Are group health insurance prices going up?

If you are a small business owner or an employee of a small business, you may be wondering how the recent changes in the health care industry, the pandemic and inflation will affect your group health insurance costs. We will explain some of the factors that influence group health insurance prices and what you can do to manage them.

Group health insurance is a type of insurance plan that covers a group of people who are affiliated with a common employer, organization, or association. Group health insurance plans typically offer lower premiums and more benefits than individual plans, because the risk is spread among a larger pool of members.

However, group health insurance prices are not fixed and can vary depending on several factors, such as:

- The size and demographics of the group. Larger groups tend to have lower premiums per person, because they have more bargaining power with insurers and can negotiate better rates. Smaller groups may face higher premiums, especially if they have a high proportion of older or sicker members who use more health care services.
- The type and level of coverage. Group health insurance plans can offer different types of coverage, such as HMOs, PPOs, EPOs, or POS plans, each with its own network of providers, deductibles, copayments, coinsurance, and out-of-pocket limits. The more comprehensive and flexible the coverage, the higher the premium.
- The claims history and utilization rate of the group. Group health insurance prices are based on the expected costs of providing health care services to the group members. If the group has a high rate of claims or uses more expensive services, such as hospitalizations, surgeries, or specialty care, the insurer may increase the premium to cover the higher costs.
- The location and regulations of the state. Group health insurance prices are also affected by the geographic area where the group is located and the state laws and regulations that govern the health insurance market. Some states have more competitive markets and lower prices than others. Some states also have more stringent requirements for insurers, such as minimum benefit standards, guaranteed issue, community rating, or essential health benefits, which can increase the premium.

So, are group health insurance prices going up? The answer is: it depends. According to a recent report by eHealth, the average premium for small group health insurance plans increased by 8% from 2019 to 2020, while the average deductible decreased by 3%. However, these averages may not reflect the specific situation of your group. The best way to find out how much your group health insurance will cost is to compare quotes from different insurers and see what options are available for your group.

If you are looking for ways to lower your group health insurance costs, here are some tips:

- Shop around and compare plans from different insurers. You may be able to find a better deal or a more suitable plan for your group's needs and budget.
- Consider switching to a high-deductible health plan (HDHP) with a health savings account (HSA). HDHPs have lower premiums but higher deductibles than traditional plans. HSAs are tax-advantaged accounts that allow you to save money for qualified medical expenses. By combining an HDHP with an HSA, you can reduce your premium and save money for future health care costs.
- Encourage wellness and prevention among your group members. By promoting healthy habits and preventive care, such as regular check-ups, screenings, vaccinations, and lifestyle changes, you can reduce the risk of chronic diseases and costly complications that can drive up your group health insurance costs.
- Seek professional advice from a licensed broker like PNW Insurance Solutions. A qualified broker can help you navigate the complex and changing landscape of group health insurance and find the best plan for your group. They can also assist you with enrollment, administration, compliance, and claims issues.

Group health insurance is a valuable benefit that can help you attract and retain talent, improve productivity and morale, and protect your group's health and well-being. However, it can also be a significant expense that requires careful planning and management. By understanding the factors that influence group health insurance prices and taking steps to control them, you can ensure that your group health insurance is affordable and effective.

During times of economic uncertainty, the choices employers make about their benefits offerings can have long-lasting effects on their finances, employee expectations, and ability to attract and retain talent. This can impact the overall health of the organization.

To ensure ongoing success, employers should carefully assess all areas of operations, including employee benefits. Focusing on this specific aspect can reveal opportunities for cost savings that could significantly affect the organization's bottom line.

Here are some practical strategies employers can implement now to optimize their benefits program and support operations during challenging times.

Plan Design Re-Evaluation
Many employers are using this time to reassess their health plan designs and offerings to increase cost-effectiveness. Some are switching to alternatively-funded health plans, while others are using health reimbursement arrangements or health savings accounts to encourage employees to make financially wise healthcare decisions. Offering high and low benefits options to meet the needs of a diverse workforce is imperative is preferred over a one-size-fits-all plan design.

Improve Employee Communications
Increasing employee healthcare literacy can lead to significant cost savings, as informed employees are more likely to make cost-effective healthcare decisions. This makes it a great strategy for supporting operations in a slow-growth economy.

