Healthcare costs are consistently listed as one of the greatest concerns facing business owners and employees in America today – certainly no different for the vending industry. If you are an operator running a small business (roughly 5 to 200 employees) and you offer a group health plan, healthcare is one of your largest expenses. And today, you likely find yourself at a crossroad: You want to offer high quality healthcare benefits to retain talent and because you care about your employees, yet it’s difficult to provide high quality coverage due to costs increasing at 10 to 30 percent or more year after year. This might then force you to “weaken” your plan, ultimately resulting in decreased participation and lower employee engagement/retention. So what do you do?
Operators in the vending industry have much more control over their health insurance costs than most realize. Here are three simple strategies to get you started towards lowering your costs right away, and controlling them for years to come:
- Use High Deductible Plans. Purchasing a high deductible (DDT) plan (say, $5,000 or $10,000 DDT) will lower the price that the carriers quote you. For example, the difference in cost between a $5,000 DDT and $500 DDT will be anywhere between 24 to 40 percent. “But my employees don't want a $5,000 DDT,” you say? Here is what you do: cover the spread (in this example, $4,500) with a fully insured gap plan or stop loss coverage. While it does take some administrative work and knowledge, at the end of the day, you have a good chance of paying less overall by doing it in this way versus buying the traditional $500 DDT plan.
- Promote a Culture of Wellness. Not only do insurance carriers love seeing this, but healthier employees will increase productivity, lower absenteeism and decrease plan usage which impacts your renewal. Huge commitment not needed. Some simple and low-cost wellness ideas: consciously choose your breakroom food options, pay for a portion of your employees’ gym membership, sign up for monthly wellness newsletters for your staff and/or register for a local wellness fair.
- Consider Alternative Carriers. There are numerous A plus rated health insurance carriers with excellent networks who provide insurance coverage in your state, yet it is likely you have only worked with a few of the “brand name” carriers. And guess what…because of all the money they spend on marketing and overhead, the brand name carriers are usually more expensive. Consider getting quotes from other A plus rated carriers who can provide you with the same comprehensive coverage, for less money.
Implement these strategies, and you will be on your way towards lower cost health insurance – especially as you begin to prepare for the implementation of The Affordable Care Act also known as “Obamacare.” And speaking of the ACA, keep in mind that businesses with over 50 full-time employees will be required to offer group health insurance, or be subject to a penalty. There are no guarantees in the health insurance game these days. However, the more control you take over your health insurance situation, the better position your company and your employees will be in – health-wise and financially.