Health insurance is among the most popular of employee benefits. The MetLife’s Employee Benefits Trends Study in 2021 found 85% of employees consider health insurance a “must have” and another 10% think it is “nice to have.” Only 4% see health insurance as not needed. That makes health insurance the most highly valued of 17 benefits asked about in MetLife’s most recent annual survey.
The truth is, if you’re a business owner or manager considering employee health insurance, most of your employees will expect it. So, the natural question is, “what will I pay for employee health coverage?” And, what can your employees expect to pay for their deductibles, co-pays, and other out-of-pocket costs? We’ll break it down for you.
So, How Much Does Health Insurance Cost an Employer?
The 2021 Kaiser Family Foundation (KFF) survey on employer-sponsored coverage came out in November. It found the national average premium across all plan types is $7,739 for single coverage and $22,221 for family coverage.
Premiums in small and large firms were similar: $7,813 for single coverage at small groups and $7,709 for single coverage at larger firms. Family coverage premiums in 2021 were $21,804 for small firms and $22,389 for large firms.
The average single and family premiums increased four percent in 2021 and forecasts suggest another mid-single-digit increase in 2022.
Workers’ Share of the Costs
On average, insured employees contributed 17% to the cost for single coverage in 2021, according to KFF data. Those with family plans contributed an average of 28% toward their premiums. For those working at small firms, covered workers’ contributions were 37% on average.
Of course, the type of coverage selected does affect premiums. Point-of-service (POS) plans had the lowest average ($1,183) for single coverage in 2021, followed by HMOs ($1,204), High Deductible Health Plans ($1,242), and PPOs ($1,389).
For family coverage, the 2021 average annual employee contributions were $5,129 for HDHP coverage, $5,254 for an HMO, $6,428 for a PPO, and $7,512 for a POS plan.
If the forecast 5.2 percent increase for 2022 holds true, premiums for all plans could top $8,125 for single coverage and $23,376 for family coverage this year.
Costs Beyond Premium
Beyond what employees contribute toward their total health insurance premium, they have other out-of-pocket costs. These vary based on the medical plans they select.
With CaliforniaChoice, calendar year deductibles range from none (on multiple Platinum HMO and Gold HMO plans) to more than $15,000 for a Bronze HMO family plan. Co-pays or co-insurance amounts may apply to some services, too, depending on the carrier and plan.
One PPO option offered in the Bronze tier through CaliforniaChoice has an out-of-network calendar year deductible exceeding $20,000. (This is a combined amount that applies to Medical/Rx/Pediatric Dental, and also applies to the plan’s annual Out-of-Pocket Maximum).
One big advantage of CaliforniaChoice is that employees are able to find coverage that matches their individual or family health care needs and budget.
Control Your Business Costs
CaliforniaChoice was developed more than a quarter-century ago with two goals: increasing choice for employees and helping employers control their costs.
CaliforniaChoice gives businesses and employees access to eight different health plans and dozens of coverage options, including HMOs, PPOs, and EPOs (Exclusive Provider Organizations).
Beyond that, CaliforniaChoice can help you control your costs. That’s because you choose how much you want to contribute to your employees’ health insurance. You can choose a Fixed Percentage (50% to 100%) of a specific plan and/or benefits. Or, you can select a Fixed Dollar Amount for each employee.
Your employees then apply your contribution to the health plans and benefits they like best. If they choose a plan that costs more than you contribute, the employees pay the difference.
One employee might select an HMO plan from Anthem Blue Cross, Health Net, Kaiser Permanente, UnitedHealthcare, or a regional plan like Sharp Health Plan, Sutter Health Plus, or Western Health Advantage. Another might choose a PPO from Anthem. A third might select an EPO plan from Cigna + Oscar or Anthem. Others might select HSA-qualified plans from several carriers.
With CaliforniaChoice, you and your employees have access to 80,000+ doctors and specialists, and 400+ hospitals – more than any other health benefit option in the state.
Talk With a Broker to Learn More
An insurance broker can help you compare options in your community. Best of all, using a broker does not cost you money. What you pay is the same, whether you use a broker or not. And, using a broker could actually deliver savings.
Ask for a customized quote for your business and your employees. You’ll learn more about all of the added advantages offered by CaliforniaChoice.
If you don’t already have a broker, you can search for one here.
The new year brings with it changes for Group Health Insurance in 2022. We’re highlighting them all in one place, so you’re in the know:
If you are making changes to your company’s Health Care and Dependent Care Flexible Spending Account (FSA) rules for 2022, plan changes needed to be communicated on or before December 31, 2021. This is something to keep in mind for future years.
