Double Digit Increases are Expected in 2016

The Affordable Care Act (ACA) has reformed the rating practices of health insurance carriers in the individual and small group markets by limiting the factors that can affect premium rates. So what does that mean for your small group health insurance premiums? Most likely double digit increases. Small businesses with employee populations that are mostly young and male will see the biggest impact.

The reason for the increase is due to forced community rating. Community rating, also known as composite rating, is the practice of lumping all eligible employees together and assigning a single rating, regardless of individual factors (such as age, gender or tobacco use) that may make an individual a higher or lower insurance risk. Health insurance plans may have grandfathered premiums that small groups have taken advantage of since 2014, but many of those plans are retiring and new policies are being written. By 2017, all grandfathered rates will no longer be affective.

Another provision is for tobacco users. These individuals can be charged rates up to 50 percent higher than non-tobacco users. Alternatively, all other rating factors will be prohibited. In other words, several factors commonly used by health insurance carriers to set higher premiums prior to 2014 (rating factors such as health status, claims history, duration of coverage, gender, occupation, small employer size and industry) can no longer be used.

In Florida, community rating will effect employers offering group health insurance that have less than 50 employees. Having an experienced broker will be the most effective way to minimize the premium increases. Full service insurance brokers have access to many different options that can help keep rates affordable and coverage comprehensive. Level funding, finding an alternate health insurance carrier, or utilizing a professional employer organization are just some of the strategies a broker can help a small group explore.

Using Technology for HR Communications

In today’s society, technology is just part of the landscape. It permeates almost every aspect of life, from communication with family, friends and colleagues to managing life’s daily activities such as banking and counting calories. Still, there a significant number of small businesses using the old fashioned way of communicating with their employees – printing flyers, posting newsletters in the breakroom or giving out orientation packets to new hires. Unfortunately all of this paperwork usually ends up in one place – the trash can.

So what can be done to change it? Using an HR platform and introducing technology into employee communications is the first step in streamlining messages and giving employees an easier way to receive and access information. A good HR platform will:

  • display or distribute employee newsletters
  • offer an area for employees to post information and share with their colleagues
  • provide a place to post job openings and training opportunities
  • contain enrollment features for benefits administration
  • be low cost or no cost to your business

Many times an HR platform is offered by your group health insurance broker as a value add. In exchange for your broker of record and the ability to manage your group health insurance benefits portfolio, you can take advantage of powerful HR technology and make communicating with employees a streamlined and less paper-laden process. You’ll save everyone time and make messages more likely to be noticed by giving employees a central place to access HR related information. Handbooks, forms, emergency procedures and company announcements can all be posted for view.

If your current broker isn’t offering an HR platform to manage your benefits enrollment and other HR related responsibilities, it may be time to evaluate your relationship and find one that does.