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Spring 2015
health. wealth. life.
In Pursuit of What Matters Most.
Spring 2015 CO N T E N T S PAGE 3 – A Letter from Terry Horan, President & CEO PAGES 4 & 5 – Wellness Works – Metro: Driving Employees Toward Healthier Lifestyles
PAGE 6 – HORAN Introduces Data from Nation’s Largest Health Plan Survey PAGE 7 – Heart of the City Award Winner Rhonda Sheakley and AHA Volunteer Anne Kereiakes Advocate for CPR Awareness
PAGES 8 & 9 –
Creating a Path to Productivity: Solutions and Strategies to Improve Poor Physical and Financial Health
PAGES 10 & 11 – Firm Overview: Corporate Retirement Plan Consultants PAGE 12 - Q&A with Andy Friedman of “The Washington Update” PAGE 13 – Education Recap PAGES 14 & 15 – Client Spotlight: dotloop
Please join us in welcoming our new corporate clients! - AtriCure, Inc. - Deer Park Roofing, Inc. - Edison State Community College - Ernst Enterprises - Healthcare Regional Marketing - Midwest Filtration Company - Springfield-Clark Career Technology Center - The R.W. Earhart Company - The Thaman Rubber Company - Ursuline Academy of Cincinnati
Cover: H.J. Benken Florist & Greenhouses Inc. provided the beautiful floral arrangement showcased on the front cover. The image on the back cover was taken in one of their lush greenhouses. In 1939, Harry and Johanna Benken and their six children moved to Silverton. The property they purchased had a small floral shop and greenhouse on it. Originally dairy farmers, the family decided to enter the florist trade and become known as H.J. Benken Florist. The Benken Family has beautified the Greater Cincinnati community for more than 75 years. H.J. Benken has been a HORAN friend and client since 1986.
health. wealth. life.
EDUCATION CALENDAR May 13 Small Business Solutions Roundtable (Cincinnati) June 9 HORAN and Mountjoy Chilton Medley LLP Wellness Seminar (Louisville) June 10 HORAN and Mountjoy Chilton Medley LLP Wellness Seminar (Lexington) June 11 HORAN and Mountjoy Chilton Medley LLP Wellness Seminar (Cincinnati) July 9 Kentucky Roundtable Series (Fort Mitchell)
Look for us online! Go to horanassoc.com and click on Education to find out more about upcoming educational opportunities as more seminars are scheduled throughout the year. Also, visit our Newsroom to view the online version of health.wealth.life.
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A letter from Terry Horan
In Pursuit of What Matters Most. We know you will enjoy this quarter’s edition of the HORAN magazine. There are many articles designed to improve your quality of life and that of your employees. HORAN is in the Benefits Design and Wealth Accumulation business. But so much of what we do is focused on providing products and services to protect families and enhance their physical and economic well-being. As a result, families are stronger and employees can be more productive. There are powerful benefits associated with workplace wellness (physical and financial), including higher job satisfaction, increased employee engagement and improved productivity and attendance. In our own company, we can observe elevated teamwork and camaraderie as a result of wellness-sponsored activities as employees spend more time together in an effort to become healthier. Many employers are encouraging employees to adopt healthy lifestyles to address the spiraling cost of health care. Progressive employers also recognize that a significant number of their employees are dealing with financial stress that can contribute to medical issues and lost productivity. Among the most disturbing numbers is a statistic that arose from The Employee Benefit Research Institute’s 2014 “Retirement Confidence Survey,” which states that 36% of Americans report less than $1,000 in total household savings and investments (excluding the value of their primary homes and any defined benefit plans). One of the major contributors to this problem is that few seek financial advice. Just 23% of workers and 28% of retirees reported that they had obtained investment advice from a professional advisor. Of those workers who sought advice, only 27% followed all of it. HORAN is now putting in place tools that help our clients address these issues. Our Health Management resources and our Financial Resource Center are ways to assist employers and employees with the information and motivation they need to tackle these issues. There are great articles this quarter about our work in action. Call us for additional ways that we can enhance your financial and physical well-being this Spring. Sincerely,
Terence L. Horan, CLU, ChFC President & CEO of HORAN TerryH@horanassoc.com
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health
Wellness Works METRO: DRIVING EMPLOYEES TOWARD HEALTHIER LIFESTYLES
Most employers would agree that engaging employees in a corporate wellness initiative comes with its challenges.
HEADQUARTERS Cincinnati, Ohio KEY PERSONNEL Dwight Ferrell Chief Executive Officer & General Manager Deborah Drayton, PHR Benefits & Compensation Manager John Ravasio, Esq., SPHR Labor Relations & Employment Law Manager INDUSTRY Transportation NUMBER OF EMPLOYEES 1300 YEAR FOUNDED 1973
health. wealth. life.
Demonstrating the benefits of wellness, securing and then maintaining employee engagement and tying all wellness activities together into a single brand—all of these challenges arise for almost every employer while embarking on a wellness journey. Metro, a non-profit, tax-funded public service of the Southwest Ohio Regional Transit Authority, has faced many obstacles since beginning its wellness journey in 2003. The biggest challenge has been the nature of the transit industry.
