How to choose the right benefits broker?

Make sure there's a good service model behind your broker. All too often, a licensed broker sells you on his agency, and then a non-licensed individual tries to service your account. Not having a qualified benefits consultant can have a detrimental impact on your employees and your business.

Health care legislation is changing frequently, make sure your CFO or Human Resource manager receives proactive support and can reach out with questions. It is essential to have someone who is accessible. People might not even know the right questions to ask. Often a phone conversation is needed to help clear up any confusion. 

Lastly, a significant thing to watch out for is the promise of one-stop-shop and all-in-one technology. Software like health care legislation is changing frequently. Software is only as good as the people managing the data. You'll need an independent expert to assist your company change with the market & legislation as appropriate. For many  businesses insurance is the highest expense after payroll, so it is essential to find a broker that understands this immense financial responsibility. 

Are only large groups required to have employer sponsored health insurance?

In January of 2018 Massachusetts passed a law to encourage more small businesses to offer employee health insurance.  Since January employers with 6 or more employees will pay a new penalty of up to $750 for each non-disabled worker, who receives health insurance coverage through MassHealth (or other subsidized coverage) instead of through an employer-sponsored health plan.  

How are benefit brokers compensated?

Generally, you don't pay your broker directly.  Regardless your broker should be providing support to your organization throughout the entire year.  Most brokers are compensated a small percentage of your insurance premium.  As we know insurance premium is costly so you should be receiving exceptional service.  

When is the best time to switch brokers?

You can choose a new broker at any time as long as it is not too so close to your annual renewal date.  Changing brokers is a simple as signing a letter.  The new broker will receive everything they need from your insurance carrier(s) to effectively manage your benefits.

Do brokers advise on reporting requirements for benefit programs?

Absolutely. Good brokers will make you aware of employee benefit required reporting well before their due dates and even offer guidance as to how to correctly complete formal documents. 

How do I find a great workplace wellness program?

It is essential to start with someone who is highly qualified.  There are a lot of "experts" in the field.  However, we suggest choosing someone with at least a bachelor's degree in nutrition. Additionally, since the most successful workplace wellness programs ultimately need to drive culture change, we also recommend finding someone that inspires employees. 

Does Massachusetts require employers with 25 or more full-time employees to have paid family and medical leave?

Yes on June 28, 2018, Governor Charlie Baker signed a Bill that establishes a mandatory statewide paid family and medical leave program for all employers, which will be administered by the new Department of Family and Medical Leave. The leave program will be financed through employer and employee contributions for groups with 25 or more full-time employees - employers are required to contribute to the tax.

Was the Affordable Care Act (ACA) ruled invalid?

Yes on December 14, 2018, a federal judge rules that the entire Affordable Care Act is invalid due to the elimination of the individual mandate penalty in 2019.  However, the White announced the ACA will remain in place pending appeal.  Additionally, the Department of Health and Human Services confirmed that it will continue administering and enforcing all aspects of ACA. 

What is the Pay or Play rules?

The Affordable Care Act requires applicable large employers (ALEs) to offer affordable, minimum value health coverage to their full-time employees or pay a penalty.  The IRS clarified that ALEs can use an affordability safe harbor to adjusted affordability contributions percentages.  Employer-sponsored coverage will generally be considered affordable under the employer shared responsibility rules if the employee's required contribution for self-only  coverage does not exceed 9.86% of the employee's household income for 2019 plan year.


Are all employees of an employer taken into account in determining whether the employer is an ALE?


Generally, all employees are counted (either as full-time employees or FTEs) when an employer is determining whether it is an ALE, but there are some exceptions.

· Seasonal workers: An employer is not an ALE if both of the following apply:

o The employer’s workforce exceeds 50 full-time employees (including FTEs) for 120 days or fewer during the preceding calendar year; and

o All of the employees in excess of 50 employed during that period of no more than 120 days are seasonal workers.


