Employee Benefits have become the second largest expense for employers, and various financing vehicles are available to manage those expenses.

Healthcare financing – and the level of risk retained by the client is the most critical element of purchasing employee benefits. In addition to selecting the right carrier and benefits, a very important consideration for employers is how to finance, manage, and control healthcare costs. Depending on the number of members covered in your group, employers can elect various methods to finance their healthcare spend.

Fully-Insured

The most common, traditional method of healthcare financing provides guaranteed rates and budget certainty. Carriers guarantee coverage and premiums – typically for a full year, regardless of the claims expense incurred by employees. Since they are taking on all the risk, carriers protect themselves by adding profit margins into the rates to ensure they stay solvent. In addition, fully insured rates add additional costs in the form of premium taxes.

Self-Funded

Typically, the more employees you cover, the more predictable the risk, and employers may use self-funding to reduce costs by avoiding carrier margins and profits, as well as premium taxes. While self-funding for large employers usually is less expensive than fully-insured rates, there is no guarantee, and employers risk spending more than they have budgeted for healthcare.

The bottom line: A self-funded employee healthcare plan means lower and more reasonable employer costs on average. However, keep in mind that a self-funded plan is risky. The number of claims per month can only be estimated and, some months, can cost a company far more than average or expected.

Each employer’s situation and risk level is unique, and HBA leverages its Underwriting and Actuarial expertise to evaluate the best funding solution for every employer.

Partially-Funded

Some employer take a hybrid approach to funding their healthcare costs.  There are different ways to undertake a “partially-funded” program.

• HRA’s, or Health Reimbursement Accounts are an employer-funded medical reimbursement plan with a tax advantage. Employers purchase a basic health plan with high deductibles and/or copays, and then use the HRA to “wrap-around” or provide supplemental coverage not available in the basic plan.  The advantage is lower health care premiums, and the employer only funds the HRA (with pre-tax dollars) when actual claims that aren’t covered by the basic plan are incurred. 

• HSA’s or Health Savings Accounts are similar to HRAs, but have several important distinctions:
• the HSA can be funded by either the employer or the employees.
• The monies in the HSA belong to the employee, not the employer, and stay with the employee if they end employment
• The basic underlying plan accompanying HSA programs are required to meet certain federal guidelines, with the employee responsible for a minimum out of pocket expense before the basic plan coverage kicks in.  The HSA dollars may then be used to pay for all  or a portion of the employee’s up-front expenses.

• “Contingent Funding” is a unique type of funding arrangement, where the underlying benefits are identical to the parent coverage.  The employer pays a fixed rate for the entire year, and at the conclusion of the year, a may lead to a premium refund.

Employers providing health insurance for their employees through a self-insured plan often subscribe to Stop Loss policies in order to protect themselves against catastrophic claims. The premium is calculated on a per employee, per month basis, and the rate is based on the number of participants, claims and diagnosis information.

HBA’s Underwriting & Actuarial experience enables us to cull through your historical claims expense and utilize mathematical models to analyze and project your high claims risk and exposure. Our ability to discern risks allows us to provide clients with the optional Stop Loss attachment points, and to and negotiate exceptional coverage and rates on your behalf. HBA is Rhode Island’s premier Stop Loss brokerage firm.

Traditional Stop Loss coverage provide for “Specific” or “Aggregating” coverage, but new forms of Stop Loss coverage are now hitting the market, that provide coverage you expect at significantly lower premiums.

In the last fifteen years, there has been a dramatic shift in employer-sponsored health care. Increased options and cost savings for employers have led the shift away from traditional indemnity plans and towards new consumer-driven HMO, PPO, and POS alternatives. HBA works with each client to determine the best type of coverage is suitable to individual employer needs and demographics.

Group dental insurance is a nice addition to your company’s group health insurance plan. With so many options out there for dental coverage, HBA can act as your trusted advisor as to which group dental plan is right for your unique situation. We understand your need for affordable, but comprehensive insurance for your employees and negotiate the lowest rates in the market.

Telemedicine is a true “win-win” benefit for employers and employees. Telemedicine provides your employees with 24/7/365 telephonic access to board-certified, licensed physicians who can prescribe medications as necessary. This provides members with easy and convenient access to physicians without the need to take time out of work, and benefits employers by reducing unnecessary claims expenses associated with Primary Care, Urgent Center, and Emergency Room visits. Effective, highly utilized telemedicine programs can reduce employer costs by $400 to $600 per employee annually – or 2.5 to 4% bottom-line.

Telemedicine is not intended for address every medical situation. Rather, it provides a convenient and inexpensive alternative to non-emergent Emergency Room visits, non-critical care clinics, or when you don't have access to your primary care provider.

It is particularly suitable for diagnosis and treatment for common ailments, such as:

• Allergies
• Bronchitis
• Cold/Flu symptoms
• Cough
• Ear Infections
• Headaches/Migraine
• Insect Bites
• Minor Burns
• Nasal Congestion
• Pink Eye
• Respiratory Infections
• Sinus Infections
• Sore Throat
• Stomach Ache/Diarrhea
• Upper Respiratory Infections
• Urinary Tract Infections

HBA shops these services with best in class, national telemedicine carriers. Contact us today for pricing on your employee group.

With group life insurance, you can offer employees peace of mind at extremely affordable rates. HBA makes providing the life insurance benefits an easy experience. We offer various types of group life insurance, including:

• Basic Life Insurance
• Life with Long Term Care Rider
• Voluntary Life Insurance

Most life insurance policies are purchased with the help of an employer. Offering this tax-deductible benefit to your employees can be more affordable in comparison to shopping for individual life insurance plans and a nice complement to group health insurance benefits. Anybody who has loved ones who rely on them for financial support, be it their spouse, their children, or other family members, should have some level of life insurance. In the event that the employee's life should be cut short, the resulting financial hardship can be catastrophic to those left behind. Unresolved debts, monthly mortgage commitments, hospital costs and funeral expenses can prove to be financially insurmountable.

Completing your employee benefits package with supplemental insurance options such as group accident insurance, critical illness plans, medical gap insurance and cancer insurance is an easy way to attract and retain talented employees in your industry. HBA will assist you in identifying which plans are affordable and appropriate for your group.

• Group Accident Insurance

Accidental injuries can lead to some unexpected out of pocket costs and medical expenses. Accident insurance can cover such costs as hospital stays, medical exams, transportation costs and much more. HBA can help guide you in finding the right policy for you and your employees.

• Critical Illness Plans

Critical illness plans can provide lump-sum, tax-free payments when a policyholder suffers from a specific, pre-identified critical illness. Access to group insurance plans such as these is usually offered through an employer. Not all illnesses are covered and some restrictions apply; let HBA help you identify the best critical illness plans for your specific employee group.

• Medical Gap Insurance

Most group health insurance plans will only cover a portion of overall medical expenses. Supplementing your benefits plan with medical gap insurance can help your employees pay high deductibles. This type of insurance is usually paired with group health insurance and can act a complimentary insurance to the benefits already being offered. HBA can help you evaluate if medical gap insurance is needed by your group.

• Cancer Insurance

Millions of people are diagnosed with cancer each year. In fact, one out of two men and one out of three women will be affected by cancer before they retire. Not only can the disease itself hurt, the medical costs of treatment can be astronomical. You can help your employees protect themselves from these costs by offering access to group cancer insurance.

Supplemental cancer insurance can help you manage the costs of treatment, preserve your savings and let you concentrate on getting better, not paying medical bills. Many cancer insurance companies offer this coverage and HBA can help you analyze which company and plan are appropriate for your group.