If your group health plan renews January 1, you still have time to do more than sign the renewal, but not much. From mid-October there are about ten weeks left, and open enrollment has to fit inside them.
This guide is for Texas employers with 50 or more employees who have an increase in hand, or are still waiting for one. It covers what you can still change, what is running out of time, and the order to do it in.
When your renewal should arrive
In Texas, your carrier must send renewal rates at least 60 days before they take effect (Texas Insurance Code 1254.001). For a January 1 plan year, that means by November 2. If you have not seen yours yet, ask for it this week rather than waiting for it to show up.
Sixty days is the legal minimum, not a good schedule. A group of 50 or more should start renewal work 120 to 180 days out. If that did not happen this year, the plan below makes the most of the time left. The longer case for starting early is in why your renewal should arrive 60 days early.
74 days from October 19 to January 1
Where the time goes for a January 1 renewal started in mid-October.
What you can still change
1. Request your claims report today
If your plan is fully insured, your carrier must provide a written claims report within 30 days of a written request (Texas Insurance Code 1215.003). The 30-day clock is why this comes first. The report shows whether the increase is driven by your own claims, and it is what other carriers will want to see. Our group health insurance quote checklist explains what is in it.
2. Push back on the renewal itself
A first renewal offer is not always the final one. With claims data in hand, your broker can question the increase with the carrier you already have.
3. Change the plan design, not just the price
Adjusting deductibles, copays or out-of-pocket limits, or adding a second plan option, can bring the cost down without leaving your carrier.
4. Change how you contribute
How much you pay toward employee and dependent coverage is your decision, and it can be adjusted at renewal. If you have 50 or more full-time equivalent employees, check that employee-only coverage still meets the ACA affordability test. See ACA compliance.
5. Get competing quotes, if the timeline allows
Above 50 employees, carriers can price your group on its own claims and demographics, so a quote usually needs your census and claims report first. This is the step that runs out of time fastest.
6. Look at level-funding
For groups from about 50 to 200 employees, a level-funded plan can cost less than a fully insured one when claims have been good. These carriers usually ask for claims data or employee health information before they give a firm rate, so it needs to start early. See level-funded vs self-funded plans.
Changing brokers this close to January 1
You can. A broker of record letter moves your account to a new broker without changing your plan or carrier. The new broker can then work your existing renewal and request your claims data.
What slows things down is having several brokers approach the same carriers. Carriers release one set of rates for a group, so it is better to choose one broker and let them work the market. More on this in when to switch employee benefits brokers.
If you want a second opinion on the renewal you are holding, ask for a free benefits cost review. Send the renewal and your headcount, and we will tell you plainly what can still be done before January 1.
Questions about January 1 renewals
Is it too late to shop our group health plan for January 1?
Not if you start now. Negotiating the renewal and changing plan design can be done in a few weeks. A full move to a new carrier is tighter, because quotes for a group of 50 or more usually need a census and claims data first.
What if our renewal has not arrived yet?
Under Texas Insurance Code 1254.001, renewal rates must be sent at least 60 days before they take effect. For January 1, that is November 2. Ask your broker or carrier for it now.
Do we have to offer the same plan as last year?
No. The plan year is the normal time to change plan design, carriers or how much you contribute. If you are an Applicable Large Employer under the ACA, the coverage you offer full-time employees still has to be affordable.
Can we move to level-funding for January 1?
Sometimes. It depends on how fast the carrier can underwrite your group, which usually means claims data or employee health information. Groups that start in October have a better chance than groups that start in December.
Written by
Trey Driver
President of Medcore Brokerage in McKinney, Texas. Licensed in Texas and Oklahoma (TX General Lines Agent #1797664), helping Texas employers with 50 or more employees design and run their benefits since 2012.
