Benefits

A Small Business' Guide to Surviving Benefits Renewal Season

August 28, 2017

A Small Business' Guide to Surviving Benefits Renewal Season

Benefits renewal season can be overwhelming for small businesses. Insurance carriers make us wait and wait and wait for the renewal, and then seem to expect decisions immediately in order to ensure coverage on day one. In the meantime, we must digest renewals, collaborate to make important business decisions, and educate employees so they can quickly make important life decisions—all on items about as easy to understand as quarterback ratings or weather patterns.

Here are a few quick tips to help you get through this hectic time of year:

Come prepared

With only a few weeks to process the numbers, decisions can often end up being rushed or pushed aside. Get a head start beforehand by asking questions like:

  • Should we look at adding additional lines of coverage, such as dental, vision, or disability insurance?
  • Should we evaluate our contribution strategy?
  • What laws are changing, and what impact will that have on our benefits?

Having an idea of what decisions you can make in advance will help you maintain focus once all the details are available.

It also helps to know who will be involved in the final decisions and how everyone’s role factors in. Should the CEO be included in the discussions? Will a board of directors weigh in? If so, will they be able to make a decision quickly, or will they turn around with more questions? Get a head start and prevent stress by knowing what factors affect your decisions.

Find a win

Renewal time can go one of two ways: Employees may finish the process with a sour feeling as rates go up and their paychecks shrink or benefits are reduced. If, however, they get enriched benefits, they can feel appreciative.

Wins come in a variety of fashions. Sure, it would be nice if rates went down, but in lieu of that, consider adding a new line of coverage (even if it’s voluntary), moving to online enrollment, or installing a Health Savings Account (HSA) contribution matching program. Since many open enrollments overlap with the holiday season, it’s a great time to do something new for your team.

Educate

Health insurance is complicated stuff, and it’s easy to lose track of what’s changed and what hasn’t. Help your staff understand what they have and how to best use it. Show them you’re not only offering a great benefit, but you care about them getting the most out of it.

Even if you don’t anticipate making plan changes, just providing employees a chance to brush up on HSAs, how co-insurance works, or the difference between a deductible and an out-of-pocket maximum can go a long way.

Know where you have leverage…

No one likes large rate increases, and they’re especially maddening if your ancillary coverages increase too. Experience rated medical plans are open to negotiation. You just need the right story to tell. Ancillary carriers are willing to get creative. Sometimes they are happy to guarantee you won’t shop around and allow early renewal requests as much as six months ahead. Sometimes adding a new line of coverage helps lower the cost of all plans.

… And where you don’t

Community rated medical plans are non-negotiable. Rates are filed quarterly at the state level and are determined only by the ages of employees and location of the business. Knowing there is no wiggle room helps avoid unnecessary internal debate or deliberations, or at least steers them to more meaningful conversations.

Benefits renewal season can be a mad dash to the finish line, and ill-prepared businesses often wind up throwing their hands up and deciding it would be easier to simply renew as-is. Businesses who navigate renewal successfully see this time of year as an opportunity to demonstrate how they are constantly working to improve the employment experience.

Small Business Benefits Strategy