If you’re considering offering employer health insurance for your small group for the first time — or if you’re looking to change the coverage you currently offer — the process of choosing a health insurance plan might seem daunting. Your choice will ultimately affect all of your covered employees and their families, but it may not be practical to base your plan selection on detailed feedback from every employee.
It is important, however, to solicit the right advice to help guide your decision-making process. Here are three parties who should weigh in on your decision.
1. Your Finance Leader and Insurance Broker
What they’ll tell you: what you can afford and what’s available
From a practical standpoint, some of the most important input you receive will come from your finance leader (or a third-party tax adviser or financial planner) and your insurance broker. Your financial decision-maker will discuss what you can afford, which will be key to narrowing down your employer health insurance options. You may find that you have a robust budget, or you may be limited to the lowest-cost plans on the market — but a rough estimate will help you to stay on track.
From there, a local insurance broker can show you a variety of options that might work for your business. Some employers prefer to start with the insurance broker and then discuss all of the available options with their financial officer, while others like to determine their budget before narrowing down the options the broker presents.
2. Your Company’s Leadership
What they’ll tell you: the goals for your employee health benefits
Though your finance leader can analyze the numbers, you’ll also need comments from the rest of company leadership. They’ll likely have a vision for the new benefits.
Maybe they want the organization to be more competitive in hiring, or maybe they want to improve retention. Make sure they explain not only what sort of benefits comparable employers in the area are offering, but also how to maximize the value of benefits you ultimately choose to offer.
3. Your Employees
What they’ll tell you: what they need from a health plan
Employees are more engaged with their work — and more likely to remain at their job — when they feel that their health and well-being are a priority for employers. Since your staff will use the new plan, it’s reasonable to learn what they want from it. However, if your employees have diverse medical needs, you may find they all want something different. On the whole, workers consistently rank health, dental and vision insurance as the most valuable part of a benefits package, so pay special attention to what your employees want in their health insurance coverage.
One way to gauge what your employees value in a health plan is to create an anonymous survey so they can provide input. Avoid questions that would require employees to provide identifying information or protected health information.
Feedback from employees will likely run the gamut from those who only want the lowest possible premiums to those with very specific requests for provider networks, drug formularies and out-of-pocket costs. Depending on the size of your business and the feedback you receive, it may be worthwhile to ask your broker whether it’s possible to offer plans from more than one insurer or plan design and allow employees to select the option that fits them best. Your broker will explain how you can still retain full control over your costs by having employees pay the additional premium required for more robust plan options. You might also find that employees value supplemental benefits like dental, vision and life insurance coverage. Luckily, these tend to be relatively inexpensive additions to your benefits package.
If employees express an interest in health savings accounts (HSAs), consider offering an HSA-qualified high-deductible health plan (HDHP) and consult your financial officer about the possibility of making contributions to employees’ HSAs. An HDHP can be a powerful financial tool. Just make sure employees really want to use it — if employees lack interest in HSAs, offering an HDHP might not serve your organizations’ purpose or interests.
Offering health benefits to your employees is an excellent way to build and retain a talented workforce, and the tax deductions that come with providing employer health insurance makes it a cost-effective form of compensation. The process of selecting a plan can certainly be challenging, but with the right input you’ll be able to build consensus around the best benefits strategy for your organization.
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