Friday
How to Reduce Group Health Insurance Costs
Group health insurance costs have risen dramatically over the last 5 years. If you already provide employee benefits, then you know this. If you're a relatively new business owner and you don't yet provide benefits to employees, you'll soon find out how costly they can be. But fortunately, there are many things you can do to reduce costs and still maintain competitive with your benefits.
Shop Around
This is one of the easiest things you can start with. Insurance companies have some flexibility in how much they charge a group. If they are trying to be competitive and acquire new business, they will charge preferred rates. But many times insurance companies will charge maximum rates so that they can increase their profits as the years go by. If you have been with the same company for a while, there's a chance that they may be charging you higher rates than they used to be. They know that it's a hassle for businesses to change insurance carriers. So the longer you've been with them, the less likely you are to change, even if your rates are going up. An independent broker can help you shop around to different companies and find the most competitive group health insurance rates available.
Increase the Shared Costs
If you are still paying for 100% of the benefit premiums, you are a rare breed. Most companies have long since gone to a shared cost plan where the employees pay up to 50% of the premiums for benefits. In addition to this, you can reduce your costs even more by increasing the co-pays for doctors visits, and deductibles. By doing this you are shifting more risk to each insured person, so your premiums come down. Employees won't like this, but it's still a lot better than having no insurance at all.
Prescription Drugs
Many employers don't realize that they can require employees to use generic prescription drugs (when available) and save a lot of money by doing so. Also, you can add a separate prescription drug deductible to your plan of $200, $500 or even $1000 per year. This will also bring your costs down.
Start A Wellness Plan
By helping your employees to become more healthy, you'll save a lot of money for your business in the long run. Healthy lifestyles mean fewer missed sick days, happier employees, and lower insurance premiums. You can create incentives for participation in exercise, healthy eating & stop-smoking programs. Your insurance premiums will be much lower for healthy employees and non-smokers.
Mark_Kenison
