Your Health Plan in Hard Economic Times

In my practice, I spend a lot of time educating my group clients on how to make their health / benefit plans as economical as possible – that is, to provide a good benefit for their employees, but at the same time, to keep that benefit affordable and therefore sustainable.

This is a challenge that employers face at least once every year as they receive a renewal on their health plan that includes a premium increase, often in the range of 15 – 20%.  The benefits plan that you have at work is extremely expensive, and many employees are unaware of exactly how expensive it is.  Employers who raise deductibles or copayments and/or raise the cost of the insurance plan that they pass onto employees often do so out of necessity, but employees may not understand where such decisions come from, and some feel that their employer does not care about them, or that they are just passing-on the cost of a benefit that was offered to them as part of their employment contract, thus “cutting” their pay.

Here are some facts about group health insurance that you might not know:

  1. The average cost of single employee coverage among small groups in my practice is >$300 per month or >$3,600 per year.  With a 15% premium increase, that will go up to >$4,140 per year at renewal.
  2. The average cost of family coverage among small groups in my practice is >$1,000 per month or >$12,000 per year.  With a 15% premium increase, that will go up to >$13,800 per year at renewal.
  3. Most of the plans that I work with still offer low copayments for office visits and prescriptions, but are considering a move to qualified high deductible plans that would exclude those benefits.
  4. Utilization is the largest single factor in the rising cost of health care – utilization is simply the cost associated with using your health plan on a day-to-day basis.
  5. You can have a positive impact on rising health insurance costs by using your plan wisely, and reducing utilization will help to reduce future health insurance renewal premium increases.

The news is full of President Obama’s plans for changing healthcare in our country, and the best ways to accomplish that will be debated endlessly over the next couple of years.  If we get back to basics, though, and look at our health insurance as a means to prevent financial ruin in the event of a large claim, instead of a way to give us access to a doctor on every whim, it would go a long way to fix our current healthcare system, without overhauling it completely.  Use your benefits wisely to help ensure that they will remain available to you in the future.

For help understanding your benefits program at work, or to request a quote for individual health insurance, contact Barbara Hostetler at Hostetler Insurance Associates, Inc. at 717 293-7100 or brh@hostetlerinsurance.com.

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