If your small business wants to control rising health insurance costs, here’s why you should consider making design changes to your employee benefits plans.
Typically, plan design changes are made at the beginning of the plan year, and communicated to employees during the open enrollment period well before the plan year begins. But you’re allowed to change things up in the middle of the year - as long you consider issues such as a) what plans can be changed, b) how much time it will take for carriers to implement the modifications, c) how these changes will affect current plans, and d) what effect a mid-year change will have on employees’ current benefit selections.
Sounds complicated? Even so, several employers choose to make midyear changes because it can significantly reduce your health and benefits costs.
Here are a few examples of plan design changes that will help control costs:
Increase employee cost-sharing (i.e., deductibles, copays, and out-of-pocket limits).
Place more financial responsibility on employees (for example, by creating high deductible health plans.
Start a wellness program that really pushes your team to improve their health and well-being.
Add an extra charge (or a spousal carve-out) for those married employees whose spouses rely on your employees’ health coverage instead of getting their own health coverage from their respective employers.
Another way to have a better hold of your healthcare benefits budget is to consider adding a waiting period to your health plan offerings. A waiting period will keep employees from participating in your health plan too quickly (or before your budget is ready to handle the costs). Under the Affordable Care Act, the waiting period can be imposed for a maximum of 90 days.
As an even more drastic cost-cutting measure, employers can cancel health insurance plans midyear. If you think this route is necessary for your small business, double check the termination provisions in your insurance contract with your carrier, notify your team in writing within 60 days of the plan termination, and figure out what company steps need to be taken to cancel the plan.
For more insurance solutions and advice for your business, visit NY Small Health or call (516) 358-5600 today.