By helping employees avoid unnecessary out-of-network care and guiding them to low-cost outpatient and inpatient options, you can reduce overall medical expenses for both the employer and employee.

Many employers are also creating easy-to-use benefits portals to educate employees and provide important information such as health plan options, forms, enrollment calendars, and links to additional healthcare resources.

Bolster Your Employee Benefits Package
During an economic downturn, employers' benefits budgets often decrease, leaving fewer resources for employee benefits when needs are high. With limited resources, your organization can adapt its benefits offerings to meet employee needs by expanding mental health support, enhancing leave options, and providing financial wellness resources. Additionally, expanding voluntary benefits can effectively meet employee needs without increasing costs.

By thinking creatively and using cost-effective employee benefits, you can maintain the quality of your offerings while freeing up funds for other areas that need support during an economic slowdown.

Ask Your Benefits Broker for Help
One effective way to reduce healthcare costs is to utilize the expertise of your benefits broker. Ask them to thoroughly analyze your organization's benefits expenses and suggest ways to save money. They may find simple solutions that won't negatively affect your employees' experience. A good broker should have a range of cost-saving options for employers to consider.

We offer no-cost, healthplan evaluations. Please contact Wendee Allen for further details at 425-314-0988.
 

What are Association Health Plans?

Association health plans (AHPs) are a type of group health insurance that allows small businesses, freelancers, and self-employed individuals to join together and access the benefits and savings of large group health plans. AHPs are offered by associations that are formed based on a common profession, industry, or geographic area. AHPs can provide lower premiums, more flexibility, and better negotiation power for their members.

How do AHPs work?

AHPs work by pooling together multiple employers and individuals into a single large group health plan. By doing so, AHPs can avoid some of the regulations and costs that apply to small group and individual health plans under the Affordable Care Act (ACA). For example, AHPs can design their own benefit packages without having to cover all the essential health benefits required by the ACA. AHPs can also negotiate better rates with insurers and providers, or even self-insure to lower their administrative expenses and avoid health insurance taxes.

Who can join an AHP?
To join an AHP, you must be a member of an association that meets certain criteria. The association must have a formal organizational structure, be controlled by its members, and have a commonality of interest among its members. The association must also exist for a purpose other than offering health insurance, such as promoting the interests of its industry or profession. The association must not discriminate against any member based on their health status or claims history.

What are the advantages and disadvantages of AHPs?

The main advantage of AHPs is that they can offer lower premiums and more choices for their members. AHPs can also provide more stability and continuity for members who may change jobs or locations frequently. AHPs can also foster a sense of community and solidarity among members who share a common interest or identity.

The main disadvantage of AHPs is that they may not provide adequate coverage or protection for their members. AHPs may exclude or limit some benefits that are essential for some people, such as maternity care, mental health services, or prescription drugs. AHPs may also vary in quality and reliability depending on the association's governance and financial management. AHPs may also face legal challenges from state regulators or other stakeholders who oppose their expansion.

If you have a health insurance plan that is not grandfathered under the Affordable Care Act (ACA), you may be enjoying some of its benefits without even realizing it. One of the most popular features of the ACA is that it requires most health plans to cover a set of preventive services at no cost to you. This means you don't have to pay a deductible, copayment or co-insurance when you get these services from a provider in your plan's network.

Preventive services include things like shots, screening tests, counseling and wellness visits that can help you stay healthy and detect or prevent serious medical conditions. For example, under the ACA, women can get free mammograms, cervical cancer screenings, contraception and prenatal care. Children can get free immunizations, developmental screenings and vision tests. Adults can get free blood pressure checks, cholesterol tests, diabetes screenings and tobacco cessation counseling.

These services are not only good for your health, but also for your wallet. According to a report by the U.S. Department of Health & Human Services (HHS), more than 150 million people with private insurance, including 58 million women and 37 million children, are receiving preventive services with no cost-sharing, as required by the ACA . The report estimates that these services have saved Americans $7.5 billion in out-of-pocket costs in 2019 alone.

However, these benefits are now at risk because of a recent court ruling that overturned some of the ACA's preventive service requirements. On January 6, 2022, a U.S. District Court judge in Texas ruled that some of the preventive services that health plans must cover with no cost-sharing are unconstitutional and violate the religious rights of some employers and individuals . The ruling affects services such as breast cancer genetic testing, contraception, sterilization and counseling for sexually transmitted infections.

