The maze of insurance options for small businesses is as complicated as today's medical problems. If you're careful when you create a more economical insurance plan, you'll not only control costs, you'll also boost employee recruitment and retention. Here are a few steps you can take to slash health insurance costs:
- Determine if managed care will help you manage costs. Many small businesses find managed care programs cut their health-care costs by 15 percent or more over traditional plans.
- Get employees on your side. A healthier workforce translates into lower costs. Give employees incentives to stay healthy and reward them when they take the extra steps.
- Compare insurance agents and shop around for the best deal. The right agent should be willing to negotiate: comparable health insurance programs can vary in cost by up to 20 percent.
- Consider options like health savings accounts or joining a group plan to decrease expenses.
Manage your costsManaged health-care programs help small businesses reduce administrative and paperwork costs while cutting premium expenses. You can choose from health maintenance organizations (HMOs), preferred provider organizations (PPOs) and open-ended HMOs, known as point-of-service plans (POS).
Find a broker who works for youA skilled health-insurance broker will help you compare apples to apples in health insurance costs. Along with costs, your agent should explain all coverage aspects, reimbursement policies, employee privacy methods, deductibles, employee advocacy, incentives, screenings and claims analysis.
Individualize your plan with innovative optionsSmall businesses can take advantage of health insurance options tailored for their needs. Health savings accounts (HSAs) are tax-free medical savings accounts generally used along with high-deductible health plans.
Create a healthier workforceMost work forces struggle with common health care problems like obesity, smoking, high blood pressure and diabetes. The more you focus on your employees' health, the more you gain in profits. Preventative efforts like from flu shots, health club access and online health assessments help reduce absenteeism and improve well-being.
- Raising co-payments by as little as $10 or offering working spouses incentives not to join your company's plan can reduce costs. If you eliminate coverage for brand-name medications, you can save considerably — in one Blue Cross plan, participants could save 28 percent on premiums.
- Implementing wellness programs can help save money on insurance premiums, although the actual savings may be slight unless you have a large work force.
- Before joining or switching HMOs or PPOs, ask what percentage of their physicians are accepting new patients.
- Employees can roll over HSAs from year to year to build a retirement nest egg.
- Health insurance information is often obscure and filled with jargon. Use videos, posters, speakers and other visual aids to help all employees understand your health insurance program.