Hartford Business Journal

12 HARTFORDBUSINESS.COM | August 15, 2022 Tim Klimpl is an employee benefits lawyer at law firm Carmody, Torrance, Sandak & Hennessey. HBJ PHOTO | ROBERT STORACE Here's how CT small employers can handle threat of major health insurance rate increases By Robert Storace rstorace@hartfordbusiness.com Connecticut's small employers once again face the prospect of significant health insurance price increases in the year ahead, leaving them in a bind as they fight for talent amid a tight labor market. The six health insurers serving Connecticut's small group market last month asked state regulators for an average 14.8% rate increase on plans serving employers with 50 or fewer workers. While the Connecticut Insurance Department may reduce some or all of those rate requests, many employers are still likely to see price increases. But any efforts to shift those higher costs to employees — a trend that's gone on for years especially as more employers have embraced high-deduct- ible health plans — or reduce benefits could upset workers at a time when companies in myriad industries are facing labor shortages. Jeffrey Hogan — a longtime employee benefits broker who last year founded his own Farming- ton-based consultancy, Upside Health Advisors — said the rate of inflation for health plans consistently outpaces the general economy, even at a time when the costs for many U.S. goods have soared over the past year. Hogan said many employers in Connecticut are now regularly facing annual family premiums that cost upwards of $40,000. "These unabated cost increases pose an existential threat to employers who are having difficulty competing in the open marketplace both for new employees and for the retention of existing employees," said Hogan, who noted that compa- nies faced with higher healthcare costs will have less money to invest in their businesses and pay competitive wages. Companies will need to respond to the latest rate increases, experts said, in a number of potential ways, including by shopping around for new plans, or finding ways to trim costs, like offering wellness initiatives that often lead to premium discounts. Breaking down the numbers The newly-requested increases for small group policies taking effect Jan. 1, 2023, range from 3.6% to 29.3%. The overall average small group plan increase was 14.8%. Farmington insurer ConnectiCare asked for the largest average increase of 29.3% for an off-exchange plan that covers over 16,000 policyholders. The other insurers requesting double-digit price increases on small employers include Aetna, Cigna, Oxford Health Plans and United- Healthcare. Anthem proposed the lowest average price increase of 3.6% for a plan on the state's health insurance exchange (Access Health CT) that covers more than 19,000 policyholders. All together, the small group insurers cover 92,610 lives in the state, and they blamed the higher rates on rising healthcare costs, Jeff Hogan

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