The lunch-and-learn opportunity does not work for our business,” said Drayton. “The coach operators and office workers have sedentary jobs so it can be a real challenge to motivate people to move.” Drayton and other Metro leadership understand the nature of their business is not going to change. They have charged themselves with the responsibility of helping their employees lead a healthier lifestyle within the existing framework. “Expenses are not going down. The goal has to be a focus on routine and preventive use of the health care benefits rather than
“Cost is not limited to health care dollars—there
The business is a cost to lost productivity, absenteeism and the operates on a toll on the employee and their family.” 22-hours-a-day, 7-days-a-week - Deborah Drayton, PHR, Benefits & Compensation Manager at Metro schedule and provides 17 million rides per year. Metro employs many treating the illness or condition that has types of positions including coach operators, progressed into a costly disease,” said mechanics and office administration roles. Drayton. “Cost is not limited to health care dollars—there is a cost to lost productivity, Deborah Drayton, PHR, Benefits & absenteeism and the toll on the employee Compensation Manager at Metro, said the and their family.” organization found the biggest challenge has been communicating with employees to The first major step Metro took toward share the Metro wellness message. wellness was developing a joint health care committee in 2003 for the purpose of talking “For a coach operator who starts the day at about benefits. Metro negotiates all of its 3:00 a.m., ‘lunchtime’ may be at 8:00 a.m. group benefits within the labor contract.
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reduction in the employee-share of the premium had the biggest impact toward participation in the biometric screening.”
In 2013, Metro’s Communications team developed a new logo to match its operating brand of go*METRO. Its wellness brand is now go*WELLNESS Driving Healthy Lifestyles.
Costs were rising and Metro wanted to work with the union to establish benefits that meet the employees’ needs while obtaining the best possible cost. The next step was for Metro to determine what was driving its employee benefits health care costs. “Our clinical reviews identified our three main cost drivers are diabetes, hypertension and musculoskeletal (back pain),” said Drayton. “These three things drive our wellness educational efforts and communication pieces.” Once Metro was able to recognize its three main cost drivers, they selected strategic partners to develop programming to help educate their employees on these issues. As a non-profit, tax-payer funded organization, Metro is careful to select partners and programs that are highly impactful in addressing its three main cost drivers while also maintaining costefficiency. Metro has established wellness program components that now fold into its benefits and business strategies for the year. These
programs include an annual Health & Safety Fair, Mammogram Van appointment opportunities and flu shots. The most successful element of Metro’s wellness program is biometric screening, the first of which took place last fall. Metro fully paid for the screening costs, and all screening participants received a $100 gift card; 62% of Metro’s employees participated in the first biometric screening. “We instituted biometric screening at the union bargaining table and tied it to the traditional health insurance benefit,” said John Ravasio, Esq., SPHR, Labor Relations & Employment Law Manager at Metro. “We also tied participation in the screening to future cost-sharing in premium-share. The
UnitedHealthcare (UHC) has been instrumental in helping Metro with their wellness programming. Working with UHC, Metro has held numerous events including Know Your Numbers and Diabetes NOT Me, as well as provided a Wellness Coordinator from TriHealth for 20 hours a month to consult one-on-one with employees. Metro also credits its strategic partnership with HORAN as essential to gathering insights on what will lead to a successful wellness journey. “We wouldn’t be as far as we are today without our HORAN and UHC partners. HORAN has a personal commitment to wellness among their own employees and are able to share their success stories with their clients,” said Drayton. “UHC recognized our efforts in the wellness arena and facilitated our partnership with TriHealth. So far it has been a win-win-win!” One of Metro’s strategic priorities for the future is to become an employer of choice. The organization strongly believes that having a robust culture of wellness is a necessary component in the overall formula to achieve this goal.
Brandon Christin, Health Management Director at HORAN, works directly with clients like Metro to create customized wellness plans built around their specific organizational and employee needs. Brandon utilizes the HORAN Health Management Way to provide a focused, strategic approach to help clients manage and improve their employees’ health to positively control the cost of health care. Utilizing his 12 years of experience in the health and fitness industry, Brandon engages in wellness research and analysis and leads HORAN’s Health Management education for clients.
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health 2014 SURVEY NOTABLE TRENDS In the North Central region, which includes Ohio and Kentucky, Consumer driven health plans (CDHPs) were 29.3% of plans offered, the second highest of any region. CDHPs represent 41.8% of plans offered in Ohio, up 3% from last year. In the North Central region, 56.8% of all employees enrolled in Preferred Provider Organization (PPO). In Ohio, 51.4% of all employees enrolled in a PPO plan. Total annual cost per employee varies greatly across the U.S. For example, the average annual health plan cost per employee nationally is $9,504; the North Central region is $10,130, second only to the Northeast region at $10,931 per employee. From the national scope, 11.1% of the plans reported were self-funded; 16% of the North Central region plans were reported as self-funded. Cincinnati reported 20% of plans were self-funded. 30.3% of Kentucky employers have company-sponsored wellness programs and 29.5% of Ohio employers offered a company-sponsored wellness program, compared to 18.4% nationally.
health. wealth. life.
