How to Lower Small Business Health Insurance Costs
One of the biggest expenses for small businesses is offering health care benefits to employees. You can offer health care to employees of your small business by purchasing a group health insurance policy. If you are a business with under 50 people than you can obtain a small group plan. However, the cost of a group health insurance plan can be expensive. This means that you may need to find way to lower your office insurance costs.
Pool Your Resources
A single small business will pay more for a group health plan than multiple businesses who purchase a plan together. Typically, when a greater number of businesses purchase a group health plan the lower it will cost. Small business owners can also look into joining a Professional Employer Organization. This is a type of single-source provider that integrates services and can negotiate collectively for clients.
Obtain Multiple Quotes
When you currently have a group health insurance plan your annual premiums may rise each year. You should not accept rate hikes from your insurance company without looking to see if there is better value from another provider. Search for providers of group health insurance online or talk with other business owners to see who they are able to recommend. Another option is to contact an insurance agent or a broker to have them search for plans that will fit your needs and price. If your current agent or broker does not provide multiple quotes, you should seek out another one that does.
Offer Wellness Programs
The cost of your health care insurance may decrease by up to 15 percent or more if your employees can stay healthy. One way for you to offer a wellness program. This type of program can be simple or made to be interactive and elaborate. A simple wellness program can be implemented by utilizing online tools to help employees count calories or by completing a health assessment. Another way is to provide prize awards for employees that meet specific health targets.
Employee Hiring Discipline
Review the hiring criteria for your business. Look to see the percentage of smokers to non-smokers that are on your payroll. Employees that smoke can cause a decrease in productivity and expenses lost for smoking related health care issues. Many states allow businesses to hire employees based on the status of being a smoker. If you are not willing to change hiring practices, then you can offer cessation programs for your employees to get them to quit smoking.
Institute Cost Sharing
Cost sharing is a way to share the expense of health care with your employees. There are typically four ways that you can share costs with employees. You can using a co-pay, a percentage of co-insurance to pay a bill, offering high-deductible coverage and paying a portion of the premium. Sharing the costs for your group health insurance plan will decrease your annual premium payments.
Change the prescription drug coverage for your group health-care plan to generics, if available. This can lower the cost of your prescription drug coverage up to 80 percent when generic drugs are used in place of a name brand drug.
Perform a yearly audit of your group insurance plan to verify all of the individuals that are included for the plan. If your plan is limited to family members, then you want to make sure that individuals listed for each employee reside live at the same residence. You can then change your small business health insurance plan as needed.
About the Author: This is a blog post from Andre Bradley. Andre writes about small office insurance for insuranceOffice.org.
Image: RobinUtrac / stock.xchng
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