About this Premium Survey |
The Premium Comparisons show the rates each carrier would charge a sample small employer for group coverage for one month for a range of standard SEH health benefit plans. The premiums for each plan are effective January 1, 2012 and are listed for comparison purposes only. Premiums for each plan are subject to change throughout the year and may vary among small employers, but only according to the age, gender, and family status of the employees in the group, and the location of the business in New Jersey. According to the SEH rating rules, the highest rate for a small employer can be no more than twice the rate for any other small employer with the same carrier and plan. The charts will not provide an employer with an exact premium for its group, but will demonstrate the relative pricing among carriers in the market for the sample group. A carrier that provides the lowest rate for the sample group for a particular benefit will not necessarily provide the lowest rate for a group whose employees have different age, gender, or family status characteristics than the sample group.
The report compares the premium shown for 2012 to the premium shown in the 2011 survey, and calculates the percentage increase. This percentage increase is only indicative for the plans of coverage shown, and for the particular sample group specified. The percentage increase shown in this report is for the standard plans, and may be different than the average percentage increase for all plans. The percentage increase may also be different for groups with different age/gender or family structure compositions.
Rates are allowed to vary by employer location. Therefore, the sample premiums have been compiled for businesses located in Bergen, Camden, and Middlesex counties. The relationship between different carriers’ premiums may change, depending on the location of your business. (The survey does not request premium information for businesses located in the other counties.) The monthly premiums listed on the Premium Comparisons are based on a small employer with six employees and their dependents, as described below:
- Single female employee age 27;
- Single male employee age 37;
- Female employee age 47, with two children;
- Male employee and spouse, both age 57;
- Male employee age 27, with spouse age 24, and two children; and
- Female employee age 47, with spouse age 50, and two children.
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| Plan Options |
One of the protections of the law governing small employer overage is the standardization of health benefit plans. The standard plans are named A, B, C, D, E and HMO. Plan A is a limited benefit plan that primarily covers hospital services. Plans B – E and HMO are comprehensive plans that cover a full range of hospital, medical and prescription drug services. Plans B, C, D and E differ in that after the satisfaction of the deductible, the plans pay coinsurance of 60%, 70%, 80% an 90%, respectively. The plans may feature a copayment for one or more services. The HMO plan may require the payment of a copayment for services or may require a combination of copayment, deductible and coinsurance.
The standard plans are typically sold as managed care plans identified by acronyms such as PPO, POS, EPO and HMO-POS. PPO, POS and HMO-POS plans provide coverage for the services of network providers and non-network providers. An EPO plan is similar to an HMO plan in that the plan requires use of network providers.
Non-HMO carriers must offer Plan A, and at least two of the other standard plans. HMOs must offer the standard HMO plan. Carriers may offer optional riders of increasing or decreasing value. The plans must be offered with and without such riders.
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| Understanding Rates |
The Department and the SEH Benefits Program Board do not set or approve rates. Carriers are required to file rates with the Department prior to using them. The law permits carriers to consider only three factors (other than plan of benefits, issue date, and family status) in determining the rates for a small employer group:
- the age of the employees
- the gender of the employees, and
- the location of the business in New Jersey
Carriers may not consider the health status or past claims experience of a group in determining premiums. The law requires carriers to limit variation in cost to a two-to-one ratio. Thus, the rate for the highest cost group (based on age, gender, and geography) may not be more than two times the rate for the lowest cost group of the same size.
Carriers may base rates on the age and gender characteristics of all the employees in the company or on only the employees that are actually enrolling in the plan. |
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| Rate Changes |
Section 5 of P.L. 2003, c. 27 requires that a carrier must provide a renewing employer 60 days notice of any rate increase. (Section 1 of this law also imposes notification requirements on employers.)
Generally, at renewal, if an employer's rate changes, it is for one or more of the following reasons:
- a change in the age/gender composition of the group
- a change in the location of the business
- a change in the factors that the carrier uses to reflect age, gender, and location
- a change in the carrier’s rate for the plan of benefits
- a change in the plan of benefits offered by the employer
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| Shopping for Coverage in the Small Employer Market |
Carriers in the small employer market are required to issue coverage to eligible small employers who meet the participation and employer contribution requirements. An eligible small employer has from 2 to 50 eligible employees, where “eligible employee” means a full-time, bona fide employee who works a normal work week of 25 or more hours.
