Options exist for small businesses looking to escape increasingly unaffordable health insurance on the Western Slope, and a forum held Wednesday explored some lesser-known ways businesses might use to economize.
Merida Odiorne, an agent with USHealth Advisors, said more affordable health plans that are not compliant with the Affordable Care Act have become a more attractive option with the termination of the penalty for carrying ACA-noncompliant plans.
Odiorne was one of seven presenters at the Health Care Forum presented by the Durango Chamber of Commerce, La Plata County Economic Development Alliance and Animas Surgical Hospital at the DoubleTree.
“We’re getting creative,” Odiorne said. “Even though we are a small community, there are options that exist,” she said.
ACA-noncompliant plans, which work well for healthy individuals, can be as much as 40 percent cheaper than preferred-provider plans, Odiorne said. However, the cheaper price comes only if an insured client is willing to sacrifice some coverage as noncompliant plans tend to have fewer benefits for coverage of such things as drug abuse or mental health.
In addition, people who don’t need maternity coverage can find plans that exclude it from their plan, which also will reduce costs, she said.
The noncompliant plans are typically offered to healthy individuals with no pre-existing conditions or people who have had medical conditions but they occurred a decade or more in the past.
Dylan Fitzsimmons, an account executive with Justworks, discussed lowering health insurance costs via services offered through professional employer organizations, which outsource functions such as payroll, human resources and regulatory-compliance support.
Fitzsimmons said professional employer organizations can group their small business clients – creating a bigger pool for health insurance, thereby providing cheaper rates for small businesses, typically businesses with five to 10 employees.
“We provide affordable benefits through aggregation,” he said.
An attribute of professional employer organizations is their ability to negotiate for better rates and for more diverse plans than small businesses could on their own.
Essentially, a professional employer organization ends up being an employee’s legal employer of record – allowing small businesses to tap into the economies of scale of a larger business.
“The Western Slope has been hit hard on small-group insurance, but there are alternatives out there,” he said.
Doug McCarthy, president of Issues Research Inc., which analyzes trends in health costs and health insurance, noted three factors in the current medical business trend to drive costs higher:
An asymmetry in knowledge between patient and doctor that creates a relationship that fosters “the doctor-knows-best attitude.”The creation of a moral hazard: After an insurance deductible is met for the year, people seek numerous medical procedures in their treatment regardless of whether they are particularly effective or likely to help because the insurance pays the full cost.The medical fee-for-service model that also tends to drive the use of as many medical techniques as possible when treating a patient even if the treatments are only marginally helpful.The three trends, McCarthy said, “Drive supplier-induced demand in which the view of everyone is: The more, the better.”