The ruling is not final and is expected to be appealed by the Biden administration, which has vowed to defend the ACA and its preventive care benefits. However, in the meantime, some health plans may decide to stop covering these services with no cost-sharing or drop them altogether.

That's why Washington Insurance Commissioner Mike Kreidler has sent a letter to all health insurers in the state, urging them to continue providing coverage of all recommended preventive services without cost-sharing for patients. He said that millions of people rely on this benefit to get affordable coverage of early detection and prevention of serious medical conditions. He also said that his office is exploring all options including legislative solutions to protect this benefit for Washingtonians.

If you are one of the many people who benefit from the ACA's preventive care requirements, you should be aware of this court ruling and how it may affect your coverage. You should also contact your health plan and ask them if they will continue to cover these services with no cost-sharing or not. If they don't, you may want to shop around for a different plan that does during the next open enrollment period or see if you qualify for a special enrollment period due to a change in your coverage.

Preventive care is one of the best ways to protect your health and save money on health care costs. Don't let this court ruling take away your access to these valuable services.

If you are an employee in Washington state, you may be wondering what are the leave of absence rules that apply to your situation. A leave of absence is an absence from work mutually and voluntarily agreed upon by you and your employer or a collective bargaining agent, or leave to which you are entitled under federal or state law, where the employer-employee relationship is continued and you will be reinstated in the same or similar job when the leave expires. There are different types of leave that may be available to you depending on your circumstances, such as:

- Vacation Leave: In Washington, employers are not required to provide employees with vacation benefits, either paid or unpaid. However, if an employer chooses to do so, it must comply with its own established policy or employment contract.
- Sick Leave: Washington law requires employers to provide employees with paid sick leave. Employees must be allowed to accrue at least one hour of paid sick leave for every 40 hours worked. Employees may use their accrued, unused paid sick leave for various authorized purposes, such as caring for themselves or their family members, dealing with domestic violence issues, or when their workplace or child's school is closed for health reasons.
- Holiday Leave: In Washington, employers are not required to provide employees with holiday leave benefits, either paid or unpaid. However, if an employer chooses to do so, it must comply with its own established policy or employment contract.
- Jury Duty Leave: In Washington, employers must provide employees with unpaid jury duty leave. Employers may not discharge or threaten to discharge an employee for serving as a juror. Employees may not waive their right to jury duty leave.
- Voting Leave: In Washington, employers must provide employees with up to two hours of paid voting leave if they do not have sufficient time outside of working hours to vote. Employees must request voting leave before election day and show proof of voting if requested by the employer.
- Bereavement Leave: In Washington, employers are not required to provide employees with bereavement leave benefits, either paid or unpaid. However, if an employer chooses to do so,
it must comply with its own established policy or employment contract .
- Family and Medical Leave: In Washington, there are two laws that provide employees with family and medical leave benefits: the federal Family and Medical Leave Act (FMLA) and the state Paid Family and Medical Leave (PFML) program. The FMLA applies to employers with 50 or more employees and provides eligible employees with up to 12 weeks of unpaid job-protected leave per year for various qualifying reasons such as childbirth, adoption, foster care placement, serious health condition of self or family member, or military exigency . The PFML applies
to most workers in Washington state and provides eligible employees with up to three months of partial wage replacement per 12 months,
with some possibly entitled to up to 16 weeks.

Employees in Washington who use this paid leave may receive up to 90% of their weekly wages or up to $1,000 per week. Qualifying events can include: birth or placement of a new child into a family, recovery from a serious illness or injury, treatment of a chronic health condition,
inpatient treatment for substance abuse or mental health, taking care of a family member with a serious health condition, and certain military events .

These are some of the main types of leave that may be available to you as an employee in Washington state. However, there may be other types of leave that apply depending on your specific situation. You should always check with your employer about their policies and procedures regarding leaves of absence before taking any action. You should also consult a legal professional if you have any questions about your rights and obligations under federal and state laws.
 

If you're wondering why your health insurance premiums are increasing next year, you're not alone. Many Americans are facing higher costs for their coverage in 2023, and there are several reasons behind this trend.

One of the main factors that affect health insurance prices is the cost of medical care. According to a report by Health Care Cost Institute, health care spending per person grew by 4.2% in 2019, the highest rate since 2014. This was driven by higher prices for hospital services, physician services, and prescription drugs.