Small employers are required to meet a 75% minimum participation requirement, which means generally that 75% or more of the full-time employees must either participate in the employer's plan (or have other qualifying coverage) in order for the employer to be eligible to purchase SEH coverage. Credit for participation is given for employees that do not take coverage but are covered under another group health plan (for example, as a dependent) or under Medicare, Medicaid, or New Jersey Family Care.
A small employer is required to pay at least 10% of the overall premium for the entire group. However, the employer may elect to contribute more than 10%.
To obtain a price quote from a carrier, contact the carrier or an authorized insurance producer (agent or broker). Carriers and authorized producers are required to provide a price quote to a small employer within 10 working days of receiving a request for a quote which contains the information necessary to provide the quote. The producer is also required to provide you with the amount of compensation (as a dollar amount or percentage of premium) received by the producer from the carrier.
Many carriers offer plans with riders that have fewer benefits and cost less than the standard plans illustrated in this survey. In considering these lower cost rider options, employers should make sure they and their employees understand the implications. The decreased benefits riders could exclude or limit certain services and supplies covered by the standard plans, or impose higher cost-sharing (deductibles, copayments, and coinsurance).
In addition to cost, an employer may want to consider 1) the financial strength of the carrier; 2) the carrier's reputation for service; and 3) for HMO, POS, and PPO plans, the carrier's network of providers, in making a decision about coverage.
Other information about small employer health coverage is available online at the Department’s web site at: www.state.nj.us/dobi/division_insurance/ihcseh/index.html.
You may also contact an insurance producer (broker or agent) for information.
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| 2012 Premium Comparisons (All files are PDFs) |
Bergen County
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Camden County
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Middlesex County
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Examples of Single and Family Rates
The published premiums in the Premium Comparison Survey do not show the cost for all single employees or families in a group with these rates. The table below provides the monthly rate for a single employee and a family for the specified group in Middlesex County, for the typical plans and larger carriers shown below. |
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| $20 Copay HMO Plan |
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Services must be provided in network. There is a copayment of $20 per office visit and $200 per hospital day. Plans are available with increases or decreases in benefits (or both.) For instance, a plan may waive the hospital copay (an increase) but have a $30 office visit copay (a decrease).
The standard prescription drug plan either covers 50% of the cost or has a $15 copay. Most carriers also offer other drug plans through riders that provide 2 or 3 tier copays, for generic, brand, and preferred brand. This may result in a total cost that is higher or lower than a plan with the standard drug benefit. |
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Carrier |
Single Rate |
Family Rate |
Aetna Health |
$569.00 |
$1,832.00 |
AmeriHealth HMO |
$817.58 |
$2,415.96 |
Horizon HC of NJ |
$550.88 |
$1,657.75 |
Oxford HP (NJ) |
$552.00 |
$1,710.00 |
Notes:
Aetna rate is for a $30 copay plan.
Oxford rate is for the company's Liberty Network. |
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| $20 Copay/$500 Deductible Plan C POS |
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A POS plan allows covered services to be obtained from health care providers in network or out of network. In-network services are provided with the same copayments as the HMO Plan above. Out-of-network services require a $500 deductible, and are then covered with the insured paying 30% of the allowed charge. Standard POS plans cover prescription drugs subject to the out-of-network deductible and coinsurance. Most carriers also offer other drug plans through riders that provide 2 or 3 tier copays for generic, brand, and preferred brand. This may result in a total cost that is higher or lower than a plan with the standard drug benefit. |
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Carrier |
Single Rate |
Family Rate |
Aetna Health |
$759.00 |
$2,444.00 |
AmeriHealth HMO |
$893.97 |
$2,641.67 |
Horizon BCBS of NJ |
$931.06 |
$2,801.81 |
Oxford Health Insurance |
$813.00 |
$2,519.00 |
Notes:
Aetna rate is for a $30 copay plan with $2,500/$5,000 out-of-network deductible, $400 per day in-patient copay plan, and 100% in network/70% out-of-network coinsurance.
Horizon rate is for a $50 copay plan with $5,000 deductible and 100% in-network/70% out-of-network coinsurance.
Oxford rate is for the company's Liberty Network. |
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