Utah Health Insurance for Small Business

Things to Consider When Getting Business Life Insurance

Life insurance is becoming a benefit that employees are increasingly wanting their employers to offer.  The need to protect their family’s future and interests if something should happen is a worry for many employees and yet, life insurance is often an area that employees don’t really know much about.  Therefore, it’s important for companies to make good decisions about the type of life insurance and the companies that they offer their employees the ability to purchase insurance from.

There are two types of life insurance policies that people can buy:

• Term Life Insurance – is a policy that is bought for a specific period of time – this can be a certain number of years or until the person reaches a certain age or while a person is employed with a particular company.  The insured person pays a premium, typically monthly or quarterly, for the specified coverage amount and there is no cash value built or change in the amount of coverage over time.

• Term Life Insurance with Cash Value – also known as a “whole life, “ “universal life,” or “variable life” plan.  This policy is again bought for a specific number of years or until a certain age, but the plan offers a savings benefit in some way, such as a dividend that accrues and is invested for the policyholder.

The second type of plan typically has higher premium cost because of the cash value that is accruing, but has other advantages that policyholders may want to look as they make their decision on which policy to purchase.

Generally when a company is offering insurance to their employees it a straight term life insurance policy, so we’ll focus on that type for the rest of this article.  There are several ways that life insurance benefits can be offered by companies.  These include:

• Company-Paid Life Insurance -  Companies will often buy life insurance for their employees, typically either a flat dollar amount, such as $25,000 or based on their annual salary, such as a policy equal to the annual salary or equal to 2 or 3 times the annual salary of the employee.  This type of insurance may include different policies or benefit levels for different classes of employees.  For example, the policy purchased for a company officer may have a different length or greater benefit amount than an administrative employee.

• Supplemental Life Insurance – Many companies will then offer the employee the opportunity to buy additional life insurance for themselves and often times, policies for their spouse and dependent children.  These supplemental plans are typically offered at a group insurance rate that is much lower than the employee could buy through an individual policy.

There are several considerations that a company must think about as they are looking for an insurance company to contract with.  These include:

• Financial Strength and Reputation – It is important to review the financial status of the insurance company since the policy won’t do any good if the company can’t pay a claim if one is made.  Also, since life insurance is a long-term benefit that hopefully an employee will not have to claim for many years, it is important for companies to choose an insurance company that has been in business for a good number of years and that has a good reputation.  Companies don’t want to purchase or encourage their employees to purchase a plan from an insurance company who might not be around when a claim needs to be made or that will be difficult to deal with during enrollment or renewal periods.

• Who the Company Insures – it is also very important to look at the type of employers that the insurance company typically focuses on.  For example, if you are a small business, you want an insurance company who is used to dealing with your demographic, just as if you are a multi-billion dollar international company, you probably don’t want to buy insurance for a company that focuses on small businesses or doesn’t have the staff capacity to deal with the number of employees that you will be enrolling and managing.

• Product Features – For supplemental insurance plans, it’s also very important to look at the types of features that are offered to the policyholder.  For example, if the employee leaves your company, can they easily convert the plan to an individual plan at reasonable rates?  Other possible features include things such as accelerated death benefits or the ability to skip premium payments for a certain period of time if the employee becomes ill or disabled and isn’t earning wages.

• Cost – obviously the cost of the insurance is going to be a large and often deciding factor.  The cost of the plan has to be not only worth the features of the benefit and the ability to deal with a strong insurance company, but also has to be affordable to the company and employee purchasing the plan.  If the benefit is too costly, particularly for supplemental plans, then obviously it isn’t going to be a program that your employees see as a benefit at all.

If you are an employer in Utah, you have a number of nationally known companies from which to choose if you’re planning to offer health insurance as an employee benefit. That number might be smaller than you would like, however, as the number of small to mid-size insurers has declined significantly in the past decade. However, large insurers remain and are stable as health providers and contributors to Utah’s economy. Between them, employers have large number of choices for plans and options even though the number of insurers from which to choose is relatively small. Indeed, the sheer number of options may be daunting, as you will soon see. Fortunately, you don’t have to tackle the problem alone.
For a comprehensive review of your insurance needs and options, contact Workforce Solutions. A Utah Professional Employer Organization (PEO), Workforce Solutions provides all the services you would expect an internal Human Resources department to provide, including health insurance administration, but it is a separate entity from the organization to which it delivers these services. PEOs deliver expert and efficient employee-related administration, sharing the responsibility and risk of managing workers. They can assess the insurance needs of your employees and shop for a package that meets them and that you can afford.

Utah Insurance Market

Comprehensive health coverage, the type most likely to be offered as part of an employee benefits package, serves 32 percent of Utah residents, and 89 percent of that coverage is provided by 11 insurers (2006 Health Insurance Market Report; all data cited in this article is from this report unless stated otherwise). The top insurers and their market shares are shown below and are profiled in this article. The information and company profiles in this article are not intended as comprehensive guides for your important insurance decisions. You should use the information as a starting point and as a guide to lead you to ask the right questions.

Top Providers and Market Conditions

The fears of some regarding the large market share vested in a small number of companies appear to have some merit: commercial insurance providers in Utah rank below the national average in consumer ratings of health plans and health care. However, they rank above the national average in customer ratings of getting the needed care in a timely manner, and the cost of premiums in Utah is well below the national average. The national average monthly premium for comprehensive coverage was $235 per enrollee in 2005, compared to a Utah average monthly premium of $171. Because the costs of health care and premiums have increased steadily since 1999 (including a 12% jump from 2002 to 2003), you should not expect your premiums to match this data. The quotes you receive from providers will inevitably be higher.
The profiles of providers below include data from third parties as well as the companies’ own marketing. You should evaluate all information carefully and use it merely to determine whether you wish to give a specific company further attention.

