I'm being offered a role at a startup. It's a non-US company with about 6 employees in the US, including myself. I need coverage for me, wife and two children. We have a choice of three PPOs and as an example I'll share the middle one in terms of cost:
In-Network Overall Deductible: Family $1,000
Out-of-Network Overall Deductible: Individual Family $3,000
In-Network Out-of-pocket Limit: Family $7,000
Out of Network Out-of-pocket Limit: Family $14,000
Monthly Cost Analysis for Employee + Family: $1,882.85
The company is saying my cost is after their $1,200 contribution so the total cost of my family's insurance would be $3,083/month ($37k/year) of which my employer is only paying 39%. My previous employer offered a HDHP and I was only paying $350/month – I know PPOs cost more but the jump in cost is extremely high it seems. I'm trying to understand why it's so high? Is it because there's only a handful of US employees and the company isn't able to access better insurance rates?
Can someone explain why potential new employer's health insurance premiums are so high?
byu/5thape inInsurance
Posted by 5thape
5 Comments
Yes. With only a handful of employees, your company is just a rounding error for the health insurance companies and benefits managers, while still requiring a considerable effort to onboard and service your company.
Everything works on economies of scale, and employer health insurance is no different
They’re also not covering the cost of premiums as much as other companies do.
37k for a family plan is very high, especially for that deductible level.
I’d guess this is a combination of the low employer contributions, a very small company, and at least one pretty unhealthy person in your office driving up pricing.
Edit: I was thinking about this and a group this small is probably community underwritten so the experience shouldn’t matter. The price still seems very high. I’d expect something in the 25-30k range.
Your employer do not have enough people for a good discounted plan .
northeast it’s around twice that for unsubsidized ACA coverage so this is pretty good for a group this small