Employee benefits seem to have a rate increase every year.
No matter how much you use your plan your insurance broker is constantly coming back every year at renewal with massive rate increases. It seems like no matter what; you get a 8 to 15% increase. Not to mention the 40 to 70% increase the year you switch over to an Obamacare plan.
Have you thought about what this means?
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Say you purchased a plan back in 2009 for your company of 60 employees. Your monthly premium was $45,000, and this is how you plan history looks:
Initial Purchase
2009
$45,000
8% Increase
2010
$48,600
8% Total
7% Increase
2011
$52,002
16% Total
11% Increase
2012
$57,774
28% Total
6% Increase
2013
$61,240
36% Total
7% Increase
2014
$65,526
45% Total
9% Increase
2015
$71,423
58% Total
Upcoming Renewal 43% Increase
2016
$102,135
126% Total
If you take your renewal as is this year you will have had a 126% rate increase from 2009. And if you down grade your benefits to keep the rate you had in 2015 you still will have a 58% rate increase from 2009 which is still significantly higher than the rate of inflation.
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So how do you keep your benefits the same, but avoid rate increases?
You do not have to decrease your benefits to save money. Your first step needs to be to pick how much money you are okay spending. Second and most important is think about supplemental coverage. Colonial Life Insurance is an example of a company to offers great supplemental products.
Here is an example of how to utilize the one of the products.
If you increase your out of pocket maximum from around $4000 to $6000 by dropping from a platinum plan to a gold plan you will save roughly $100 dollars a month. By adding the colonial medical bridge plan that costs roughly $50 dollars a month you get a $2000 hospital benefit. Statistically speaking you will not hit that $6000 out of pocket maximum with out being admitted into the hospital.