3 Strategies To Help Employers Manage Workplace Stress And Improve Productivity

Published in June 2013, Employee Benefits Healthcare research, reveals that just 46% of respondents have strategies in place to combat workplace stress. There are many reasons why the majority of employers have yet to address this problem. For example, many employers simply refuse to accept that stress is actually a problem in their workplace. Many others recognize the issue, but do not take it seriously and do not believe it is there responsibility. But lessening workplace stress and addressing employee health issues is part of a good employer’s compact.

How To Manage Workplace Stress

workplace stress

Managing Workplace Stress = Productive Employees

Pontrelli, Timour, & Associates Inc. has seen from experience that employers who address the issue of workplace stress in advance avoid problems and pitfalls later on. Yet, when the return on investment is so difficult to measure, it is difficult to convince senior managers to use resources, funds and valuable time to address this problem. Another problem is caused by the continuing sensitivity about mental health issues, particularly within the workplace. Many employees do not reveal the damage being done by difficult situations that generate workplace stress until it’s too late.

Here are three strategies to consider to proactively address employee workplace stress before it becomes a problem:

  1. Use online tools because they are anonymous & revealing
  2. Train managers to identify stress-related problem areas in your business and direct appropriate resources
  3. Encourage employees to take responsibility for their own physical and mental wellbeing

1) Online Tools For Workplace Stress Management

A number of organizations are working with the British program designed by PruHealth. The English company has developed online tools, packaged as the Vitality mental wellbeing suite, that can assess employee stress, psychological wellbeing, resilience and social support. Support is then offered through a Living Life online life skills course that uses cognitive behavioral therapy (CBT) and consists of modules, worksheets and e-books. In the United States, the Mayo Clinic and the Cleveland Clinic also have excellent online wellness programs.

2) Train Managers To Identify Potential Problem Areas

Managers are often not given any training to identify stress. Training involves giving managers the courage to have initial conversations with staff suffering with stress. Employers should identify particular problem areas of their business and direct their resources accordingly. Assess the challenging areas of your business and compile the difficulties in a document. Such an accounting can help in the targeting of potential problem areas.

3) Encourage Employees To Take Responsibility

In order to fully address the issue of stress in the workplace, employers need to encourage employees to take responsibility for their own health, both physical and mental.  It is surprising how promoting a walking group where employees enjoy an extended lunch break once a week can increase productivity and improve morale. Employees need to understand that employers support their efforts to promote wellness and engage in positive activities.

Pontrelli, Timour & Associates believes in helping our client companies address workplace issues at the outset in order to ensure they do not become problems. By addressing the issue of stress in the workplace, you can avoid a loss in productivity and profitability down the line. To learn more how PT Benefits can help you, please call 626-795-4138 for a free consultation.

5 Strategies To Optimize The Employee Benefit Enrollment Experience

Rate Your Employee Benefit Enrollment Experience

As respected employee benefits & insurance brokers in Pasadena, Pontrelli, Timour & Associates believe in helping our client companies optimize the employee benefit enrollment experience. With all of the changes brought on by the Affordable Care Act, it is important to avoid confusion and unneeded difficulties in the workplace. By making the enrollment experience as smooth as possible, company morale can be noticeably improved. The key to success is providing quality enrollment tools and support.

What is significant about this opportunity is the simple historical reality that as many as one-third of employees tune out during this important annual event. In fact, only 42% of employers – a minority – are very satisfied with their level of engagement. These are some of the findings from MetLife’s 11thAnnual Employee Benefits Trends Study. Such findings can be used to help improve the employee benefit enrollment experience.

Rolling Over No Longer A Viable Option

Employees can no longer simply roll-over the previous year’s selections, and they should not really be doing this in the first place. If they do, they often miss out on new coverage options. PT Benefits believes that by offering a wide range of benefits options that fit the needs of your employees, you can strengthen enrollment and engagement across the board.

Optimize Employee Benefit Enrollment

An analysis of the MetLife study suggests four strategies that help to drive benefits participation, raising employee engagement.