HORAN INTRODUCES DATA FROM NATION’S LARGEST HEALTH PLAN SURVEY Valerie Bogdan-Powers, Vice President of Employee Benefit Services Valerie leads HORAN’s employee benefits department, developing customized solutions to meet the business goals and benefit objectives of HORAN clients. Twenty-nine percent of Ohio employers offered a company-sponsored wellness program, compared to 18.4% nationally, according to the 2014 United Benefit Advisors (UBA) Health Plan Survey. Most significantly, 41.7% of Cincinnati companies offer a wellness program, twice the national rate of 18%. The 2014 Health Plan Survey is conducted by HORAN’s national partner, UBA, the nation’s largest independent benefits advisory organization. With responses from 16,467 health plans sponsored by nearly 9,950 employers nationwide, the 2014 UBA Health Plan Survey is the nation’s largest and most comprehensive survey of plan design and plan cost benchmarks. The survey provides the best source of data for area employers to benchmark their health plan based on plan type, region, state, number of employees and industry category. This unparalleled number of reported plans studied is nearly three times larger than the next two of the nation’s largest health plan benchmarking surveys combined. The resulting volume of data provides employers of all sizes, including mid-size and small companies (other surveys primarily target large employers), more detailed – and therefore, more meaningful — benchmarks and trends to manage health care benefit programs than any other source.
As the only UBA firm in the region, HORAN has exclusive access to the survey data and can provide employers with a free, local benefits benchmarking report that illustrates more granular and accurate data. As health care plan offerings and the federal regulatory environment become more complex, benchmarking data such as the 2014 UBA Health Plan Survey have become increasingly critical for employers looking to manage their health care benefit programs effectively. Providing an attractive, competitive and cost-effective health plan is critically important to local employers. In order to provide such a plan, understanding how your health plan compares to other similar companies is crucial. HORAN sees the growth of companysponsored wellness programs and Cincinnati’s large involvement as an endorsement of the growing trend of wellness and preventative care to help slow the increase in health care costs. The intent of the survey is to provide employers of all sizes with the data they need to determine which types of plans are most popular in their area and those being phased out, average employee costs and participation, how their plans compare against competitors’ plans and relevant information to negotiate their rates and communicate plan advantages to their employees. HORAN has a multi-disciplinary team dedicated to advising employers on all aspects of health benefits. The 2014 UBA Health Plan Survey, as well as additional publications, compliance alerts, webinars and seminars, will continue to be provided to give further guidance to clients as a part of HORAN’s commitment to educate on best practice benefits strategies and support business objectives.
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HEART OF THE CITY AWARD WINNER RHONDA SHEAKLEY AND AHA VOLUNTEER ANNE KEREIAKES ADVOCATE FOR CPR AWARENESS Photo courtesy of American Heart Association. Pictured (left to right): Rhonda Sheakley and Anne Kereiakes.
The American Heart Association is a very important organization to HORAN. Terence L. Horan, President & CEO of HORAN, and his wife Christy served as co-chairs of the 2013 Heart Ball and have been long-term supporters of the annual event.
Anne and her husband, Dr. Dean Kereiakes, Medical Director of The Christ Hospital Heart and Vascular Center as well as Medical Director of the Carl and Edyth Lindner Center for Research and Education, co-chaired the 2006 Heart Ball.
Additionally, Erik Freudenberg, Vice President and Market Leader at HORAN, is a member of the American Heart Association’s Red Tie Society and served as an Executive Board Member and Dayton Go Red for Women chair. Cheryl Mueller, Relationship Manager at HORAN, is currently on the Executive Leadership Committee of Dayton Go Red and Piqua Go Red.
Rhonda and Anne co-hosted a CPR awareness luncheon in September 2014. Attendees learned more about the CPR awareness initiative. In addition, guests were taught how to properly perform CPR and were able to practice on CPR manikins.
HORAN and its employees support the American Heart Association in many ways, including sponsoring American Heart Association events such as Dayton’s Go Red for Women luncheon and Go Red Goes North in Piqua and Urbana. HORAN also supports our clients who are involved in the organization’s initiatives. Larry Sheakley, CEO of Sheakley Group of Companies—a HORAN client—and his wife Rhonda were named the winners of the Heart of the City award during the American Heart Association’s 2014 Heart Ball. During their acceptance speech, Rhonda spoke about her mission to make CPR training a high school graduation requirement in Ohio.
