Controlling Health Benefit Costs for 2021
Health insurance costs are expected to rise in 2021. According to the Kaiser Family Foundation, these costs have been increasing for years, with increases totaling more than 50% from the previous decade. Additionally, the ongoing economic impacts of COVID-19 will contribute to further uncertainty in the structure of benefits programs and healthcare access.
With substantial increases in health insurance costs, employers continue to focus on cost-effective benefit design while preserving access to high-quality care for their employees. When exploring possible ways to control costs, it’s best to work with a knowledgeable employee benefits advisor that understands the market, your unique business needs, and your employee population.
Below are cost-reduction strategies we’ve utilized to help our clients control their costs:
- Audit Costs: Employers should review every piece of health care data available. Understanding where the money is spent can help focus on employers’ cost-cutting efforts. Your insurance advisor can help you understand your cost analytics and help target areas for improvement.
- Explore Technology: Technology is creating new options for expanding access while reducing costs. For example, telehealth and online portals allow comprehensive care without the added costs of an in-person visit. By collaborating with your insurance advisor on employee communications and understanding the options available within your carrier’s network, you can lower costs.
- Consider Alternative Plan Options: Exploring different plan structures and funding options can lead to potential savings. Make sure to review available options every year to ensure you are selecting for the right fit. Consult with your benefits advisor on the benefits and drawbacks of different plan designs each year.
- Require Active Enrollment: Require employees to actively review and re-select their benefits each year. Active enrollment ensures employees review all options before making selections. This process allows employees to consider important life events and to reevaluate the benefits they’re paying for and not utilizing.
- Evaluate the Funding Structure: The market and employer needs can shift from year-to-year, and companies may find more value in self-insured or fully-insured programs based on their specific circumstances. Under fully-insured plans, employers pay a set premium to an insurance provider and the insurer assumes responsibility for all claims beyond each employee’s deductible. Under self self-insured plans, employers pay for claims out-of-pocket as they are presented, often protecting against excessive claims by purchasing “stop-loss” insurance. Depending on plan size, hybrid or alternative funding options may exist. . Your insurance advisor can help determine which funding structure is best for your organization.
RBN CAN HELP
Whatever your needs, know that RBN Insurance Services is here to help. Contact RBN to discuss your 2021 benefits. RBN has the knowledge and industry partnerships to explore your options and to give you a full picture of spend and areas for possible improvement.