4 Strategies That Can Help

1. An Experience Upgrade:

50% of employees responding to the MetLife study said they appreciate online decision-support tools that help prioritize their needs. By providing such tools, you can upgrade the employee benefit enrollment experience. Such tools improve the ability of employees to understand how benefits decisions affect their paycheck. In addition, 7Personalized 4% of employees would value personalized benefits information focused on their age group.

2. A Straightforward Process:

In this hectic day and age, most employees have little patience for complexity when it comes to enrollment. MetLife’s study found that only 58% of respondents described their enrollment process as simple. By reducing and removing complexity from the process, PT Benefits gives our client companies the ability to help their employees make the right choices.

3. Easy Online Benefits Selection:

employee benefit enrollment

Online Tools For Employee Benefit Enrollment

50% of employees prefer online enrollment, but it’s only offered to 35% of the employees surveyed. Both greater satisfaction and engagement are associated with online enrollment. Expectations for an easy online experience are running high among employees who are used to shopping online. PT Benefits can turn this request into a reality for your employees.

4. A Feedback Mechanism:

By asking for employee feedback, it both gets employees involved while creating a sense of ownership of the process. 42% of employees who are engaged in annual enrollment report that their employer obtains their opinion and feedback. By having the input of your employees, you can improve the process and discover any problems that you might have missed.

The experienced management team at Pontrelli, Timour & Associates recognize that nothing makes the changes of the Affordable Care Act easy to handle for either employers or employees. Nevertheless, if an employer can improve the employee benefit enrollment experience, it will be a step in the right direction. If you want to know more about turning these strategies into realities, contact PT Benefits by calling 626-795-4138 for help.




How Online Employee Surveys Can Improve Communication And Raise Morale In An Organization

Why should employers use online employee surveys and how can they gauge the temperature of their companies? In the age of the internet and remote work opportunities, the question of employee loyalty to organizations of any size needs to be addressed by employers. Employees are more likely to leave such businesses and move on to other opportunities they now can easily access on the web and through social media sites like LinkedIn.

Online Employee Surveys Can Help

online employee surveys

Online Employee Surveys

To avoid such loss and improve company morale, online surveys can help achieve this goal. Pontrelli, Timour & Associates has learned through experience that online surveys can help reveal a level of employee dissatisfaction that is hidden beneath a surface layer of pleasantries and the desire to not rock the boat. By understanding the true concerns of employees before they become problems and being able to address them in advance, true employee loyalty that supports the long-term interests of a business can be fostered.

3 Benefits Of Utilizing Online Employee Surveys:

1) Surveys Provide Concrete, Actionable Data

On account of their anonymity, surveys provide data that can be used to take concrete actions that foster employee loyalty. If a company is unsure of how employees are relating to new benefits program options, an online survey can provide the information and feelings that employees are not willing to reveal in person. By surveying all of the employees in a business, data can be achieved that reveals the true temperature of a company.

2) Communication Is Streamlined
Online employee surveys provides a level of communication that is much more effective and streamlined than tradition methods of employer-employee interactions. In the past, problems in the office tended to be conveyed via second-hand information and long after the issues should have been addressed. After utilizing surveys, however, problems are revealed first-hand. By speaking their minds a professional and respectful manner, even when the survey is anonymous, employees can help improve office administration and the overall protocols of behavior.

3) The Cost Is Really Low
As opposed to trying to access employee feedback at the end of a performance review, online surveys, both anonymous and otherwise, help generate a much deeper level of honesty. By receiving feedback without the fear of reprisal, once again the true temperature of a business can be properly gauged. In addition, when offered both multiple choice and written methods of response, employees find a comfort zone to communicate what needs to be heard by an employer.

Online Employee Surveys Are Effective

When implemented properly, PT Benefits has seen that online employee surveys can help establish a positive workplace that helps to foster a more productive and profitable business. By boosting morale, long-term employee loyalty becomes a more likely prognosis. In light of healthcare reform and the job security concerns of employees in small to mid-sized businesses, online employee surveys can reveal problems before they arise.

