3 Myths Small and Midsize Employers Believe About Benefits

You’ve heard it before: It takes great health benefits to attract a great pool of talent. But as an SMB (Small or Midsize Business), you’re scratching your head over how to offer the buffet of options new employees expect.

You might think you’re stuck with a skimpy benefits offering, but that’s not necessarily true. Here are three myths SMBs often believe about their health benefit options -- and what the facts really are.

Myth #1: I Can’t Give My Employees a Wide Choice of Plans.

Negative. Actually, you can. Private exchanges help SMBs offer employees a wide range of plans. How? The best exchanges have relationships with a broad set of carriers and use a technology platform to offer many different predefined plans. That spares you the thankless task of trying to find one plan that meets the needs of all your employees.

Beyond a palette of plans, your employees can also get easy-to-use online tools, access to a knowledgeable benefits advisor, and more. Don’t expect less just because you’re an SMB. Your employees should have the same enrollment perks large companies have.

Myth #2: My Small Business Can’t Leverage Vendors.

Actually, you have more purchasing power than you might think. Private exchanges combine the purchasing power of multiple SMBs to leverage competitive pricing from vendors. The result? Lower administration fees and more services like personalized call center support and insightful decision support tools.

With private exchanges, SMBs are able to give their employees greater access to services and solutions that they wouldn’t be able to otherwise. And here’s a benefit for your organization: With a private exchange, your company can put a fixed amount toward each employee's health premium, no matter which plan they select, allowing for more predictable budgeting.

Myth #3: My Employees Won’t Consider High-Deductible Health Plans.

At first glance, a high-deductible health plan (HDHP) might sound like a hard sell. Your employees must pay for most health services out of pocket until they meet their deductible, which could be a few thousand dollars.

But here’s what makes employees take another look: Lower monthly premiums. That’s especially attractive to millennials.

For example, a healthy, 28-year-old employee who sees her doctor only for an annual check-up can save hundreds of dollars a year with a high deductible plan. And she’s not the only one: HDHPs also cut costs for your company, since you pay less for your portion of the plan cost.

Enrollment in HDHPs is on the rise. In 2016, 29% of covered employees enrolled in a high-deductible health plan, compared to 25% in 2015.  Employees have shown more interest in these plans than many employers anticipated.

With all of these health benefits plan on the table you can pinpoint the best option for your business -- and that same old tired plan is not one of them. Talk to a benefits advisor about evaluating the options that are right for your company.

Todd Renner
by Todd Renner

Partner, Health, Mercer Todd Renner is currently Mercer’s US Health & Benefits Practice Leader for the Enterprise and Midmarket segment as well as the leader for Mercer Marketplace 365+ and Mercer Administration’s portfolio of technology and administrative services. In this role, Todd works closely with internal and external constituents that support Mercer’s consulting and administration solutions geared toward the 100 to 5,000 employer segment. Collectively, this team delivers Mercer’s proven value to a segment that is increasingly demanding top tier consulting and simplified benefit administration from their benefit consulting team. Todd has been with Marsh & McLennan Companies for a total of eleven years and recently rejoined the firm in 2015. Prior to joining Mercer, Todd was Head of the Employee Benefits National Practice at Wells Fargo Insurance Services. Todd earned both his BS degree in Business Administration and his MBA from Wake Forest University. He holds the Certified Employee Benefits Specialist (CEBS) designation.

Partner, Health, Mercer

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