Employees are the backbone of any successful company. Their work is what keeps everything running smoothly, but it is no secret that employees can be expensive to maintain, especially for small businesses. Health insurance premiums can fluctuate when you least expect them to, which makes them difficult to budget for. But with the right strategies in place, you can ensure your employees are covered without spending more than you can afford.
1. Assessing Current Health Insurance Costs
Before you can start taking the necessary actions, you must first assess how much you are currently paying in health insurance. You can start by collecting all available health insurance documents, such as benefit summaries, breakdown of the costs, and renewal information. It is important for you to carefully go over these papers to know how much you are paying for each employee. Once you have a better understanding of the costs, you can start planning how to reduce them.
2. Shop Around for Competitive Rates
Finding the right health insurance for small businesses can be challenging with so many variable rates. However, this is what makes health insurance competitive, which is something business owners can capitalize on. Comparing rates can help you receive a better offer.
Before undergoing negotiations, it is essential that you identify your leverage points. These leverage points can include whether or not your company is a high-value customer, being able to easily swap providers or qualifying for special discounts.
During the negotiations, be sure to advocate on behalf of your employees. While you want to lower costs, it’s ultimately important to remember that the end goal is getting them the best possible coverage at the most affordable price.
3. Consider Different Plan Options
When shopping for small business health insurance, you have a variety of different options. You do not have to purchase a policy for each individual employee.
Below are the following plan options you can choose from:
- Preferred Provider Organization (PPOs) – PPOs offer customers a large network of doctors. Employees on this type of policy can choose any provider within the network. PPOs allow more flexibility, but can have higher premiums.
- Health Maintenance Organization (HMOs) – HMO policies work a bit different than the standard PPO policy. Rather than having access to all health care specialists within a given network, you must choose a provider as the primary care physician. The premiums of an HMO are lower, but do not have as much flexibility.
- Point-of-Service (POS) – POS policies are a special type of health insurance where it combines the best features of PPOs and HMOs. The amount you pay depends on whether or not your employees seek out medical attention within the given network.
- Exclusive Provider Organization (EPO) – EPOs offer similar coverage as other plans, but they operate like HMOs while carrying some of the flexibilities of PPOs. While you can’t go outside the network for care, you do not need a referral from a primary care physician (PCP) for referrals to see specialists.
It is important for you to research each health insurance option before committing. Make sure to consider your current income and how many employees you have.
4. Explore Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs)
HSAs and FSAs are accounts that allow you to set aside pre-taxed funds to pay for medical expenses. While both have the same goal, there are differences that set them apart. The first difference is eligibility.
HSAs are available for people who currently have a high-deductible health plan (HDHP). HDHPs have lower monthly premiums, but the deductibles are usually higher. FSAs are typically offered as a benefit, but it is possible to apply for it through other means.
5. Implement Wellness Programs
Implementing wellness programs is another way you can help lower the cost of health insurance. These programs come with a wealth of benefits such as incentivizing getting routine health screenings, scheduling necessary vaccinations and promoting healthier lifestyle habits. Furthermore, wellness programs can reduce the risk of injuries and illnesses and boost employee morale.
6. Encourage Preventive Care
One of the best ways to keep health insurance premiums low is by being proactive in preventive care. With preventive care, employees can catch and treat any problems before they become worse. The longer a problem festers, the worse it can get over time. In addition, preventive care is an excellent way to reduce the risk of complications and the need for more extensive treatment.
You can help promote preventive care by:
- Offering contributions to HSAs and FSAs
- Implementing reimbursement programs
- Offering paid time off
- Allowing flexible scheduling
- Having on-site screenings
7. Consider Partial Employee Contributions
Partial employee contributions, which is also called employee cost-sharing, is when an employee pays a portion of their health insurance plan. The cost is split between both the employer and the employee. The contributions made by employees can be based on pay period or a percentage of the total premium cost. This also applies to other factors aside from premiums, such as deductibles and copays.
To implement partial employee contribution, it is important that you plan everything out first. You want to have a set contribution limit, communicate the reason behind the amount and thoroughly explain the cost-sharing structure.
8. Review and Adjust Coverage Regularly
Whether you switched providers or were able to negotiate for a better deal, you will need to regularly assess and adjust the health coverage as needed. Though you may have an affordable plan now, the economy and needs of your employees can change. If you need to adjust your coverage, an effective strategy is considering going for tiered coverage. Tiered coverage is basically a variety of healthcare plans that cater to different needs.
9. Seek Professional Guidance
As a small business owner, it can be challenging managing your company, the employees and the benefits they are entitled to. That is why it is imperative that you consult with insurance brokers about the best course of action. Insurance brokers are the best source of information when it comes to health insurance. They can help you navigate the health insurance market more efficiently, advise you on how to compare plans and even teach you how to spot hidden costs.
Keep Your Employees Happy and Healthy
Health insurance is essential, but it is not always easy to acquire. That is why offering it as part of your benefits package can ensure your employees are insured and well-taken care of. Reach out to Live Health to discuss your business’s needs with a qualified and experienced Florida health insurance broker!