SelectHealth
Enrollment as of January 2006: 475,099
By far the largest insurance provider in Utah, SelectHealth is a nonprofit health system based in Salt Lake City with over 26,000 employees. Its corporate messaging emphasizes consumer choice and it offers an array of plans and networks (all information from Small Employer Sales Packet, a corporate brochure).

SelectHealth was the subject of a lower than average number of complaints with OCHA, but it was rated well below average in terms of enrollee satisfaction with the plan. This rating is not to be confused with enrollee ratings about the quality of care, in which SelectHealth scored above average in many areas.**

Regence Blue Cross Blue Shield
Advertised enrollment in Utah: 400,000
In close second place behind SelectHealth, Regence is another large entity in the Utah market collecting nearly $6.5 billion in annual premiums. A primary part of its corporate messaging is choice. Small employers can choose from at least three provider networks and from three tiers of plans (all information from BlueChoices: A Suite of Solutions, a corporate brochure):

Regence performs comparably to other Utah providers in customer ratings surveys and a lower than average number of complaints were filed against it with the Utah Office of Consumer Health Assistance (OCHA).**

Altius Health Plans
Enrollment as of January 2006: 214,288
The smallest of the top three providers in terms of market share, Altius performs comparably in quality of care metrics; like its competitors, it received fewer than average complaints at OCHA and ranked above average in many quality-of-care measurements. It enjoys less success in customer satisfaction, ranking at or below the national and state averages for many enrollee-based ratings.**
While its larger competitors offer several choices in provider networks, Altius alludes to only one, which includes 3,800 participating doctors. It leverages that single network to offer a wider variety of plans than the other insurers. Its options include the following (from tp://www.altiushealthplans.com/emp/dispatch.aspx?a=editorial&itemID=11690&link=child&Community=Employer&mode=):
Peak Advantage: A unique plan featuring total choice of all health care  providers—all of the time—under a simple four-tier benefit plan.
Peak Plans: Fully insured plans, which feature open-access, no-referral products that can include split copay differential for primary care and specialty care
Mountain Plans: Fully insured plans, which are designed for a cost sensitive client and feature a referral for specialty care
I Plan: Health benefits for individuals and families
Traditional Plans: For employers looking for a traditional approach to health care benefits with deductibles and coinsurance
FlexChoice Plans: Consumer-driven health solutions that combine high-deductible plans with a personal health account, i.e. HSAs, HRAs or FSAs
Individual Plans: individual coverage
Self Funding: For companies that want an alternative to fully insured coverage
Out-of-Area Options: For companies with less than 10% of employees out of the Altius service area
Employers and enrollees can customize their plans by adding additional services and features such as discount dental benefits, massage therapy, health education, work site wellness and more.

United Health Care
Enrollment as of January 2006: 56,990
At least 16 percentage points behind its nearest competitor (Altius) in terms of market share, United Health Care (UHC) nevertheless compares well with its larger counterparts. It, too, receives fewer complaints than average at OCHA and performs at or above average in many quality-of-care measurements. However, as is common in the industry, its enrollees rated its plans lower than average.**
With less emphasis on provider networks and number of physicians, UHC offers a comparable number of basic plans from which to choose, including the following (from http://www.uhc.com/ourhealthplans/medical/groupplansbystate.htm):
Choice Plus: features freedom of choice in providers and non-network coverage “with somewhat higher deductibles and co-payments”
Definity Health Reimbursement Account: a tax-advantaged system based on the health reimbursement account
Managed Indemnity: “a managed version of traditional health care insurance”
Options PPO: features broad access to network providers and covered services
UnitedHealth Basics: a basic coverage plan designed for part-time and hourly employees
These four insurers are the largest in the Utah market, but there are many others from which to choose, and some of them might offer plans that are right for your employees. If the statistics presented here are any indication, providing a plan that employees will rate highly might be an uphill battle; those enrolled in plans consistently rate those plans down even though the quality of care delivered by the plans is a or above average in many cases.
If the choices and variables are overwhelming, why not call an expert? Workforce Solutions has years of expertise in the Utah insurance market and can help you make choices that suit your needs, keep your employees satisfied, and won’t break the budget.
** Utah Department of Health, 2006 Performance Report for Utah Commercial HMOs and Medicaid and Chip Health Plans.

Because of the complexity of the different types of insurance plans and the importance of choosing a strong insurance company, many employers are choosing to use the services of a Professional Employer Organization (PEO) or a benefits broker.  This outside vendor can assist the company in making wise decisions that create a good benefit for their employees.

Workforce Solutions is a Utah based company and provides Utah Health Insurance for Small Business. If you have a small business and are at a point where you need to offer your employees a health insurance plan we can get some great quotes for you. We offer plans from several health insurance companies that operate in Utah. There are many health insurance companies in Utah including bluecross/blueshield, altius, IHC, and more. There are also several options for maternity, deductibles, rx plans, prescription rates, surgeries, etc. The rates may be for smaller businesses or large corporations, as long as you have a few employees we should be able to help you.

We offer free quotes for anyone interested in an Utah health insurance for small business. The price of insurance varies based on your business size, please contact us for more details.