“Anne and I are passionate about empowering our youth to be lifesavers,” said Sheakley. “To date, 18 states across the country have passed laws requiring every high school student to be CPRtrained before graduation.” Last November, Rhonda, along with dozens of other American Heart Association volunteers, lobbied Ohio State Legislature to make CPR training a high school graduation requirement. Their efforts paid off. Rhonda secured a special grant to be able to work CPR awareness and training into local high schools. “Sudden cardiac arrest could happen at any time, anywhere and to anyone,” said Sheakley. “It’s time for Ohio to have more lifesavers in our communities.” To learn more about the importance of CPR and how you can become involved in CPR advocacy, visit www.heart.org.
Rhonda and fellow CPR advocate Anne Kereiakes have worked side-by-side to advocate for CPR awareness.
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health l wealth [ PART TWO]
CREATING A PATH TO PRODUCTIVITY SOLUTIONS AND STRATEGIES TO IMPROVE POOR PHYSICAL AND FINANCIAL HEALTH
G
allup-Healthways Well-Being Index® recently released its 2014 Community Well-Being Rankings. The study measures well-being across five elements: purpose, social, financial, community and physical. According to the survey, “Well-being is correlated with health care utilization and cost as well as productivity measures like absenteeism, presenteeism and job performance—all critical to organizational and economic competitiveness.” Ohio was measured as having five communities among the 10 cities rated the lowest for overall well-being—Cincinnati (91); Columbus (93); Dayton (97); Toledo (99)
HORAN advisors apply learnings from clients who engage in this process and share best practices with other clients who are beginning the journey. Additionally, HORAN employees have embraced the Path to Productivity internally as well and have participated in each of the following three steps.
1. MEASURE CURRENT STATE OF PHYSICAL AND FINANCIAL WELLNESS HORAN evaluates the wellness of its clients’ employees in a few ways. The first is through a survey to assess the employees’ overall view of their physical and financial health.
“Well-being is correlated with health care utilization and cost as well as productivity measures like absenteeism, presenteeism and job performance—all critical to organizational and economic competitiveness.”
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Gallup-Healthways Well-Being Index®
and Youngstown-Warren-Boardman (100). Neighboring cities did not rank any better, with Louisville ranked 86 and Indianapolis ranked 96. HORAN utilizes a process in an effort to increase productivity through the improvement of physical and financial health. The Path to Productivity includes measuring the current state of physical and financial wellness, providing educational opportunities and tracking overall results.
health. wealth. life.
The survey also collects information on the areas of wellness that employees feel they need to improve, as well as obtains data about wellness activities in which they would participate. The second way is through a variety of tests to measure the current state of physical and financial health. HORAN measures physical health via biometric screenings, health risk assessments, analysis of claims, etc. HORAN
offers comprehensive financial planning which evaluates multiple areas of an individual’s financial well-being.
2. PROVIDE EDUCATIONAL OPPORTUNITIES It is crucial that employees understand the importance of taking care of their physical health and their finances as well as the correlation between the two. These educational opportunities should be offered in many formats. Employees have busy schedules and vary in the way they consume information. HORAN recommends clients hold lunch-and-learns, provide a wellness coach or financial advisor for oneon-one guidance and post information on an intranet site for employees. HORAN provides all of these options internally for its own employees. HORAN’s Corporate Retirement Plan advisors work with thousands of clients’ employees in seminars and one-on-one settings. Recently, HORAN met one-on-one with 48 employees of a manufacturing company. As a result of these education meetings, eight employees enrolled in the company’s retirement plan for the first time. In addition, 16 employees increased their deferral rate and/or switched to a Roth 401(k) plan and 14 employees changed their asset allocations. HORAN also implemented an online Financial Resource Center to address the
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INTRODUCING HORAN HEALTHY™ HORAN has experienced significant success in its wellness program and moved from one end of the wellness continuum to the other. HORAN has decreased renewal percentage year over year, made positive progress in three out of four biometric indicators and lost 300 pounds collectively.
Graphic courtesy of United Benefit Advisors (2014) Source: The Principal Financial Group. Data based on a combination of 42,806 participants opting out of Automatic Enrollment or Automatic Increase as of April 25, 2013, and 65,662 opting in Principal Step Ahead Retirement Option™ as of April 31, 2013.
basic financial planning needs of our clients’ employees. This tool provides basic planning resources for employees in every age range.
3. TRACK OVERALL RESULTS HORAN has worked with over 120 employers on improving their employees’ overall wellness. HORAN has learned from the success of our clients about what works and what doesn’t. The most important stage of the process is for HORAN and its clients to track results in order to see progress and to make any necessary changes in the overall strategy. HORAN tracks improvement in physical health through the HORAN Health Management Way™, which measures progress along a proprietary continuum. Over 70 HORAN clients are currently participating in the HORAN Health Management Way™. In addition, HORAN has seen the impact of health management initiatives on its own employees. Since implementing its program in 2010, the average sick hours used per employee has dropped from 16.25 hours used in 2010 to 12.05 hours used in 2013. HORAN also reduced its employee health risk levels: its high risk level was lowered from 3% in 2012 to 1% in 2014, and its moderate risk
level was lowered from 22% in 2012 to 14% in 2014. The HORAN Corporate Retirement Plan Consulting organization recommends autoenrollment and auto-increase to clients in order to increase participation rate. According to an article by United Benefit Advisors entitled “Getting Employees to Save More for Retirement”, “91% of participants stay in the plan when automatically enrolled. And 88% of employees participate in an automatic escalation program when it’s a default feature—only 12% opt out. But when they have to sign up on their own, just 6% participate.” HORAN tracks auto-enrollment and autoincrease data to measure the current state and progress of an organization’s retirement plan offerings. Recently, HORAN worked with a large, nursing and personal care facility that added an automatic enrollment of 3% with automatic increase of 1% per year to a maximum of 6%. The changes of plan design resulted in an increase of participation from 35% to 87% and an average deferral rate from 1.72% to 3.56%.
