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One of the most important financial and personnel-related decisions you can make for your startup is deciding on which health insurance plans to offer your employees.

Throughout the Bay Area and Silicon Valley, COVID-19 has made many startups reevaluate their choice of health plans. Not to mention that investors may be looking for ways to tighten spending with an economic crisis still looming large. Even before the COVID-19 pandemic, selecting which health insurance plan for your business has been a tough balancing act between trying to cater to your employees, recruit top talent, and adhere to your funding situation.

Your first step in trying to navigate how to successfully choose your group health insurance is to understand which tiers you want to offer. After the Affordable Care Act (ACA), health care plans were categorized into different level tiers by insurance companies. ​

You can think of the different metal tier categories like the Olympics. Small group ACA Plans are split into Bronze, Silver, Gold, and Platinum levels.

The higher the tier, the more coverage is paid for by the insurance company in terms of lower deductibles, copays, and out-of-pocket expenses. But at the same time, the higher the metal tier, the more you would pay for in monthly pre-tax premiums.

The plans reflect what percentage of coverage insurance companies pay for out-of-pocket expenses versus what an insured employee enrolled in the health plan would pay. As a general approximation, the plans cover out-of-pocket expenses at the following rates:

  • Bronze: insurance company pays 60% / insured employee pays 40%
  • Silver: insurance company pays 70% / insured employee pays 30%
  • Gold: insurance company pays 80% / insured employee pays 20%
  • Platinum: insurance company pays 90% / insured employee pays 10%

But a lot more goes into understanding the metal tiers than their percentage of coverage. Let’s break down the plan levels further to see which one would be best for your startup.

Bronze Plans

Bronze plans are the lowest tier of health plans. If you are low on cash flow then a Bronze plan will be the least cost for your startup. These plans have the lowest monthly premium out of most major plan options yet they have the highest price point for when you access your care.

You could even have a deductible as high as $6,000, which may only be waived for the first three doctor’s visits of the year.

As an employee, Bronze plans are a good option if you’re looking for coverage in case of an emergency and if you want some form of health coverage without paying a lot each month.

Startups that offer Bronze plans usually do so to offer a Health Savings Account, also known as an HSA. You can create an HSA for High Deductible Health Plans (HDHPs), which are typically only Bronze level plans. But a major caveat is that most companies no longer fund HSAs due to HDHPs providing less and less savings over the years.

Based on my clients’ experiences, Bronze plans are often cheap to buy but expensive to use. In other words, you may be able to cut down on pre-tax monthly costs when it comes to your premiums but you and your employees will be paying for it after-tax when it comes to actually using medical services.

Silver Plans

Silver plans usually have a moderate monthly premium but the enrolled employee will have less out-of-pocket expenses to pay than a Bronze plan.

A typical deductible for a Silver plan is around $1,800 to $2,200 and may be waived for office and specialist visits with only a copay to pay. Some Silver plans even waive the deductible for certain lab tests, x-rays, and outpatient surgeries.

Silver plans are ideal if you are looking to control costs but you still would like to have an increased amount of coverage for care and services.

Silver plans are a smart compromise if your startup doesn’t have limitless resources but you still would like to offer your employees more robust coverage.

Gold Plans

Gold plans typically have high monthly premiums but low costs for when the insured employee receives care.

Startups that want to retain and even recruit talent gravitate towards Gold plans. With a Gold plan offering, employees can be more at ease knowing that the costs of their appointments and procedures will cost less when they use them. For what you receive, Gold plans can be a cost-effective option even with the higher premium.

Employees who utilize large amounts of care would select a Gold option when available since they are willing to pay more in pre-tax premiums so that they could have more coverage for expensive appointments and services.

Platinum Plans

Platinum level plans are the highest tier and offer the most coverage for the insured employee’s medical costs out of all the tiers.

On the other hand, Platinum plans tend to have the highest monthly premiums. If you rarely use health care services then Platinum plans may be a poor option. Typically, Platinum plans are favored by those who have chronic health conditions or diseases, disabilities, or want to pay more on the front end than the back end for using services.

However, there may be tax incentives to a Platinum plan. As an employee, I would want to pay more pretax for higher premiums taken out of my payroll than pay more for services after tax when I try to use them.

