Business
Enterprise Bank & Trust Survey Tackles the Rising Cost of Health Insurance for Small and Midsize Companies
ST. LOUIS, Oct. 23, 2019 /PRNewswire/ -- The rising cost of providing health insurance to employees is one of the top financial pressures facing owners of
About this update from Enterprise Financial Services Corporation
[{"type":"text","content":"ST. LOUIS, Oct. 23, 2019 /PRNewswire/ -- The rising cost of providing health insurance to employees is one of the top financial pressures facing owners of small and midsize companies, according to a recent Enterprise Bank & Trust Think Tank survey. Enterprise surveyed 230 businesses to understand issues and trends regarding the ever-growing cost of health insurance. \n\n \nFor most, health insurance is a top line-item expense, next to payroll, and the only expense companies generally don't have much control over. John Wennemann, Vice President of Human Resources at St. Louis-based Duke Manufacturing, says his company strives to make their insurance program more attractive. \"One of the steps we've taken is to offer a narrow network option, with lower premiums, to make it more affordable.\" \nIn the survey, the top three concerns of smaller businesses in relation to providing health insurance are:\nImpact of the cost on the company's profitability Increase in premiums would make it unaffordable High cost limits the ability to award raises and bonusesReducing Premium Costs: Three Big Levers Benefits Plan Design – Self-funded insurance can lower premiums for employees and save companies money through reduced operational costs, but this comes with risk of a huge bill if something catastrophic happens. Thus, it must be weighed carefully by small companies less likely to absorb the cost. \nAnother option is to choose a narrow network insurance plan, offering low out-of-pocket costs and monthly premiums in exchange for a smaller provider network. \nA popular choice is a High Deductible Health Plan (HDHP) which lowers premiums by increasing deductibles. A HDHP makes insurance more affordable for both the employee and the company.\nFinally, a Health Savings Account (HSA) whereby the money is deposited tax-free and used for qualifying expenses, is a solid option, but despite HSA benefits, only 42% of survey respondents offer an HSA. \nPreventative Care Incentives – Studies show more than 50% of American businesses offer a wellness program. \nMichael H. Schmidt, Owner of PACE Nutrition Coaching, said, \"Employers have the ability, through a comprehensive health and wellness program, to contribute notably to their employees' well-being.\"\nAlthough 93% of small businesses said that employee well-being is critical to their bottom line, o...