Another factor that influences health insurance prices is the demand for health care services. The COVID-19 pandemic has had a significant impact on how people use health care, both during and after the crisis. Some people may have delayed or avoided preventive care or elective procedures due to fear of exposure or lack of access. Others may have experienced long-term health complications from COVID-19 that require ongoing treatment. These changes in utilization patterns can affect how insurers estimate their risk and set their premiums.

A third factor that affects health insurance prices is the availability of subsidies and tax credits. The American Rescue Plan Act (ARPA) of 2021 expanded eligibility and increased amounts for premium tax credits for people who buy health insurance through the Marketplace. This means that more people can qualify for financial assistance and pay lower premiums than before. However, this also means that insurers have to adjust their rates to account for the higher federal spending on subsidies.

The impact of these factors on health insurance prices may vary depending on where you live, what type of plan you choose, and your income level. To get an estimate of how much you'll pay for health insurance in 2023, you can use tools like HealthCare.gov's plan preview or ValuePenguin's average cost calculator. You can also compare different plans and options to find one that meets your needs and budget.
 

WA SB 5546 requires that all individual and insured medical plans cap member cost for insulin at $35 per month in 2023.  This will impact plans as they are purchased or renewed in 2023.  Prior to this change, insulin was capped at $100 per month instead.  Great news for the many diabetics in Washington state!

Each year, small group insurance carriers in Washington state must submit their requested rate increases to Washington’s Office of the Insurance Commissioner (OIC).  Small group insurance plans are for employers who had 50 or fewer employees on average during the calendar year prior to the effective (or renewal) date of the plan.  

Unfortunately, there are more two digit increases requested for 2023 than in 2022.  Why? The pandemic.  Many insurance companies are asking for higher rate increases on renewals due to lagging COVID-related claims, COVID test kits, a higher medical and prescription drug trend, and overall inflation.  Additional factors impacting small group rates include:

• Some care deferred during the pandemic returned - Healthcare spending by employers in 2021 was lower than expected, in large part because of the deferral of care as a result of the pandemic. 
• COVID costs are likely to persist - The costs of testing for COVID, treating patients and administering vaccinations for the disease likely will continue into 2023.
• The mental health and substance use crises show no signs of waning - The pandemic substantially increased demand for mental health services. Increased substance use also likely will increase healthcare spending in 2023.
• Population health worsened during the pandemic - Poor pandemic-era health behaviors such as lack of exercise, poor nutrition, increased substance use and smoking has led to an increase in healthcare spending and medical trend.  Medical trend is defined as the projected percentage increase in the cost to treat patients from one year to the next, assuming benefits remain the same.

There are two insurance companies who asked for double digit increases to their small group, age-banded rates:  Kaiser of WA (+10.2%) and Premera Blue Cross of WA (+11.5%).  These increase requests are based upon each carrier's gain or loss at the end of 2021.  Kaiser has a $10.3M deficit and Premera's was $1.6M.

It will take a few months for the OIC to review and approve the requested increases, but if you're with Kaiser of WA or Premera for small group, it may be time to shop around.  Need help? Contact us. We can help find alternative affordable plans.

A quick update on the WA Cares LTC Act.  On 1/27/2022, Governor Jay Inslee signed into law two bills, House Bill 1732 and House Bill 1733, which became effective at signing. These new bills will delay and make significant changes to the Washington Cares Fund.

Employers should cease collecting premiums for the Washington Cares Fund immediately and refund any premiums that have been deducted in accordance with HB 1732 which requires refunds to be made within 120 days of the collection of the premiums.

Employers should continue to monitor the WA Cares Fund for further developments at the following link: https://wacaresfund.wa.gov/.  We will continue to provide updates on our website's blog located at https://pnwisol.com/hot-topics1.
 

On Friday, December 17, 2021, Governor Inslee, as well as Senate Majority Leader Andy Billig and House Speaker Laurie Jinkins, issued statements implementing a delay in the WA Cares program. Specifically: 

• The statements “strongly encourage” employers not to withhold the premium, which would have otherwise gone into effect January 1, 2022.
• The Washington Employment Security Department will not collect the employee premiums from employers before April 2022, at the earliest.
• Washington State will not assess penalties or interest on employers who do not withhold the premium from employees’ wages.

Photo by Brett Jordan on Unsplash