Some of the top tech companies offer Platinum benefits. For startups, you may need proper funding in order to provide lucrative Platinum plans. Even with the right funding, startups face difficulty in sustaining Platinum plans because of the high cost and burn rate.

Just remember selecting a Platinum option depends entirely on who you’re recruiting from, if you’re targeting talent who may be accustomed to Platinum level coverage, as well as if you’re sufficiently funded.

Offering More Than One Tier

The wisest solution for a startup would be to offer your employees different options of plan tiers. With the right contribution model of how much your startup pays and how much your employee pays for premiums, you can offer a variety of solutions for your employees that would fit their individual health needs.

Employees can truly reap the benefits of having a diversity of options. Say you’re an employee and become pregnant or are expecting to become pregnant. If your startup offers a variety of plan options, you can sign-up for a Platinum plan to take advantage of the lower out-of-pocket costs for the tests, appointments, and delivery. Even with higher monthly premiums you can save a lot more with having high level coverage for services.

You can then downgrade to a lower tier with less of a monthly premium after you have your baby since having a baby is a qualifying event that allows you to change your health plan. Since all carriers are different, please make sure to check with your carrier and get it in writing before you do this.

A variety of plans will also cater to the diversity of your employees. Someone who is young, healthy, and doesn’t want to pay a lot in premiums may opt for a Bronze or Silver plan. Meanwhile if you are an employee and are going to have a major surgery this year, you may want to think about upgrading to a higher plan so you pay less out-of-pocket.

In the end offering different solutions will be the best way to go.

How Am I Supposed to Decide Between All These Plan Tiers?

All in all, the numbers make the decision for you. If cashflow is not an issue for your startup, then offering high-level plans may make sense for offering a comprehensive benefits package.

Don’t be afraid to start with lower-tiered benefits and work your way up. Employees will always appreciate if you upgrade their tiers as your startup grows, although downgrading plans may hurt morale when funding slows or during economic crises. Remember to exercise caution when selecting a plan tier.

We understand that even if you know the differences between all the various health insurance tiers, it may be difficult to decide which level, let alone which exact plans, will offer you and your employees the best coverage, care, and value.

At AEIS, we are your trusted partner that will help you make the best decision for your startup when it comes to employee benefits. We believe a robust, well organized, and well communicated employee benefits package is essential for incentivizing and retaining top talent.

Setup a complimentary consultation today with myself, Ron Bland, at ron@aeisadvisors.com and 650-348-6234 x12 for a review of your current plans and how we can work together.

By Ron Bland

Disclaimer: Any compliance related information in this blog is intended to be informational and does not constitute legal advice regarding any specific situation. Should you require further compliance assistance or legal advice, please consult a licensed attorney.

June 2020

The Centers for Medicare and Medicaid Services (CMS) published its final rule and fact sheet for benefit payment and parameters for 2020. Although the final rule primarily affects the individual market and the Exchanges, the final rule addresses the following topics that may impact employer-sponsored group health plans:

  • The 2020 maximum annual limitation on cost sharing is $8,150 for self-only coverage and $16,300 for other-than-self-only coverage.
  • For fully-insured plans, any indication of a reduction in the generosity of a benefit for individuals that is not based on clinically indicated, reasonable medical management practices is potentially discriminatory.
  • Amounts paid toward cost sharing using direct support by drug manufacturers (for example, coupons) to insured patients to reduce or eliminate immediate out-of-pocket costs for specific prescription brand drugs that have a generic equivalent are not required to be counted toward the annual limitation on cost sharing.
  • Federally Facilitated Small Business Health Options Programs (FF-SHOPs) may operate a toll-free hotline rather than a more robust call center.

The final rule is effective on June 24, 2019. The final rule generally applies to plan years beginning on or after January 1, 2020.

By Karen Hsu

Originally posted on ubabenefits.com

On August 1, 2018, the Internal Revenue Service, the Department of Health and Human Services (HHS), and the Department of Labor (collectively, the Departments) released a final rule that amends the definition of short-term, limited-duration insurance. HHS also released a fact sheet on the final rule.

