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The Affordable Care Act has made individual health insurance much more accessible and affordable, but nonetheless, many employees in Wisconsin receive health insurance through a group health insurance plan from their employer. But with more Wisconsin employers making the switch for themselves and their employees to individual health insurance, the questions arise: which insurance plan is best? Is it worth it to make the switch? How much does group health insurance cost?
The Rise of Group Health Insurance Rates
In the last decade, the cost of group health insurance has been steadily increasing. According to the Towers Watson 2015 Emerging Trends in Health Care Survey, these costs can be attributed the slow increase of health care costs, which are growing at more than double the rate of inflation. This significantly impacts the affordability for employers and employees. And with the Affordable Care Act, a report from The Centers for Medicare & Medicaid Services predicts that over 65% of business employees will see an increase in health insurance premiums.
How Much does Group Health Insurance Cost?
With group health insurance, cost and risk are distributed across the entire company and the number of employees covered in the group benefits plan. For example, if one employee is diagnosed with a chronic illness, the cost impacts everyone, which leads to an increase in the premium rate when the time comes to renew your employee benefits package.
This year, the average annual premiums for employer-sponsored health insurance plans rose 4% over last year’s average premiums, according to the Kaiser Family Foundation’s 2015 Employer Health Benefits Survey.
Below, their findings regarding average annual firm and worker premium contributions and total premiums for single and family coverage by plan type:
The result of different benefits, cost-sharing, coverage, location, and premiums do vary significantly around the average for both single and family coverage.
Alternatives to Group Health Insurance
Of course, not offering health benefits is not an option for your organization, but with rising costs, what is the alternative? Healthcare Reimbursement Plans, offering tax-free reimbursements to employees is becoming a popular choice. This option allows employees to better track their monthly expenditures while employees can choose the health insurance policy that best meets their needs.
To find out more about Healthcare Reimbursement Plans, talk to your Milwaukee Insurance Broker/Consultant and find out how you can implement a new healthcare insurance program.