One way to keep your rates low

Providing employee benefits is a balancing act, especially in Small Group Reform / Community Rated States like Maryland.  Since nearly all insurance companies rate their plans based on the AVERAGE AGE and ZIP CODE of enrollees, you must keep these factors in mind when deciding what to offer your employees.

Too much of a good thing?

• We have encountered businesses who pay too much of their employees' health premium, meaning that employees elect employer-sponsored coverage even when they have affordable coverage available elsewhere (i.e., through a spouse). This can needlessly drive up costs for the employer.  

Not enough to draw participants?

• We have also seen the other extreme, when employers don't contribute enough toward employees' health premiums. Young and healthy employees then opt-out of the group coverage, leaving an older and less healthy employee-base in the health plan. Since rates are based on average age, the coverage eventually becomes unaffordable for both employer and employee.

What's the best approach?

• A balanced health census is made up of the youngest and oldest employees, but rates are always lowest when the average age is low.  In order to provide great coverage for employees of all ages, you should discover what it takes to keep your youngest workers on the group health plan. How much are they willing to contribute toward their health premiums? Once you know how much your youngest employees will pay, you can offer an employer premium contribution that ensures everyone benefits from the group plan. 

Part of our job is to work through these questions with you.  Please give us a call.  We are happy to share our experiences with you!