If you’ve opened your group health insurance renewal and immediately worried about another premium increase, you’re not alone. Health care costs continue to rise, leaving many small business owners wondering how they’ll continue offering competitive employee benefits without stretching their budgets even further.

Should you absorb another increase? Reduce benefits? Ask employees to pay more? Fortunately, there’s another option that helps control employer health insurance costs  while giving employees more choice. A private health insurance exchange for small business with a Defined Contribution model can help you lock in your costs without limiting your employees’ options. It essentially can freeze your employee benefits budget.

What Are Defined Contribution Employee Benefits?

Think of Defined Contribution employee benefits like setting a benefits budget instead of buying a single insurance plan. Rather than selecting one health plan for everyone, you decide how much you’re willing to contribute toward each employee’s health insurance premium. That contribution can be a fixed percentage or a fixed dollar amount, depending on what works best for your business. Your employees then use that contribution to choose the health plan that best fits their needs. If they select a plan that costs more than your contribution, they simply pay the difference through payroll deductions. If they select a plan that costs less, they pay nothing.

The result? You gain predictable health care costs, while your employees gain flexibility.

Predictable Costs for Your Business

One of the biggest advantages of a Defined Contribution model is budget control. Because you determine your contribution, you can:

• Lock in your employee benefits budget for the entire plan year.
• Adjust your contribution at renewal based on your business goals.
• Better plan for future health insurance costs.
• Continue offering valuable employee benefits without losing control of your expenses.

For many small businesses, this creates much-needed predictability in an increasingly unpredictable health insurance market.

More Choice for Your Employees

Not every employee has the same health care needs. One employee may want a PPO because their preferred physician is in-network. Another may prioritize a lower monthly premium because they rarely visit the doctor. Someone with a growing family may have completely different priorities.

Instead of asking everyone to enroll in the same plan, CaliforniaChoice lets employees choose from seven leading health plans and 100+ coverage options. Available health plans include:

• Anthem Blue Cross (statewide)
• Health Net (statewide)
• Kaiser Permanente (statewide)
• Sharp Health Plan (San Diego and Southern Riverside counties)
• Sutter Health Plan (Greater Bay Area, Sacramento, Central Valley, and Central Coast)
• UnitedHealthcare (statewide)
• Western Health Advantage (select Northern California counties)

Employees get the freedom to choose the coverage that fits their lives, while you continue receiving a single monthly bill and one streamlined administrative experience.

More Value Without Higher Costs

A private health insurance exchange offers more than medical coverage. CaliforniaChoice also makes it easy to expand your employee benefits with additional options, including:

• Dental, Vision, Chiropractic & Acupuncture, Life, and AD&D coverage
• Flexible Spending Accounts (FSAs) that allow employees to pay eligible medical expenses with pre-tax dollars
• Premium Only Plans (POPs), which can reduce payroll taxes for both employees and employers
• Savings on pet insurance through MetLife and Spot
• Discounts on fitness memberships, prescription medications, vision care, hearing products, and more
• Online plan comparison tools that compare premiums, deductibles, copays, and out-of-pocket costs
• Provider search tools that help employees confirm their doctors, hospitals, specialists, and prescription medications are covered

These added resources help employees get more value from their benefits while making enrollment easier.

A Smarter Way to Offer Employee Benefits

As health insurance costs continue to rise, many small businesses are looking for ways to maintain quality benefits without sacrificing their budgets. A private health insurance exchange like CaliforniaChoice helps you do both. You gain predictable costs and simplified administration. Your employees gain more choice and flexibility. It’s a win-win that helps your benefits package stay competitive while keeping your budget under control.

Your Broker Can Help You Get Started

If you’re interested in learning whether a Defined Contribution health plan is right for your business, start by talking with your employee benefits broker. They can help you compare your options and determine whether a private health insurance exchange like CaliforniaChoice is the right fit for your employees. If you do not have a broker, we make it easy to search for one online.