5 Ways to Lower your Employee Benefits Premium
Benefits are without a doubt are one of the top needs for companies to attract and retain top talent in their field. However with medical premium outpacing the rate of inflation, it is becoming harder to find affordable comprehensive benefits. In addition to that, other lines of coverage as well seem to be increasing year to year with no real sign of stopping. If you implement just two of the listed ways to lower costs below, I can almost guarantee you will see results.
Make the Carriers Compete for your Business
Capitalism at its finest make them work for your money. I have received a 10% discount from a carrier on a group over 50 just by going back to them and telling them their quote is non competitive compared to alternative options. Whether their quote is too high, their network is not as large, or another carrier is offering discounts with packaging. It never hurts to go back to the carrier and make a strong argument for them to lower their rates. More often than not carriers will want to see competitive quotes prior to providing the discounts. and make a strong argument for them to lower their rates. More often than not carriers will want to see competitive quotes prior to providing the discounts, but the discounts sometimes can be significant even if the other quote is priced similarly to their option.
Have Employees Fill Out Health Questionnaires
We have an article on why you should consider filling out questionnaires for quoting every year.
Package your various employee benefit options with One to Two Carriers
The more lines of coverage the more the carriers are willing to lower rates. Whether you package your Medical with your Dental/Vision or all of your ancillary lines with one carrier. They are always willing to negotiate for more business. In addition to packaging your lines with one carrier, I would also recommend adding additional voluntary options if possible. Even if there is low participation on those additional options carriers are still willing to cut your rates on the more utilized options with those additional plans being offered.
Consider Contributing More to select Plan Options
There are numerous plan types for employer health insurance in Texas. It is hard for employers to decipher their meaning and the best option for their group. There are PPO, HMO, and EPO plan types. PPO Health Plans are the least restrictive of these options. PPO plans generally have affordable copays, and a wide selection of providers/doctors. If your employees are adamant on using their doctor then I highly recommend a PPO option. Unlike the other options, PPO plan types even offer coverage for Out of Network Providers. EPO plans generally have the same network size as PPO plans (They use the same in-network doctors). However EPO Plans, do not offer out of network coverage. HMO plans are the most restrictive of the three plan options. HMO plans sometimes require employees to designate a primary care provider, and only go to specialist he/she recommends. However, not all HMO options have this restriction. Either way, HMO networks are the smallest in comparison with EPO and PPO plans. In addition to having the smallest network, HMO plans like EPO plans do not offer coverage to out of-network providers. This is just a quick synopsis of differences. To get exact details on your plan type I would recommend reviewing the SBC (Summary Of Benefits And Coverage). The SBC will show your coverage details, and plan type.
Quote out your Benefit Plans with Other Brokers
There are numerous plan types for employer health insurance in Texas. It is hard for employers to decipher their meaning and the best option for their group. There are PPO, HMO, and EPO plan types. PPO Health Plans are the least restrictive of these options. PPO plans generally have affordable copays, and a wide selection of providers/doctors. If your employees are adamant on using their doctor then I highly recommend a PPO option. Unlike the other options, PPO plan types even offer coverage for Out of Network Providers. EPO plans generally have the same network size as PPO plans (They use the same in-network doctors). However EPO Plans, do not offer out of network coverage. HMO plans are the most restrictive of the three plan options. HMO plans sometimes require employees to designate a primary care provider, and only go to specialist he/she recommends. However, not all HMO options have this restriction. Either way, HMO networks are the smallest in comparison with EPO and PPO plans. In addition to having the smallest network, HMO plans like EPO plans do not offer coverage to out of-network providers. This is just a quick synopsis of differences. To get exact details on your plan type I would recommend reviewing the SBC (Summary Of Benefits And Coverage). The SBC will show your coverage details, and plan type.
These are not the only ways to lower your costs. Another example of a way to lower premium is by having a claims audit by an actuary firm to see if your renewal increase was warranted given your claim history/your groups current health status. Unfortunately, I cannot list or speak on all of the various ways to lower premium some I have to keep as secrets from competitors. As Benjamin Franklin stated, 'Three may keep a secret, if two of them are dead'. However, I can provide you with the 5 steps to utilize the Sanus Benefits Platform to start saving on your premium. Check out the video below and for more details read the Why to Quote Employee Benefits Online? article.
If you would like a complete review of your benefits package click the Get Quote button below, and one of our experienced brokers will reach out to you for quoting. Please remember you can change your carriers at anytime without any reprcussions you are not tied into a contract. It is better to start saving money now rather than waiting till later (your renewal date). If you have any questions, concerns, or if you would like to debate any points in the article feel free to reach out to me directly at anytime. If you would like additional information on the Sanus Benefits Platform feel free to visit Overview of The Sanus Benefits Employee Benefits Quoting Platform article. You can e-mail me at Bstevenson@sanusbenefits.com or call 832-604-2937.
Employer Medical Premium Statistics
| Average Monthly Contribution Amount | Percentage Difference | Average Monthly Premium | Percentage Difference | Average Deductible Amount | |
|---|---|---|---|---|---|
| Small Employers 2009* | $355.08 | 0% | $408 | 0% | $1,254 |
| Large Employers 2009* | $337.00 | 0% | $395 | 0% | $640 |
| Small Employers 2020* | $515.33 | +45.14% | $602 | +47.55% | $2,271 |
| Large Employers 2020* | $487.08 | +44.53% | $598 | +51.39% | $1,412 |
| Sanus Benefits Employers | $359.37 | +1.21% | $462 | +13.24% | $3,220 |
*Based on Kaiser Family Foundation 2019 Employer Health Insurance Stats
**Based on Sanus Benefits Current Clients.
Employer Medical Premium Overview
So what inferences are we able to make from the above statistics? The obvious glaring issue/inference is the dramatic rise in premium with Health Insurance for all Employers. How is healthcare going to continue to be affordable for groups if the premium increase has been 50% in overall premium in the past 11 years? A sizable portion of the increase can be attributed to the Affordable Care Act (Enacted March 23 2010), which (depending on who you are asking) is the best/worst legislation for healthcare. However that is not the only cost driver by far. The 2019 Employer Health Benefits Survey by Kaiser Family Foundation, found that premiums are increasing by an average of 4-5% each year. Which is surpassing the rate of inflation ( 1.81% 2019) and wage growth (4% 2019). This is a conundrum which has no easy answer. Most groups just cut the benefits more and more each year which is why you see the increase in deductible, or they force the employee to pay more to participate.
How has Sanus Benefits shown their customers such affordable rates compared to the market norm for 2019?
Our most notable differentiator is our willingness to come up with creative solutions. There is not a single fool proof method to save on premium other than cutting benefits. However as you probably can infer, that method is not going to last (the deductible can only go so high). We are knowledgeable on a multitude of different cost saving strategies and unique marketplace options any of which could be the best option for your group depending on your needs. Some of these strategies can be implemented overnight, others do not start showing their benefits until a year or two later. The longterm strategy is often over looked by our counterparts but it has proven pivotal in premium savings and overall health of employees. That is a high level overview of how we have enabled our customers to save on their premium without cutting benefits. If you would like a more detailed answer feel free to reach out to us at anytime.