According to the Departments, the final rule will provide consumers with more affordable options for health coverage because they may buy short-term, limited-duration insurance policies that are less than 12 months in length and may be renewed for up to 36 months.

The final rule will apply to insurance policies sold on or after October 2, 2018.


By Karen Hsu
Originally Published By United Benefits Advisors


New technologies are poised to fundamentally change the HR industry as we know it. Just as the smartphone revolutionized the way we communicate, artificial intelligence will reshape all areas of HR, from employee onboarding to learning management to developing top talent. And, similar to smartphones, these changes will take place at lightning speed.

But what exactly is artificial intelligence? And what implications might this evolving tech have on the future of health care? Buckle up, because we’re going to take a glimpse into the current AI projects, as well as what the future of health care could look like with AI advancements.

What Is Artificial Intelligence?

In its most basic form, artificial intelligence uses computer programming to develop systems that are able to perform tasks that would normally require human intelligence. These tasks could include speech recognition, decision-making, language translation, and much more.

Have you ever wondered how ridesharing apps like Uber and Lyft are able to predict ETAs for rides? Artificial intelligence. Or, how email platforms know how to filter out spam and nicely categorize your emails into categories? Yep, artificial intelligence.  Or, how your banking app is able to process a check deposit via a simple image? You guessed it, artificial intelligence.

Artificial intelligence has become an integral part of many of the technologies and services that we use in our everyday life without us even knowing or really thinking about it.

In addition to its many convenient applications, AI also offers a promising and impactful future in the field of health care.

Examples of Artificial Intelligence in Health Care

The use of artificial intelligence is completely altering the front door of health care as we know it. From specific programs that aid in medical diagnostics to intelligent apps that triage remote patients, AI is making health care more efficient and accessible than ever.

Medical Data Mining

One of the primary areas in which AI shines versus manual human processes in the field of data analysis. Not only can artificial intelligence process complex sets of data at lightning speed, it can also provide meaningful and actionable insight and recommendations based on data sets. DeepMind(acquired by Google in 2014) is an AI-based technology that works to expedite the process in which patients are moved from ‘test’ to ‘treatment’. IBM’s Watsonproduct provides solutions for interpreting, organizing, and easily accessing clinical and patient data, in addition to providing technology for recognizing patient similarity and medical insights. According to IBM, medical data is expected to double every 73 days by 2020. And, each person will generate enough health-related data in their lifetime to fill 300 million physical books. Utilizing AI will not only expedite the process in which health care providers access patient info but also better-organize and analyze data available and even provide predictions on future health concerns and recommendations for treatment plans.

Powering Diagnostics

The FDA recently approved the use of artificial intelligence powered software for the use of medical diagnostics, marking the first use of AI in this application. The program is designed to detect signs of diabetic retinopathy, a condition that can cause long-term vision loss and that impacts more than 30 million people in the United States alone. The technology uses an AI algorithm to scan and analyze multiple images of an eye and then delivers a positive or negative test result. This is the first FDA approved solution that does not require a doctor to interpret test results, and more AI-based diagnostic solutions are expected to get the green light in the next several years.

Drug Development

It’s no secret that testing pharmaceuticals through clinical trials is an expensive and time-consuming process. The full development, testing, and approval process can literally take decades and cost billions. Though pharmaceutical players of all sizes are currently experimenting with AI applications in the drug discovery and development process, GSK is considered a leader in the space. GSK has fully embraced AI research and applications with their dedicated in-house team, ‘In silico Drug Discovery Unit’. The ultimate goal of the GSK project is to leverage artificial intelligence to shorten the drug research, testing, and launch window to under a year, a bold vision. Making the pharmaceutical process more efficient could drastically reduce the cost of medical treatments and the cost of health care in general.

Solving Doctor Shortages

China is facing one of the most alarming doctor shortagesin history, with only 1.5 doctors for every 1,000 residents (compared to 2.5 doctors per person in the United States). The need is dire, and the government is calling for action and loosening restrictions on the use of data and new technology. Currently, more than 100 companies are working to develop AI solutions to address urgent health care needs. A recent reportpredicted that China’s market for AI-powered health care services will reach almost $6B yuan ($930 Million) by 2022. Current projects include diagnostic tools to assist with CT scans, x-rays, ultrasound scans and prosthetic design and manufacturing.

