Employers May Delay New Hires’ Health Benefits For Up To 4 Months
A new rule, set to take effect Aug. 25, applies to coverage beginning in plan year 2015, reports CQ HealthBeat. Meanwhile, retiree medical liabilities fall as Americans live longer and interest rates remain low, and PricewaterhouseCoopers projects accelerating employer health costs next year.
CQ HealthBeat: Employers May Delay New Hires’ Health Coverage For Up to 4 Months Under Rule
Employers in some circumstances will have up to four months to delay the start of health benefits for new hires, according to a new rule jointly issued by three federal agencies. The rule, set to take effect August 25, addresses the effects of “orientation periods” for new employees in determining how long they must wait for health coverage to begin. It applies to coverage beginning in “plan year” 2015. Employers and insurers differ in what they interpret as the start of a plan year (Reichard, 6/24).
The Wall Street Journal’s CFO Journal: Retiree Medical Liabilities Fall
Companies may lose the savings they booked last year on retiree medical costs as Americans live longer and interest rates remain low. Among the Fortune 1,000 companies, the combined liabilities for retiree medical benefits totaled $285 billion at the end of last year, down nearly 16% from 2012, according to benefits adviser Towers Watson & Co. These obligations stem largely from long-ago promises to unionized employees. Most companies have shut their plans to new workers. In fact, only half of the companies studied continued to carry retiree medical liabilities on their balance sheets (Chasan, 6/24).
Kaiser Health News: Capsules: Employer Health Costs Forecast To Accelerate In 2015
Health costs will accelerate next year, but changes in how people buy care will help keep them from attaining the speed of several years ago, PricewaterhouseCoopers says in a new report. The prediction, based on interviews and modeling, splits the difference between hopes that costs will stay tame and fears that they’re off to the races after having been slow since the 2008 financial crisis (Hancock, 6/24).