The Balancing Act
Finding the right balance between health benefits and cost management is difficult for many Washington State employers, especially now. Without sacrificing quality, matching the best group health plan with the needs of their employees and their families while navigating new FMLA legislation (during a pandemic no less!), is particularly challenging.
Historically companies have had limited options and have chosen fully insured group health plans. Since the insurance companies assume all the financial risk the premiums are typically high and employers don’t have any control how the money is spent.
More recently, following the economic downturn and new legislation both at the federal and state level, employers have sought out more affordable group health insurance options and providers have responded with innovative and flexible health plans.
Flexible Health Plan Options
Along with Health Savings Accounts (HSA), self-funded (a.k.a. ASO Administrative Services Only) and level premium self-funded medical plans all offer employers more control over how their money is being spent. “Self-funded medical plans have lower premiums and better plan designs to healthy groups,” says Steve Brown, Principal Benefits Broker at Group Benefits Northwest. Further, a level premium plan is only partially self-funded so while it’s considered an ASO, the monthly costs are fixed making budgeting much easier for employers. (Related article: Understanding Your Health Benefits)
With level premium self-funded plans, when group claims are less than expected, employers receive credits which can add up to substantial savings. Monetary incentives in the form of point rewards programs also encourage an overall company climate of wellness and prevention which drive down health costs. Further, stop-loss insurance premiums protect insurers against large claims and take effect after a threshold has been exceeded in claims.
During this unprecedented time analyzing the cost structure of your business’ group health plan might be timely. Healthcare is complicated. There are better ways for you to manage your healthcare costs and we are here to help.
Group Benefits Northwest is family owned and operated and has been proudly serving Washington State for over 35 years.