Improving Telemedicine

Which would you prefer – an hour-long wait in a doctor’s office plus the time to actually see the doctor, or a quick 15-minute consultation and diagnosis via your smartphone? Though many assume telemedicine is a modern iteration of health care, this practice has actually been around since the 1950’s. Now, telemedicine is a common alternative to traditional doctor’s visits for simple diagnostics and treatment. A new app, 98point6, is taking this remote-experience to the next level with artificial intelligence. The technology interacts with subscribers to help better understand medical needs and then channels requests to the appropriate doctor for evaluation. The AI-bot essentially serves as a personalized triage service, saving manual time and labor.

The Bottom Line?

The adoption and utilization of artificial intelligence in the health care space will make health care more accessible, efficient, and affordable for everyone.

by Meisha Bochicchio, Content Marketing Manager at PlanSource
Originally posted on blog.ubabenefits.com

What people want in their benefits package is changing. Retirement and health care still rank high but soft perks and voluntary benefits factor into satisfaction more than any other benefits, so says “Employees Increasingly Excited About Soft Perks and Company-Culture Benefits,” in Employee Benefit News.

When considering a job offer, these types of benefits are top of mind for potential employees and should, therefore, be priorities for employers. Still, over 4 in 10 respondents said their company didn’t offer any perks, a sign that employers still value traditional benefits more.

With a tightening work force and historically low unemployment, employers may need to adjust their offerings to better align with the people they need and want to hire.

Sure, free snacks and coffee are always appreciated. With millennials and Gen Z entering the workforce, it’s clear a new generation of workers is looking for a new generation of benefits. At the same time, baby boomers are working longer than the generations prior. Companies, then, must develop not only perks but also voluntary solutions that meet a sprawling range of life experiences according to “9 voluntary solutions for today’s diverse workforce” and “10 perks that help attract and retain workers,” in BenefitsPRO.

More and more, flexible hours are a leading request in interviews. Likewise, the opportunity to work from home or a company keeping summer hours can boost satisfaction. Having control over when and where work happens is more and more important to employees.

Other perks seen as essential were professional development and fitness and health programs. Wellness programs might include discounts for fitness wearables. Professional development could include creating opportunities to learn about topics as diverse as coding to project management. Lunch-and-learn events are a small-scale way to invest in employee development, and it’s seen as even better if the employer provides the lunch.

Read “Employees Increasingly Excited About Soft Perks and Company-Culture Benefits” here.

Read “9 voluntary solutions for today’s diverse workforce” here.

Read “10 perks that help attract and retain workers” here.

By Bill Olson

Originally Published By United Benefit Advisors

Friday, April 27, the Internal Revenue Service (IRS) announced that the 2018 annual contribution limit to Health Savings Accounts (HSAs) for persons with family coverage under a qualifying High Deductible Health Plan (HDHP) is restored to $6,900. The single-coverage limit of $3,450 is not affected.

This is the final word on what has been an unusual back-and-forth saga. The 2018 family limit of $6,900 had been announced in May 2017. Following passage of the Tax Cuts and Jobs Act in December 2017, however, the IRS was required to modify the methodology used in determining annual inflation-adjusted benefit limits. On March 5, 2018, the IRS announced the 2018 family limit was reduced by $50, retroactively, from $6,900 to $6,850. Since the 2018 tax year was already in progress, this small change was going to require HSA trustees and recordkeepers to implement not-so-small fixes to their systems. The IRS has listened to appeals from the industry, and now is providing relief by reinstating the original 2018 family limit of $6,900.

Employers that offer HSAs to their workers will receive information from their HSA administrator or trustee regarding any updates needed in their payroll files, systems, and employee communications. Note that some administrators had held off making changes after the IRS announcement in March, with the hopes that the IRS would change its position and restore the original limit. So employers will need to consider their specific case with their administrator to determine what steps are needed now.

