ASK ALISON Controlling Your Dealerships’ Healthcare Costs By Alison McCallum, EPIC Insurance Brokers and Consultants With record-breaking general inflation rates, the specter of significant medical insurance cost increases has been looming over employers and individuals alike. Many dealerships are grappling with medical insurance cost increases that are dramatically higher than what they experienced during the years of COVID-driven cost suppression. It is crucial for dealerships that are facing unaffordable increases in their medical insurance costs to explore various strategies to mitigate their financial burden. One common approach used by insurance providers is to project high expected trends in healthcare costs even though this inflation may not necessarily materialize. With large trend rates impacting renewal costs, dealerships should closely examine alternative funding options — especially those where maximum costs are capped. Under these programs, the dealership is not responsible for paying excessive amounts if these projected costs do not materialize, yet there is downside protection if they do. Captive Insurance programs can also mitigate individual client risk. Emerging providers in many markets can also help lower healthcare access costs. These providers offer innovative solutions to avoid shifting towards even higher deductibles and increased cost-sharing. By partnering with such providers, dealerships can provide their employees with more affordable healthcare options without compromising the quality of care. Managing eligibility and contribution strategy is another critical opportunity in controlling healthcare costs. Implementing eligibility and contribution management strategies won’t lower per-employee costs but can reduce overall employer spending. By carefully evaluating eligibility requirements and contribution structures, dealerships can optimize their healthcare plans and ensure that they are not overpaying for coverage. It is essential to work with an innovative broker who possesses the knowledge, access and market clout to educate your dealership about these available options. Early engagement with such a broker can help minimize disruption and ensure that dealerships are steered toward the optimal solution that meets their specific needs. The broker should offer comprehensive solutions, market influence and expansive resources to guide dealerships toward the most suitable healthcare options so your dealership can make informed choices to balance budgetary and employee satisfaction. If you would like more information or a review of your current benefits/costs, EPIC is happy to provide details to CNCDA members at no cost. A EPIC ranks among the top 15 retail insurance brokers in the United States and is the largest insurer of auto dealers in the state. Alison McCallum has been in the employee benefits industry for over 20 years and personally works with more than 80 California Dealerships. She is a Principal with EPIC Insurance Brokers and Consultants. EPIC offers unique dealership expertise and services available to CNCDA dealer members at no cost. If you have questions or would like further information, please feel free to contact her at (949) 417-9136 or alison.mccallum@epicbrokers.com. 20 California New Car Dealer Quarterly
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