“Seasonal workers” are   workers who perform labor or services on a seasonal basis (as defined by the   DOL) and retail workers employed exclusively during holiday seasons. For this   purpose, employers may apply a reasonable, good faith interpretation of the   term “seasonal worker” and a reasonable, good faith interpretation of the   DOL’s definition of seasonal worker.

· TRICARE/Department of Veterans Affairs (VA) Coverage: Employees who have coverage under TRICARE or a VA health program are not taken into account in determining if an employer is an ALE.

These exceptions apply solely for purposes of determining whether an employer is an ALE. For additional information, see Section 4980H(c)(2)(F) and Section 54.4980H-2(b) of the regulations.

How long are qualified beneficiaries entitled to COBRA?

 Where a loss of coverage is a result of an employee’s termination of employment (other than by reason of gross misconduct) or reduction in hours, qualified beneficiaries are entitled to continue coverage for a maximum of 18 months


Where a loss of coverage is a result of any of the following, qualified beneficiaries are entitled to continue coverage for a maximum of 36 months

· Death of a covered employee; 

· Divorce or legal separation of a covered employee from the covered employee’s spouse;

· A covered employee becoming entitled to Medicare benefits; and 

· A dependent child ceasing to be a dependent child under the terms of the health plan. 

Where a loss of coverage is a result of an employee’s termination of employment (other than by reason of gross misconduct) or a reduction in hours and a qualified beneficiary is determined by the Social Security Administration to be disabled before, at or within 60 days of the date of the qualifying event, all qualified beneficiaries within that family are entitled to COBRA for a maximum period of 29 months. To benefit from this extension, any qualified beneficiary within the family must notify the plan administrator as required by the reasonable procedures established by the plan administrator. 

Where a qualified beneficiary was determined disabled by the Social Security Administration prior to the qualifying event, the qualified beneficiary is considered to meet the statutory requirement of being disabled “within the first 60 days of COBRA coverage.” 

How long are qualified beneficiaries entitled to COBRA when the employee/qualified beneficiary was enrolled in Medicare prior to a termination or reduction in hours?

 If the employee was enrolled in Medicare prior to his or her termination or reduction in hours (for example, retirement), the employee is entitled to 18 months of COBRA continuation coverage. Where the spouse or dependent is covered under the plan on the day before the employee's termination or reduction in hours, the spouse and dependent are entitled to COBRA continuation coverage for the longer of:   

· 18 months from the date of the employee's termination or reduction in hours; or 

· 36 months from the date the employee became enrolled in Medicare.

When may COBRA be terminated early?

COBRA continuation coverage will terminate before the maximum coverage (that is, 18, 29, 36 months) period if: 

· COBRA premiums are not made in a timely manner; 

· The employer ceases to provide a health plan to any employee;

· After electing COBRA continuation coverage, the qualified beneficiary first becomes covered under another health plan; or   

· After electing COBRA continuation coverage, the qualified beneficiary first becomes entitled to Medicare (Part A or B). 

Provided that a qualified beneficiary has received no less than 18 months of COBRA continuation coverage, COBRA continuation coverage will terminate where COBRA coverage was extended to 29 months due to a disability as determined by the Social Security Administration, and the Social Security Administration later determines that the qualified beneficiary is no longer disabled. 

Where an individual is covered under COBRA, but not a qualified beneficiary, the individual loses coverage when the qualified beneficiary is no longer covered under COBRA. 

What premium may be charged for COBRA coverage?

COBRA premiums may not exceed 102 percent of the cost to the plan for similarly situated beneficiaries with respect to whom a qualifying event has not occurred (without regard to whether such cost is incurred by the employer or employee). 

Where COBRA continuation coverage is extended due to disability, COBRA premiums may not exceed 150 percent of the cost to the plan for similarly situated beneficiaries with respect to whom a qualifying event has not occurred (without regard to whether such cost is incurred by the employer or employee) for months 19 through 29. Where the disabled qualified beneficiary is no longer covered under the plan, the remaining qualified beneficiaries within the family are entitled to continue coverage for up to 29 months at an amount not to exceed 102 percent of the cost to the plan.

