The high price of health insurance: there are creative ways to trim costs to your health insurance plan.

• Author: Myers, Deborah

It's inevitable. Health insurance premiums are an element of over-head that employers can expect to increase every year. Small employers are hardest hit.

"I have a few smaller employers with under 10 (employees) that can no longer afford health benefits," said Rick Johnson, an agent with Baldwin Financial Concepts in Anchorage.

"Six weeks ago, I had to deliver to a group of four a rate increase of 35 percent," he added. "That's tough, to deliver those increases that are either passed along to employees or employers will absorb."

Savvy business owners and management can maintain better control of this expense through understanding how plans work, selecting the best plan for their companies, and also keeping abreast of new plans available.

SHARING THE COST

"Many employers are passing along those rate increase expenses," Johnson said.

Although they are not required to foot the whole bill, "for many years, employers have provided these plans with no cost to employees," said Tom Hardwick, a representative of Benefits Inc. in Anchorage.

"Employees have paid nothing," Hardwick said. "They've been insulated, thinking everything is ducky with the insurance while the employer has been pulling out his hair to maintain profitability and benefits for the employees."

Insurance premiums may be paid in part by the employee and in part by the employer, but "carriers mandate a certain percentage that employers carry," said Spencer Biegel, an agent with Alaskan Benefit Insurance Consultants in Anchorage.

For example, a carrier or insurance provider may stipulate that the employer pays 50 percent of the premium and the employee pays the other half.

By sharing the burden of the premium, employers can save.

A MORE DESIRABLE PLAN

One way to make employees more receptive to this change is by "adding some inexpensive benefits like increasing the amount of life insurance coverage or adding long- or short-term disability," Johnson said. "It's a modest cost to the employer and provides more benefit to the employee."

Although spending more may seem counterproductive, psychologically it helps employees feel better about picking up a larger amount of the medical premium.

For employers that absorb the added expense, Johnson encourages them to be sure to let employees know.

"Employees don't see that it's like a raise," he said.

Delaying eligibility can help employers save.

"Most employers have a 90- to 180-day waiting period," Biegel said. The employers that have high turnover go to a much longer waiting period."

By using a probationary period, they make sure they have a qualified employee before paying for their benefits, Biegel said.

The type of plan selected also makes a big difference in the bottom line.

"There are options," said William H. Gill, who runs William H. Gill Insurance & Risk Management Consulting in Anchorage. "You have to suit...