The healthcare benefits landscape is undergoing a significant transformation. Business leaders are no longer willing to tolerate the traditional industry’s unnecessary complexity, lack of transparency, and relentless premium increases. Instead, they are seeking innovative solutions to regain control over their healthcare spend and deliver better value to their employees.
Employers are saying, “enough is enough,” as they move away from fully funded healthcare plans. Some still find value in these plans, provided they have the right broker who leverages data to advocate and negotiate effectively. Regardless of the approach, one thing is clear: no employer can afford to be passive in this process.
To help you navigate these changes and learn about new innovative options, HumCap is hosting an upcoming webinar on September 12th from 11:30 AM to 12:30 PM CST. Register and learn more here.
The Cost of Healthcare Benefits
According to data from the independent health and medical research firm KFF, individuals enrolled in group health plans paid an average annual premium of $8,435 in 2023 (about $703 per month). For families, the total annual premium averaged $23,968 — or about $1,997 per month.
In 2023, employers covered 83% of employees’ self-only insurance plans and 73% of employees’ family insurance plans on average. This resulted in the following distribution:
| Plan Type | Total Annual Premium | Employer Coverage % | Employer Dollar Amount | Employee Coverage % | Employee Dollar Amount |
|---|---|---|---|---|---|
| Self-Only | $8,435 | 83% | $7,034 | 17% | $1,401 |
| Family | $23,968 | 73% | $17,393 | 27% | $6,575 |
If we see a repeat of the 2023 14% average premium increase in 2024, employers can estimate the following impact:
| Plan Type | 2023 Premium | 2024 Premium Increase | 2024 Estimated Premium |
|---|---|---|---|
| Self-Only | $8,435 | $1,181 | $9,616 |
| Family | $23,968 | $3,356 | $27,324 |
For a company with 300 employees, this translates to approximately $2.9M for healthcare coverage — over $354K more for the same or less coverage.
Maximizing Your Benefit Budget
To get the most out of your benefit budgets, HumCap’s HR Consultants recommend starting with a benefits strategy if you don’t already have one, or, revisiting your strategy and metrics if you do.
Be very clear on why you offer benefits, identify your overall budget, and construct a benefit plan to satisfy those strategic needs. Consider partial and full self-funding models, ancillary benefits, and other innovative approaches. Take reasonable risks where you can and identify metrics to ensure you are achieving the intended results.
Healthcare benefits are like any other investment. You’ll want access to data to determine how to get the greatest return on investment and engage SMEs to help you make sound decisions and manage risk.
Join Our Webinar
To help business leaders better understand trends in today’s healthcare benefit market that help control costs and risk, HumCap is hosting a webinar on September 12th from 11:30 AM to 12:30 PM CST. Tune into a panel of HumCap’s HR experts to learn about innovations in healthcare benefits that are reducing costs and offering better employee value. This timely presentation offers insights needed before you negotiate your next benefit renewal.
To learn more about the program and to register, click here.
