What Are The Best Ways To Reduce Business Health Insurance Costs
One of the biggest expenses of doing business is getting a business health insurance policy. That is especially true for small businesses and mom-and-pop ones too. The soaring premium rates are cutting into business owners' finances and forcing them to ask their employees to share more of this financial burden.
According to a study, it was found that small business health insurance costs more than 18% compared to large business health insurance. Such high insurance costs have proven a little too much for many businesses. Moreover, as per the U.S. Chamber of Commerce, over 45 million Americans are currently uninsured, and out of that number around 60% are employees of small businesses.
Despite the fact that small business health insurance is responsible for taking a big chunk of your finances the many benefits it offers, can help you attract more experienced and reliable employees, while helping you retain the existing work pool.
So, if you are a small business owner, struggling to balance the expense of business health insurance cost for your company, below are some quick tips to help you reduce them.
1. Promote Health In Your Employees - The better the health of your employees, lower the cost of your business health insurance. Did you know that many companies like Motorola Inc. have set up a wellness program that offers health assistance and disease management to its employees, besides having a 24-hour dedicated nursing line? Implementing such a program may seem daunting and expensive at first, but it's going to help you save money like $3.93 that Motorola saved for every dollar it spent.
Wellness programs are an excellent way to keep your employees happy. They also keep your accountants happy!
2. Reducing Coverage - Another way to reduce small business health insurance costs is by lowering the extent of coverage or better still making your employees contribute some more towards the insurance plan. However, though this may keep you happy, it may most likely displease your employees, leading to attrition.
For achieving middle-ground, try to ask your workers what coverage they would want. Perhaps they will choose vision, dental insurance coverage as well as a health savings account.
3. Health Savings Accounts- Health savings accounts help small business owners reduce the cost of small business insurance cover. As these accounts are tax-exempt, they can be used to pay for specific medical expenses that leading to overall reduction of health insurance cost. Moreover, your firm's employees also benefit from tax breaks.
If opting for a health savings account, you will have to get a high deductible small business health insurance plan. Fortunately, the big benefit of having such accounts is that both the deposits and withdrawals are tax-free and employees are allowed tax deduction on the 1040 forms they submit to IRS.
Lastly, while all these ways can lower the cost of your small business health insurance, do get this insurance because healthy and happy employees are vital for the growth of your business.