Figuring out the cost of providing group health insurance benefits to employees can be complicated. In this post, we are walking you through the process of decoding group health benefits for your company.
Let’s say for example I have a friend who owns a small manufacturing business that employees 10 people. He currently doesn’t offer medical benefits to his employees, but he wants to learn about the process. He wants to make sure he is giving his employees a great working experience while also helping the company thrive. Finances are tight for his manufacturing business and the cost is always a critical part of any decision. Providing group medical benefits to employees gives them further incentive and reason to be happy with their employment.
Group health benefits are expensive
Paying for medical insurance is expensive whether you are looking at it as an individual or as an employer offering medical benefits to your employees. To make matters worse, the healthcare industry doesn’t make it easy to understand the costs of your care. It is so hard to know if you are getting a good deal or if you’re getting ripped off.
This is where a good broker comes in. A knowledgeable broker can interpret costs and also help you find the best path to getting the best price for your group health benefits.
How much will it cost to provide benefits?
Understanding how much it will cost to provide medical insurance, also known as group health benefits, is an integral part of every business budget. Each year the Kaiser Family Foundation publishes a report that shows the annual premiums for medical coverage. The 2019 version can be found here. The cost has increased 54% in the last 10 years. Employer-sponsored insurance covers over half of the non-elderly population; approximately 153 million nonelderly people.
Diversified can help you manage healthcare costs
Diversified Insurance Group makes every effort to support our clients in reducing the cost of healthcare. Our active approach to managing healthcare has consistently given our clients a lower annual premium increase compared with the national average. The premium amount our clients paid on average compared with the national average was 18% less for single coverage and 13% less for family coverage.
|Diversified||Monthly||Annual||Percent less than National|
Back to our hypothetical story, I helped my friend dig into the financial details for his manufacturing company. Providing health benefits to his employees would add a new line item to his costs. Salary, Cost of goods, Shipping, and then health benefits would be his most expensive items. Each company needs to budget for that cost. It needs to be part of the overall budget conversation.
Providing health insurance to employees is inevitably expensive. It’s important to know that you can take active control of your medical spend and find ways to reduce how much you spend on health care. The team at Diversified Insurance Group would love to talk to you about how we can support you in that journey. For more information, go here.