Article - Keepin Up With Benefits
Want to know how business owners are navigating the tricky world of health care insurance? Free Benefits Review Sessions help COSE members find their way to affordable answers.
As you navigate the winding road of benefits—one with “tolls” that climb up further each year at a steep incline. The complex map, a renewal package that reads like The Illiad, gives you many complicated ways to reach your destination.
You’re looking for affordable coverage. And you don’t want to disappoint your employees by leaving them stranded.
There are plenty of signs that point to an oasis, a light at the end of the tunnel. Should you lean toward a Health Savings Account (HSA)? Or would you better serve employees by giving them a choice of three standard plans?
And what are all the other businesses in the region doing to strike a balance between offering benefits and affording them?
SO WE ASKED...
“Given the health care costs are increasing by double-digits, it’s interesting that business owners have still given their employees pay increases, and a majority of them are still paying 100 percent of their employees’ benefits,” says Patty Starr, senior director of health insurance and benefits for COSE.
According to COSE’s 2008 Employer Benefits Survey, 55.6 percent of companies with two to four employees contribute 91 percent to 100 percent toward health insurance. More than half (65.7 percent) will not change their contribution amount, meaning they will continue to give generously toward employees’ premiums.
But now, more than ever, small business owners need guidance when navigating health insurance information and analyzing differences between one program and the next. It’s tough to find time to consider all of the opportunities while still running your business.
That’s why COSE creating Benefits Review Sessions—comprehensive, one-on-one meetings that give members clear direction to help them make wise decisions when they face complex benefits decisions, Starr says. With the help of expert advisers, business owners can choose the best plans for their employees. Here is how two COSE members found their way to viable solutions.
PLAN OF ATTACK
Over time, employees’ benefits needs have shifted at Kleinhenze Jewelers. Age, medical conditions and external factors propelled premiums to an all-time high last year. Administrative Manager Kim Smith knew the company needed to re-evaluate its program. She and her sister-in-law attended a COSE Benefits Review Session and arranged follow-up personal meetings with COSE to hash out all the options.
Kleinhenz Jewelers focused on a few key issues when they consulted with COSE about reconfiguring their plan. Like many small businesses, they treat all of their employees like family. Armed with the needs of each staff member, Smith and her sister-in-law considered how the various COSE benefits programs would meet those needs and also align with the overall company mission.
Smith’s Benefits Review Session helped her understand exactly what each plan included.
“We reviewed the company’s goals and did an individual analysis on a per-employee basis. This allowed us to establish ground work for the company while determining what the majority of employees needed,” Starr says.
Smith wanted to be sure that premiums would not overwhelm employees, so staff members’ individual salaries were considered. Because Smith wanted employees to feel like they had choices, she elected three different plan options from the COSE program, including Multiple Option Plan 80, SuperMed Plus 1000/3000 and SuperMed Plus HSA 2500 .
The various plans “grades” allow employees to decide how much premium they want to pay. The company now contributes $175 (single), $350 (two-person) and $450 (family) and the remainder is deducted from employees’ paychecks, Smith says.
It’s that flexibility that small business owners need to stay competitive. With the COSE program, members can offer up to three different health plans simultaneously, Starr points. Out. Nearly 25 percent of survey participants were not aware of this.
Next, Smith and Starr tackled challenges centering on the network. Some employees’ physicians were in network, while others were not. “It was important to both Smith and Kleinhenz Jewelers to elect a program applicable to all employees,” Starr says, noting that through discussion and thorough explanation of Smith’s options, they worked as a team to find a solution.
The results were well received. Employees were thrilled when Kleinhenz added plans with pharmacy copay as opposed to getting reimbursed for medications.
Meanwhile, Smith says the one-on-one meetings with COSE professionals helped her sort through the complex process of choosing the best plans.
“Throughout the year, as I add new employees who need coverage, I feel like I have someone to call and I can put a face to a name,” she says.
WEIGHING THE OPTIONS
The most frustrating part about benefits renewal is deciphering what each health plan includes and figuring out how to compare them, says Mike Simko, president of Access Solutions.
“Health care is a huge expense—it’s like hiring an employee,” Simko says, relating how he wouldn’t make an insurance or hiring decision without doing his homework. So he attended a Benefits Review Session.
Simko plans to grow his business this year. He expects to hire at least one more employee—maybe more. That said, he knew he needed to factor in his payroll expenditures when choosing a plan. It wouldn’t seem fair to increase workers’ obligations without reflecting that in their salaries.
Starr discussed these issues with Simko and met with him to review plan options. Initially, Simko wanted to change his SuperMed Plus 250/500 plan with prescription coverage—he figured there had to be a better option. He covers 100 percent of salaried employees’ premiums.
But after crunching numbers, Simko and Starr recognized that this was not the year to make changes. Simko won’t shift his course just yet. “Some of the potential changes would have shifted more cost at the time of service to employee than I’d like to,” he says. Now he understands exactly what his plan offers vs. others in the COSE program.
MAXIMIZE YOUR FLEXIBILITY
There are numerous ways for employers to build flexibility into their COSE programs. For one, a Health Savings Account (HSA) allows eligible employees and employers to maintain quality health insurance benefits with a high deductible and lower premium. Plus you can contribute to their savings account on a pre-tax basis, and they can spend it when they visit doctors, purchase prescriptions or buy other eligible services and medical products. Any remaining money grows and rolls over year after year. And employees can take the money with them in the event of a job change or retirement.
Jan Nowac, secretary and treasurer of A.J. Nowac landscapting Inc., and 18-year COSE member says, “COSE helped me understand all my alternatives.” Nowac, like 19.6 percent of small business owners surveyed, did elect an HAS. “I had to find a way to get excellent coverage and not hit the pocket so hard,” she says.
Also, employers can offer dental plans, as Smith did for Kleinhenz employees. When she surveyed her staff to find out whether they would take advantage of a dental plan, even if they had to pay full price for it, their response was overwhelmingly positive. Now, every employee—even those who do not have a regular health plan at Kleinhenz—has a dental policy through the COSE Dental Program, which costs less than $10 per month.
This offering reflects the same choice made by more than half of survey respondents who offer dental insurance. Thirty-eight percent of employers provide vision insurance . The percentage of companies who offer both benefits increases with company size. Also, because life insurance is more cost effective for employees to purchase through their place of work, companies that provide these benefits offer a real value to their staffs. These extras give employers a competitive edge in the hiring arena, and employees certainly appreciate the opportunity to participate, Smith says.
Unless you take the time to explore all your options, you’re not making the most of your benefits investment. So it makes good business sense to schedule a Benefit Review Session for yourself.