Business insurance medical for your employees is a major expense. So why provide it? Because a healthy workforce is a productive workforce, and a good benefits package is often the key to a stable workforce. There are strategies for keeping your costs manageable. The Internet has revolutionized the way companies shop for health insurance. Comparison websites make it easy to compare insurance quotes at no cost to you whatsoever, so you can choose the business health insurance plan with the cost and features that fit your business needs best.
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What type of medical insurance should your business get to keep premiums affordable? Here are 8 tips:
1. Buy a Plan With a High Deductible
The higher the deductible, the lower the costs of the monthly premium. Of course some experts have linked health insurance plans with high deductibles to increased medical expenses over the long run, since these types of plans provide consumers with a disincentive to seek medical attention for small health problems. Small health problems left untreated can develop into large health problems. You may want to consider all the factors that go into a high deductible health plan (HDHP) before jumping right into one.
2. Reduce Coverage
Limited medical benefit plans, nicknamed mini-med plans, provide 100 percent benefits with no deductible up to a pre-defined cap. Mini-med policies are far less expensive than traditional policies because they pass on more costs to employees. Once the sole province of the self-employed, these days mini-med plans are the health care insurance plan of choice for employers such as McDonald’s and Friendly’s.
Other ways of reducing coverage include:
• Cutting ancillary health care services such as vision and dental insurance
• Capping lifetime coverage
• Capping hospitalization costs
3. Buy All Your Insurance From the Same Provider
It’s generally less expensive to deal with one company for all your insurance needs. Many health insurers offer discounts to companies with over 50 employees, but even the ones who don’t regularly set discount rates may be willing to negotiate because your business will be making a sizable purchase which the insurance company will not want to lose.
4. Buy Insurance Through Industry Association and Health Co-ops
Industry associations and trade unions are frequently able to ensure their business members lower premiums because they function like purchasing coalitions. Additionally, they spread the risk of injury or illness over a larger group of people, reducing the statistical probability that an insurance company will have to subsidize care.
Another financing model that’s received a lot of attention in recent years is the health care cooperative, or co-op, which also creates larger risk pools, thereby giving it an edge in terms of negotiating with health care insurance providers. The legal framework for health co-ops only exists in Minnesota and Washington at present, but discussions about the feasibility of the model are underway in other states as well.
If you’re not a member of an industry association or a health co-op, you still may be able to team with other businesses to expand your group plan options. Make sure the businesses you partner with are in your state however, since insurance regulations vary by state.
5. Consider an HSA
An increasingly popular health insurance choice among small business owners are health savings accounts (HSAs) that enable employees to reap tax benefits when paying medical expenses. HSAs can only be associated with high deductible insurance plans, which means that employees may end up paying for more out-of-pocket expenses overall, but they will be paying for them with an account into which employers, workers and family members contribute tax-free dollars. HSAs are portable and exempt from federal income tax.
6. Implement Wellness Incentives
Some of the nation’s top insurance providers bundle health care insurance with wellness plans that offer incentives for healthy behaviors such as weight loss and smoking cessation. According to a 2003 report from the U.S. Department of Health and Human Services, every dollar invested in these types of prevention services saves three dollars in medical expenses. Wellness programs are very popular with employees who appreciate such implementations as job site gyms, according to that same report.
7. Consider Offering a Managed Care Plan
Managed care plans restrict members’ access to health care to provider networks. There are two types of managed care plans:
• HMOs: Health maintenance organizations, or HMOs, keep insurance costs down by restricting caregivers to a single network of health care providers. HMO members are required to choose a primary care physician when they first sign up for the insurance. This primary care physician then functions as a gatekeeper, monitoring access to additional health care services. HMOs also keep costs down by implementing utilization reviews and assigning case managers to patients suffering from chronic conditions.
• PPOs: Preferred provider organizations, or PPOs, are pools of health care providers that include both primary care providers and specialists. PPO members are free to see specialists without authorization, so long as the specialist is one of the physicians in the PPO pool. By contracting with PPO providers, the insurance company is essentially vetting them which gives PPO members an extra layer of protection.
8. Shop Around For the Best Prices
The health insurance industry is very large, and competition within it can be quite fierce. This can work to your business’s advantage when you are buying health insurance for your company.
Start out by assessing your company’s needs. In a perfect world, what kind of options would you like to offer employees? Consider the budget restrictions you’re operating under: What kind of options are you able to offer your employees?
Next, try to ascertain a baseline cost. Ask friends who own businesses, the owners of businesses adjacent to your lown and the owners of businesses in any professional groups you may belong to: What do you pay for health care insurance? Additionally, find out what benefits that amount buys them.
The final step is to compare free insurance quotes from as many health insurance providers as you can to find the plan rates and benefits that are the best match for your company’s needs. Shopping around for business health care insurance ensures that you will find the plan that’s right for you and your employees. Enter your zip code to receive free business health insurance quotes from the top insurance companies in the country!