As a result of HORAN’s internal wellness effort, the organization has been named a Healthiest Employer in Cincinnati three years in a row (2012, 2013 and 2014) and a Healthiest Employer in Dayton two years in a row (2014 and 2015). Since financial wellness is one of the five significant measures of well-being and has proven to be an impacting element of an employee’s productivity, HORAN believes it also should be a component of the HORAN wellness program. As a result of this belief, HORAN created HORAN Healthy™ to include financial education in HORAN’s Wellness Initiatives to develop a holistic approach to improving both physical and financial health. Through HORAN Healthy™, HORAN hosts monthly lunch-and-learns that cover topics such as budgeting for short- and long-term needs, financial planning and a deep-dive into HORAN’s retirement plan offerings. HORAN has plans to expand efforts in the near future.
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wealth FIRM
VERVIEW
CORPORATE RETIREMENT PLAN CONSULTANTS Employers need a partner who can focus on investments, plan design as well as fiduciary and regulatory issues. Most companies who seek a financial advisor for their retirement plan offerings will receive fundamental guidance on investment selection. HORAN’s Corporate Retirement Plan Consulting organization acts as more than a typical advisor to employer clients. Not only do they directly work with employers, HORAN also partners with clients to provide one-on-one financial education for its employees. Additionally, HORAN is able to provide employer clients with a total fund evaluation to provide better options for its employees as a result of its partnership with Retirement Plan Advisory Group (RPAG), a national alliance of accomplished advisors that demands and delivers higher-level strategies.
FOUR PILLARS OF SERVICE HORAN offers objective advice, custom products, quality service and practical ideas about qualified retirement plans. Particularly today, with the complexities of the new pension laws and the need to hire and retain valuable employees, employers are seeking experienced and knowledgeable professional advisory partners who pursue the right principles: analyze, design and then act. “HORAN works to identify gaps and provide solutions for our clients. We also work closely with clients’ employees to set retirement plan objectives, review any existing plan and/or design a new program to help achieve retirement goals,” said Karl Diebold, CFP®, Vice President, Investment & Retirement Plan Consultant at HORAN.
Pictured: Standing (left to right) – David Lohre, AIF ®, Vice President; Anna Pfaehler, CFP ®, Director of Financial Planning; and Karl Diebold, CFP ®, Vice President and Corporate Retirement Plan Consulting Lead; Seated (left to right) – Paul Carl, Vice President - Retirement Services; and Joanna Hankey, CFP ®, RICP ®, REBC ®, RHU®, Senior Account Manager.
HORAN’s Scoreboard System Methodology incorporates both quantitative and qualitative criteria including upside and downside capture, one or more style analyses, Modern Portfolio Theory statistics, information ratio, tracking error and other relevant factors. Well-qualified to formulate individual recommendations, HORAN advisors apply profound knowledge in statistical analysis to go far beyond typical investment screenings, driven by insight and independent impartiality.
HORAN’s Corporate Retirement Plan Consulting organization is structured to provide clients with four pillars of service: investment monitoring, fiduciary support, plan design and employee education.
FIDUCIARY SUPPORT
INVESTMENT MONITORING
Retirement plans require prudent governance by plan sponsors and fiduciaries. HORAN utilizes the Fiduciary Fitness Program™ to confirm and document proper roles and execution of responsibilities in a prudent manner.
HORAN’s Corporate Retirement Plan Consulting organization devotes significant focus to investment monitoring and benchmarking. Through HORAN’s Investment Due Diligence System, the group is able to provide clients, with pinpoint precision, the assistance to select, monitor and evaluate funds within a best practices environment.
health. wealth. life.
Many companies do not know their fiduciary responsibilities under the law. In order to gain perspective, employer clients reach out to HORAN for specific direction on how to guard against troublesome and costly liabilities.
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A common concern for many employers is the amount of fiduciary risk they are subject to when sponsoring a 401(k) plan. One way to mitigate that risk is to hire fiduciary service providers, in particular to help with selecting and monitoring plan investments.
COMMITMENT TO CLIENTS
PLAN DESIGN
HORAN has acted as a true advisory partner for more than 60 years to help clients in the selection, implementation and ongoing service of retirement savings plans. Drawing upon decades of combined experience, the HORAN organization puts a stake in the ground for each and every individual client.
