Employers and business owners alike have noted the upward trajectory of benefits costs, particularly over the last few years. Like most people, you’re interested in learning how you can tame the cost of benefits.
The Obvious Solution
The first solution anyone proposes when it comes to cutting the costs of benefits is terminating them. If you’re looking to save money, this is a quick and effective way to do it.
As you’ve probably guessed, it’s not the best solution. Many employers are reluctant to terminate benefits or even to reduce coverage. Their employees rely on their benefits. Benefits also provide an incentive for job seekers to choose their company and for existing employees to stay.
The “solution” of terminating benefits isn’t much of a solution after all. What alternatives do you have?
There Are Other Options
One reason employers go ahead and terminate benefits is they’re not sure they have any other choice. If costs need to be curved, this may seem like the only way to do it.
Rest assured you do have other options.
One of the first things you can do is review your benefits plan. Many employee benefits packages are rather robust. There’s a good chance your employees have benefits they don’t want or use. If you find such unused benefits, talk to your insurance provider about removing them from your plan.
You could also consider scaling back some benefits. This isn’t a preferred solution for many employers and employees, although it’s better than terminating the entire benefits plan.
Consider Switching Plans
Another option available to you is switching plans. The plan you have may no longer meet employee needs, or it may contain benefits your employees don’t use. See what other plans are available.
Plan structure is also something to consider. Group benefits are often the “default” selection for employers. Flexible benefits solutions may provide your employees with better choices and give you better cost options.
Consider Switching Providers
Even if you’ve only ever had one plan through one provider, you should consider switching insurance providers. The market is full of new players offering innovative plans and lower-cost alternatives.
The best advice is to shop around. Even if you stick with the same provider, you’ll at least have the peace of mind knowing you’re getting a great deal.
Consider Voluntary Benefits
Another way employers have been bending the benefits cost curve is to offer voluntary benefits. These benefits options allow employees to pick and choose the benefits they want and “opt in.” The employee pays for the options they choose, often in full. They still get a discounted rate by going through their employer, so this structure has advantages for everyone.
Co-payment options are another structure you might consider for your employees. This allows you to reduce your costs as the employer, while still offering your employees a great rate and lower costs for the services and products they need, such as prescriptions or dental care. It also allows you to keep your employee benefits package.
What’s Right for You?
As you can see, there are many alternatives to terminating benefits! The question is which option or mix of options is right for your business.
If you want to keep offering a great employee benefits package that meets your employees’ needs, you can mix and match any of the options here. Survey your employees, review your current benefits program, and do some research about providers and packages. The best solution for your business is out there.