As an employer, your health care costs are likely to rise in 2017, according to the National Business on Group Health. But, by how much? In some ways, it’s up to you. The health insurance marketplace will evolve and change, but it’s unlikely that the direct costs or insurance premiums are going to decrease. The year-over-year increase that you pay, as the sponsor of a health care plan, comes down to regular analysis and review of plan selection and use.
Your company’s health care costs are primarily defined by the plans you offer to employees. And for employers that insured employees for decades, the idea of eliminating the most expensive plan option may feel heartless. Some of your employees have grown to depend on the doctors they see who accept that one plan. But those doctors likely accept other plans. And as long as you offer other, more affordable plans, you could consider paying a smaller percentage of that high-end plan, especially if times are tight.
Review Your Current Enrollees
Review your participant list and ensure everyone still qualifies for your health benefit. If you have a few employees who have gone through a divorce, you could still be paying for the ex-spouse’s insurance. Respectfully ask they exit the plan. While employees really value dependent coverage, keep in mind that you’re not required to offer or pay health insurance costs for any partners, spouses or dependents. And with other insurance potentially available for those family members, consider reducing how much of those costs you’re willing to cover.
Consider Offering a High-Deductible Plan
Consider offering plans that have high deductibles and high out-of-pocket limits. These are great options for a young, healthy workforce unlikely to visit the doctor much throughout the year. Health insurance plans usually include a free annual physical, so encouraging your healthy staff members to consider these kinds of minimal coverage plans won’t discourage them from critical, preventive care. In addition, you can encourage your employees to buy supplemental plans that will help them cover out-of-pocket costs and living expenses in the case of a serious accident or illness. The high-deductible health insurance plan covers the majority of the health care costs, and the supplement insurance can cover many out-of-pocket bills.
Create a Wellness Program
Jump on the preventive care bandwagon. By encouraging preventive care like flu shots, annual physicals and cancer screenings, you’ll create a culture in your workplace that values healthy living. Will a healthier workforce really translate to lower insurance premiums? In short, yes. If you have a workforce that’s routinely sick, your health insurance contract prices will rise faster every year. But more importantly, by encouraging healthy living and preventive care, you’ll have a more productive workplace. Employers with healthy employees have higher productivity, fewer sick days and lower turnover. The real savings could come in the form of offsetting other costs.
Don’t ignore your health insurance costs. You need to invest your time in revising your company’s health plan options, reviewing plan use by employees and encouraging preventive care. You aren’t at the mercy of rising health care costs. You’re a driver of those costs, and you can steer your company in a better, leaner direction.
Dylan Murray has an MBA from San Diego State University and a bachelor’s degree in communication from Boston University. He’s a licensed insurance agent in California, but he works as a professional researcher and writer reporting on business trends in estate law, insurance and private security. Dylan has worked as a script analyst with the Sundance Institute and the Scriptwriters Network in Los Angeles. He lives in San Diego, California, and Marseille, France.