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Did you know that other employers are impacting your health insurance renewal?

That's right. This is true whether you are fully-insured or self-funded (assuming you purchase stop loss protection).

The fewer number of employees you have enrolled in your health plan, the bigger impact other employers will have on your health insurance renewal.

For an employer with 100 employees enrolled on the health plan, other employers might count 50% toward your renewal.

So, you might think your plan is running great but then you end up getting surprised by a double digit increase. That's because the other employers performed much worse than you.

Knowing this information is crucial when you start thinking in multiple years.

Did you know that other employers are impacting your health insurance renewal? That's right. And if you're fully insured, this could be having a bigger impact than you think. And here's what I mean. When the underwriter at the insurance carrier projects your renewal, they're using your company performance, and they're using their book of business company performance. Which is multiple companies together, and the smaller employer you are, the bigger impact this will have on your renewal. So let's say you're an employer and you have a hundred employees enrolled on your health plan. In this scenario, your claims might have only counted 50% towards the renewal, which means that the carrier's book of business also counts 50% to the renewal. So if your experience indicated a 0% renewal and their book of business indicated a 20% renewal, guess what? 50/50 weight? You're getting a 10% renewal. And so understanding these components can help you make more logical sense of your renewal. But the bigger picture is that this information can also help you create a good long-term strategy. Let's take that a hundred life employer. If their claims are consistently running better than the carrier's book of business, they may wanna strongly consider self-funding their health plan. And so here's my advice, knowledge is power. The more you know, the better prepared you will be. So just start asking more questions. Thanks.

About the Author

Mike Kroupa, Self-Funding Insurance Expert

I grew up in a house that was constantly under construction and the experience helped me uncover one of my passions, remodeling. After running a successful remodeling business with my brother during college, I decided I wanted to keep this as a hobby. Instead, I took my advisor’s recommendation and started down the actuarial path, which ultimately led me to insurance.
Since then, I have focused my career teaching employers how to better manage their health insurance plans. I found myself frustrated year after year of doing the same thing because it didn’t feel like I was making an impact. Healthcare costs were continuing to increase, and it felt like the only options employers were left with was increasing deductibles, increasing contributions, and switching carriers.

There was a turning point for me in 2020 as I found Health Rosetta, an ecosystem for scaling adoption of practical fixes to our health care system. As my clients started adopting these fixes, I found myself getting passionate about what I was doing for the first time. Then I realized my hobby of remodeling was driving the passion because I was remodeling health plans. Even better, I was having an impact because patients (employees, spouses and children) were getting the best care they ever have and saving a lot of money in the process.

Get in contact with Mike: 

Phone: 630.738.1835     Email: mkroupa@gocgo.com     LinkedIn: Mike Kroupa

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