Bellingham Business Journal - Groups find cure for health-insurance woes: small businesses can find ways to get big benefits

When Troy Olney, owner of Unity HR, first opened his business in 2002, there was no one to worry about but himself.
As his business grew, he needed help. So in 2004, he hired his first employees and immediately he began thinking about health benefits for his small but growing office.
An employer must provide a compensation package that attracts and retains employees for the success of a company, he said.
“They are investing their time in me; I need to invest in them,” Olney said.
Too often, medical benefits are out of reach of the small employer. The costs are high and it is too easy to get lost in the maze of red tape and legalese.

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Sue Sharpe, a consultant for the Whatcom Alliance for Healthcare Access (WAHA), a nonprofit organization that works to ensure access to medical care and coverage, said that young adults who work for small businesses are the fastest growing section of those without medical insurance in Whatcom County.
When Olney hired his first employees, he began hunting for benefits options right away. To him it was less about whether or not he could afford them and more that it was just the right thing to do.
“We made it work,” Olney said. “This is just the cost of doing business.”
A local alliance to ensure health care access
Sue Sharpe has worked in the health care field in one way or another for the past 30 years and was involved with the creation of the WAHA. In 2002, local nonprofit St. Luke’s Foundation convened a summit to increase awareness about the lack of health care access on local, state and national levels and to identify potential response strategies.
Sharpe said the steering committee from that summit drove the creation of WAHA, an organization that works locally to enhance opportunities in Whatcom County and also works with elected officials to create sound health care policies.
Sharpe and the rest of WAHA felt that the best way to act locally was to focus on what they found was the largest and fastest growing section of the uninsured: small-business employees and low-income workers.
So WAHA started the Small Business Health Insurance Connection program, which is a single stop for information regarding health-insurance issues for small businesses.
WAHA can help businesses evaluate public and private health care options depending on the eligibility of their employees
In an effort to better understand the issues facing small employers, WAHA surveyed the Whatcom business community in late 2007 and early 2008.
“We found that cost, administrative complexity and participation with small numbers of employees can be barriers for smaller businesses,” Sharpe said.
While there is little to be done about the high cost of insurance, Sharpe said WAHA works with insurance brokers, who are the link between small businesses and large insurance carriers
“The broker community is really critical to the small-business community,” Sharpe said.
Rod Bring, one of the three principal owners of Employee Benefits Planning, is a broker as well as an insurance agent and he said it can be frustrating for employers to navigate the maze of insurance options.
“You need to rely heavily on a professional that is in that industry,” Bring said. “It would be very difficult for someone to just start out and understand all the ins and outs.”
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Adding value to employment
Bring said when employers begin looking at benefits packages they are seeking ways to add value to employment.
“To add value, you offer more than just wages,” he said.
First, Bring suggested that employers do a little homework. First determine if the business can afford benefits.
“You have to be in a positive cash flow because benefits aren’t cheap,” Bring said.
Next, Bring said the employer should have clearly defined objectives for what the company is trying to provide. For example, does the employer want to provide a plan that emphasizes prevention and wellness and is that within reach of the employees; or is less-expensive insurance that covers only dire emergencies more feasible?
“We usually will consult with employers to find out if, given the range of the employees: salaries, they are trying to provide something the employees cannot afford,” Bring said.
Olney from Unity HR said the first benefits package he offered was a more traditional plan with a $20 co-pay and an 80/20 split, where the employer covers 80 percent of the cost of the benefits. However, significant annual premium increases and a lack of control over how the insurance carrier spent his premium led Olney to switch to providing a health savings account (HSA) for his employees. HSAs allow employees to contribute pre-tax income to an account that can be used for medical expenses. “My personal opinion on insurance is that you have insurance to cover a catastrophic, life-changing event,” Olney said. “An HSA plan allows for that while it gives me control over what the premium is doing.”