Among all of the benefits offered by employers, none is more important to employees than health insurance. What's more, the passage of the Affordable Care Act (ACA) brought health insurance to the forefront nearly a decade ago. It continues to be a hot topic among both employers and employees alike.
Unfortunately, healthcare costs continue to rise. According to the National Conference of State Legislatures (NCSL), health insurance premiums for both family and individual policies have been increasing steadily for years. In 2018, a typical family policy was priced at $19,616, representing a 5% increase from the previous year. Individual policies were up 3% to $6,896.
The NCSL further explains that single employees covered up to 18% of their total insurance costs while workers with family policies covered 29%. The numbers clearly show that the cost of health insurance is weighing on both employee paychecks and company bottom lines.
If you are concerned about the financial toll health insurance is taking on your company and your employees, below are several suggestions to help you manage your company's healthcare costs. Implementing as many as you can will go a long way to keeping costs in check.
Look into the SHOP Program
The ACA includes the provision to help small businesses pay for affordable health insurance through the Small Business Health Options Program (SHOP). If your company meets SHOP qualifications, signing up for the program would give you access to an expanded marketplace offering more affordable plans on a state-by-state basis. Signing up for SHOP would also qualify your business for the healthcare tax credit, a tax credit that could be worth up to 50% of your health insurance premiums.
Shop for Plans Annually
Insurance companies price employer-based healthcare plans after considering a number of factors. They look at group age, employer location, industry, and the kinds of coverage employees are likely to prefer. Note that any shift in these pricing factors can affect premiums from one year to the next. Therefore, it's a wise idea to shop for healthcare plans every year.
Analyze Each Plan
The vast majority of employer-based plans are either health maintenance organization (HMO) or preferred provider organization (PPO) plans. Your company might have access to a point of service (POS) or high deductible plan as well. It's important to analyze each plan you are offered in light of how likely your employees would be to use it. The goal is to pick the plan that is best for the largest number of employees.
Consider Deductibles and Co-Pays
Higher deductibles and co-pays generally translate into lower premiums. The opposite is also true. If the vast majority of your workforce is not likely to use their health insurance frequently and could afford the higher deductibles and co-pays, you can certainly reduce costs by going with a high deductible plan.
Employee Wellness Programs
Finally, an effective way to keep healthcare costs under control is to minimize how frequently your employees have to use their health insurance. To that end, employee wellness programs are a wise idea. Everything from free smoking cessation programs to free or discounted health club memberships can help. Every little bit that encourages employees to live healthier lives can contribute to lower health insurance premiums.
Here at BenefitMall, we work with some of the nation's leading providers to offer alternative health insurance plans to our clients. Our plans are some of the most creative in the industry, designed to make offering health insurance affordable for even the smallest companies. Contact us right away if you would like to know more.
- SHOP – https://www.healthcare.gov/small-businesses/choose-and-enroll/qualify-for-shop-marketplace/
- NCSL – http://www.ncsl.org/research/health/health-insurance-premiums.aspx