3 strategies to cut healthcare costs without cutting benefits

3 strategies to cut healthcare costsAccording to a report done by PwC, medical inflation still outpaces general economic inflation by a 4.5% growth rate. It can be a difficult juggling act for employers to keep health insurance premiums from financially squeezing their business, while also providing a robust benefits package for employees.

There is no single reason healthcare costs keep rising but there are many drivers contributing to the increases. Soaring prices for medical services, unhealthy lifestyles and a lack of transparency concerning prices and quality are all factors that contribute to the spike in premiums.

Employers may have more options for controlling their company’s healthcare costs than they realize, here are 3 strategies your clients can implement to minimize costs without cutting benefits:

  1. Self-fund healthcare costs
  2. Implement a telehealth program
  3. Offer Voluntary Benefits for purchase

By adopting these new healthcare benefits strategies and partnering with FreedomCare, your clients can lower their healthcare costs substantially. Give FreedomCare a call today.

Self-Funded Benefit Plans are on the rise.

Rise of Self funded benefitsWith the advent of the Affordable Care Act and skyrocketing healthcare costs, the concept of Self-Insurance is on the rise. It has been commonplace with large companies for some time but rare among small and midsized employers. So how does self-insurance work?

Self-funded health care has been described as an arrangement whereby an employer provides health or disability benefits to employees with its own funds.

Well, with health insurance costing close to $6,800 per employee per year, self-insuring your benefits can save you 12% or more. So if you have 100 employees, your insurance alone can cost $680,000 annually. A 12% savings would be $81,600. It seems like a no brainer at that point. What would your clients do with an extra $81,600 a year?

Because self-insurance allows an employer to break down virtually every component of their health care claims and administrative expenses, it allows for transparency to see the hard numbers and where all of those hard earned dollars are actually being used. This helps employers to plan better and allocate funds for certain contingencies.

Ask yourself 3 things if you want to self-insure your benefits plan:

  1. Do you want to save money?

  • According to ADP, the average monthly health plan premium rose 13.9% between 2010 and 2013, making a 12% savings hard to pass up.
  1. Are you compliant?

  • Employers still have to comply with the Employer Mandate portion of the ACA, not all companies offer compliant plans. FreedomCare offers the only 100% ACA compliance guarantee.
  1. Can you do this alone?

  • FreedomCare handles all of the details including administration, COBRA, paying claims, enrollment, etc.

According to the U.S. Department of Health and Human services, only about 26 percent of employers between 100 and 499 employees self-insure compared with more than 82 percent of employers with 500 or more employees. With no minimum participation, FreedomCare has made self-insuring possible for employers of all sizes, not just the large ones.

How to control your “out of control” insurance premium increases.

Insurance premiums expected to riseAmerica is sicker than we thought. The nation’s leading health insurers are seeking rate increases of 20 to 40 percent for the 2016 open enrollment season citing sicker than expected customers who purchased health benefit policies under the Affordable Care Act.

The rate requests, from some of the most popular health plans, suggest that the insurance market is still adjusting to the shock waves set off by the Affordable Care Act. Experts believe the root cause of this problem is the failure of several marketplaces to attract enough young, healthy applicants.

With increasing expenses already hurting your bottom line, how are you going to keep your business alive while facing inflated insurance premiums or massive penalties from the IRS?

  • Self-Insure your health benefits.

This isn’t a new concept, large companies have been self-insuring their health benefits and workers comp for years. We’ve now made it available to any size employer; so why would you pay a large insurance carrier for something you can do yourself?

  • Stop-loss or reinsurance to limit your liability.

When you self-insure, you need to have reinsurance to protect your business.

  • Claims funding is returned to you.Control your insurance premiums

When you self-insure, you are contributing monthly to a fund that claims are paid out of. Any money that goes unused will be returned to you on a quarterly basis. In a nutshell, you only pay for what you use and that unused money ends up back in your pocket.

  • Implement Health and Wellness Programs to keep your costs low

It’s no secret that America is unhealthy. Bringing health and wellness programs to your employees and encouraging yearly checkups can cut down on illnesses and increase the possibility of claims funding coming back to you.

Simple enough, right? Give FreedomCare a call to learn more about self-insuring and avoiding these premium increases.

3 Reasons to Self-Insure your Benefits Plan

shutterstock_94589152Most brokers and employers were in denial this past year about the Affordable Care Act. With its ever-changing laws, continuous delays and lack of clear information some brokers and employers were under the impression the employer mandate would never go into effect. Well, its 2015, nothing was overturned and here we are, employers are facing thousands of dollars in potential penalties.

Most people don’t know that a large portion of the ACA is going to be funded by employers who fail to comply and end up paying penalties. Compliance is critical if you or your clients do not want to be part of the Obamacare funding machine.

Any insurance agent who represents large groups of 50 or more full-time employees knows that the ACA is going be challenging. Agents and Employers that understand the basics of the laws are more equipped to navigate the changes and are often more open minded to considering different strategies.

When considering plans like the ones FreedomCare offers, you have to start by changing the way you think about traditional health insurance plans and start exploring the world of self-insured health plans, also known as ERISA qualified plans. The Affordable Care Act brought numerous mandates on traditional insurance plans but exempts ERISA plans from a lot of the ACA provisions. Self-Insuring your benefits is not only legal; it has been around for decades. Traditionally Self-Insurance has only been able to be utilized by large employers; until now.

So why would you want to self-insure?

1. You have more control over your plan design:

Traditional insurance companies usually offer set packages for benefits. By self-insuring, an employer can tailor a plan suited for their employees.

2. You can save a lot of money:

Self-Insured plans are not traditional products, they have very different costs associated with them. For example, they don’t have to build in extra charges for profits or taxes.

3. Better cash flow:

With a traditional insurance plan, the employer pays the same premium even if their employees use less care one month than predicted. With a self-insured plan, the employer pays the actual cost of care instead of a fixed monthly premium and holds on to that extra money.

So you’ve seen that self-insuring offers several advantages over traditional insurance. But where do you begin?

Well FreedomCare allows employers greater flexibility and discretion when it comes to self-insuring their benefits. We offer the only Guaranteed Compliant program along with a wealth of benefits that are not only valuable to employees but also a value to business owners.

Take control of your benefits program, start your self-insured program today.