HSA Summary

An HSA is a tax-exempt savings account employees can use to pay for qualified health expenses. To be eligible to contribute to an HSA, an employee:

  • Must be covered by a qualified high deductible health plan (HDHP);
  • Must not have any disqualifying health coverage (called “impermissible non-HDHP coverage”);
  • Must not be enrolled in Medicare; and
  • May not be claimed as a dependent on someone else’s tax return.

HSA 2018 Limits

Limits apply to HSAs based on whether an individual has self-only or family coverage under the qualifying HDHP.

2018 HSA contribution limit:

  • Single: $3,450
  • Family: $6,900
  • Catch-up contributions for those age 55 and older remains at $1,000

2018 HDHP minimum deductible (not applicable to preventive services):

  • Single: $1,350
  • Family: $2,700

2018 HDHP maximum out-of-pocket limit:

  • Single: $6,650
  • Family: $13,300*

*If the HDHP is a nongrandfathered plan, a per-person limit of $7,350 also will apply due to the ACA’s cost-sharing provision for essential health benefits.


Originally posted on thinkHR.com

As the costs of health care soar, many consumers are looking for ways to control their medical spending. Also, with the rise of enrollment in high deductible health plans, consumers are paying for more health care out-of-pocket. From medical savings accounts to discount plans for prescriptions, patients are growing increasingly conscious of prices for their healthcare needs. Price shopping procedures and providers allows you to compare prices so that you are getting the best value for your care.

Why do you need to look beyond your nearby and familiar providers and locations for healthcare? Here’s a hypothetical example: Chris is a 45-year old male in good physical health. During his last check-up he mentions to his doctor that he’s had some recent shortness of breath and has been more tired as of late. His doctor orders an EKG to rule out any problems. If Chris went to his local hospital for this procedure, it would cost $1150. He instead looks online and shops around to find other providers in his area and finds he can get the same procedure for $450 at a nearby imaging center. His potential savings is $700 simply by researching locations.

So where do you start when shopping around for your health care?  A good place to begin is by researching your health plan online. Insurance companies will post cost estimates based on facility, physician, and type of procedure. Keep in mind that these are just estimates and may vary based on what coverage you are enrolled in. Another way to shop is by checking out websites that have compiled thousands of claims information for various procedures and locations to give an estimate of costs. However, deciphering whether a site is reporting estimates based on the “medical sticker price” of charges or rates for private insurance plans or Medicare is difficult.  There are huge differences in prices at different providers for the exact same procedure. This is because contracts between insurance agencies and providers vary based on negotiated amounts. This makes it hard to get consistent pricing information.

Check out these sites that do a great job comparing apples to apples for providers:

  • Healthcare Blue Book
    • What Kelly Blue Book is to cars, Healthcare Blue Book is to medical pricing
  • New Choice Health
    • Reports on pricing of medical procedures, providers, quality of facilities, and customer feedback for healthcare in all 50 states
  • The Leapfrog Group
    • Publishes data on hospitals so patients can compare facilities and costs for treatments and procedures

After compiling all the information on prices and procedures, you can still call and negotiate costs with the location of your care. Fair Health Consumer has tips on how to negotiate with providers and plan for your healthcare needs.

Knowledge is POWER and when you spend time researching and comparing healthcare costs, you are empowering yourself!  Exercising due diligence to plan for you and your family’s medical needs will save you money and give you confidence in your decisions for care.

Two tri-agency (Internal Revenue Service, Employee Benefits Security Administration, and Centers for Medicare and Medicaid Services) Interim Final Rules were released and became effective on October 6, 2017, and were published on October 13, 2017, allowing a greater number of employers to opt out of providing contraception to employees at no cost through their employer-sponsored health plan. The expanded exemption encompasses all non-governmental plan sponsors that object based on sincerely held religious beliefs, and institutions of higher education in their arrangement of student health plans. The exemption also now encompasses employers who object to providing contraception coverage on the basis of sincerely held moral objections and institutions of higher education in their arrangement of student health plans. Furthermore, if an issuer of health coverage (an insurance company) had sincere religious beliefs or moral objections, it would be exempt from having to sell coverage that provides contraception. The exemptions apply to both non-profit and for-profit entities.