If you would like to learn more about online employee services and how PT Benefits can serve you as experienced insurance brokers, please call at 626-795-4138 for help.

Three Key Points For High Growth Companies To Consider About Employee Benefits Programs

As insurance brokers working with group benefit programs , Pontrelli, Timour & Associates understands the challenges facing high growth companies. If you are an owner or partner in a high growth company, you most likely experience change and the resulting business evolution on a regular basis. From expanding into new markets and developing your product lines and service offerings to finding the right talent and renovating office space, you have learned that to grow is to change. Without question, PPACA will present a new healthcare challenge for high growth companies in California.

ACA Challenges for High Growth Companies

high growth companies

High Growth Companies & ACA

Given the major changes in the past year with healthcare reform and the Affordable Care Act, the same evolution is true for a growing company’s  employee benefits strategy. Well before your company hits 50 full-time employees or equivalents, you need to be ready to act. The mandate was only delayed for one year.  Once you reach 50 employees, there are responsibilities that you will need to think through in order to help ensure the success of your company. With PT Benefits, you access insurance brokers that have both the skill set and expertise to work with your company as a growing firm.

As a full-service benefits program provider, we offer a host of services beyond just renewal numbers once a year. Given the complexities of the Affordable Care Act, we have become strategic advisors and business consultants for our clients. If you are a growing company and you are looking for an effective insurance broker, below are three key points you should take into consideration.

Three Key Points For High Growth Companies

Pontrelli, Timour & Associates recommends that you make sure you’re Employee Benefits Advisor can:

  1.  Provide Updates on ACA Compliance and Health Care Reform and Laws:  An advisor should provide consistent updates on regulations such as ERISA, HIPAA, FMLA as well as guidance on health care reform and Affordable Care Act Compliance.
  2. Develop an Employee Benefits Plan Built for the Future:  Are you planning to continue to grow and expand your business? If this is the case, do you have a plan in place? A Benefits Advisor should be able to help you develop a more strategic employee benefits plan that aims to achieve the goals of your organization in terms of growth and expansion.
  3. Help Establish an Employee Wellness Program: Consider implementing an employee wellness program to help reduce health care consumption at your organization.  A good wellness strategy can impact the bottom line by keeping your employees happy and working effectively. Nothing beats good health.

PT Benefits understands the growing pains of a successful company and it  can be stressful. By partnering with an experienced benefits advisor and insurance broker, you can both help ease some of that transitional pain while also being more prepared for the future growth of your firm. To learn more about how we can help smooth the growing pains for your successful business, please call PT Benefits at 626-795-4138.

Three Ways For Employers To Help Employees Understand Healthcare Policy In The 21st Century

With the onset of the Affordable Care Act changing the landscape of healthcare benefits and plans, employers need to help employees understand their company’s healthcare policy and the new options provided by the Affordable Care Act. From implementing any of the new changes to communicating new information about both regulations and options to employees, Pontrelli, Timour & Associates can help employers feel comfortable about taking such steps.

healthcare policy

Healthcare Policy in the 21st Century

Once you understand what needs to be communicated, you can come up with a workable and proactive plan of how to communicate this bevy of new information about your healthcare policy.  PT Benefits offers 3 ideas on how to help your employees with a dual goal of covering the informational bases of your new healthcare policy and creating common ground that raises morale.

3 Ways To Help Employees Understand Your Healthcare Policy:

1) An employer should make sure to share the “what” and “why” of their company’s healthcare strategy. If you’re changing your organization’s health benefits approach for 2014, communicate both the “what” and the “why” to employees. Such shifts in strategy and plans are very common among small to mid-sized companies, particularly nonprofits. You should help employees understand what impact the Affordable Care Act has on the plans you offer, including who is eligible for coverage. In addition to raising awareness, all employers are required to provide a notice about new coverage options with the health insurance exchanges.

