Securing Maximum Participation in Your Working Spouse Provision

Balancing the responsibility of providing healthcare benefits with controlling costs is a major challenge. In 2023, 69% of employers identified company healthcare costs as a top health and wellbeing priority for the next three years.¹ The cost associated with providing healthcare coverage for a dependent spouse, in particular, can be especially high.

This is because spouses often incur higher healthcare costs than employees. While insured spouses spend an average of $6,609 on healthcare services annually, employees spend just $5,430.² This is a difference of $1,179 per spouse.² Enforcing your working spouse provision is as important as establishing one in the first place. If you’re not regularly verifying working spouses, you are not maintaining compliance, and you’re losing money for every spouse that has other coverage available but not reporting it.

These risks motivate many employers to enforce the cost-saving measures they established to reduce the number of spouses they cover who already have access to their own employer-sponsored plans or implement a surcharge to the enrolled employee should their spouse remain. By working with a trusted cost containment partner to maximize the value of your working-spouse provision you can benefit from millions of dollars in cost savings. For example, if a plan has approximately 2,500 enrolled spouses at an average annual cost of $7,200 per spouse and verification identifies 750 as having access to other coverage, the first-year cost savings could amount to $5.4 million.

Mitigation Strategies for Unverified Working Spouses

Regardless of the type of working spouse provision you have, maximizing participation is critical. It helps reduce expenses and improve plan performance by ensuring the plan remains sustainable and fair for all employees over time. The most common working spouse provisions include:

• Spouse surcharge: Some organizations charge an additional fee, typically administered through payroll deductions, for covering a spouse who has access to other employer-sponsored insurance. This discourages employees from enrolling spouses who have other coverage options, but doesn’t fully remove the option for those who truly need it.
• Carve-out/exclusion: With a spousal carve-out, the spouse is only eligible if they do not have access to their own employer-sponsored plan. This is usually stated in the Summary Plan Description (SPD) during benefits enrollment and requires employees to disclose whether their spouse is employed, has access to their own employer’s coverage, and is already enrolled in that coverage.

The Mechanics of Consova’s Spouse Health Insurance Verification

Many working spouse verification programs rely solely on employee self-reporting to verify whether the spouse has access to coverage. Consova’s iVerifyPro solution, however, gains confirmation directly with the spouse’s employer. This third-party verification eliminates ambiguity and ensures data accuracy. Based on the results, surcharges may be applied, and spouses may be removed if ineligible.

Using this approach, Consova goes the extra mile to lower costs and mitigate risk for employer-sponsored health plans.

Benefits of a Structured Verification Process

Organizations of all sizes realize substantial cost savings with Consova’s Working Spouse Verification program, as well as numerous other benefits that minimize disruption, including:

• Streamlined processes: Consova’s streamlined and efficient program significantly reduces the burden on HR teams by seamlessly integrating into existing HR and benefits systems.
• User-friendly interfaces: Through a user-friendly interface, employees can enjoy more convenience and accessibility. Consova’s program makes it easy for employees to upload required documentation, check verification status, and receive real-time updates.
• Enhanced data accuracy and analytics: The program simplifies data transfers and verification workflows, improving data accuracy and real-time reporting and analytics.

Consova’s program also comes with the following improvements in security and health benefits compliance:

• Single Sign-On (SSO) and data encryption: These robust security measures protect sensitive employee information during the verification process.
• Careful adherence to regulations: A regular spousal coverage audit ensures organizations stay compliant with plan policies and regulatory requirements such as the Consolidated Appropriations Act (CAA) and ERISA.
• Long-term maintenance of plan integrity: A continuous spousal verification program ensures that new dependents added throughout the year meet eligibility criteria. This proactive approach helps maintain plan integrity over time.

Consova’s working spouse verification program provides a convenient and streamlined process for eliminating unnecessary spending on spouses with access to their own employer-sponsored plans. With Consova’s support, you can improve plan performance while effectively reducing expenses.

Ready to maximize the value of your working-spouse rule? Contact us to learn how our customized solutions can help you achieve significant healthcare cost savings.

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Sources:

1. Controlling healthcare costs and boosting mental health outrank other priorities. (2023, October 11). WTW. https://www.wtwco.com/en-us/insights/2023/10/controlling-healthcare-costs-and-boosting-mental-health-outrank-other-priorities
2. Sammer, J. (2023). Carving Out’ Spousal Benefits: Cost-Cutting, with Repercussions. Shrm.org. https://www.shrm.org/topics-tools/news/benefits-compensation/carving-spousal-benefits-cost-cutting-repercussions