6 Ways to Lower Employee Benefits Costs for Your Business
Employee benefits cost is often one of the largest expenses for a business. While employee benefit plans are a must-have, there are ways to minimize your benefits costs and lower your average benefits cost per employee. Here are 6 things you can do with employee benefits to reduce how much you spend:
1. Review Your Current Benefits Package
Take a fresh look at your current plan and see if any changes can be made to lower costs, while still covering your employees needs.
For those with access to real claims data for their employees, use findings from that data to determine what kind of plan is best for you. This data also gives you transparency for negotiating costs, when signing new plans and at renewal.
For added perspective, consider customized benefits benchmarking to see how your plan compares to similar companies. See what kind of coverage other companies provide and at what average benefits cost per employee.
2. Consider a High Deductible Health Plan
An HDHP is a type of consumer directed healthcare (CDH). Having a high deductible health plan means that while incurred deductibles are more costly, you and your employees can spend less on medical premiums. In many cases, switching to an HDHP results in significant savings over time for the employer.
If your plan members generally have especially high risk, this may not be the plan for you. Beacon can help you get a clear picture of your plan members risk factors to help determine this.
3. Set up a Health Savings Account
Offering your employees an health savings account can help offset employee benefits costs associated with a high deductible health plan. Funds in an employee’s HSA can be used to pay for eligible health care expenses and for out-of-pocket costs that their health plan does not cover. Many employees find that having an HSA helps relieve the stress of unexpected medical costs. Additionally, HSAs have significant advantages for retirement savings and are a compelling benefit to employees.
4. Educate Employees on Their Health Plans
Employees often don’t understand their medical plan, which means that they don’t always make the most cost-effective medical decisions.
Providing more in-depth education on how their plan works, and support for questions that may come up, can help lower incurred medical fees. For example, someone may end up going to an emergency room when other more appropriate solutions can exist for their issue, leading to higher costs. Educational programs can also help employees prioritize preventative care, saving money in the long run.
5. Explore Self-Funding Your Benefits Plan
Self-funding your employee benefits plan allows you to avoid carrier mark-ups and keep the unused money that has been allocated for insurance claims, rather than paying a fixed premium to the insurance carrier. Before moving to a self-funded plan and purchasing stop-loss insurance, it’s important to deeply understand your group’s risk profile.
6. Review Your Benefits Package Regularly
With so many employee benefit plans, deciding which ones are best suited for your business can be a headache. Once you’ve gone through the process and made your decision, make sure you keep tabs on your plan and benefits spending.
For the most accurate analysis, use Beacon to access real claims data for your employees and determine if your plan best suits your needs. You’ll also get the transparency you need to negotiate the best costs and avoid unfair premium increases at renewal.
What is Beacon?
Our software collects real healthcare claims data for any group and gives you a clear picture of benefits spend and risk factors for your client. Access a real healthcare claims data assessment for any employer group and make decisions based on actual data.
- Get the transparency you need to negotiate costs, avoid unnecessary rate increases, and make the most of benefits spend for your employees.
- Access to real benefits data gives you the freedom to consider all plans and choose the one that’s right for you and your business.
- In less than a pay period, get accurate information without having to worry about time consuming questionnaires and flawed health surveys.
See how this client avoided a 36% premium increase using insights accessed with Beacon:
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