Do you have a break room in your office?
Jeana Goosmann:
Oh we do, I'm thinking about that right now. It is not big enough to have really more than two people in it. Right. In one of my offices now I have a much larger break room in a different office and so we can go to putting the circles on the floor, you know, where should people should stand and but those are real issues with the space.
Cara Kirsch:
Yeah. And did you, you know, Silverstone group made a very conscious decision to move away from paper cups. Everyone got their own water cup with a straw years ago and we have ice and water machines and you know, that's probably not gonna work. So how do you create a culture where you were encouraging people to be healthy by drinking water, but now they can't refill their water bottle at work? Or how do you create inviting spaces while still social distancing? How do you encourage people to make good decisions for their health that will still allow you to thrive in your business because they're scared. How do you respond to the mental health challenges that I would, I would estimate almost every person right now is challenged by anxiety, worry, stress. How are you going to respond to those concerns for employees so that they can be as productive as possible at work?
Jeana Goosmann:
Are you seeing any innovative things that people are doing to help with the mental health issues? Because they really are rampant right now. Everybody is struggling, one way, shape or form and has different triggers and then let alone people that had issues prior. Right? They're just exasperated and it is going through the roof and I think that we've been hearing about this is going to become a problem than actually COVID itself, but I think we're now at that point.
Cara Kirsch:
Yeah.
Jeana Goosmann:
Anything innovative that you're seeing people do there where you're like, Oh wow, I should spread the word on that.
Cara Kirsch:
Well, I go back to the point on telemedicine. Telemedicine. Mental health is a very viable solution. It creates an affordable option for people to access the mental health system because in mental health we have a shortage of providers and it's not cheap. And so many people are covered on high deductible health plans where they're subject to the cost until they meet their deductible. And so they don't go.
Jeana Goosmann:
And so use those EAPs, employee assistance plans.
Cara Kirsch:
That's right. Utilize your EAP if you don't have one, put one in there. Super affordable and EAP is focused on other things that will definitely be a response to COVID. Financial challenges, will preparation, those kinds of things that are stressing families out. The more you can offer in that regard, the better.
Jeana Goosmann:
And some folks might even offer it and not know that they have it available to them. We might've been guilty of that around here. I had a number of partners like, Oh, I didn't even know we had an EAP. So whatever initiatives we're doing right now is to get everybody to sign up for it and reward them if they just log in and see that it's available.
Cara Kirsch:
Absolutely. Great strategy. Yes.
Jeana Goosmann:
And then they're going to get a water bottle. So I don't know if that is a good solution. But that's their reward.
Cara Kirsch:
Well they can have a water bottle as long as they keep it at home. So I would say like those are probably the, sorry about my light that goes off when I don't move around frequently. But I would say those are, you know, the biggest things. The last thing I'll say, and, and this is more of a plug for my relationship with you, is just you know, now is not a time to let your benefits partner get lazy and now is the time for you to partner with someone who will drive you to the place that you want to go, wherever that is and who will enhance the understanding of what you have. So to your first comment, we, we came in and did just a, it wasn't open enrollment, it wasn't a management meeting. It was for your whole firm to really talk about how great your benefits are.
Jeana Goosmann:
It was a powerful 15 minutes slideshow and everybody learns something that they didn't know previously.
Cara Kirsch:
I love that. So don't let your benefits broker or benefits consultant get lazy right now. Now is not the time people are struggling and employers want to make sure they can keep their doors open and there are options in employee benefits that so many people don't talk about. So don't, don't let your consultant get lazy.
Jeana Goosmann:
Well and I think people need those benefits now more than they ever have. And being employed, I mean I've had a lot of conversations about the PPP and how some people are struggling to get their employee numbers back up because they're on unemployment and they get the kicker now, but that doesn't mean that they get the same benefits. So having great benefits is a strategic advantage as an employer.
Cara Kirsch:
Most definitely. The other thing I'll say is that, remember what your dad said, if he said it sounds, if it sounds too good to be true, it probably is. So if someone is marketing to you right now as an employer and telling you that they can get all these savings in your health plan, I would, I would approach it with caution because if there was these silver bullet solutions, everyone would have them.
Jeana Goosmann:
Very good advice as well. Because people are also scamming more than they ever have right now, both cyber security wise and with like you said, potentially too good to be true offer. So that's another really key tip and point which, you know, kick them wall or down. Right. I mean that's just that.
Cara Kirsch:
It's terrible and it's not how we should work. It's not American. You know, we should be supporting each other and helping each other thrive, especially the small businesses that we serve because we serve so many of them and, and the large employers that are trying to figure out how to get people into the office safely, you know, this is going to be a challenge for all of us and we're in it together and you know, I'm here to serve and help in any way I can.
Jeana Goosmann:
Well, the idea of a potential premium refund, I think a perk, a lot of people's gears up for sure. So we'll end on that high note. How about that, Cara?
Cara Kirsch:
That's great.
Jeana Goosmann:
Thank you so much for joining me today and all the rich content that you provided. I really enjoy working with you and so grateful that you joined me on Law Talk.
Cara Kirsch:
Thank you so much for having me.
Jeana Goosmann:
Thanks everyone and go make it worth it.
Goosmann Law Firm :
Thanks for joining us for Law Talk With The Flock by Goosmann Law Firm. We hope you feel energized and ready to soar past your goals. Become a Flock Fan and subscribe to our podcast for weekly episodes. Learn more at https://goosmannlaw.com/
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