US: Benefit managers focus on Cadillac tax issues for 2016 enrollment season
In the U.S., benefits practitioners are busy implementing strategies to avoid the Cadillac tax — a 40% tax on health plan premiums exceeding USD 10,200 for single coverage and USD 27,500 for family coverage; the tax is to be effective in 2018. They are making plan design changes such as increasing cost-sharing, reducing subsidies and eliminating plans with extensive coverage. They are also stepping up wellness activities, increasing consumerism tools, and providing incentives for wellness participation. Thoroughly communicating those major plan design changes is essential; the Cadillac tax comes into effect in 2018 but plan changes must be gradual if they are to be accepted by employees, hence the activity seen in late 2015 and pertaining to 2016.