HORAN has a focus of creating outcomes for both the employer and the employee. Plan design is a powerful way to guide individuals to reach a successful retirement nest egg, and, in turn, a fulfilling retirement. Companies have more influence than they may realize on the success of their employees to retire with a benefit adequate to meet their retirement needs.
HORAN is committed to clients and to continuous improvement. The Corporate Retirement Plan Consulting organization strives to ensure employer clients and their employees are satisfied with its service delivery. For that reason, HORAN conducts client satisfaction surveys to measure effectiveness and quality of service, both at the employee and employer levels.
HORAN works to understand client goals and create a plan design which maximizes the benefits for both the employer and employees. While there are myriad plan design choices, there is an optimal way to structure a retirement plan to create a meaningful benefit.
For example, in a survey of one of its largest clients, a relationship that spans over two decades, HORAN asks about service, responsiveness and overall client satisfaction. Currently, the survey results are a 4.8 out of a possible 5.0.
HORAN advisors focus on the following: • • •
Utilization of eligibility rules, vesting schedules, non-discrimination testing variations, etc. Automation for administration and employee engagement. Employer contribution configuration: Match, Profit Sharing, Safe Harbor, Social Security integration, new comparability/cross testing and utilization of defined benefit/cash balance plans.
Design elements impact every aspect of a plan – from investments and recordkeeping to compliance and communication.
EMPLOYEE EDUCATION HORAN is committed to both group and one-on-one meetings with our clients’ employees, which have resulted in increased contribution rates, increased participation and enhanced asset allocation. A retirement plan is one of the most valuable benefits offered to employees and can be used to not only recruit new talent, but to retain existing personnel. In order to do that, retirement plans must be understood by employees. The HORAN process includes group employee meetings, targeted communications, a variety of communication tools and, most effectively, oneon-one employee meetings reviewing their specific situation. The results of Employee Benefit Research Institute’s 2014 “Retirement Confidence Survey” indicate that 36% of Americans report less than $1,000 in total household savings. HORAN understands the need for clients’ employees to have a better understanding of the importance of retirement planning to create Financial Wellness. In order to address this need, HORAN invested in a Financial Resource Center for employees to refer to for information and tools needed to have a fulfilling and financially secure retirement. The Financial Resource Center is accessible on HORAN’s website: www. horanassoc.com.
KARL DIEBOLD, CFP ®, LEADS HORAN’S CORPORATE RETIREMENT PLAN CONSULTING ORGANIZATION Karl Diebold leads HORAN’s Corporate Retirement Plan Consulting organization and works with individuals and corporations to deliver investment and retirement planning services. “We work with a committee to ensure they are fulfilling their fiduciary responsibilities in terms of investment monitoring, benchmarking and process,” said Diebold. “If the company was ever audited, we are confident they will have the processes and documentation in place to answer any audit questions.” Karl regularly holds seminars on asset allocation and portfolio management. As a Certified Financial Planner™, he maintains high satisfaction through plan sponsor engagement, plan design and robust participant education. “About 20 years ago,” said Diebold, “my father urged me to ‘start preparing for retirement. If an 18-year-old invests $2,000 a year for 10 years into an IRA and stops,’ he said, ‘that 18-year-old will retire with $500,000 at age 65 (assuming an 8% annual return)’. This lesson has stayed with me. I strive to communicate advanced investment concepts in an easy-to-understand way to the clients I meet.” “It’s the little things you don’t think about or that you put off that can become a problem,” said Diebold. “Wise retirement planning demands attention to all kinds of details – forms to fill out, investment options, beneficiary designations, to name a few – and if you don’t keep up with them, you can lose options. One good way to prevent that is to enlist the help of a professional.” Karl has over 20 years of industry experience. His clear delivery of information assists individuals in understanding their options and helps them to make sound decisions.
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life
Q&A WITH ANDY FRIEDMAN OF “THE WASHINGTON UPDATE”
Terence L. Horan, CLU, ChFC President & CEO of HORAN Andy Friedman is “one of the nation’s most sought-after speakers on all things political.” An expert on political affairs, Andy is known for predicting the outcomes of Washington tax and fiscal deliberations and providing financial advisors and investors with strategies to consider in light of the changing political landscape. Andy spoke in front of an audience of HORAN clients and friends of the firm on March 19, 2015. He also took time to sit down with me to discuss the future of the federal budget and potential tax law changes. TLH: How would you describe the political gridlock in Congress and why does it exist? AF: The political gridlock is as bad as I’ve ever seen it. The primary reason for it is the congressional redistricting that took place in the wake of the 2010 census. After the 2010 census, all of the states reset the boundaries of their congressional districts. The party in power in any given state did so in a way to make the maximum number of districts safe for that party. Most House candidates feel comfortable that they will win their district because their district votes the same way they do. Instead they worry about being challenged in a primary election and getting knocked off because they have compromised on legislation and thus appear to be too
health. wealth. life.
