With Open Enrollment starting November 1, we thought we’d address the most common questions we’ve been receiving from employers and give you a few things to ask yourself as you’re considering your options for 2016.The biggest questions employers are asking involve costs:
How much are premiums going to increase for 2016? What are the best options to mitigate those increases without hurting my employees?
While no one has a crystal ball, the most recent data from the Kaiser Family Foundation states that rates for some areas could increase as much as 38.4%. Some states will see an average decrease, while some will see a more modest increase. So the answer, in many cases, is unknown until your renewal hits.
But employers aren’t helpless when it comes to controlling costs. There are several options to mitigate your rising group plan costs and each may make sense depending on your situation:
- Adjust the contribution percentage you provide to employees – while it’s never what employers want to do, nor well received by employees, rising group health insurance premiums often become too much of a burden on the business and require employees to contribute more to their premiums.
- Try to pull some "levers" with your group plan by adusting deductibles, co-pays, and surcharges – similar to adjusting contributions, modifying these components help keep premiums in check and transfer some additional payment responsibilities to your employees. Again, the challenge with these changes is managing the difficult balance between what’s best for the business and what’s best for employees.
- Move to a solution like Gravie, and eliminate your group plan while providing support for your employees to select and purchase the plan that’s right for them in the individual market for a win/win.
You can get a summary, including costs, by requesting a Gravie financial analysis with this simple form. You might be surprised to learn what an attractive option this is for both you and your employees. In fact, the average employer that moves to Gravie ends up reducing costs by 36%, while employees pick plans that fit their specific needs the best.
Beyond just premium considerations for 2016, think about what your current plan actually offers your employees:
- Are employees happy with the plan they have today or are they simply okay with it because they see it as their only option? If they’re not genuinely satisfied with the group plan, they may be more willing than you think to make some changes.
- Is there a range of ages and situations in your employee pool that need to be taken into account when choosing your plan? Most group plans are based on an average age, average family make-up, average location, etc. This means the youngest, healthiest employees are likely paying more than they should and may feel so penalized they see opting out as their best alternative.
- How much of your company's time and resources are spent on insurance research, selection, and administration? According to a recent Trinet study, Presidents/CEOs are spending 11% of their time on benefits. That doesn’t take into account all of the hours the HR/Business manager spends researching, analyzing, administrating and working with each employee. Imagine if all that time was put into the business and employee development instead!
After answering those questions, you’ll be in a better position to decide which options make sense for you. We’re happy to discuss your options and how Gravie can help you decide what’s right for you, your business, and your employees.