EMPLOYEE BENEFITS
Minimize Cost , Maximize Talent Retention
UTILIZING CONTRIBUTION MODELING TO YOUR BENEFIT
BY BARRY E . FIELDS
As healthcare costs continue to rise , employers are looking for effective ways to contain costs . One way is to leverage contribution models to allow both employers and employees to share the cost of ever-rising health insurance premiums so it ’ s easier for both to afford .
SO , WHAT IS CONTRIBUTION MODELING ?
With contribution modeling employers choose a health plan for their employee population and then determine the dollar amount they ’ ll cover and the premium amount employees will be responsible for according to a cost-share model . For example , if an employer covers 80 % of the cost of the plan , the employee would be responsible for the remaining 20 %.
In 2022 , employers contributed an average of 80 % of the premium cost for individual health insurance coverage and 67 % for family coverage .
GIVEN TODAY ’ S WAR FOR TALENT , FINDING AN OPTIMAL PREMIUM COST-SHARE ARRANGEMENT IS KEY .
Striking the right balance between reining in costs and offering valued health insurance benefits can make a difference in successful talent acquisition and retention .
3 QUESTIONS EMPLOYERS CAN ASK WHEN CONSIDERING CONTRIBUTION MODELS
1 . HOW CAN YOU LEVERAGE BENCHMARKING TO CHOOSE THE RIGHT CONTRIBUTION MODEL FOR YOUR ORGANIZATION ?
Should you do 90 / 10 ? 80 / 20 ? 75 / 25 ? Knowing how similar-sized companies in the same industry and location are
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