Pictured: Andy Friedman speaks to an audience of HORAN clients and friends of the firm on March 19, 2015, at the Cincinnati Art Museum. Friedman is a frequent speaker at Association for Advanced Life Underwriting (AALU) events. Terence L. Horan, President & CEO of HORAN, is on the AALU Board of Directors.
moderate. The result of that is that we really only get serious compromise when Congress has to pass legislation because the adverse consequence of not acting is too great; I call these “forcing events”. An example is the need to raise the debt ceiling each year so the U.S. can borrow more money to cover its budget deficit. TLH: What are the major concerns for the Federal Budget? AF: The major concern for the federal budget is the growth of entitlement spending, and by entitlement I mean government spending, primarily on Social Security, Medicare and Medicaid. As the Baby Boomers age, they put more and more pressure on the budget because of the need to spend more on benefits for Social Security and Medicare. Recent reports say that in about three or four years, the growth in spending on Social Security and Medicare will out-strip the growth in the economy. Ultimately, there will have to be changes to entitlement. TLH: What is the potential for tax law changes in the future? AF: One broad tax law change that everyone is talking about is tax reform. There will be an effort at tax reform in congress this year. My guess is that individual tax reform is not going to succeed because it’s just too controversial. Corporate tax reform might be possible. Longer term there is going to be a need for more revenue at the government level. The growth in entitlement spending is going to cost more and more money. Part of that equation probably means the need for some
additional tax revenue. Congress will look for more technical provisions in the tax code (loopholes) that could be changed to bring in additional revenue. The bottom line is that the amount that higher-income people pay in taxes is not going to go down. TLH: What are the opportunities for investment products in light of tax laws? AF: Taxes on investment income went up 10 percentage points for higher-income taxpayers in 2013. A recent study suggests that average tax rates on higher-income families are the highest they have been in the last 35 years. People need to be mindful as they are making investments of the tax drag on the investment income. This should compel individuals to look at tax-efficient vehicles. Life insurance typically has been used as a wealth transfer vehicle, but it’s also important as a vehicle to reduce income taxes. Properly structured, life insurance can provide a source of income during your retirement that is tax-free. TLH: Describe the political horoscope for 2016. AF: You have to expect that Hillary Clinton will be the Democratic nominee, although never say never. The Republican field is wideopen, the latest count is close to 20 people who have either said or are going to say they are running for president. The Republican candidates will have to cater to two wings of the party—the more moderate, establishment Republicans and the more conservative, Tea-Party Republicans. Whichever candidate comes along is going to have to negotiate between those different parts of the party.
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education
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HORAN HOSTS HEALTH MANAGEMENT SEMINARS IN CINCINNATI AND DAYTON HORAN hosted Health Management seminars for clients to gain learning from a HORAN client case study and create a forum for best practices. The seminar was offered on two dates: April 15 in Cincinnati and April 23 in Dayton. HORAN’s Health Management experts, Brandon Christin and Scott Silver, provided an overview of HORAN’s proprietary Health Management tools and a client example of a best-in-class wellness program. Additionally, they discussed a framework for comparing a company’s wellness program with the continuum of programs in the marketplace. The seminar also highlighted a Cincinnatibased company that has been a HORAN client for over seven years and has implemented a wellness program that reduced the trend of their health care costs.
HORAN’s Health Management approach provides employers with practical insights for customized solutions, recommendations and strategies to help them execute and achieve measureable outcomes related to employee health and their health care costs. Pictured: Erik Freudenberg, CBC, Vice President - Dayton Market Leader at HORAN, presents at HORAN seminar in Dayton entitled “How to Create a Wellness Program to be a Best Performer”.
HORAN works closely with carriers and wellness partners who offer programs that help encourage clients’ employees as HORAN helps guide employers through their wellness journeys to achieve positive outcomes.
HORAN HELPS EXECUTIVES BETTER PREPARE FOR POSSIBLE 2015 DEPARTMENT OF LABOR TARGETED INITIATIVES HORAN’s Corporate Retirement Plan Consulting organization partnered with Dinsmore, the largest law firm in Cincinnati, to hold a seminar on April 22, 2015. The seminar was designed to help executives better understand how their 401(k) and 403(b) plans may be at-risk for a Department of Labor review. HORAN’s Karl Diebold, CFP®, Vice President, and Paul Carl, Vice President - Retirement Services, discussed a variety of topics including: understanding your retirement plan fees, the importance of benchmarking, securing live bids and evaluating your results. William M. Freedman, Esq. and Nicole M. Hanna, Esq. at Dinsmore highlighted self-directed brokerage accounts, remittance of contributions and the “new” definition of Fiduciary. Attendees also benefitted from a Health Benefits Compliance Update from Shelly Hodges-Konys, CBC, Compliance Leader at HORAN, and a Capital Market Update given by Nicholas C. Reilly, Portfolio Manager and Partner at HORAN Capital Advisors.
