Health plan prices for small businesses have been on the rise. Since the passage of the Affordable Care Act (ACA) in 2014 many are looking for new solutions to control costs and create more flexibility for employees.
What level funded plans do is create a new plan option for small businesses that enroll five or more employees. Because they sit outside of the community rating provisions of the ACA, these health plan options can price risk appropriately while offering several other benefits for small businesses.
If you are a small business looking for a new health plan option, here is what you need to know.
In today’s ACA environment we have what is called pooled risk. This means that many businesses may be paying more for their healthy group than needed based on that specific group’s risk composition. These new plans have the potential to save businesses as much as 25% a year which could result in savings as high as $72,000.
And employers also get the added benefit of multiple plan designs, greatly improving employee choice. With a diverse workforce reflecting different age groups and health plan needs the ability to pick from multiple plan designs not only benefits employers but empowers their employees to choose what is right for them. [Read more…]