The key to compliance with new health care requirements is paperwork, paperwork, paperwork. And the best way to make this easy is with good systems and technology.
One of the big drivers of improved health care and lower costs in the Affordable Care Act (ACA), otherwise known as ‘Obamacare,’ are technology tools. These will improve physician communication, reduce paperwork errors and provide patients more information to make health care decisions.
Members of the Western Pallet Association heard about the developments in health care and related technologies when Leanne Seeger, a vice president of Hub International, an insurance broker and consulting firm, delivered a presentation called “Technology and the Changing Landscape of Employee Benefits.” She gave the presentation at the association’s annual meeting in Rancho Mirage, California, in January.
In her speech, Seeger used a football analogy when talking about the implantation of the ACA. “We’re now at the 50-yard-line,” she said in a phone interview to discuss her presentation. The law, adopted in 2010, now is scheduled to be fully implemented by 2020. There already have been changes to it, and there could be more in the future, depending on the next president.
One significant change has occurred over the last year. Previously, small employers were identified as those with 2-99 workers. However, federal legislation passed in the fall empowers the states to define small employers, and a majority of states chose to define small businesses as those with 2-50 employees. In addition, the so-called ‘Cadillac’ tax — an excise tax imposed on employers — was delayed until 2020.
This year, employers need to report to the Internal Revenue Service every person they employ, whether or not they have health insurance through the business, and what portion employers are paying. For employers with a lot of turnover, this can be a huge undertaking.
The main forms that companies need to file with the Internal Revenue Service (IRS) are 1094 and 1095. These will be used to track compliance. The good news is that Seeger anticipates IRS will be pretty lenient the first year on mistakes and errors. But keeping track of paperwork and making sure it is filled out correctly is an important part of ACA compliance.
The reporting requirement has spurred a lot of technology that will be incorporated into employer health care programs in the next few years, she added.
The first portion of her delivered remarks noted that more people are becoming insured and how the ACA is impacting individuals and businesses. However, most of her presentation focused on changing technology in the health care industry — technology that will affect employer health insurance programs.
Immediately worth noting is that there has been a 2-4-fold increase in investment in the health insurance technology market from 2010-2015.
The development of new technology is being driven by the need to comply with the ACA, to improve efficiency in managing employee benefit plans, the invention of new healthcare devices and the application of existing technology for the health care industry, and the need to integrate technology. Examples of new technology include wearable electronic devices, insurance carrier apps for smart phones, social media and digital medical records.
How does that affect the delivery of health care? Telemedicine is one example. Some health care programs offer limited physician services via phone video chatting 24/7. Using video chatting technology, a physician can treat common illnesses, including dermatological conditions and authorize short-term prescriptions. For employers, claims are lower, and employees are not absent from work; employees save time and money. This is available through carriers or on a standalone basis. Telemedicine started with physician services and is now moving to offering behavioral health visits.
Seeger’s remarks are reflected in a 2015 report on the future of health insurance by the global accounting and professional services firm, Ernest & Young. The report cited mobile health technologies as one of the six factors prompting nothing less than an “unprecedented revolution” in the health care field. In fact, in the introduction to the report, it cited “digital health, which is democratizing data and empowering consumers,” as one of two momentous shifts, the other being the need to rein in rapidly escalating costs.
“These technologies may seem like novelties with niche appeal, particularly in these early days, but their potential for managing chronic diseases is nothing short of revolutionary,” the report goes on to say. However, while new technologies are tools to manage and prevent chronic disease more cost effectively, insurers and government entities have been slow to embrace them.
The issue of managing and preventing chronic disease is significant. The reason is that rapidly increasing health care costs are being driven in large measure by a looming epidemic in chronic disease, such as heart disease, type 2 diabetes and hypertension. Chronic disease is the biggest driver of global health spending, accounting for about 75% of costs.
“The greatest need, therefore, is to focus on changing long-term behaviors and managing chronic diseases over the long run in more efficient ways,” stated the report.
In the fee-for-service model that has dominated health care, however, there is no incentive to focus on the long-term needs of patients. Health care providers are reimbursed for procedures, not results or outcomes delivered. The model is beginning to change, albeit slowly, to restructure financial incentives and align them with health outcomes and economic value.
A related factor changing health care is what the report called the “big data revolution” — a quantum increase in the information that is being gathered and generated via digital health records, claims, pharmacy records, laboratory test results, and so on.
For the pallet industry and other industries characterized by small group insurance plans, owners and managers should realize that what was available to large employers soon will be available to small employers with increased technology.
Small employers do need to comply with the ACA. They cannot pay for individual plans, they are subject to the ‘Cadillac’ tax, and they must have the documents required for all companies. The IRS is auditing companies of all sizes.
As the ACA unfolds, health insurance exchanges will grow, noted Seeger. An exchange is essentially an online marketplace. Public exchanges sponsored by states and the federal government allow people who are not covered at work to obtain health insurance; private exchanges allow employees to shop for insurance, providing a variety of plans from which to choose for health, dental, vision, and so on. It is not unlike using one travel website to shop for an airline ticket, rental car, and a hotel. An employer can offer multiple options and set a defined contribution amount, allowing employees to pick a plan that meets their individual needs.
“Exchanges are like a cafeteria, where you are able to choose what works best for you and/or your family needs,” commented Seeger.
“Employers need to stay abreast of new plan options, technologies, and meeting their employees’ needs while keeping their costs down,” said Seeger, who described the new technologies as “skyrocketing.”
“Our health care system is changing, and it’s going to be changing rapidly because of the ACA,” she said, and other factors.
“When you’re looking at technology, you may be surprised” by what employees are doing. Minimum wage employees, even those who don’t speak English, “they do everything on the job” because they have an iPhone
similar smart phone. “They’re using apps for health care. Everything is available to the (smart) phone now…how to find benefits, how to find a doctor.”
That kind of technology is increasingly important to help keep health care costs down, she added.
Major technology changes are just beginning and will provide companies a lot to think about. Seeger explained the overall benefits, “Technology will help your HR department and will also help your employees make better informed decisions.”
The biggest change is that various parts of the health care system that have been disconnected will begin to talk with each other and collaborate.
Health Care Technology Advances
Patient Health Portals – Online portals that allow patients to keep their medical records in one place where they can access the information.
Wearables – Watches and other devices that allow an individual to monitor aerobic activity, basic bodily signs, such as heart rate.
Push Messaging – Health care providers and insurance companies sending regular messages to customers via email or text message that communicate how-to and best practices for maintaining health.
Digital Medical Records – No more taking your x-ray from doctor to doctor. The ACA mandates that physicians begin storing digital records for patients that will make communication between medical professionals easier and less prone to diagnosis errors.
Digital sensors – Wearable sensors and monitors as well as pills that can help doctors determine certain health conditions or monitor key bodily functions.
Transparency Tools – Shopping websites, search engines and rating systems that give more information to patients. They will be able to shop for health care like they do cars or electronics. They can know the cost of procedures, various specialties of doctors, ratings for hospitals, etc.
Telemedicine – use of phone and video communication to talk with a doctor or nurse at a distance. This can reduce costs, eliminate worker downtime and provide access to health care to remote communities.
Key Health Coverage Form Filing Deadlines
Employers must file the following forms with the IRS by the dates below or face a fine.
Form Type Filing Deadline
Forms 1094-B and 1095-B Paper 5/31/2016
Forms 1094-C and 1095-C Electronic 6/30/2016
