The Price And Pain Of An Industry In Transition

The rising cost of health insurance is painfully apparent each time you write a check for your employees’ health insurance premiums. What’s less apparent is how much it affects your business every other day of the year. Like rising fuel costs, the cost of health insurance is embedded into every service and supply item we buy, from Post-Its to postage. The Washington Post, for example, reported awhile back that the Ford Motor Company’s employee health insurance costs added $1,000 to the price of every Ford vehicle sold in the United States. Generous benefit packages negotiated with worker unions seemed like a fine idea for many employers until elements within those packages began taking on lives of their own. A single element, like health insurance, can rise out of control and put the sponsoring companies on the brink of bankruptcy.

Companies that don’t have worker unions to deal with have a lot more flexibility. But there’s no mistaking it: Everyone is feeling the squeeze. If this trend continues, it may become increasingly common for businesses, both large and small, to get out of providing health insurance entirely. But before you consider anything quite that dramatic, let us help you look at ways to cut back on your costs while still providing the benefits you need to attract the best and the brightest employees.

Evaluate your health insurance options
The easiest way to reduce monthly premiums is to adjust your plan's deductible. The deductible is the amount a patient is required to pay out-of-pocket for healthcare before any health insurance coverage kicks in. High-deductible plans will protect you and your employees from serious financial trouble in case of injury or illness, without emptying your bank account to cover every employees’ every cold. Your employees may express concerns about a high deductible health plan but you can consider these complaints on a case-by-case basis and help some of your employees out in other ways. Perhaps a salary increase to help offset the deductible cost would make sense for targeted employees or for staff across the board. Remember that most employees do not use all or even most of the benefits provided through a comprehensive, employer-sponsored health plan. Help your employees do the math. They may find they’re actually benefiting financially with a small salary increase coupled with a high deductible heath plan.

Reconsider coverage for dependents
If higher deductibles don’t provide the relief you need, your next move might be to consider dropping coverage for your employees’dependents. Many companies are viewing this as “only fair.” After all, if you have two employees performing the same job, you wouldn’t pay one more simply because he had more children to clothe or needed a 4 bedroom house. Some employers keep the dependent coverage but pass on 100% of the increased expense to the employee. Others drop the coverage entirely and assist the affected employees in finding their own plans in the individual health insurance market. Independent brokers like InsureMeOnline.com can quickly provide a variety of quotes from different carriers, and can help small business anticipate the increase in salary that may be needed to offset this new cost to the employee. You may be surprised how many workers prefer to be in the driver’s seat. Offering increased compensation in lieu of family health benefits could be a win-win for you and your employees.

Consider the individual and family health insurance market
Some employers have found that the cost of group health insurance has simply grown beyond their reach. Others considering providing health insurance to employees for the first time may now be having second thoughts. If either of these sounds like you, you may want to consider helping your employees find their own health plans in the private health insurance market. Many employers are now providing their employees with an "allowance" to find health insurance on their own. Host a staff meeting and show the employees how to navigate a site like InsureMeOnline.com can quickly see how to get the most for their health insurance allowance. Again, many employees prefer to have this kind of control over their healthcare.

So while this may well feel like dire times for health insurance, what we’re probably looking at are the pressures and pains associated with an industry in transition. The day of the employer-provided group insurance plan may be coming to an end. Time will tell. But in the meantime, chances are you will find more and more employees hiring on at your company with their own health insurance already in tow.