Seeking Options for Price Stability in an Existing Plan

A post-production TV studio, with just under 50 employees, was concerned about the cost volatility that they were having with an existing employee benefits plan. Every year on renewal, there were unexpected surprises. Some years, plan costs would go up due to an increase in claims. However, other years when claims were low, costs remained the same. Ultimately, they reached out to our team at BenefitDeck for a second opinion to determine if they were being treated fairly and to find options that might enhance renewal stability.

Assessing The Plan and Proposing the Best Option

After meeting with the client, assessing their existing plan, and discussing their benefits plan objectives, we recognized that the client’s concerns were valid, and proposed that the client move to a self-funding dental coverage option. This option would allow the company to set a specific budget for dental coverage, which is that amount plus a fixed mark-up from the insurance provider.

Reducing Premiums with Self-Funding Options

Our suggestion was based on a few key factors. Dental procedures are mostly routine, making claims costs predictable. An insurance provider’s dental coverage is generally pricier as the provider tends to factor the possibility of high claims into their costs. Since the client had generally stable dental claims, and low employee turnover, self-funding dental seemed like the best option. To make sure, we used the previous year as a model for financial comparison, and determined they would certainly be able to reduce premium costs with this option.

Implementing a Hybrid Plan with a New Provider

Since the current provider did not offer self-funding options, we suggested a new insurance provider which would accommodate a hybrid employee benefits plan for a company of their size. Working closely with the insurance provider, we were able to setup a plan for our new client that matched their exiting health care and life and disability coverage, with an option to self-fund the dental coverage.

Realizing a 16% Savings after the First Year

To the employees, nothing about their benefits plan coverage or claims processing had changed. They received the same plan structure, and the employer was still covering 100% of their dental costs, as before. The real benefit was to employer who was able to save 16% on premium costs within the first year. In the end, our client is happy with their new benefits plan, and continually relies on our team for employee benefits plan advice and support.