Health Insurance Trends in 2020 for Small Businesses
To remain competitive in an increasingly tight market, small businesses must develop sophisticated benefit strategies to attract and retain top talent. From trend initiatives in the workplace to increases and changes in federal legislation, the healthcare system for small businesses will change in 2020.
In order to counteract the rising cost of premiums, many small companies are switching their insurance offerings to High Deductible Health Plans with (HDHPs). HDHPs can be linked to Health Savings Accounts (HSAs), allowing employers to pay tax-free contributions into their employees' accounts and receive tax benefits. In addition, the funds are renewed every year, making them a great addition to retirement savings accounts and an attractive employee benefit.
According to the Society of Human Resource Management (SHRM), 56 percent of employers offer HSAs as a supplemental benefit - a percentage that is expected to increase rapidly in the coming years. According to Devenir, HSAs have grown 12 percent year-on-year, with assets growing 20 percent annually. The investment advisory and consulting firm expects the HSA market to approach $88 billion in assets held in more than 30 million accounts by the end of 2021.
With rising health premiums, unhealthy habits can drive up the health expenditure of small businesses. As a result, health care will become a greater priority for small businesses in the coming years.
Already, the Centers for Disease Control and Prevention reports that nearly half of U.S. companies offer some form of wellness program. Beyond counting steps or logging water intake, initiatives such as gym memberships, screening tests and smoking cessation programs will be commonplace in small businesses by 2020.
Visiting a doctor in person can be inconvenient and costly if you consider issues and co-payment fees when scheduling appointments. Many small businesses have found telemedicine, also known as telecare or virtual care, to be a good solution. According to the National Business Group on Health, 56 percent of companies surveyed currently offer telemedicine services for employees. NBGH assumes that almost all companies offering group health plans will also offer telemedicine by 2020.
Telemedicine enables a patient to consult with a medical provider via a computer, smartphone or tablet. It's an attractive benefit that allows patients to see a doctor around the clock, saving you and your staff time and money. In fact, insurance broker Willis Towers Watson found that employers could save up to $6 billion per year by providing telemedicine.
Small companies are increasingly looking to make better use of technology to facilitate the management of employee benefits. A study by Guardian Life Insurance found that nearly half of all small businesses are more digital than paper-based - a percentage that will continue to grow as more business owners recognize the low cost and high potential.
Moving benefit administration to a Web-based portal provides an easier and more efficient way for employers to manage their back office in one place. In addition to managing benefits, small businesses can also look to digitize payroll, employee appraisals, time tracking, PTO requests and corporate communications.
As a small business owner, you know your employees, your business, and your industry like the back of your hand, but when it comes to federal regulations, you'll probably scratch your head. After all, keeping up with regulations and the annual changes that are made to them can be a challenge for small businesses.
Last year was no exception, as we saw some legislative changes in health insurance. For companies with 50 or more employees, entrepreneurs must provide the minimum health insurance needed, which is affordable, or pay a penalty. When deciding whether to pay or play, keep in mind that penalties will increase by almost 30 percent by 2020.
Healthcare management is a contemporary task for small businesses, which prevents them from focusing on customer relations and job satisfaction. Perhaps this is why so many small businesses have found that the best option is to outsource the management of social benefits to a professional employers' association (PEO).
PEOs take responsibility for providing and managing things like health insurance so that employers can focus on growing their business. Not to mention that PEOs also assume the regulatory liability of your employees, so small business owners can sit back and relax. Working with a PEO also enables small business employees to access benefits for employees of large companies, such as wellness programs and health, dental, life and other insurance offerings.
With every year that passes, healthcare is only becoming more complex. Small businesses will need more support to manage change and develop benefit strategies.
Read More... Ways to Increase Employee Health in HRM