The currently-in-place accommodation is also maintained as an optional process for exempt employers, and will provide contraceptive availability for persons covered by the plans of entities that use it (a legitimate program purpose). These rules leave in place the government’s discretion to continue to require contraceptive and sterilization coverage where no such objection exists. These interim final rules also maintain the existence of an accommodation process, but consistent with expansion of the exemption, the process is optional for eligible organizations. Effectively this removes a prior requirement that an employer be a “closely held for-profit” employer to utilize the exemption.

On November 30, 2017, the Centers for Medicare and Medicaid Services (CMS) released guidance on accommodation revocation notices. Plan participants and beneficiaries must receive written notice if an objecting employer had previously used the accommodation and, under the new exemptions, no longer wishes to use the accommodation process. The Interim Final Rules required the issuer to provide written revocation notice to plan participants and beneficiaries. CMS’ recent guidance clarifies that the employer, its group health plan, or its third-party administrator (TPA) may provide written revocation notice instead of the issuer.

CMS’ guidance also clarifies the timing of the revocation notice. Under the Interim Final Rules, revocation is effective on the first day of the first plan year that begins on or after 30 days after the revocation date. Alternatively, if the plan or issuer listed the contraceptive benefit in its Summary of Benefits and Coverage (SBC), then the plan or issuer must give at least 60 days prior notice of the accommodation revocation (SBC notification process). CMS’ guidance indicates that, even if the plan or issuer did not list the contraceptive benefit in its SBC, the employer is permitted to use the 60-day advance notice method to revoke the accommodation as long as the revocation is consistent with any other applicable laws and contract provisions regarding benefits modification.

Further, if the employer chooses not to use the SBC notification process to notify plan participants and beneficiaries of the accommodation revocation and if the employer instructs its issuer or TPA not to use the SBC notification process on the employer’s behalf, then the employer, its plan, issuer, or TPA must send a separate written revocation notice to plan participants and beneficiaries no later than 30 days before the first day of the first plan year in which the revocation will be effective.

Unlike the SBC notification process, which would allow mid-year benefit modification, if an employer uses the 30-day notification process, the modification can only be effective at the beginning of a plan year.

Employers that object to providing contraception on the basis of sincerely held religious beliefs or moral objections, who were previously required to offer contraceptive coverage at no cost, and that wish to remove the benefit from their medical plan are still subject (as applicable) to ERISA, its plan document and SPD requirements, notice requirements, and disclosure requirements relating to a reduction in covered services or benefits. These employers would be obligated to update their plan documents, SBCs, and other reference materials accordingly, and provide notice as required.

Employers are also now permitted to offer group or individual health coverage, separate from the current group health plans, that omits contraception coverage for employees who object to coverage or payment for contraceptive services, if that employee has sincerely held religious beliefs relating to contraception. All other requirements regarding coverage offered to employees would remain in place. Practically speaking, employers should be cautious in issuing individual policies until further guidance is issued, due to other regulations and prohibitions that exist.

By Danielle Capilla
Originally Published By United Benefit Advisors

The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) requires employers to offer covered employees who lose their health benefits due to a qualifying event to continue group health benefits for a limited time at the employee’s own cost. Per regulation, qualifying events are specific events that cause or trigger an individual to lose health coverage. The type of qualifying event determines who the qualified beneficiaries are and the maximum length of time a plan must offer continuation coverage. A group health plan may provide longer periods of continuation coverage beyond the maximum 18 or 36 months required by law.

There are seven triggering events that are qualifying events for COBRA coverage if they result in loss of coverage for the qualified beneficiaries, which may include the covered employee, the employee’s spouse, and dependent children.


Triggering event plus loss of coverage equals COBRA coverage

The following quick reference chart indicates the qualifying event, the individual who is entitled to elect COBRA, and the maximum length of COBRA continuation coverage.

COBRA qualifying events


By Danielle Capilla
Originally Published By United Benefit Advisors

Dear Ron, Thank you so much for generously supporting [us] and our AIDS walk team this year. It was a lovely foggy Sunday morning in Golden Gate Park, with thousands of folks walking to fight AIDS. It has been a pleasure working with you over the years. You have saved us LOTS of money! I want you to know how much we appreciate all that you do!

- San Francisco, Non-profit organization