With Premiums Spiking – Now Is The Time To Change The Way We Structure and Offer Benefits


May 4, 2014

stormsThere is a storm coming for every small business in America – for your health insurance policies renewing for 2015.

Aetna CEO Mark Bertolini was among the first to sound the alarm about the potential for rate shock on the Obamacare exchanges. In December 2013, he told investors that “in some markets,” individual-market premium increases “could go as high as 100 percent.” This past January, in an interview with CNBC, he asked, “are we going to get beat up because [next year’s premium increases will be] double-digit or are we just going to have to pull out of the program?”

WellPoint CEO Joseph Swedish has also recently stated that he would “not be surprised” to see “double digit” increases for 2015 rates. Insurers will begin filing their 2015 rates this month and next. Other health industry officials told the media last December that “Obamacare-related premiums will double in some parts of the country, countering claims made by the administration.” One insurer indicated that “his company expects to triple its rates next year on the Obamacare exchange.” Other insurers expect to see rate increases of about 20 to 40 percent, on average, throughout the country.

Local insurance brokers in some parts of the country are already reporting spikes ranging from 35 percent to 120 percent on policies that renew from July to December. [1]/ “The increases are especially acute among employers with workforces made up of younger, healthier men. That’s because Obamacare prohibits offering lower rates to healthier groups. It also narrows the allowed premium gap between older and younger enrollees.”

These developments point to another reason why CEMA and other associations turn to private health insurance and employee benefit marketplaces for their members. Employers need to rethink their approach to offering benefits, expand their benefits choices NOT limit them, and empower employees to make choices and become informed consumers.

We Are Not Here JUST To Sell You A Policy – We Are Here To Guide You Through Fundamentally Changing the Way We All Structure and Deliver Employee Benefits

It is an accident of World War II that we get insurance coverage from our employer, where the employer picks the one policy we all live with. That is called defined benefits, where the employer has defined what employees get for benefits.

The modern alternative is where employers create a budget that’s affordable for them — the employer creates a strategy with a professional benefits advisor that allocates that budget among employees and then lets the employees pick whatever they want in this robust marketplace that allows them to have control, personal accountability and the ability to make their own decisions. That is called defined contribution, where the employer defines the contribution to each employee and then the employee decides what benefits to buy. To enable an employee to make their own decisions they need a place in which to make their decisions – the Association Marketplace.

Hence, your local broker needs to know how to transition an employer from the WWII defined benefits era to the 21st century defined contribution era using a marketplace. Your local broker needs to be up-to-date on the Affordable Care Act. Your local broker needs to be able to help you use our new marketplace as no one is ever in the marketplace alone – only with a qualified, professional benefits advisor.

Now Is The Time to Change The Way You Structure and Offer Benefits

Having a great marketplace for employers and employees starts with great technology to help people make those choices about their benefits with the help of an insurance professional. The CEMA benefits marketplace has tremendous technology that compares plans, asks employees questions about their needs and advises them of their choices. In addition to the support of gbac in making these decisions, the marketplace has a 24 hr a day, 7 day a week, 365 day a year support for the marketplace itself.

Employers need to change their perspective away from carriers, policies and premiums and instead concentrate on budgets, strategies for dividing budgets among employees and then empowering employees to make their own benefit selection choices. Employers can control their benefit costs and can empower employees to become educated consumers – as soon as they decide to take a different approach to how they organize, structure and deliver benefits.

Great employee benefit plans are not commodities, they are carefully planned with a professional using the powerful tools of a great private association marketplace.


For More Information Call Joe Bucci at 203.985.1703

For More Information Call Gene Guilford at 860 989 0756



[1] http://m.reviewjournal.com/politics/own-small-business-brace-obamacare-pain

About gguilford

A successful executive well positioned to leverage extensive skill and experience in the business, government and political environments within which I have worked to bring energy, vision and skill to managing human capital, strategic planning, crisis management, corporate management, financial management, government and public affairs challenges. Positioning for the future in managing and directing change and as well as seeing and seizing opportunities others miss.
This entry was posted in Association Health Insurance and Employee Benefit Marketplaces, GBAC APG News, Health Insurance Reform. Bookmark the permalink.

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