2) Employers should develop a new plan for distributing resources about basic healthcare information. PT benefits can help you with such a plan based on our experience with other clients. Many employers are shifting how they offer benefits because of the Affordable Care Act. In many cases, this means is a shift toward consumer-driven health care or defined contribution. Both of these models require employees to take more control. Employees need access to resources and education about basic health care terms, and basic healthcare reform information. A good start is by answering the following questions:

Healthcare Policy Questions

  • Who can your employees call with questions?
  • How can healthcare experts like PT Benefits help? 
  • What resources should be provided to employees? 

3) In order to strengthen their bond with employees, employers need to reinforce the value of their health plans and the overall value of working for the company. Regardless of the type of health benefits you are providing, you obviously care about the health of your employees, but do your employees know this to be the case? If not, you should use communication about health reform as an opportunity to reinforce this principle in order to improve retention rates and create a sense of goodwill by raising company morale.

PT Benefits can support your efforts to help your employees understand your company’s healthcare policy. To learn about how we can make the Affordable Care Act easier for your company to navigate, please contact the professionals at Pontrelli, Timour & Associates by calling 626-795-4138 or fill out our handy contact form.





Colonial Life Survey Reveals Seven Top Benefits Plan Enrollment Mistakes Made By Employees

benefits plan enrollment mistakes, colonial life survey, employee healthcare

Colonial Life Employee Healthcare Survey

A new Colonial Life survey shows countless employees making benefits plan enrollment mistakes because they lack the willingness to educate themselves. They simply do not know or have a basic understanding of what is available to them. Colonial Life & Accident Insurance Company recently questioned nearly 400 employee benefits counselors about the top mistakes they see employees making during enrollment. As experts in benefits program administration and employee benefit plans, the principals at Pontrelli, Timour & Associates are not surprised by the results of the survey.

The number one mistake was how employees tend to assume they do not need certain benefits being offered without even discussing such options with a benefits professional. This all-too-common mistake was cited by 81 percent of survey respondents.

Benefits Plan Enrollment Mistakes

What PT Benefits find fascinating is how little the expertise of insurance brokers is taken advantage of by employees. It’s almost as if there is a fear that asking questions will have repercussions. From our perspective, there are no foolish questions if they are asked in a honest quest for understanding and knowledge.

Benefits Plan Enrollment Mistakes 2 to 5 were closely grouped in the rankings and all related to lack of information:

  1. Not reading the benefits information prior to enrollment — 69 percent.
  2. Not knowing what benefits they currently have and what they cost — 69  percent
  3. Forgetting to talk with their spouse about their family’s needs before the enrollment — 67 percent
  4. Assuming the cost of a new benefit is unaffordable without seeing any prices — 66 percent

A survey respondent describe his frustration with this lack of planning and foresight by employees when he said: “This is the one time you have to take control of how you want to provide for your family and yourself. Take time to talk with your spouse and understand how the benefits can really help your family.”

Benefits Plan Enrollment Mistakes 6 & 7 directly pertain to a failure to take advantage of educational resources available:

  1. Not attending group informational meetings — 58 percent
  2. Not taking time to understand the upcoming changes in their benefits plan — 50 percent

Personal knowledge can be translated into power, but so few employees seem willing to access such power to help themselves. Many employers give workers the opportunity to meet one-to-one with a benefits expert for a personalized counseling session.

Post-enrollment surveys by Colonial Life show 98 percent of employees who participated in a one-to-one session said it was important, and 97 percent said the session improved their understanding of the benefits being offered.

With the complexities presented by the Affordable Care Act, such past benefits enrollment mistakes are even more dangerous today. PT Benefits recommend that every small to mid-sized employer sit down with their employees and emphasize the importance of education and knowledge.

With ACA affecting everyone and the higher costs coming down the line, it is time for employees to take hold of the reins when it comes to benefits enrollment. If you have questions from the perspective of an employer or an employee about benefits enrollment, please call 866-782-9899 or fill out our handy contact form.


