Many employers struggle with how to balance providing adequate coverage for their employees while not overpaying for their health insurance. Fortunately, there are several things you can do to ensure that you are getting the best value for your money. Below are five ways to ensure that your company is not overpaying for health insurance.
Conduct a competitive market analysis:
Before you decide on an insurance plan, take the time to investigate what options are available and get multiple proposals. There are many plans out there, and prices can vary significantly between them. There are also new plans available aimed at helping employers creatively contain costs. Don't settle for the first plan that comes across your desk. Take your time to ensure that you're getting the best deal for your money.
Hire a consultant, not a broker:
Health insurance consultants work with clients to offer guidance and industry knowledge. They do more than just shop for coverage. Consultants advise clients on possible risks and exposures of different insurance plans, and the reviewing and benchmarking of each carrier’s plan coverage, plan cost, and network. A health insurance consultant can help employers to make sure their employees understand what benefits are being offered and how to best utilize what is being offered.
Consider alternative funding:
Level-funded and Self-funded plans are an alternative to traditional insurance plans that can save companies money. With either plan, the employer designates money to pay for employee health care costs instead of paying it all in premiums to an insurance company. These plans can be tailored to fit the specific needs of your company and can be significantly cheaper than traditional insurance plans.
Audit your claims data:
Analyzing your claims data can provide valuable insights into your company's health care costs. By examining your claims data, you can identify patterns in employee health care utilization and health risks. This information can help your company develop strategies to encourage healthy behaviors and reduce medical costs.
Analyze your employee demographics and health risks:
Understanding employee demographics and health risks enables employers to make educated decisions about insurance plans, leading to cost savings for both parties and promoting a healthier workforce. Demographic analysis can expose prevalent chronic diseases or risk factors, guiding employers to establish targeted wellness programs. This not only reduces healthcare costs but could also boost workplace productivity.
By taking the time to shop around for insurance plans, utilizing a consultant, considering a alternative funding strategies, analyzing your claims data, and analyzing your employee demographics and health risks you can ensure that your company is not overpaying for health insurance. Providing your employees with adequate insurance coverage is a critical component of running a successful business, but it doesn't have to come at an exorbitant cost. By being proactive and strategic about your health care options, you can provide your employees with the coverage they need while keeping your costs under control.