When may COBRA premiums be changed?

COBRA premiums must be established before a 12-month determination period. A determination period must be applied consistently from year to year. During a determination period, COBRA premiums may only be increased in the following three cases: 

· COBRA premiums were set below the maximum amount permitted (for example, 102 percent of the plan’s cost); 

· COBRA premiums are increased to 150 percent of the plan’s cost as permitted during disability extensions; or 

· The qualified beneficiary has changed his or her election (that is, single to family, HMO plan to PPO plan). 

What is timely payment for COBRA continuation coverage?

The qualified beneficiary’s first COBRA premium payment is due within 45 days of the date of his or her COBRA election. 

For subsequent COBRA premiums, a qualified beneficiary’s payment is considered timely if made on the later of the following: 

· Within 30 days of the beginning of the coverage period (that is, the beginning of the month); 

· The date on which similarly situated active employees are required to pay for coverage; or 

· The date on which the plan is permitted to pay the insurance company, HMO, or other entity that it pays for coverage. 

Payment is considered made on the date it was sent by the qualified beneficiary. COBRA premiums may be paid by any third party on behalf of the qualified beneficiary. For example, a qualified beneficiary’s new employer may pay COBRA premiums to the former employer on behalf of the qualified beneficiary. 

What if a qualified beneficiary fails to pay the entire COBRA premium?

If a qualified beneficiary makes timely payment in an amount that is not significantly less than the amount due, the payment is deemed to meet the qualified beneficiary’s payment obligation, until the plan notifies the qualified beneficiary and grants a reasonable amount of time to correct the deficiency. For this purpose, 30 days is considered reasonable.

Under COBRA, what coverage must be offered to a qualified beneficiary?

 Each qualified beneficiary must be offered an opportunity to elect the same coverage that was provided on the day before the qualifying event. 

Also, qualified beneficiaries must be given the same rights as similarly situated active employees. Where similarly situated active employees are permitted to change between health plans or add dependents to the plan during an annual open enrollment, qualified beneficiaries must be permitted to do the same.

Under COBRA, what coverage must be offered to a qualified beneficiary who is relocating?

 If a qualified beneficiary participates in a region-specific benefit package (such as an HMO) that will not service his or her health needs in the area to which they are relocating (regardless of the reason for the relocation), the qualified beneficiary must be given an opportunity to elect alternative coverage that the employer makes available to active employees. While the employer is not required to put a plan in place to accommodate the relocated qualified beneficiary, it must make available coverage which it has available, even if that qualified beneficiary was not eligible for that coverage while he or she was an active employee. 

Can a qualified beneficiary revoke a COBRA waiver?

If a qualified beneficiary waived COBRA continuation coverage, he or she may revoke the waiver at any time during the initial election period. COBRA continuation coverage is effective on the date the waiver is revoked.

What are the recordkeeping requirements under the Family and Medical Leave Act (FMLA)?

What are the recordkeeping requirements under the Family     and Medical Leave Act (FMLA)?

Employers covered by the FMLA must make and keep records regarding their compliance obligations under the FMLA. These records must be preserved for a minimum of three years.

Covered employers who have FMLA-eligible employees must maintain records that disclose the following:

· Basic payroll and identifying employee data

· Dates that FMLA leave is taken

· Hours of FMLA leave that are taken, if taken in increments of less than a day

· All employee and employer FMLA notices provided

· Any documents describing employee benefits or employer practices or policies regarding paid and unpaid leave that is taken

· Premium payments of employee benefits

· Records of any disputes regarding the designation of leave

Covered employers that have no FMLA-eligible employees must still maintain basic payroll and identifying employee data.

Employee FMLA records relating to medical certifications, recertifications or medical histories of employees or their family members must be maintained as confidential medical records in separate files from employee personnel files. However, individuals such as managers, safety personnel or government officials investigating compliance may be informed of relevant FMLA medical information as necessary. In addition, these records may be subject to further confidentiality requirements under the Americans with Disabilities Act (ADA).

