CSA Introduces New Cost-Saving Health Insurance Program

By: Jim Moody, CAE
CSA President
When we’ve asked members about the challenges you face (aside from the global economic issues we can’t solve), we’ve consistently heard from you that health insurance is one of the biggest thorns in your side.

The federal government is working on that issue, but I don’t put a lot of hope in their efforts. I suspect that at the end of the day, health insurance will still be incredibly expensive for small business, and that the pressure for you to provide coverage for your employees will be intense.

While I’m not ready to say we’ve solved problem that has confounded experts and the government for many years, I am happy to say we have found an option that may present some ideas you haven’t explored previously.

For more than a year, CSA has been diligently looking at a variety of options to allow you to provide health insurance benefits without breaking the bank. That search ended last month when the Board voted to endorse a program by Association Health Programs out of Overland Park, KS.

This company is essentially an independent agency with the ability to write policies from a variety of companies, including all the big names. But this is where the similarity to traditional programs ends.

Rather than looking for the best group rate, Association Health Programs starts with individual plans. These are typically less expensive than group plans, and there are some other benefits as well. For instance, the plans are portable, meaning if the employee loses his job, he can keep his health insurance as long as he’s willing to pay the premium himself (and you don’t have to worry about administering COBRA benefits). Also, the policy can’t be cancelled for any reason (group plans can be cancelled). It may also allow you to tailor coverage to the individual’s situation for the best combination of price and coverage, which may be different from employee to employee.

One downside is that in some states (Georgia is one), insurance companies can choose not to write initial coverage for some individuals. (Alabama is a different story – everyone with an Alabama residence or an employer in Alabama is guaranteed coverage through a state risk pool.) When there are employees who can’t be insured individually, a group plan must remain. The goal then becomes to make the group as small as legally possible and cover everyone else as an individual.

As you might guess, this approach can be complicated. On the other hand, the cost savings can be dramatic – 30-40% is not unusual. Each company is different, so the plan has to be tailored for your needs and must take into account the health of your employees. While I can’t promise that everyone will see this kind of savings, the due diligence we’ve done convinces me that this program really will work for many of you. The only way to know is to call Association Health Programs to discuss your specific situation and let them work on quotes for you.

Note that this is not a health savings account that requires lots of administration nor is it some fly-by-night option that will fold without notice. The company has been in business for years and has hundreds of thousands of people covered through various plans. That large number gives AHP buying power you can’t find in a “regular” agent, and that is the key to providing lower cost premiums.

We’ll be working hard over the next few months to educate you more about this option. I suspect you are intrigued but have questions, which is reasonable. Feel free to contact me with general questions or call AHP directly to quiz them on how this all works. There’s also a website with more information: http://www.associationpros.com/assoc/csa. You can also call toll-free at (888) 450-3040 for more information.

Again, this may not work for everyone. But it does offer you an option you probably haven’t considered before, and it has the potential to save you a fair amount of money. Now, more than ever, something like this is worth exploring.