8 Affordable Care Act Predictions For 2014

When it comes to making expert predictions about the wide range effects of the Affordable Care Act in 2014, Pontrelli, Timour & Associates have the expertise needed to be right on target. As an employee benefits and insurance agency working with small to mid-sized businesses for over a decade in Pasadena, the principals at the agency have the knowledge to provide quality prognostications. The following 8 predictions are based on a balance of factual data combined with the insight of long-term experience.

8 Affordable Care Act Predictions For 2014

  1. Since the majority of carriers shifted the renewal dates of their clients to December 1, most business owners don’t have to take any direct action until then. As a result, the true brunt of the Affordable Care Act’s business fallout will hit hardest in the 4th quarter.
  2.  The biggest initial problems will be with individual solo policies as rates go up the benefits are reduced. The result is going to be a lot of angry people shaking their fists at healthcare reform and wondering why they ever wanted it in the first place.
  3.  Many uninformed business owners without an actual understanding of the laws will try to avoid the 50 employee mark of the Employer Mandate by shifting full-time employees to part-time. Such a shift is illegal, doesn’t work as an avoidance strategy because part-time employees are included in the Employer Mandate equation, and will result in many stories about the IRS and other government agencies cracking down on small business owners across the country for this violation.
  4. On account of the customercentric approach of PT Benefits, almost 100% of our clients early renewed and moved to December. In contrast, how many small to mid-sized companies with the huge corporate providers fell through the cracks of poor customer service. The immediate result when they have to renew early will be the tough initial options on account of a lack of concrete rate information. Anger over this outcome will result in a bevy of local negative ACA news stories in the first to second quarter of the year.
  5. affordable care act predictions

    Affordable Care Act Predictions

    Any employee or group that had a high deductible catastrophic PPO plan will most likely be paying double come their renewal in 2014. An example is a small restaurant owned by an older lady with such a plan. Her rate will double in terms of the costs because of the minimal coverage and deductible thresholds. In addition, the new extensive requirements for pediatric dental and vision, maternity, expanded non-institutional mental health benefits, contraceptives, breast pumps, lactate consultants, and the list goes on and on. Each state threw in their benefit requirements on top of the federal requirements, resulting in plans that simply cover so much more than is truly needed. Both the business owners and the employee are being hurt because the rates are skyrocketing. As a result, this woman’s rate at her restaurant will more than double because of these new requirements, perhaps even causing her to go out of business after years of serving food to her community.

  6.  The biggest losers in the financial chaos that is being wrought by the Affordable Care Act will be lower middle class to middle class Americans, the vast majority of the country stuck in the center. Healthcare reform really only affects high middle class to wealthy Americans as business owners, and most of them will be able to adapt. The bottom rung of the ladder – the homeless and the destitute – theoretically will be helped. But the middle will be hurt and hurt bad in 2014. And this middle is the heart of America.
  7.  Technology in the industry of benefits administration and insurance brokers traditionally has been very poor. In 2014, this is going to start to shift as a result of ACA and the need for more interactive websites to explain and evaluate the changes for existing clients and potential new clients. Mobile technology will be on the rise as well.
  8. Overall, the Great Panic Debate of 2013 will shift into more realistic discussions about how to be sustainable in 2014. How are insurance brokers going to make the changes work for their clients beyond the initial stage of denial. This is why the insurance brokerage team at Pontrelli, Timour & Associates is focused on finding the best possible ways to optimize the Affordable Care Act options and possibilities for all of our clients.

Help With The Affordable Care Act

If these Affordable Care Act predictions scare you, you are not alone. The perspective of the government on the Affordable Care Act is not the perspective of insurance professionals. If you are worried about how the Affordable Care Act will affect your business and your employees, please contact PT Benefits by calling 626-795-4138 for insurance solutions.

