05 May Unlocking Carrier Credits in Employee Health Plans

Employers continue to face the challenge of managing employee health care costs. One often overlooked strategy to mitigate these expenses is leveraging carrier credits. These credits can provide savings and enhance the overall value of employee health plans. A plan may already include carrier credits, but it is beneficial to understand what they are and how employers can access them. This article explores carrier credits and how employers can unlock their potential for their organizations.

Carrier Credit Overview

Carrier credits are reimbursements or discounts provided by insurance carriers to offset the costs of employee benefits. These credits can appear as reductions on monthly invoices, end-of-year refunds, or funds allocated toward wellness initiatives and other employee benefits. They come in various forms due to factors such as group size, plan selections and renewal agreements.

Here are common types of carrier credits:

End-of-plan-year unused claims funds credits—For employers using alternative funding types like level funded plans, some carriers return unused claims funds at the plan year’s end. Working with a benefits broker can help design a plan eligible for these credits and secure an appropriate surplus refund, if applicable.

Premium or administrative credits—When adding new lines of coverage, employers can negotiate premium or admin credits with their insurance carriers. This is an excellent opportunity to secure additional concessions or benefits as coverage is expanded.

Wellness credits—These credits are allocated for wellness programs and initiatives that promote employee health and well-being. They can be used to fund activities such as gym stipends, nutrition services and wellness app subscriptions.
Carrier credits can directly reduce the financial burden of employee health care costs. They also allow employers to design a health care plan that best meets the needs of their organizations.

Accessing Carrier Credits

It’s important for employers to review their health plans and their performance regularly. While ongoing observation can help identify opportunities for carrier credits, there are key times to check for carrier credits:

Pre-renewal—One of the best times to ask for carrier credits is when negotiating for renewals. Understanding which plan options have access to carrier credits can allow your organization to make more educated decisions about employee benefits offerings.

Midyear—A simple check-in during the plan year can help ensure approvals are processed on time.
End of the year—If an employer has to use credits before the plan year ends, it’s important to check in and create a plan to use them and not lose them.

A benefits broker may often already be negotiating carrier credits on an organization’s behalf, but it’s good to confirm. They can help navigate the complexities of health plans and negotiate the best possible terms with insurance carriers. They may also be able to help unlock potential credits for unused claims funds already paid. To learn more about credits directly applicable to an organization’s health care plan or future options, employers can ask their broker specific questions about how to maximize credits.

Summary
Unlocking carrier credits in employee health plans is a powerful strategy for employers looking to manage health care costs effectively. Employers can maximize these opportunities by understanding the types of credits available and working closely with a benefits broker. Carrier credits can lead to significant cost savings, enhance employee benefits, and contribute to a health care plan that equips a healthy and productive workforce.

Brokers can be valuable resources in identifying and securing carrier credits. Contact us today for additional employee health plan guidance.