Constructing a Defined Contribution Health Plan

DC HEALTH PLANNING AND DEVELOPMENT PROCESS

Defined Contribution Health Care “Cause and Effect Analysis”

This is a group exercise in which we try to list all possible causes and their effects (and identify how they are linked) associated with a particular problem or situation. It aims at discovering the possible or probable causal factors and their outcomes that will lead to the creation of a visual “cause and effect analysis diagram” from which we can work to develop your Defined Contribution Health Care Plan Arrangement using a Gnatt Chart for its implementation.

DISCOVERY AND PLANNING PROCESS:

We begin by identifying a comprehensive list of the Core Problems, Challenges, and/or Issues of providing employee health care benefits under a Defined Contribution Health Care Plan Arrangement by first identifying “the causes” and “impact” of such including, but not limited to:

• Employer PEPM Total Health Care Budget and Cost-Funding Strategies
• Employee Cost-Sharing Strategies – “Community Rating” PEPM or 2-Tier Single/Family
• Impact of using traditional fully-insured PPO HDHP
• Impact of using non-traditional fully-insured “Limited Benefit Catastrophic” (LBC) HDHP Plan or, self-insured arrangement
• HRA vs. HSA – i.e. characteristic and philosophical similarities/differences
• Pre-funding vs. notional “pay as you go” funding
• Annual Roll-over or not
• Vesting or not – limited to retirees or, including non-retired terminated employees
• Financial instruments – custodial account, trust (501c9) account, or general funds account
• Employer and Employee administrative issues
• Impact of implementing wellness initiatives
• Impact of Corporate Cultural and Environmental changes
• Innocuous HRA/FSA benefit plan design issues;
  • Order of payment – Employee pays first – up-front calendar year deductible
  • In-network/out-of-network reimbursement differences
  • Benefit limitations (if LBC) – i.e. Rx Drugs, Diagnostic, Therapies, Urgent Care
  • Employee/family HRA funding limits
  • Employer’s HRA annual funding aggregate
  • Non-Vested Forfeitures, if any

SAMPLE IMPLEMENTATION SCHEDULE:

ASSUMING AN EFFECTIVE DATE OF _______________ 1^st 20____

*This represents the initial “learning curve” period inherent with any “change.”

For more information on "How to Design, Develop and Implement" a Defined Contribution Health Plan Arrangement" visit: http://www.strictlyhr.com or call 330-575-2029.