The Trendiest Benefits for 2023

insurance benefits

Benefits Breakdown

There’s no denying that employees’ needs have changed in recent years. As such, employers should consider offering benefits to meet evolving worker needs shaped by the lingering effects of the COVID-19 pandemic, a tight labor market, and rising inflation. In 2023, many workers are now paying more attention to their benefits and wondering how to stretch their dollars further.

Benefits have always been crucial for attracting and retaining top performers. In 2023, employers are uniquely positioned to offer more than just a healthcare plan, including holistic benefits, resources, and perks that today’s workers most need. The following benefits are likely to be popular in 2023:

  • Voluntary benefits, such as accident and critical illness insurance
  • Financial wellness benefits, including health savings and flexible spending account contributions, and financial planning assistance
  • Health care full premium coverage
  • Family-friendly benefits

Organizations can start optimizing benefits packages by evaluating employee preferences and thinking about ways to improve offerings or tailor them for their workforce. To ensure offerings and investments will resonate with employees, organizations should consider surveying them first. It’s important to keep a pulse on employees and see what they find most valuable and necessary for their overall well-being.

Strategies for Encouraging Employee Health Care Shopping

Paying more for health care doesn’t necessarily mean the consumer receives a higher quality service or outcome. Shopping around for health care can result in savings for both employees and employers.

One of the first steps in encouraging employees to shop around for health care is education. Employers have a unique opportunity to provide data and information to help employees understand the saving potential of healthcare comparison shopping. Employers can also direct employees to user-friendly tools that break down pricing. These may be available through a third-party benefits administrator or health plan partner.

Aside from education, another way to help make healthcare shopping top of mind for employees is creating rewards for certain consumer behaviors, such as comparison shopping. Incentives may also be rewarded for using employer-provided price transparency tools to compare services and procedures. Some employers may offer cash incentives, while others offer wellness program points.

The rise of health care costs isn’t slowing down any time soon. Fortunately, comparison shopping offers employers an opportunity to take a proactive approach to reduce these costs and make employees feel empowered to take charge of their health.

Contact Midwest Insurance Group For Health Insurance

We do more than recommend policies from a nearly limitless range of casualty and property insurance for businesses and individuals. We help transform our clients’ businesses and households into financially secure, profitable endeavors through coaching programs, technological support, and attentive claims service.

Midwest Insurance Group partners with Erie insurance, one of the nation’s leading auto and home insurers, with an A.M. Best rating of A+ (Superior). Contact MIG at 262-646-5777 to discuss employee health insurance plans for your business.

Self Funded Insurance With Level Funding


Level Funding

If you desire the freedom of a self-funded insurance plan but need a little more certainty for your budgeting concerns, level funding might be an option for you. Weigh the advantages and disadvantages and decide what’s best for your company.

What is a Self-funded Plan?

In a self-funded health plan, the employer assumes the risk and responsibility of medical claims instead of contracting with an insurance carrier to pay claims. The employer sets premium rates based on claims history and typically benefits from lower administration costs and greater flexibility both in plan design and cash flow within the business.

A self-funded plan may contract with a third-party administrator (TPA), but it is still a self-funded plan because the company is responsible for funding the claims payments. Stop-loss insurance can be obtained to pay for excessively high claims, but the employer is responsible for the majority of the costs and the stop-loss insurance is simply a protection against extremely high, unpredictable claims.

Self-funded plans are not right for every company. One of the downsides to a self-funded plan is that the employer must pay out claims as they come in, leaving itself exposed to fluctuating expenses. Level funding is an option that can add predictability back into the equation if your company decides to implement a self-funded plan.

What is Level Funding?

Level funding is an option that can accompany a self-funded plan, aiding employers in their health coverage budgeting efforts. With level funding, employers pay a set amount each month to a carrier. This amount typically includes the cost of administrative and other fees and the maximum amount of expected claims based on underwriting projections, as well as embedded stop-loss insurance.

The carrier facilitating the level funding will pay your employees’ claims throughout the year. At the end of the year, if your payments exceeded claims, you will receive a refund from the excess you paid in monthly claim allotments. If the claims exceeded what you paid into the program, in most cases your stop-loss insurance will cover the overage amount.

Advantages of Level Funding

Level funding offers several advantages. Like other self-funded plans, you don’t have to pay premiums that are based on community rates, which might be higher than your employee group’s risk. Instead, you only pay the actual claims and an additional administrative fee. Another benefit of level funding is that if all the money you set aside each month to cover claims is not used, you will receive a refund at the end of the year from the surplus, instead of paying expensive premiums for a fully insured plan and essentially using or losing that money. If you are already self-funded, then you will enjoy a more budget-friendly method of monthly claims payment, with stop-loss insurance to protect you from unexpectedly high costs.

Generally, the monetary advantages of level funding are that you are better able to manage your budget and prepare for claims costs. You will benefit from a smoother cash flow and not worrying that a high claim near the beginning of the year will impact your business.

Additionally, many level funding plans provide detailed reporting on utilization trends, giving you important information on where employees may be causing overspending (such as unnecessary use of emergency room visits instead of urgent care).

Another advantage of level funding is having fewer governmental regulations than fully insured plans are subject to. Check with your legal counsel about regulatory benefits specific to your state and business.

Disadvantages of Level Funding

Although there are upsides to level funding, there are also some disadvantages. One is that when you choose to self-fund you are likely looking to cut costs—and with level funding, part of your monthly payment is to cover administrative fees. Depending on the plan and your other options, these fees have the potential to cut into the savings you hope to gain from running a self-funded plan. You’ll need to weigh the cost-effectiveness of administering your self-funded plan in-house, hiring a TPA or choosing a level-funded option with the attached administrative fees.

Additionally, you still have to pay the claims. With level funding you’re paying for the convenience of having equal payments throughout the year and the security of stop-loss coverage.

Another challenge of level funding to consider is the terms of the contract; make sure you understand how the contract will impact a business of your size—companies with smaller numbers of employees may benefit differently than those with larger numbers. Also, many level funding plans restrict their offerings to companies with a certain minimum or maximum number of employees, which may affect your ability to contract with your desired carrier.

Making Your Decision

Ultimately, if you want to operate a self-funded health plan, level funding is an option that must be considered in light of your company’s cash flow, risk tolerance, employee numbers, and preferred budgeting methods.

Contact Midwest Insurance Group at 262-646-5777 for more information about insurance coverage options.