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Got a group health renewal? Read it before you sign.
Your renewal came in higher than last year. Before you accept it, or panic and move the whole plan, there are six things worth checking.
Start here
A renewal increase is a number. It is not an explanation.
Most employers see one figure — the percentage — and make a decision from it. But two groups can get the same increase for completely different reasons, and the right response is completely different in each case.
Sometimes the increase is your own claims experience, and changing carriers just resets the clock without fixing anything. Sometimes it is trend and pooling, and it has nothing to do with your group at all. Sometimes it is a plan design that quietly shifted, and you are comparing this year's apples to last year's oranges.
You cannot tell which from the percentage. You can tell from the paper.
The six checks
What we look at, in order
Did the plan actually stay the same?
Deductible, out-of-pocket maximum, coinsurance, copays, Rx tiers. A renewal that looks like a modest increase often carries a quietly richer deductible. Compare the benefit summaries side by side, not the premiums.
Did your census move?
Age, family tier mix, and headcount all drive rate independently of claims. If you hired six people in their fifties, part of your increase is arithmetic, not underwriting.
What is the network, and did it change?
A narrower network on renewal is a cost reduction dressed as a flat rate. If your people lose their doctors, you will hear about it in January, not now.
Is the funding arrangement still right for your size?
Fully insured, level funded and self funded each stop making sense at different points. Groups outgrow fully insured and nobody tells them. That is a conversation worth having before you renew, not after.
Are you an ALE, and does the offer still comply?
Fifty or more full-time equivalents changes your obligations. Affordability safe harbors move every year. A renewal that is fine on cost can still be a penalty exposure. More on ACA compliance.
What is the broker being paid, and is it disclosed?
Commission is built into your rates whether or not anyone shows it to you. You are entitled to know the number. If your current broker has never told you, that is worth noticing.
Often the answer is to keep what you have. A renewal review that always ends in a recommendation to move is not a review, it is a sales process. If your plan is priced correctly and your carrier is performing, we will tell you that and you will have lost nothing but the time it took us to read it.
Send us the renewal
What to send
Four documents. That is the whole ask.
You do not need to prepare anything. Send what your current broker or carrier already gave you:
The renewal letter or rate sheet — whatever states the new rates.
Current and renewing benefit summaries — the SBCs, so we can compare plan design rather than assume it held.
A census — ages, tiers and ZIPs. If you do not have one in a usable format, use our template.
Claims experience, if your carrier releases it — optional, and not available to every group size. Send it if you have it.
Please do not send us Social Security numbers or anything clinical. A rating review needs dates of birth, tiers and ZIP codes. It does not need identifiers or diagnoses, and neither does any carrier we would market you to.
No obligation, and we mean the boring version of that
Send us the renewal.
You get our read within one business day. If your plan is priced correctly we will say so, and you can take that back to your current broker and use it.
Reviewed by Deon R. Williams — MLS, Risk Management & Compliance, REBC, CLCS, and a former claims adjuster and SIU investigator. Brokerage compensation on any placement is disclosed before anything is bound. No broker of record letter is requested, or accepted, during a review.