Choosing the Right Insurance Plan

Cost Isn't Everything

Though for some businesses, the idea that cost isn't everything may be anathema, when it comes to choosing a health insurance plan for your Michigan employees, that statement is absolutely true. If providing a health insurance plan is meant to be a perk for your employees to keep them happier and healthy, choosing a "bottom of the barrel" health insurance plan for them may accomplish none of those goals. There are several factors to take into consideration and balance when deciding on the right plan for your employees:

1. How much will the company pay? In choosing a group plan for your employees, you will be allowed to decide how much of the premium cost your company will pay for, leaving the employee to pay the rest. Of course, the plan to impress your employees the most is the one where the employer pays 100% of the monthly premium amount. This can be prohibitively expensive for many companies though, so finding a balance is important. If the company pays too little (or nothing), then employees are likely to refuse the plan and instead seek their own, individual policy.
2. What types of coverage is provided? As mentioned earlier, there are plenty of health insurance plans out there that provide coverage for next to nothing. These plans are the most inexpensive up front, but then if you or your employees try to get a medical procedure covered, they may find themselves paying a great deal out of pocket.
3. The makeup of your employee workforce: If, for example, your business is a traditionally male-dominated one such as an auto-body shop, you can expect that your insurance plan premiums will be significantly less than those industries that have a lot of female employees. This is because statistically, men cost less to insure than women - especially women in their childbearing years. If you usually have only men working for you, then you can customize a health plan that leaves off many feminine necessities such as maternity care and gynecology which will bring substantial savings. Of course you should also keep in mind that your men will likely have wives as well, who would like to have those services.
4. Who is covered? Just the employee? Or will you be offering coverage for employees plus their family. Offering coverage for an employee's family increases the value of the insurance perk to your employee, but of course it also increases the price tag on your policy.

The Guaranteed Participation

One way of lowering the cost of whatever insurance plan you choose is by guaranteeing participation among a certain number of your employees. If you tell the insurance company that you will always have at least 10 employees in the plan at any one time (or you will pay the difference for the number of employees that do not sign up), the insurance company may lower your rate significantly. Of course, the trick to pulling this off is in picking a plan that is attractive enough to attract most of your employees to sign up and stay on it; otherwise you could quickly lose your premium savings.

So when choosing the plan for your employees, remember that balance is key. You do want to save money, yes, but if you save too much, few employees if any will participate in your plan which will nullify its value as a fringe benefit or means of loyalty retention. Make sure to read through details of both business group policies and individual policies.