Evaluate carriers’ provider networks

Make sure your carrier’s priorities match yours—providing the best possible network for care while lowering employees’ out-of-pocket costs. Among the most significant benefits of health insurance coverage are the lower rates for services carriers negotiate with providers and through provider networks. These rates are far less than costs absent health insurance or when paying providers directly. Health insurers, including Community Health Options (Health Options), take a step even further by establishing preferred provider networks. These networks are based on a providers’ price of care while factoring in the overall quality of care based on publicly available quality rankings. So, providers who offer better outcomes while keeping costs low often become preferred providers. Most carriers provide participants with financial incentives to use the preferred provider network. The carrier’s incentive is the same as yours—lowering the overall cost of care, which greatly influences overall premiums and employees’ out-of-pocket costs depending upon your plan design.

Explore premium offset plans

Consider working with a broker to establish premium offset plans, which give participants a tax break on their portion of health insurance premiums, all paid with pre-tax dollars. Premium offset plans require that the employee portion of the health insurance premium be deducted from payroll, a capability supported by most payroll services. It may seem insignificant, but premium offset plans add up to big savings for employees, especially for those paying additional premiums for family plans.

Offer Health Savings Account Compatible Plans

When selecting a health plan, consider options compatible with Health Savings Accounts (HSAs). HSA plans are a great way to allow plan participants with a high deductible health plan to save money in a tax-free account to pay for qualified medical expenses. HSAs, for instance, cover the costs of deductibles and co-insurance expenses for healthcare, dental and vision. In 2023, participants can save up to $3,850 in pre-tax dollars using a health savings account offered by a local bank or credit union.  The savings account is designed to cover qualified medical expenses and is paired with a qualified medical plan. (Brokers can help employers establish a qualified health insurance plan.)

Provide Health Reimbursement Accounts

High deductible plans like the new Clear Choice Bronze plans are great options to provide health insurance for your employees and to keep premiums as low as possible. But once claims start rolling in, funding a large deductible can become overwhelming for plan participants. That’s where Health Reimbursement Accounts (HRAs) come into play.

HRAs are a type of funding vehicle whereby a Small Group employer agrees to pay a certain portion of the employees’ deductibles and/or co-insurance to minimize their claims costs. For example, an employer with a Bronze plan with a $5,900 deductible might pay $3,000 after the employee incurs $2,900 in out-of-pocket expenses. That way, the employee pays “first dollar” of the deductible and has an incentive to keep costs down, while the employer is obligated to pay the remainder of the deductible.

The good news about an HRA is that if the employee does not use the full $3,000, the employer keeps any unspent money and benefits financially by offering a lower priced premium plan. It’s rare that employers would be on the hook for the full commitment for all covered plan participants. Small group employers need an experienced broker and a third-party administrator to implement an HRA program as part of an overall health insurance program.

Tap into Direct Primary Care

Direct Primary Care (DPC) has recently emerged as a popular way to manage primary care healthcare expenses but be warned: There are just 40 such providers in the state of Maine. Still, it’s an option worth exploring with a broker. DPC providers do not accept health insurance as payment for care. Instead, they typically charge an annual fee for service, which covers all primary care visits during the year, including preventative care. Employers providing some level of self-funding for a small group plan in the form of an HRA, for example, may find the cost of subsidizing Direct Primary Care reduces the likelihood of employees incurring higher deductible costs.

Resources for Small Groups and their Brokers

Community Health Options, a Maine-based nonprofit health insurer, is committed to the Small Group health insurance market and to providing an easy purchasing experience for Small Groups and their brokers to navigate the changes in the merged market. To that end, the Health Options team has been reaching out to brokers and Small Group employers to educate them about the upcoming changes in the merged market and ways they can keep costs down. For information, call 207-402-3353.