5 Things you can do

5 Things you can do "right now" to cut your health insurance costs!!

1. Extend the waiting period for new employees to 180 days.
Consider lengthening your existing waiting period. Your employer-sponsored group health plan is a sitting duck for people with health issues in their family who want your health benefits more than they want to work for your company. The cost of such people joining your plan is borne by both the company and your existing employees. The solution to protect your company's group plan while still being able to recruit the best employees with coverage from day of hire is to offer "waiting period coverage - a short-term health insurance policy paid for by your company with a "new employee HRA". Short term medical policies cost about 50% less than your average employer group policies. The temporary coverage also will allow your new employees guaranteed acceptance into the group plan at the end of their waiting period.

2. COBRA Alternative Program
If your regularly employ more than 20 employees during any 6 months of the year, you are subject to the COBRA laws. When employees are terminated, or a covered spouse becomes divorced from an employee, they must be offered the right to participate in the company's group health plan for 18 months and in some cases up to 36 months. Former employees and ex-spouses can be hostile participants in your group health plan and incur large or many claims costs. To encourage terminated employees to get permanent, affordable individual/family coverage the day the become qualified for COBRA, your company should offer a COBRA Alternative Program using an HRA to reimburse the former employee for the cost of either a short-term medical policy or for permanent individual/family health insurance. You might offer 3 to 9 months of reimbursements for these individual/family plans. In most cases they will be cheaper than your group premiums and reduces the number of people who elect COBRA coverage and reduces your risk by 80 to 90 percent.

3. Put children on individual health insurance policies
If your health plan rates are two tier, that is, one rate for single and another rate for family, and a single parent with one child is considered family coverage, offer an individual policy to the employee for their child. This will result in tremendous savings to you and your employee. They will be able to drop their coverage to single, it will save you the expense of paying a portion of the family premium and the child will have a permanent individual health policy regardless of where the parent works. Typically, children can be insured from age 6 months to age 19 and their premium rates will be well below what you and the employee have to pay for family coverage.

4. Move your company to a high deductible health plan
By moving your current health program to a high deductible health plan, you can save you upwards of 40% on health premiums. You can implement and HRA to pay for part of the medical expenses on behalf of the employees before the deductible is reached. Once the deductible is reached, your insurance carrier will be liable for further claims. Roughly 80% of your employees will consume less than $1,000 a year in healthcare. Why pay for coverage that will never be used? By using a high deductible and an HRA, you'll only pay for "benefits used" and receive significant savings from your current low deductible, traditional plan. Also, moving to a high deductible your annual renewal rates should decrease as your insurer is not covering the lower first dollar claims.

5. Self-fund your own dental plan
If you currently offer dental coverage with your group health plan, consider dropping that coverage from your insurance carrier and self-funding your own dental plan. This is especially beneficial if you've had dental coverage for two years or more. Most of your employees will have had their major dental work done. Dental claims are more accurate to predict and you have a built in cap. The ADA (American Dental Association) recommends a "direct reimbursement dental plan". These are very simple plans that are dollar specific and allows your employees to use any dentist they choose. You don't have to worry about "networks", classes of coverage and what is covered under each class. We've listed a sample plan below:
$50 deductible single/ $150 family
First $200 of dental expenses covered at 100%
Next $1,600 of dental expenses covered at 50%
Total annual benefit=$1,000
Notice that employee's don't have to worry about what class of services are being provided. They receive first dollar coverage of $200 and a calendar year benefit of $1,000. Total freedom of choice for dentists and simplified claims administration.

*We do not recommend self-funding dental if your group has not had dental coverage in the past. You should implement a fully insured dental plan for at least two years before moving to self-funding.

Any and all of these steps can be taken immediately. In fact the sooner you take action, the more money you'll save for your company and add to your bottom line. We can assist you in making these changes and offer free, no obligation consultation until your satisfied you'll benefit from our solutions.

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