Five Ways to Take Advantage of Health-Care Reform

The Affordable Care Act offers CUs some opportunities.

August 26, 2013
While health-care reform means new oversights, obligations, and work, it can create opportunities for credit unions prepared to harness them.

So say Brad Pricer, senior manager, CUNA Mutual Group employee benefits product management, and Annette Bechtold, senior vice president of regulatory affairs and reform initiatives with Digital Benefit Advisors.

Besides—credit unions don’t really have a choice. Although the Obama Administration has delayed until January 15 a key provision of the Patient Protection and Affordable Care Act, (ACA) many other provisions already are in effect.

Pricer and Bechtold advise taking these five steps to take advantage of the opportunities health-care reform can offer your credit union:

1. Don’t wait

The first step is to simply get going. Many employers, including some credit unions, stalled on implementing ACA while awaiting the outcome of the 2012 presidential election.

But no amount of hand-wringing or political rhetoric will repeal the ACA now. It’s time to comply and, if necessary, adjust attitudes.

2. Review health-care plans

Ensure your current health-care offerings meet federal requirements. The Labor Department has started to audit employer-sponsored plans.

Audits are in the early stages, and credit unions don’t appear to have any issues. But these spot-checks are a good reminder the government will hold employers accountable for meeting ACA requirements.

3. Consider opportunities

Instead of focusing on how reform might hamstring employers, credit union leadership could seek out a silver lining.

The rise of public exchanges and the increased demand for private exchanges present a new option for credit unions to switch their benefits plans from a defined benefit model to a defined contribution model. This shift is similar to what most employers did with retirement plans.

This will enable credit unions to better control costs, which has been difficult with the unpredictable annual increases many employers faced in the past decade.

4. Choose wisely

Credit unions switching to exchanges should choose a private exchange that offers the quality their employees expect.

Employees will continue to have questions and issues with their plans and will continue to use work time to resolve them. Customer service difficulties, administrative hassles, and coverage battles could diminish employee productivity and morale.

Rely on brokers and consultants when exploring exchange options. Private exchanges lack track records, so credit unions must negotiate how to handle employee disputes, and ensure safeguards and guarantees are in place so these arrangements benefit the institution and their employees.

5. Communicate well

Many credit unions use the strength of their benefits to compete for talent. Employees could perceive your moving to an exchange as a departure from a longstanding tradition of providing the best health-care and retirement offerings.

Design and implement thoughtful, honest, and optimistic employee communications. Assuage concerns and assure employees that a defined contribution approach will enable them to maintain or even enrich their health-care coverage.