Questions you should ask when weighing up healthcare for small businesses
Earlier this month, we examined employee benefits for small businesses, and why companies might want to offer such perks to their staff. Some do it for talent acquisition purposes; others to reward and support loyal, hardworking staff. Whatever the reasons, securing healthcare for small businesses can seem like a huge task. Asking these key questions of your business can help put you in the best position when you’re just starting out.
What coverage will you offer?
Insurance policies come in a range of different shapes and sizes, and healthcare for small businesses can be extremely flexible in order to meet the needs of both your company and its staff. Basic plans will offer essential cover for inpatient care (hospitalization), but you can expand the benefits to include outpatient care, vision and dental, and even mental health. What you offer will depend largely on your budget and goals. Being clear about these before you source a plan can make the process much, much easier.
What will be most relevant to your staff?
Getting the best fit isn’t just about finding the right plan; it’s about knowing the needs of the people the plan will serve. Are they generally fit and healthy people? Perhaps a less comprehensive plan with lower premiums and higher copays might be more appropriate. Do your people have a hugely diverse set of needs? Maybe a middle-of-the-road plan would be best for supporting as many people as possible.
How much choice will you offer with your benefits?
There are two parts to this: The first is in the form of a “provider network” in which insurers only approve medical care and treatment from particular doctors and facilities in order to save money and streamline claims processing. Health insurance plans for small businesses that feature provider networks are generally less expensive than those without, but will certainly restrict the number of care providers that your staff can use.
The second part relates to the flexibility of your employee benefits, and the types of extended perks you might offer. This may be in the form of optional vaccinations and health check ups, gym memberships, or other wellness options that staff can choose to take up if they want to. For some demographics, particularly younger ones, having a choice in benefits can hugely support satisfaction levels with the plan and your company.
What will the cost share for care be?
What’s often not commonly understood about healthcare for small businesses is that the company generally pays for all of the medical treatments staff receive via the premium paid. Where claims amount to more than the premium, such as when a significant treatment is paid out or staff benefit usage is high, insurers may then seek to raise the cost of the premium at renewal time.
One way to mitigate this can be to introduce co-pays on common or high-cost benefits – effectively asking your employees to help share the cost of their care. This is commonplace for many insurance plans, and a good way to keep healthcare for small businesses sustainable in the long run.
Which insurers and employee benefits providers do I trust?
The benefits market is full of options when it comes to providers, but it can be difficult to know which ones offer the sort of service and support you need. Many globally recognized names, like Bupa or Cigna, can be a safe and easy choice, but more local providers can require a bit more in-depth knowledge to trust. To get the information you want on such companies, reaching out to people and businesses you know, or enlisting the help of an experienced broker, can ensure that you’re not giving money to a company that will under-deliver.
What else do I need to be aware of as I look for healthcare for small businesses?
Once you have an idea of what sort of small business medical insurance plan you need, the next step is finding it. Here are some ways to source healthcare for small businesses that are common around the world:
- Go direct: Search for a list of healthcare and employee benefits providers in your region, and reach out to them directly. Going direct isn’t necessarily cheaper, and it doesn’t always mean less work, but for some small businesses this can be a preferred way of starting out with employee benefits.
- Engage an agent: An agent is a separate entity from an insurer that is contracted to sell specific plans. They can offer a range of added support services related to the maintenance of your insurance plan, however it’s worth remembering that their relationship with their contracted insurer may be their top priority.
- Work with a broker: An independent intermediary can offer added support services (such as claims processing, plan analysis, and renewal assistance), but their biggest advantage is that they’re not beholden to any single insurer; they source and sell plans from whoever fits their clients’ needs best.
In addition to working out where to source your plan from, you’ll need to make sure you’re prepared with all relevant information when it comes to quotes and pricing. A key piece of information all intermediaries and insurers will need is accurate employee census data so your premium can be worked out appropriately.
Getting the best support for your small business medical insurance plan
The employee benefits market does what it can to ensure that businesses who wish to secure insurance alone can do so. The best option by far, however, is to engage the services of a reputable broker who can take you through all of these steps and ensure that your small business gets the best options available to it. At Pacific Prime, our consultants are employee benefits specialists with a long track record of delivering award-winning service to our clients.