Raphy Timour Of PT Benefits Speaks For Business Owners In Pasadena Now Article On The Affordable Care Act (ACA)

As a co-founder of Pontrelli, Timour & Associates and a respected expert on the Affordable Care Act, Raphy Timour was interviewed by Pasadena Now about how ACA is affecting small to mid-sized business owners and their employees across Pasadena. Since so many business owners are trapped in the maze of the healthcare requirements, mandates and restrictions, Raphy Timour is stepping up to be the voice of the small to mid-sized business owner in trouble. The problem with the Affordable Care Act is that the good man in the middle is being squeezed once again. It is both a honor and an opportunity for Pasadena Now to give Raphy Timour a platform from which to help educate business owners who truly need help and support

A Voice Speaking For The ACA Embattled Business

In the Pasadena Now article, Raphy Timour describes the difficulties faced by one of the clients of PT Benefits:

aca, pasadena now

ACA Going Off The Rails

“We do the benefits for a small local restaurant and the owner is a woman in her early 60’s. She chose not to early renew. Over the years, to help offset the rising cost of healthcare, she moved to a higher deductible PPO plan. Although the out-of-pocket costs were greater, she chose to pay less each month in premiums. Her group benefits plan renews in March 2014 and her individual rate is going from $532 a month to $925 a month! Yes, her benefits are more extensive, but nowhere near justifying a 74% increase over last year. Why should a woman in her 60’s with adult children be required to have a plan that covers maternity and pediatric dental and vision?”

Why should business owners be penalized who actually have been doing the right thing for years? Why should they be hurt just so others can be helped? Does it seem fair that so many small to mid-sized business owners across not only Pasadena and Southern California, but across the entire country are being slammed so hard or are going to be slammed so hard in their pocketbooks by the Affordable Care Act? Why is Affordable even in the name of the act if the actual results turn out to be the exact opposite of this word – more expensive and more costly?

A Voice Needed Come ACA December Renewals

Since most business clients early renewed, they won’t be facing the real financial challenges of the Affordable Care Act until December. Come December, however, Raphy warns in the Pasadena Now article that “The fourth quarter is going to be a real wake-up call for most employers. There are going to be a lot of shocked and surprised people.” The goal of Pontrelli, Timour & Associates is to help our clients make this tough transition as easily as possible while raising awareness of these challenges in our community in general. To learn more about how ACA might affect your business, please call 626-795-4138 to reach Pontrelli, Timour & Associates and get the help your company truly needs.

Pasadena Now Article And Interview With Raphy Timour About The Affordable Care Act

Reprinted from with permission from Pasadena Now,  this Business Article was titled:

How Is The Affordable Care Act Affecting Small To Mid-Sized Businesses In Pasadena?

The institution of the Affordable Care Act and its effects on business owners and their employees is one of the biggest national stories of 2014. Pasadena Now wanted to break down the implications of this national story by understanding what is happening on a local level. To illuminate how the ACA changes are affecting small to mid-sized businesses in Pasadena, Pasadena Now spoke with Raphy Timour of Pontrelli, Timour & Associates, Inc.

Like most insurance brokers that handle employee benefits, Raphy Timour recommended that most his clients take the early renewal option. As a result, their current plans will stay in place until December of 2014. Most companies will not experience major changes until the end of the year. When those changes come, however, Raphy Timour told Pasadena Now what will happen:

affordable care act, pasadena now

Raphy Timour on ACA

“The fourth quarter is going to be a real wake-up call for most employers. There are going to be a lot of shocked and surprised people. Most plans had to bulk up to meet the minimum essential coverage requirements of the ACA. These new comprehensive plans are both less flexible and more expensive. I believe the middle class in Pasadena are going to be hit the hardest. They won’t qualify for the low-income subsidies and employers will pass off most of the new expenses onto their employees. They will have higher premiums, and higher out of pocket costs when they go to seek services. Healthcare reform will make life harder for a lot of people.”

