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Health Care Reform Changing the Health and Retirement Plan Landscape. Prepared byPrepared for Xxx xxx Xxx xxx. . . . . Managing Risk Through Changing Environments. History as a solutions provider Holistic approach to meeting participant objectives - PowerPoint PPT Presentation
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CONFIDENTIAL – NOT FOR DISTRIBUTION
The Manning & Napier Fund, Inc. is managed by Manning & Napier Advisors, LLC (“Manning & Napier”). Manning & Napier Investor Services, Inc. and affiliate of Manning & Napier, is the distributor of the Fund shares.
Prepared by Prepared forXxx xxxXxx xxx
Health Care ReformChanging the Health and Retirement Plan Landscape
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History as a solutions provider
Holistic approach to meeting participant objectives
Investment solutions to drive outcomes
Deep bench of resources and subject matter expertise
Managing Risk Through Changing Environments
Manning & Napier: The Investment Manager
Founded in 1970
$45.2 billion is assets under management as of 12/31/2012
First objectives-based account in 1971
Co-fiduciary status to actively manage asset allocation in separately managed accounts and collective investment trust funds
Client Analytics Group of over 20 analysts with approximately
200 years of combined industry experience
Manning & Napier Advisors, LLC (Manning & Napier) provides investment advisory services to Exeter Trust Company, Trustee of the Manning & Napier Collective Investment Trust funds. The Collectives are available only for use within certain qualified employee benefit plans.
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Retirement Plan Shift
Increased Regulation and Unsustainable Employer Liability Motivate Shift from Defined Benefit to Defined Contribution
Poor Employee Retirement Savings
ChoicesStrain Employer
Bottom Line
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Health Plan Shift
Health Care Reform and Unsustainable Health Care Inflation Motivate Shift from Defined Benefit to Defined Contribution
Poor Employee Health Spending
ChoicesStrain Employer
Bottom Line
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Convergence of Health and Wealth
Employers Cannot Afford to Wait.
HEALTH WEALTH+
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Significance of 2014 Changing the Way Employers Approach Benefits Retirement regulation and health regulations on a parallel path
Health Care Reform Accelerates Convergence
ImpactCost Impact for Some, Consulting Opportunity For All Retirement industry has a responsibility to help plan sponsors understand retirement plan implications to health decisions
Opportunity Call to Action Plan sponsors must partner with experts to help guide them through the uncertainty
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Health Care Reform Timeline
2014-2018Phase 2: Strategic ComplianceNew Options, Benchmarks, and Penalty Requirements
2010-2013Phase 1: Tactical ComplianceNew Coverage, Administrative, and Disclosure Requirements
2010Passage of the Patient Protection and Affordable Care Act
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2014: The New Landscape
Benchmarks Penalties
Options
Employer Sponsored Coverage
Public Exchanges
Expanded Medicaid
Benchmarks
Broader Access
More Affordable Premiums (for lower earners, high health consumers)
Less Rich Benefits
Penalties
Individual Mandate
Employer Mandate (for Employers with 50+ full time employees)
Cadillac Tax
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Importance of a Holistic Benefits Perspective
1. In 2014, do you plan to offer health plan coverage?
Health ConsiderationHealth Care Reform cost impact
Retirement Implication Competitive total benefits offering
2. Are you making changes to administrative processes?
3. Are health benefits part of your current executive compensation package?
Health Consideration Health Care Reform establishes new administrative requirements
Retirement Implication Health plan administration may differ from retirement plan administration
Health Consideration Health Care Reform imposes new nondiscrimination requirements on health plans
Retirement Implication Competitive total executive benefits offering
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Health Plan Termination
Drop Coverage Maintain Coverage
This prompts the question:Do you plan to drop or maintain health plan coverage?
Did You Know…Citing a Deloitte report published in June 2012, The Wall Street Journal reported that an estimated 1 in 10 employers will stop offering health coverage because of the new health care reform law. 1
1Source: The Wall Street Journal. “Deloitte: One in 10 U.S. Employers to Drop Health Coverage.” 24 July 2012. Web. <www.wsj.com>
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Health Plan Administration
This prompts the question:Have you evaluated your administrative procedures and processes to comply with health care reform requirements?
Did You Know…Beginning in 2014, employers that employed an average of 50 full-time employees during the previous calendar year must offer health coverage that meets minimum essential coverage requirements or pay a fine. The Joint Committee on Taxation estimates employers will pay $52 billion over 10 years in penalties for noncompliance. 1
Yes No
1Source: U.S. Chamber of Commerce. “Critical Employer Issues in the Patient Protection and Affordable Care Act.” Web. <www.uschamber.com>
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Health Plan Nondiscrimination
This prompts the question:Prior to health care reform have you used health benefits as part of your executive compensation package?
Did You Know…Health Care Reform expanded the application of rules prohibiting health benefits discrimination in favor of highly compensated employees (HCEs). As a result, it is more difficult for employers to use health benefits as part of their executive compensation package.
Yes No
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Total Outcomes StrategyAllocation of Benefits DollarsHealth Care Reform Impact may shift employer investment away from core health
Reallocate Benefits Spend to enhance employer
contribution to retirement, employee engagement
Total Rewards align benefits allocation with benefits valued by employees
Plan DesignCoordinate health and retirement incentives for holistic financial health
Use Plan Designs that facilitate behavior changes and maximize participant outcomes
Employee EngagementUnderstand Employee Demographics to nudge behavior in the right direction
Empower Employees to be better consumers of health care and save more
TotalOutcomes
Allo
catio
n of
Ben
efit
Dolla
rs
Plan Design
Employee Engagement
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Manning & Napier Can Help
ResourcesRead Manning & Napier White Papers available at www.manning-napier.com
• Helping Employers and Employees Navigate the Health/Wealth Convergence
• An Evolving Landscape: Regulatory Impacts on Health/Wealth Choices
WebinarFor a more in-depth discussion on this, sign-up for our upcoming webinar at [email protected].
Partnering to Drive OutcomesOur investment solutions are designed to manage the real world risks facing plan sponsors and participants. To learn more about our solutions, talk to you retirement advisor or service provider.