Speaking during the AICPA Not-For-Profit Industry Conference, Karl Ahlrichs, Michael J. Monahan and Peter Petesch bought up the various legal complications that can arise when managing employees, including the issues that come from a business background.
They took note of the following five business trends and the problems they can cause:
- Nonprofit mergers and acquisitions, particularly in the healthcare and healthcare-related communities, are trending up – activities have gone up more than 50 percent in the past three years;
- Compensation decision-making at nonprofit entities continues to evolve with compliant and effective governance models and processes being the keystone;
- Benefit costs often range from 30 to 35 percent of the total cost of compensation can be higher depending on location, collective bargaining agreement provisions and the types of ‘benefits” included in the calculation;
- During the past 10 to 15 years annual health insurance program cost increases turned up from 5 percent a year in the 1990s to 12 percent or more a year in the early 2000s with recent increases as high as 20 percent; and,
- Account-based health plans, whether using health savings accounts or health reimbursement arrangements should be an active consideration in plan designs for the future.