Insurance, Small Business

Seven Ways for Small Businesses to Rein in Health Care Costs

Recently, the Journal of Accountancy website had a good article by Ken Tysiac on how small businesses might be able to slow down the rise in health care costs. As an owner of a small business, I was very interested.

1. Consider a self-insurance plan. Most big companies self-insure for all or part of health care costs of their employees. Insurance companies administer the plans and sometimes reinsure the risks. Insurers are creating self-insurance plans for smaller employers.

2. Consider a defined contribution plan. This works like a 401(k) plan for health insurance. Provide several alternatives for employees on a private exchange and let them choose the coverage that works best for them.

3. Review contracts with vendors. Good advice not just for insurance.

4. Evaluate coverage of dependents and spouses. Among other options, an employer might consider structuring the benefit and costs based on “employee plus one, employee plus two, employee plus three (and so on).” “Employee plus children” and “employee plus family” alternatives do not take into account the total number of dependents.

5. Assess the whole benefits package. If the employer is paying for a non-health care benefit that not many employees are using, it may make sense to drop them and divert the savings to health insurance.

6. Consider wellness strategies. This good idea can be tricky to implement.

7. Communicate better. Make sure that employees are well-informed of their health care options.

My summary above does not address some additional suggestions and ideas in the article. If any of these strategies are interesting to you, contact your insurance adviser. That’s what we’ll be doing.


Just for Fun


In the tax business, we focus on one fact about April 15 – it’s the tax deadline and the end of our spring busy season. (Full disclosure: in our office, there are at least four additional big tax deadlines each year. We celebrate them all!)

Despite our myopic focus on April 15 as the tax filing and payment deadline, other things have happened on this date. Here are just a few examples:

  • In 2010, volcanic ash from the eruption of Eyjafjallajökull in Iceland led to the closure of airspace over most of Europe. Reports of this natural disaster were delayed for 24 hours as newscasters searched for the pronunciation of the name of the volcano.
  • In 1992, billionaire Leona Helmsley was sent to jail for tax evasion. She said that paying taxes was for the “little people.” Think the day of her incarceration was a coincidence?
  • In 1968, the Houston Astros beat NY Mets, 1-0, in 24 innings. Except for one miraculous season, the ‘Stros hitting has remained about the same as in 1968.
  • In 1959, Fidel Castro began his US goodwill tour. Huh? Did I read that wrong?
  • In 1955, Ray Kroc started McDonald’s chain of fast food restaurants. Mr. Kroc was multi-mixer salesman who was intrigued by these two McDonald brothers ordering eight multi-mixers for their burger joint. He was fascinated by the restaurant’s focus and efficiency. One thing led to another.
  • In 1931, the first walk across America backwards began. Plennie Lawrence Wingo actually walked backwards to Istanbul, Turkey. I am not sure how he got across the Atlantic Ocean.
  • In 1912, RMS Titanic sinks at 2:27 AM off Newfoundland as the band plays on.
  • In 1892, The General Electric Company was formed. Based on a quick search, I determined that a share of GE today is worth about the same it was worth on the date that Jack Welch retired as CEO of GE on September 7, 2001. Impressive – not.
  • In 1071, Bari, the last Byzantine possession in southern Italy, was surrendered to Robert Guiscard. (That’s a shout out to my good friend, Alessio Bax, favorite son of Bari and recognized as one of the finest classical pianists in the world.)

And in all seriousness, we offer prayers for the Boston Marathon bombing victims, the three that died and the 264 others that were injured, and their families – April 15, 2013.