The Evolution of Benefits and Payroll Integration: Advancing Your Options
A CBIZ Benefits & Insurance Services Program
Presenters
Jim O’ConnorCBIZ Employee Services OrganizationChief Executive Officer
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Wendra Johnson, SPHR, SHRM-SCPCBIZ Employee Services OrganizationChief Business Development Officer
Agenda
• Marketplace and Industry Trends– Benefits– Human Capital Management
• Identifying Best Solutions• CBIZ Employee Services Organization
– Bringing It All Together• Q&A
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Marketplace and Industry Trends
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The Current Employer Dilemma
• Organizations across the country just like yours are dealing with the following issues every day: – Skyrocketing health care costs– Health care reform compliance challenges – Overwhelmed human resources teams
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Employee Benefits Trends – Costs
• How much is health spending expected to grow?
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Employee Benefits Trends – Self-Insurance
• Self-insurance…rapidly coming “down market” • Reasons to consider…
– Participate in “good” claims experience– Risk mitigation through stop-loss insurance (specific and
aggregate)– Cash-flow advantages– Plan design flexibility – Access to your plan data– Ability to manage your own risk (wellbeing) – Greater plan transparency
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Employee Benefits Trends – Self-Insurance
• Traditional Self-Insured Program – “Bundled” (insurance carrier) or “unbundled” (third party
administrator, various vendors)– Plan administration
• Claims• Eligibility • Utilization management• Disease management• Rx formulary
– Network access– Wellbeing programs– Stop-loss insurance
• Specific• Aggregate• Reserves (“run-out,” “incurred but not reported”)
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Employee Benefits Trends – Self-Insurance
• “Level-Funded” Programs– Legally, a self-insured plan – Looks like a fully insured plan – Pay “conventional equivalent” rates each month– Year-end accounting for potential “dividend”– Attractive to employer not comfortable with internal budgeting
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Employee Benefits Trends – Self-Insurance
• Other considerations/risks with self-insurance– Greater fiduciary responsibility – Some additional administrative/financial management– More decision-making regarding vendor selection– More responsibility to “get engaged” in health risk management
(wellbeing)– Potential increased financial risk if plan is not managed properly – What about joining a “captive”?
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Employee Benefits Trends – Self-Insurance
• “Dipping your toe in”…– Combining High Deductible Health Plan (HDHP) with Health
Reimbursement Arrangement (HRA)• Fully insured plan • HDHP lowers premium• Premium savings used to fund HRA• “Promise to pay”• Target HRA at specific coverage areas (i.e., hospitalization) • Limit the risk • More flexible and better cash management for the employer than
Health Savings Accounts (HSA)
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Employee Benefits Trends – Wellbeing
• 60-75% of our country’s health care expenses are tied to lifestyle/behavior risks that can be eliminated or reduced by personal decisions
• Blood pressure, LDL cholesterol, glucose, triglycerides, body mass index (BMI), tobacco use
• All directly relate to: – Heart disease– Stroke– Diabetes
• Activity-based vs. results-based
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Employee Benefits Trends – Results
• Some form of “partial” self-insurance could very likely be a more cost-effective strategy…coupled with the right wellbeing strategy! – “Traditional” approach with stop-loss insurance– “Level-funded” – HDHP with HRA
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Human Capital Management Trends
• Administrative burdens continue to increase
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Human Capital Management Trends – ACA
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Source: Payroll System
Purpose: Determine Applicable Large Employer
(ALE) Status Define Federal Employer Identification
Numbers (FEINs) and How They Relate Define Individual Employee Status Provide Full-Time Equivalent Count Track Through Measurement Periods
Source (multiple possibilities): Benefit Admin Systems Insurance Carrier Systems Human Resources Information
Systems (HRIS) Proprietary Client Files (e.g., Excel)
Purpose: Track Offers/Elections/Waivers Plan and Dependent Data Track Affordability Track and Trigger Eligibility of Full-
Time Employees
Human Capital Management Trends – Staff
• Doing more with less– 2013 – 2014
• 1.3 HR professionals per 100 full-time employees– 2015 – 2016
• 1.1 HR professionals per 100 full-time employees
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Human Capital Management Trends – Tech
• 125 new vendors in past few years– HR Insurance/Benefits– Culture and Productivity – Applicant Tracking– Recruitment Tools– Recruiting Marketplace and Search Platform– Operations Management– Employee Perks– Wellbeing
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Human Capital Management Trends – Vendors
• HR executives are generally satisfied but not often enamored with the performance of contractors and vendors. – 66% of the HR executives reported that their most recent
outsourcing initiative ‘‘met expectations’’ for improvements in service quality, with only 11% reporting that the contractor’s performance ‘‘exceeded expectations.’’
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Benefits + Technology = Engagement
• 78% of workers base their acceptance or rejection of a job offer in part on the benefits package
• 33% of companies emphasize benefits to recruit highly skilled employees
• 9% of companies say employees are very knowledge-able about their benefits
• 5 generations are in the workforce today (all present unique employee communication and experience needs)
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Identifying Best Solutions
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Identifying Best Solutions
• Endless consultants and vendors, but limited unified solutions
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Identifying Best Solutions – Where to Start?
• Self-identification – current and future state– Small, medium, large organization– Growth mode, geo-dispersed, industry requirements
• Workforce demographics– How will you communicate across generations– Need for self-service or vendor support
• What challenges are most pressing or concerning– Too many systems and vendors to manage– Improving integration and workflow– Cybersecurity and protecting the data
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Identifying Best Solutions – Where to Start?
• Map out or revisit 3- to 5-year plan– Benefits, core and nonmedical, wellbeing– Recruiting and onboarding– HRIS, payroll and reporting needs– Compliance– Additional resources or access to industry experts
• Technology– System orientation (open architecture; one solution)– Integration and workflow options
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Why CBIZ Developed Employee ServicesOrganization
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Evolution of an Industry
• CBIZ created CBIZ Employee Services Organization to solve those issues and many more.
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Evolution of an Industry
• Benefits expertise integrated with efficient HR technology that simplifies the entire employee life cycle.
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Financial stewardship
Administrative support
Employee experience
Financial Stewardship
Efficiently managing your employee benefits costs – Expertise in negotiations – Buying power – Creative solutions – Wellbeing solutions
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Administrative Support
Making your HR team’s job easier– Eliminate unnecessary paperwork– Manage the employee life cycle in one platform – Create action-oriented roadmaps to success– Utilize online enrollment
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Employee Experience
Engaging your employees and enhancing their overall experience
– Manage your employee communications and education
– Integration of human-based and tech-based approaches
– Claims advocacy for your employees – Wellbeing programs that address the “whole”
person
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CBIZ ESO
• Smart People. Smart Technology.
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QUESTIONS
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