4 Point Compass: Fall 2019

Chicago rookery building

Health Insurance Tax for 2020 – Under the Affordable Care Act (ACA), all insurers that offer fully insured health insurance must pay an annual fee – the so-called “health insurance tax” or “HIT”.  The tax, which was designed to help fund the federal and state marketplace exchanges, equates to about 2% of premiums and is effectively passed on to employers.  In 2018, Congress approved a one-year moratorium on collecting this insurer tax for 2019, but the moratorium will lapse for 2020.  So fully-insured plans will see this tax built back into premiums in 2020 – a recent study found that annual costs will increase by $154 for a single person and $479 for a family.

Individual Insurance Pricing for 2020 – Illinois residents who buy health insurance on the Individual Marketplace (i.e. the individual exchange) will likely see rates fall slightly or hold steady next year – even as fewer consumers turn to the Marketplace for coverage and the Trump administration battles the law behind it.  The state’s largest insurer, Blue Cross and Blue Shield of Illinois, plans to decrease rates by an average of 0.02% across its exchange plans. Celtic and Cigna are also proposing similar decreases.

Additional Employee Benefit Offerings – Many employers try to offer robust & comprehensive benefit plans to stay competitive when hiring in their industry.  In addition to a Medical plan offering, employers will provide other benefit plans to their employees, sometimes on a Voluntary basis where the employee pays the full cost via payroll deductions.  Some examples of this are Dental, Vision, Additional Life Insurance, & Short/Long Term Disability.  A new, growing demand in the marketplace are “Worksite products” (i.e. Accident, Critical Illness, Hospital Indemnity plans) that are individually owned and paid for by the employee, but offered via an employer.  If you would like more information about adding additional plans, feel free to contact your Stumm service team to discuss further and have a proposal put together for you.

Human Resources Tip – New Illinois Law – There is a new Illinois Law that will become effective September 29, 2019.  Employers are prohibited from requesting salary history from all job applicants (but they can still ask applicants for their salary expectations).  Employers should modify their employment applications, make sure hiring managers are trained on the new law, and adjust hiring process accordingly.  A reminder that Stumm Insurance has HR360 available as a resource for clients to help answer any HR-related questions, and we can also provide consultant referrals for clients who may interested in using an HR consultant.