Health insurance time renewal is upon us ,? and if you're researching several profitable health plans or research on small business health benefits for the first time, a common question is, "How much does it cost to provide health insurance for employees? "
the cost of health insurance for employees depends on a few factors:
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the company ' insurance
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The type of plan you choose (eg :. PPO HDHP, etc.)
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The supplier network
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your position
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your contribution strategy
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demographics of your staff (your "employee census" )
If you are still in search mode and not quite ready to get detailed estimates of consulting company health insurance or health benefits, you can learn a lot about the cost of health insurance for employees by understanding national averages and cover basic concepts.
The following is a concise breakdown of the cost of providing health insurance to employees.
cost of health insurance coverage
When an employer offers health insurance coverage to employees, the company buys a plane (or planes ) to cover all employees and eligible dependents. This type of coverage is commonly called a "group health insurance plan" or "health insurance sponsored by employers."
In 2015, the average premium for individual coverage is $ 521 per month, or $ 6,251 per year. the average premium for family coverage is $ 1,462 per month or $ 17.545 per year (source).
These amounts are generally divided by the employer and the employee. In average, employers pay:
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$ 5,179 per year (83 percent of the premium) to cover one employee
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$ 12,591 by year (72 percent of the premium) to cover a family
the remaining amount is covered by employees, usually through a payroll deduction
Related:. How the cost of insurance illness group Much
Furthermore, the costs of premiums with a group health insurance plan may change each year. In fact, this year, more than 0 percent of employers see rate increases at renewal, with about a quarter to see the increase in double-digit premiums.
To minimize or reduce the fluctuation of premium amounts, and control the cost of benefits each year, one option is to change the contribution strategies.
Cost control strategy with a defined contribution
instead of purchasing a group health insurance policy and pay the premiums set by the company insurance, an alternative strategy is to define the amount of contribution to employee health insurance. With this type of model "defined contribution", the company:
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Sets the amount of contribution to employee health insurance costs
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allows employees to purchase a health insurance scheme (either through a private exchange or health insurance markets)
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Reimburse employees for premiums in the amount of available balance
the cost of health benefits with a defined contribution strategy? Any amount that the company can afford.
That being said, many companies look at the cost of employee individual health insurance policies will buy to help establish the level of contributions. In 2014, the cost of individual health insurance on average
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Without premium subsidies: $ 346 per month or $ 4,152 per year
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with the premium subsidies: $ 82 per month or $ 984 per year
Because the cost of individual health insurance, on average, costs less expensive than group health insurance, employers often see savings of up to 60 percent by adopting a defined contribution strategy
Related :. a concrete example - defined contribution and health insurance subsidies
Conclusion
on average, the combined cost of providing group health insurance is $ 6,251 per year for individual coverage (2015) or $ 17.545 per year for family coverage.
In order to offer more affordable health benefits, one solution is to adopt a strategy defined contribution where employees purchase individual health insurance and are reimbursed by their allocation to defined contribution.
In a period of high annual rate increases for group health insurance, a defined contribution model offers cost predictability and access to quality health insurance coverage
Related :. Insurance Cost Comparison Tool 
Do you have any questions about how much it costs to provide health insurance to employees of small businesses? We would be happy to respond. Leave a comment below.
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