Health Insurance Premiums

pvrhr

We are in the process of changing health insurance companies due to a huge increase in premiums. How much notice do I have to give our employees? Also, previously we paid 50% of the premium cost, but now the employer share will be going to 30 - 40%. Is this legal? I can't find anything saying the employer has to pay a certain percentage of benefits, and as a small seasonal business (25 in the winter, 50 in the summer), we simply cannot bear to pay any more of the premium.

Helena

>We are in the process of changing health insurance companies due to a
>huge increase in premiums. How much notice do I have to give our
>employees? Also, previously we paid 50% of the premium cost, but now
>the employer share will be going to 30 - 40%. Is this legal? I can't
>find anything saying the employer has to pay a certain percentage of
>benefits, and as a small seasonal business (25 in the winter, 50 in
>the summer), we simply cannot bear to pay any more of the premium.


I have found that it takes me almost a month after choosing a different
health and dental insurance company to conclude all paperwork and get
ready for open enrollment and that has always been perceived as plenty
of notice by our employees. If the insurance companies that you or your
agent choose have no minimum employer contribution it is perfectly legal.
What I do pass out during open enrollment is a "Group Medical/Dental
Enrollment Monthly Premium and Employer allowance per bi-weekly paycheck" so
that all employees (We presently have 117)can see exactly what the costs are
and just how much they will have deducted from their paycheck.

Helena

pvrhr

Thanks for you help.

Carol CA

We also have had to switch carriers due to rising premiums. Our employees are told that our plan year is the calendar year. Each year we have open enrollment for effect January 1st. We usually have to start the enrollment process in November to get everyone enrolled correctly, get new cards, etc. Whatever "processing" time you need should be sufficient notice to the employees.

There is no law that mandates an employer has to pay a certain amount of the medical premium. In fact, there is no law that says you even have to provide medical coverage. I would keep the communication lines as open as possible with your employees so they understand why it is necessary to make these changes. Although they won't like higher premiums, if they understand the researching you did to get the lowest possible cost, how much the company is still paying, etc., it will go down easier.

Good Luck!