PPACA: Pandemonium Today, Panic Later, Prosperity for HRO

By Amy L. Gurchensky, HRO Research Analyst, NelsonHall

It was pandemonium after the United States Supreme Court announced its ruling upholding the Patient Protection and Affordable Care Act (PPACA). The outstanding decision left so many in a holding pattern pending the constitutionality of the act.

Now that the decision is more firmly settled for the time being (primarily pending the November presidential election), U.S. states and organizations will have to take more definitive steps in securing exchanges and evaluating whether to offer health insurance plans or pay the tax penalty.

In fact, the state of Florida, via Florida Health Choices, set the wheels in motion earlier this week ahead of the ruling when it awarded a $68m contract to Xerox to administer a health insurance exchange for nine years. Services include:

• A web portal and online plan selection tool
• Eligibility determination and enrollment management services
• Customer contact center services.

Other states that have delayed taking action are still expected to meet the law’s timelines. The same is true for employers that have yet to make employee healthcare decisions that take the PPACA requirements into consideration. Watch for a spate of webinars by benefits service providers to remind all of us of the changes still to come in 2014 through 2018.

Regardless of today’s decision, HRO and particularly benefits administration service providers have been sitting in a sweet spot.  Vendor interviews for NelsonHall’s recently published “Targeting Benefits Administration” market analysis revealed that business has been going on as usual with many employers turning to benefits administration vendors to implement services that are focused on controlling the cost of rising health care such as:

• Dependent eligibility audits to remove ineligible dependents from plans
• Wellness programs
• Improving absence management
• Switching to high-deductible health plans with associated health savings accounts.

The published report explores the current state of benefits administration as well as the future market and its growth over the next five years by geography and service line including:

• H&W administration
• Reimbursement administration
• Leave of absence administration
• COBRA administration
• Flexible benefits administration
• DC administration
• DB administration.

The analysis also looks beyond legislative implications in the U.S. and new offerings that have emerged such as health insurance exchanges to explore the automatic enrollment requirement in the U.K.

The greater unresolved issue at hand, however, is how to control the rising cost of health care that is already arguably unsustainable as evidenced by the more than 30m Americans currently without insurance.

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Take Care to Show You Care – of Humanity and HRO

If you are in the business of caring for people, you have to show you care about people.

In the HRO community we all are in the business of caring for people, as employees, as managers and as retirees. We provide products and services that help people at every stage of working life and beyond. Much of that care is administrative, automated and drives to self-service and efficiency, as well it should. Sometimes we get to show employee care in a more direct manner, such as calls with live agents to understand the variety of benefit actions and options needed to wend through a major life event, or use of a caring tone when helping process an unexpected leave of absence during a personal or family crisis.

There are other ways to show you care in this professional space we have chosen to serve, such as corporate social responsibility activities and philanthropic initiatives.

HRO service provider examples include: 

• ACS Government Healthcare Solutions has a dental outreach program for disadvantaged children which has expanded from one to ten states

• Convergys highlights its Social Responsibility Community focus with examples of worldwide projects, including many teacher training and education programs

• Accenture uses its consulting and IT expertise in its Skills to Succeed effort to build skills that will enable people all over the world to participate in and contribute to the economy

• IBM, befitting its size and global reach, sponsors many varieties of programs. One that caught my eye is Kid Smart for early learning development that has reached 60 countries and has won IBM accolades from the highest levels in some countries

Then there are the times of crisis like a hurricane, a tsunami and now the earthquake in Haiti. How do we in the HRO community lend our skills and capabilities when natural disasters strike?

Many companies, which also happen to be HRO clients, excel in business-aligned philanthropy. For example, as it relates to the catastrophic earthquake in Haiti last week, GlaxoSmithKline donated cash and medicine worth $1.8 million, mostly urgently needed oral and topical antibiotics, and has promised further commitments as local infrastructure is repaired. AT&T immediately gave $50,000 to help bring emergency telecommunications to Haiti, supports the American Red Cross’ text donation program (in the U.S. text the word Haiti to 90999 and a one time charge of $10 will be added to your cell phone bill), and has pledged $200,000 to the Red Cross this year alone for disaster relief. And the State of Florida called upon its citizens to donate money to its “Neighbors to the Rescue” program through the Florida Disaster Recovery Fund.

Ceridian is making sure its Life Works customers know that services are available for employees concerned about friends and family in Haiti, and it has also listed some contact and resource information for the general public on its website, including several in Creole.

Hewitt posted a Red Cross press release for Thursday’s CHICAGO HELPS HAITI telethon in which 1,500 employees will volunteer their time staffing the phone banks from its Lincolnshire headquarters and three other centers.  The press release also mentions, “The last time the Red Cross partnered with Chicago media and Hewitt was in 2004 for a one-day telethon to aid victims of the Asian tsunami. The result of that effort was extraordinary.” This is a very good example of using the skills and caring of the company and its employee during a crisis, as well as getting positive media coverage for the significant contribution.

The human impact of major disasters lasts for years, long after the media leaves. That will be the time to consider using ongoing corporate responsibility programs in both nearby communities and markets in which it is most needed. How are you showing you care?

Linda Merritt, Research Director, HRO, NelsonHall