What exactly is meant by the new coverage requirements? Won’t healthcare reform be beneficial for most people? Aren’t the new essential health benefits a positive thing? When asked this question, Raphy Timour shook his head in frustration:

“You would think that would be the case, but it actually is the opposite. If you currently offer your employees a small group health plan in California that was established or renews in 2014, your plan is mandated to include 10 categories of essential health insurance benefits. Some of these essential benefits make perfect sense like the preventative services that include both annual screenings and wellness visits, inpatient hospital services, emergency services, and prescription drug coverage.  On the other hand, so-called essential benefits now also include the following: acupuncture, pediatric dental and vision services, and a host of other specialized items. These specialized services increase the costs for everyone.  People should have more choices; one size does not fit all.”

Wanting to know more, Pasadena Now asked for a concrete example of how a small business could be affected by these rate increases. Raphy Timour responded by telling us a story about one of his Pasadena-based clients:

“We do the benefits for a small local restaurant and the owner is a woman in her early 60’s. She chose not to early renew. Over the years, to help offset the rising cost of healthcare, she moved to  a higher deductible PPO plan. Although the out-of-pocket costs were greater, she chose to pay less each month in premiums. Her group benefits plan renews in March 2014 and her individual rate is going from $532 a month to $925 a month!  Yes, her benefits are more extensive, but nowhere near justifying a 74% increase over last year. Why should a woman in her 60’s with adult children be required to have a plan that covers maternity and pediatric dental and vision?”

By removing the ability to choose what should be covered, ACA is adding significant costs. Moving forward, what is the best choice for small to mid-sized businesses to make in regards to health insurance? Should they go on the Covered California exchange? Raphy Timour answered these questions with a resigned honesty:

“Healthcare reform is a very complex issue with many perspectives and market forces. Right now, the group insurance market is still the best choice as opposed to the exchanges and the individual policies. There are significantly more options and carriers available with the off-exchange group insurance market, including the largest network of hospitals and medical providers. What is frustrating is that all of the options under the Affordable Care Act seem to be more expensive and less helpful. They tried to squeeze everyone into the same little box. When it comes to healthcare, one size simply is not enough.”

IRS Modifies “Use It Or Lose It” Rule For Health Flexible Spending Arrangements Under The Affordable Care Act


Pressures of Use It Or Lose It

On October 31, 2013, the Internal Revenue Service issued Notice 2013-71 about the “Use It Or Lose It” Rule for health flexible spending arrangements under the Affordable Care Act.

The notice instituted significant changes that will affect the administration of cafeteria plans under section 125 of the Internal Revenue Code. Pontrelli, Timour & Associates offers a brief outline of these changes as a public service. If you need to know how the specific details affect your healthcare plans, please contact PT Benefits for help.

Use It Or Lose It Update

The main change is a modification of the regulations proposed under section 125 to add a limited exception to the “use it or lose it” rule for health flexible spending arrangements. Employers are permitted to amend plans that provide health flexible spending arrangements to permit up to $500 of unused credits to be carried over and applied towards the following plan year.

It is important to realize that the “use it or lose it” rule is not  completely eliminated. Any unused credit in excess of $500 will still be forfeited.

This new carryover is an alternative to the current “grace period” rule. As a result, a health FSA may not provide for both the new carryover and the current grace period. From a pragmatic perspective, if a carryover is to be provided at all, the choice is between (a) permitting a carryover of a limited amount (up to $500) that can be applied during the entire following year, or (b) permitting a potentially larger carryover that can only be applied against expenses incurred during a specific period of time (one month, two months, three months) that is designated as the grace period.

Use It Or Lose It Modifications

PT Benefits understands if all of these new rules and regulations sound like a sputtering of ancient Greek to you. As a businessman, you are focused on growing your business and not getting lost in a maze of such technical particulars.

If you contact Pontrelli, Timour & Associates with questions, we can provide you the support you need to make sure the “Use It Or Lose It” modifications are effectively applied to your business. To learn more about how PT Benefits can deliver premium health coverage and benefits packages to your employees and guide you as an employer through the maze of the Affordable Care Act, please call 866-782-9899 or fill out our handy contact form.