Changes can include one or more of the following:
- Carry-over amounts: Allowing all or a portion of unused funds from an FSA to be carried over to a new plan year (e.g., rolling over FSA funds from the 2021 plan year to 2022) OR extending a grace period for using leftover FSA funds from 2021 during 2022
- New elections or revocations: Allowing participants to make new FSA and pre-tax premium elections or revoke an existing election mid-year without a status change event for the plan year ending in 2021
- Spend-down: Permitting employees who discontinue their participation in a health care FSA to spend down funds in their accounts for expenses incurred after their employment separation through the end of the grace period of the plan year in which the employment separation occurred
- FSA limits: For 2022, the Flexible Spending Account contribution limits are as follows:
Health Flexible Spending Accounts (Health FSAs)
|2022 Maximum Salary Deferral Contribution||Change from 2021|
Dependent Care Flexible Spending Accounts (DC-FSAs)
|2022 Maximum Salary Deferral Contribution||Change from 2021|
|$5,000 Family $2,500 Married, Filing Separately||In 2021, as part of the American Rescue Plan (ARP) Act, Dependent Care FSA contributions were expanded to $10,500 for the 2021 plan year only. The pre-ARP Act limit was $5,000.|
“No Surprises Act”
The new calendar year also ushers in the implementation of the “No Surprises Act,” which was passed by Congress as part of a year-end 2020 omnibus spending bill. Starting in 2022, the law limits surprise medical bills sent to individuals with health insurance for inadvertent out-of-network care in emergency treatment situations or from out-of-network providers providing services at in-network facilities.
One example is if an insured patient receives care for an accident and is unconscious; transport could be to an out-of-network emergency room, which triggers unanticipated charges. Another example is if a patient receives care at in-network provider, but a specialist outside of the patient’s provider network delivers some services (such as those of an anesthesiologist). In both situations, the patients would incur surprise charges though not due to any action taken by them.
The No Surprises Act mandates that health plans offer emergency care without preauthorization, without regard to whether the provider is in-network or out-of-network, with no requirements that would be more restrictive than for in-network services, and with cost-sharing for out-of-network providers no greater than if those providers were in-network.
In addition, non-emergency services cost-sharing for out-of-network services cannot be greater than cost-sharing for in-network services.
According to a November 2021 article published by the Society for Human Resource Management (SHRM), under interim rules issued in October, air ambulance services must limit participant cost-sharing for out-of-network services to the same costs as if provided in-network. The interim rules also include an independent dispute resolution.
HDHP and HSA Limit Changes
The Internal Revenue Service (IRS) has published new High Deductible Health Plan (HDHP) maximum out-of-pocket amounts and Health Savings Account (HSA) contributions for 2022. Below is a comparison of 2021 and 2022 amounts.
|Contribution and Out-of-Pocket Limits for HSAs and HDHPs||2022||2021||Change|
|HSA contribution limit (employer + employee)||Self-only: $3,650 Family: $7,300||Self-only: $3,600 Family: $7,200||Self-only: +$50
|HDHP maximum out-of-pocket amounts (deductibles, copayments, and other amounts – but not premiums)||Self-only: $7,050 Family: $14,100||Self-only: $7,000 Family: $14,000||Self-only: +$50
|HDHP minimum deductibles||Self-only: $1,400 Family: $2,800||Self-only: $1,400 Family: $2,800||No change for either Self-only or Family|
The HSA catch-up contribution for individuals age 55 and older is the same in 2021 and 2022: $1,000.
New Out-of-Pocket Cap
The 2022 health coverage maximum out-of-pocket limit for in-network care for essential health benefits is $8,700 for a single person. For a family, the limit is $17,400. These limits do not apply to “grandmothered” or “grandfathered” plans or fixed indemnity health plans. Although up by $150 from 2021, these amounts are slightly lower than the proposed 2022 limits, because of a change in the calculation methodology.
Talk with a Broker to Learn More
Your health insurance broker can provide more information about what’s changed in 2022, including new health plan options and provider networks in your area. If you do not have a current employee benefits or health insurance broker, you can search for one here.
At CaliforniaChoice, we’re committed to helping our members stay healthy in the new year. Our partnership with the ChooseHealthy program reflects this commitment. The program gives CaliforniaChoice members access to savings on a variety of health and wellness products at reduced rates.
With ChooseHealthy, you can save on top brands, including Fitbit®, Garmin®, Vitamix®, and other top products and fitness centers. The program also includes:
- Access to the Active&Fit® Direct program which includes 10,000 participating fitness centers nationwide for $25 a month (plus a $25 enrollment fee and applicable taxes)
- A digital workout library of 5,500+ videos
- 800+ on-demand classes from world-class organizations and instructors
- Access to online health classes at no cost
You can also join any of 4,500+ premium exercise studios with 20-70% discounts on most.
More Member Value Suite Savings
As a member of CaliforniaChoice, you and your employees can also take advantage of savings and discounts on:
- Vision Care: The Vision One Eyecare Discount Program from EyeMed offers discounts on eye exams, frames, and lenses at locations nationwide, including participating Pearle Vision, LensCrafters, Target Optical, and JCPenney Optical locations.
- Dental Care: Pay reduced fees for dental services at Dentegra® Smile Club dentists across California and nationwide. You get instant savings with no waiting period or claim forms.
- Prescription Drugs: The California Rx Card saves you up to 80% on brand name and generic prescription drugs at 68,000+ locations nationwide. You may be able to reduce your out-of-pocket cost to less than your Rx copay with insurance.
- Hearing Services: Hearing loss is a common health problem. The EPIC Hearing Service Plan offers savings of up to 50% on hearing aids and discounts on testing, batteries, and more.
Talk to a Broker to Get Started
If you’re adding employee health insurance for the first time in 2022, or if you’re shopping to make sure you’re getting the most for your benefits dollars, be sure to ask your broker about CaliforniaChoice. In addition to offering employees access to dozens of coverage options from eight premier health plans, you and your employees also get “extras” with CaliforniaChoice. If you don’t have an insurance broker, we make it easy to search for one here.