While the benefits industry has seen a whirlwind of change since the rollout of health care reform began, the full impact of the Affordable Care Act has yet to be felt and advisers are still bracing for its aftermath.
In fact, so many employers opted to take advantage of an early renewal option in 2013 to avoid rate increases, its difficult to say what effect the health reform law will have on premium rates, a new survey from United Benefit Advisors finds. But one thing is for certain, an increase in Dec. 1 renewals means a heavy workload for advisers in the fourth quarter.
Were seeing little change in premium rates and employee benefit plans, and thats because many employers renewed twice in 2013 to delay the effects of the ACA, says Carol Taylor, a benefit adviser with Virginia-based D & S Agency and Chairwoman of the UBA Client Compliance Solutions Committee.
Many early renewal plans were allowed to renew on Dec. 1 for 2014. In fact, 32% of all employers opted to move their renewal date to Dec. 1, according to the 2014 UBA Health Plan Survey. Most (94%) of those employers that chose to do so were small businesses in the under 100-employee market.
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In the category of employers with 50 or fewer employees, the results are staggering, says Taylor. In 2012, there were 507 employers with a Dec. 1st renewal date. In December 2013, that number was more than five times (412.4%) higher at 2,598 employers. This is going to have a ripple effect for years to come in the small group market.
Tanya Boyd, of Tanya Boyd and Associates, says about 80% of her clients moved to a December effective date in 2013 to avoid higher premiums under the ACA.
The majority of these groups were young and healthy. Some of my groups were facing 80% increases, she says.
Christy Schwan, president of the Brookfield, Wis.-based Stellarus Benefits says more than 90% of her firms small employers took an early renewal last fall, either with an Oct. 1 or Dec.1 renewal date to avoid moving to ACA community rated plans and to take advantage of the full transition relief period until Sept. 30, 2017.
Boyd says, We are thankful for the transition relief, but fearful about the future when employers are forced to move to a metallic plan.
She adds, I also dont see the December renewal dates changing down the road. This may be our new normal crazy fourth quarters.
Handling the heavier workload
Taylor agrees December renewal dates will likely not change and advisers should prepare for heavier workloads in the last quarter.
It certainly changes our workflows, says Schwan. Weve invested in new technology that has helped us streamline the small group renewal process to manage the volume.
She says Stellarus will then use the earlier half of 2015 to focus on new business development, retool and further upgrade our systems and processes. We will evaluate staff workloads and may adjust schedules.
Boyd says her firm prepares for the increased workload by getting renewals out to our clients as soon as they enter our inbox, and we stress the timeline and deadlines to our clients.
She says, effective communication is also key. We communicate changes to our clients in email campaigns so they hear it from us before the carrier, and we provide step by step instructions.
She says they also add staff as needed to assist with the heavy work load, even if it is just scheduling, screening individuals for quotes, or preparing renewal documents and spreadsheets.
We put everything on our calendar and stick to it, she says. We are cramming a lot into a short time, so we must take control of our calendar and not let our prospects and clients control us. That may be the hardest but most important thing to do to ensure a smooth fourth quarter.
