Every year I see the same scenario play out.
A small business owner receives a renewal notice in late October or November showing another significant increase in health insurance premiums. With only a few weeks before the plan renews, they are forced to make a difficult decision: absorb the higher costs, shift more of the expense to employees, reduce benefits, or begin shopping for another plan under a tight deadline.
Unfortunately, by then, many of the best opportunities have already been missed.
August is actually the ideal time to begin planning your employee health benefits for the coming year.
Give Yourself Time to Evaluate All Your Options
The small-group health insurance market continues to evolve. Employers today have more choices than ever before, including:
- Traditional fully insured group plans
- Level-funded plans
- Association Health Plans (where available)
- Individual Coverage Health Reimbursement Arrangements (ICHRAs)
- Premium assistance programs
Each option has advantages and disadvantages depending on the size of your company, the demographics of your workforce, your budget, and your long-term business goals.
Waiting until renewal often leaves employers choosing from only the options they can evaluate quickly rather than the options that best fit their business.
Rising Healthcare Costs Make Planning More Important Than Ever
Healthcare costs continue to put pressure on employers across the country. While no one can predict exactly what every renewal will bring, few employers expect healthcare costs to decrease.
Beginning the process now gives you time to:
- Review your current benefits.
- Compare competing insurance carriers.
- Evaluate alternative funding arrangements.
- Consider plan design changes.
- Educate employees before enrollment begins.
A proactive approach almost always produces better decisions than reacting to a last-minute renewal.
Don’t Focus Only on Premium
One of the biggest mistakes employers make is comparing plans based solely on the monthly premium.
A lower premium may come with:
- Higher deductibles
- Narrower provider networks
- Increased employee out-of-pocket costs
- Less comprehensive prescription coverage
Conversely, a slightly higher premium may provide significantly greater value through broader access to physicians, lower employee cost-sharing, or better overall benefits.
Health insurance should be evaluated based on total value, not simply the monthly invoice.
Ask Whether Financial Assistance Is Available
Many small businesses are surprised to learn they may qualify for programs that help reduce employee premium costs.
For eligible Texas employers, programs such as the TexHealth Premium Assistance Program can help lower the employee’s share of premium costs while allowing businesses to continue offering employer-sponsored health insurance. For qualifying employees, this can make coverage substantially more affordable and improve participation in the company’s health plan.
Many employers never explore these opportunities simply because they don’t know they exist.
The Earlier You Start, the More Choices You Have
Beginning your planning in August allows time to:
- Gather employee census information.
- Request multiple carrier quotes.
- Meet with your insurance agent.
- Compare funding options.
- Review employee needs.
- Budget accurately for the coming year.
- Make thoughtful decisions instead of rushed ones.
It also gives employees adequate time to understand any changes before open enrollment begins.
Final Thoughts
Health insurance is one of the largest investments many businesses make in their employees. It also remains one of the most valuable benefits for attracting and retaining a quality workforce.
Planning ahead doesn’t necessarily guarantee lower premiums, but it does give you the greatest opportunity to find the solution that best fits your business and your employees.
Don’t wait until your renewal notice arrives.
Use August to start asking questions, exploring your options, and preparing for 2027. Your employees, and your budget, will thank you for it.