Choosing the Best Plan For Your Employees
The Competitive Edge – What to Look For When Using Benefits to Recruit and Retain Talent
Lack of competitive pay and benefits are two of the most common reasons employees leave one employer to join another. LLH’s fixed-indemnity insurance program provides a turnkey solution to make your company more competitive in the search to attract and retain talent.
Navigating benefits for your employees can be tricky – there are several plans in the marketplace that are not what they seem. LLH, in conjunction with industry peers, have been working tirelessly to shine a light on bad actors while exposing common pitfalls and mistakes to avoid when reviewing benefits programs.
Listed below are several items to review and consider when exploring benefit options for your employees:
1. Fully-Insured and Risk Transfer to a Third Party
A properly-constructed and compliant plan must be underwritten and insured by a highly-rated insurance carrier who bears risk in order to comply with the risk transfer requirement set forth by the IRS. The LLH program partners with Bain Capitals’s Federal Life (AA- rated), Activ8 (LLH’s operations arm), and Sydney Administrators (Third-Party Administrator) to distribute and administer a Hospital Indemnity plan that is fully compliant with the Affordable Care Act and IRS rules and regulations.
2. Third-Party Administration (TPA)
The Third-Party Administrator of the plan must be respected in the industry and be licensed in each state the program operates in. LLH’s plan is administered by Sydney Administrators, which handles actuarial modeling, pricing, and compliance services for 40+ of the nation’s leading insurance companies, including many of the top 100 most recognized companies in the United States. Sydney Consulting’s team of actuaries and attorneys works in conjunction with Federal Life to ensure compliance on a state-by-state basis. Furthermore, the teams directly involved in the development and management of the LLH program have over 200 years of combined experience in the insurance industry, specifically indemnity and ancillary products.
3. State Licensing Requirements
Employer healthcare programs must be licensed and vetted by the Board of Insurance in each state they operate in. Unlicensed companies promoting insurance benefits to employers is a major red flag for the state Boards of Insurance and the IRS. Be certain when reviewing benefit plans that your provider maintains the appropriate licensure to legally operate within the state. LLH maintains the appropriate licensure and has been fully approved by the Boards of Insurance in each state the program operates in.
4. Claims of Tax-Free Benefits
Programs touting tax-free benefits are another major red flag and a sure way to get in trouble with the IRS. Avoid plans that advertise “tax free benefits” at all costs. LLH pays in advance to provide each plan participant access to a tax hotline so employees can retain expert tax guidance and advice on how additional benefits affect their income and taxes.