What is Group Health Insurance?
For most small businesses, offering group health insurance is the single most valuable benefit you can provide your team—and often your largest recurring expense outside of payroll.
Yet many employers with 5 to 100 employees assume they cannot access the aggressive pricing and custom plan structures available to massive corporations. That assumption is costly.
How Small Group Plans Work
In Missouri, Illinois, Kansas, and South Carolina, group health coverage allows businesses to pool their employees together under an employer-sponsored plan.
Key fundamentals include:
- Employer Contribution: Typically, employers cover at least 50% of the employee-only premium, while dependent coverage can be voluntary or subsidized.
- Participation Thresholds: Most carriers require 50% to 75% of eligible, non-waiving employees to enroll.
- Pre-Tax Savings: Premiums paid through a Section 125 cafeteria plan lower payroll taxes for both the employer and employees.
Level-Funded vs. Fully Insured Plans
Small businesses often start with standard fully-insured plans from major carriers, where premium rates are fixed and any unspent claims reserve is kept by the insurer.
With level-funded arrangements, small businesses pay a predictable monthly amount that covers:
- Administrative fees
- Stop-loss insurance (capping maximum risk)
- A claims fund
If your team has lower claims throughout the plan year, your business receives a surplus refund or credit at renewal.
Average Savings: $2,000 to $4,000 Per Employee
By shopping more than 25 group carriers and exploring modern network options, our small group clients routinely save $2,000 to $4,000 per enrolled employee without reducing benefits or increasing out-of-pocket maximums.
If your renewal notice just arrived with a double-digit rate hike, call us at (636) 536-0386 or request a quote online.