Pictured: Karl Diebold, CFP ®, Vice President at HORAN, presents at HORAN seminar entitled “Prepare for Possible 2015 Department of Labor Targeted Initiatives”.
Education is crucial to investment and retirement plan consulting. HORAN’s education strategy ensures employer clients have the information needed to help their employees have a successful retirement.
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clients Client Spotlight: dotloop
CONNECTING PEOPLE AND BUSINESSES TO WORK BETTER TOGETHER Anyone who has ever purchased residential real estate understands the volume of paperwork that is involved in the transaction. It weighs down all parties involved in the process and can put a damper on the excitement of purchasing a new home or condo. Austin Allison, Chief Executive Officer of dotloop, knew there had to be a better way to do this transaction. And this idea is how dotloop was born. dotloop is an online collaboration platform that enables multi-party real estate transactions to be completed electronically.
together,” said Michael Graham, Chief Operating Officer at dotloop. “dotloop started by connecting real estate agents and home buyers and sellers, then we began bringing brokers into the process.
“It requires more of an employee to work at a company that is entrepreneurial than to work for a company that is not. You have to be responsible for your own work and career.” - Michael Graham, Chief Operating Officer at dotloop We are working toward connecting ancillary services, as well, in order to bring all parties into the transaction and let them collaborate seamlessly.”
HORAN began working with dotloop in 2011, two years after it was founded. Nathan Decker and Julie Tople lead the HORAN representatives who work with dotloop as its employee benefit advisor. They have been able to experience dotloop’s incredible Julie Tople growth firstAccount Manager hand.
“We are all about connecting people and businesses to work better
Nathan Decker Relationship Manager
HORAN advocates for clients to maximize benefits, minimize costs and improve health. They work to identify and understand clients’ organizational challenges and then collaborate to put strategies in place that will achieve their desired outcomes. HORAN’s Client Service Model provides exemplary service and commitment. A dedicated team provides custom solutions to clients and their employees leveraging the deep experience, skills and expertise of the benefits team.
health. wealth. life.
first met with Austin (Allison). I quickly saw the value in what they were doing and knew that anyone else who had ever closed on a house would as well,” said Nathan Decker, HORAN Relationship
“I had recently purchased a condo when I
Manager for dotloop. “They were under 20 employees then and pursuing a contract that would launch their growth.” Decker recalls dotloop’s first open enrollment meeting, which took place around a pool table in the middle of their office. “The same buzz and excitement that I experienced at that first open enrollment meeting is still in the air,” said Decker. “I have watched dotloop grow from a small business with a great product, to a much larger business with a proven model. A lot of strategy goes into an employee benefits package when an organization grows as quickly as dotloop has.” The organization’s employee base has grown to 120 employees—an astounding 67% growth over four years. The average employee’s age is under 30 years old.
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“It requires more of an employee to work at a company that is entrepreneurial than to work for a company that is not. You have to be responsible for your own work and career,” said Graham. “We seek out employees who will excel in that environment.” A strong benefits package is important to dotloop in order to attract and retain the top talent who will excel in its entrepreneurial environment. Additionally, dotloop focuses on educating its young employee base to ensure they fully understand their benefits. “Our focus is on giving our staff the tools and knowledge they need to make educated decisions when it comes to their health benefits as well as demonstrating how they can utilize their benefits in the most-effective manner,” said Kim Ellis, Human Resources Director at dotloop. dotloop grew its population base to more than 100 employees on the plan in 2013—enabling HORAN Financial Analysts to receive claims experience reports from Anthem. These reports allowed HORAN to be proactive with renewal projections and review detailed utilization reports on a monthly basis to plan for the 2015 renewal. “Having that partnership with HORAN has been great for me as we move forward in making sure we have the most affordable and best coverage available for our employees,” said Ellis. “HORAN helps us seek that out and makes sure we know what is available.” As a result of having affordable coverage, dotloop is able to pay for all of the employees’ health plan benefits’ cost. Graham and Ellis believe this is a huge driver for attracting the top talent that brings passion and entrepreneurial drive to the organization.
Pictured left to right: Michael Graham, Chief Operating Officer, and Kim Ellis, Human Resources Director, at dotloop.
“Our people have a passion that I have not seen at this level,” said Ellis. “The passion, energy and commitment that they have to do what they do and continue to improve upon it is inspiring.” Graham agrees that the employees are essential to the dotloop mission of creating great experiences for people who are transacting residential real estate. “Every single one of our people here does work that matters a lot. It’s very satisfying when I see a result that I can’t trace back to any one person or one group because that positive result came from so many places and people in the organization to get it done,” said Graham. “When we are all working together and when the result is not attributable to any one person or any one group—it’s because of the collective effort of us all working together and all chasing the same vision.”
DOTLOOP HEADQUARTERS Cincinnati, Ohio KEY PERSONNEL Austin Allison Chief Executive Officer Michael Graham Chief Operating Officer Kim Ellis Human Resources Director INDUSTRY Real Estate NUMBER OF EMPLOYEES 120 YEAR FOUNDED 2009
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