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Convert to Individual Plans and Save on Group Coverage?

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Saving money on insurance is a huge concern for many small firms, who fear that they won’t be able to cover their employees without driving up their costs to unsustainable levels. This is something I am asked about all the time in my work as an insurance consultant: how can firms lower their costs while still providing adequate healthcare for their employees? Many people see it as kind of a ‘Sophie’s Choice’ scenario, where business owners are forced to choose between saving money and providing health plans that their employees will appreciate. Well, I’m here to tell you that it doesn’t have to be that way, and anybody who says otherwise just isn’t doing the legwork that an employer should put in on behalf of his company.

If you’re smart about choosing the benefits that you offer, it’s not that difficult to cover your employees while keeping costs manageable. I won’t lie to you: health care coverage always takes an investment from the employer. That’s why employees want to work for companies that offer health benefits. The good news is that you attract a higher volume of skilled and motivated workers, and the better your benefits are, the less likely they’ll be to desert you for the competition. Now for the harder news:

Finding affordable benefits takes work—especially if you’re a small company with a limited amount of money in the budget. The first step, of course, is accepting the truth: you may have to compromise a little. Chances are, you can’t afford the fancy health plans offered by companies who are buying up prime time ad space. No, you’re going to have to dig a little deeper when you’re looking for provider – or are you?

Here’s an idea: have your employees pick out their individual plans. Self-insured programs are reasonably viable options for employees who work at small firms, especially if they qualify for subsidies. Better yet, it can reduce—or even eliminate—your employer contribution. This is an excellent way to make sure that your employees can select the benefits that are most important to them, while you avoid paying extra for their preferences.

There are many ways to help your employees find self-insured programs too, and it’s not hard to dig up information on them. Look at or other independent brokerage firms to see how they can put you in touch with individual plans for the people in your workplace. Just make sure that you choose highly qualified professionals whose advice you can trust. It’s a big, complex world out there and not everybody is equipped to handle it.

To sum up: individual plans are an excellent way to save money when trying to have your employees covered by health insurance. They’ll stop you from spending more money on blanket coverage that may not be right for everyone, and there are people with specialized knowledge who can help you choose sensible individual options. Whatever you do, though, remember: research is essential! My advice is a good starting point, but you’ll have to keep your own eyes peeled at every step of the journey if you want to find affordable care to keep your employees happy.

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