Am I required to provide severance pay to terminated employees?

Employers are not legally required to provide severance pay to terminated    

employees unless company policies or employment contracts specify that severance pay will be provided.

Many employers offer severance pay, but in order to receive it, employees must typically sign a document releasing the company from any liability for termination. Severance pay and packages vary, but they often include some of the following:

· Payment for unused paid time off

· Payment based on length of service

· Payment in lieu of a required notice period

Employers should note that providing severance pay to some employees and not others could lead to charges of discrimination and other litigation. A nondiscriminatory, consistent severance policy should be established and followed. 

Which questions should be avoided during the interview process?

There isn’t an exhaustive list of questions employers should avoid asking, but employers need to be careful that any questions asked cannot be interpreted as discriminatory. To help avoid discrimination claims, information requested from the applicant should be directly related to the position he or she is interviewing for. Acceptable topics include previous work experience, education and skills that are necessary for the position. The following are some suggested subjects to generally avoid in an interview:

· Asking questions that, if the applicant responded, would reveal whether he or she belongs to a protected group, or how he or she feels about a controversial issue.

· Inquiries about an applicant’s marital status, the existence of (or probability of having) children or his or her age. Considering age in hiring decisions may violate the Age Discrimination in Employment Act, unless age is a legitimate qualification for the position.

· Questions about an applicant’s criminal history. Basing a hiring decision on criminal history may violate Title VII of the Civil Rights Act. Also, several states limit how and when the employer may use arrest and conviction records to make employment decisions. 

· Inquiries concerning child care arrangements, mode of transportation or home ownership. Rather than asking applicants if they have a car, it is generally better to ask  if the applicant has reliable transportation to report to work. 

· Questions about citizenship or national origin. However, employers can, inquire about an applicant’s ability to show authorization to work in the United States, if hired. 

· Any questions related to medical conditions or medical history. However, if you know an applicant has a disability (because it is evident or the applicant has volunteered that information) it may be reasonable to question whether the disability might pose difficulties for the individual in performing essential job functions. If so, the employer may begin a dialogue with the applicant to determine whether he or she would need reasonable accommodations in order to perform any tasks and what the accommodation(s) may be. 

Previous salary.  Massachusetts has Pay Equity law that prohibits this question. 

Some of these questions are permitted after a job offer is made, but should only be asked if there is a business necessity. When in doubt, it’s better to err on the side of caution than to ask a problematic question and risk a discrimination claim. Train anyone who will be interviewing candidates, and create standard interview templates to avoid accidentally asking discriminatory questions. 

What are total compensation statements? Are they required? If not, why should I provide them?

 Total compensation statements highlight the monetary value of your benefits package, including the perks that may be overshadowed by traditional benefits. These statements are not required, but providing them may increase employee morale and loyalty. Typical total compensation statements may include the following:

· Salary

· Bonuses

· Commissions

· Stock options

· Stock grants

· Employee stock purchase plan

· Retirement plan

· Social Security contributions

· 401(k) matching contributions

· Paid time off

· Coverages for health, life and disability

· Wellness rewards (discounts, cash bonuses, etc.)

Providing these statements increases employee awareness of how much the company spends on his or her benefits. Informing employees of the behind-the-scenes expenses that the company covers can increase retention rates and morale.

Another reason to provide total compensation statements is that health care reform requires employers to report the aggregate cost of employer-sponsored group health plan coverage on their employees’ Forms W-2. For employers that file fewer than 250 Forms W-2, this is currently optional. Providing total compensation statements may make providing this information at tax time easier.

Tax Advantage Accounts for High Deductible Health Plans

The are several different types of taxed advantaged accounts that you can pair with a High Deductible Health Plan. Some of the options are Health Reimbursement Arrangement, Health Savings Account, or Flexible Saving Account. We can help you to choose the best option for your company and your employees. Below are a few short videos.


What is a Health Reimbursement Account?

What is a Health Saving Account?

What is a Flexible Savings Account?