Every health insurance renewal tells a story.
Sometimes the answer is changing carriers. Sometimes it’s exploring a level-funded plan or a MEWA. And sometimes the best solution is making a few thoughtful adjustments to an existing plan while keeping disruption to a minimum.
Here’s an anonymized example from a recent renewal. Some details have been simplified to protect the employer’s privacy, but the numbers and decision-making process reflect an actual case.
The Health Insurance Renewal Situation
The employer had maintained a legacy (pre-ACA) health insurance plan for many years. Like many employers with older plans, they valued the familiarity of the benefits and preferred to avoid unnecessary disruption if possible.
When their renewal arrived, the premium increase was 22.69%.
That immediately raised an important question:
“Is there a better way to manage this renewal?”
Looking Beyond the Initial Renewal
A premium increase doesn’t automatically mean an employer needs to change carriers.
Our first step is usually to determine whether a different plan design with the same carrier can better balance premium, benefits, and long-term costs.
In this case, we identified an alternate plan that kept many of the features employees were already accustomed to.
The individual deductible remained at $2,500, with a $5,000 family deductible.
Primary care, specialist, and urgent care office visit copays stayed essentially the same.
The largest changes were:
- The plan paid 80% after the deductible instead of 100%.
- The maximum out-of-pocket increased modestly.
- The emergency room benefit changed to a different cost-sharing structure.
While those are meaningful changes, the overall feel of the plan remained very similar.
More importantly, the premium increase dropped from 22.69% to 9.7%.
Here’s a simplified comparison of the most meaningful changes.
| Benefit | Current Renewal | Alternate Legacy Plan |
|---|---|---|
| Premium Increase | 22.69% | 9.7% |
| Individual Deductible | $2,500 | $2,500 |
| Family Deductible | $5,000 | $5,000 |
| Coinsurance After Deductible | 100% | 80% |
| Maximum Out-of-Pocket | $2,500 Individual $5,000 Family |
$3,500 Individual $7,000 Family |
| Primary Care Visit | $30 Copay | $30 Copay |
| Specialist Visit | $60 Copay | $60 Copay |
| Urgent Care | $75 Copay | $75 Copay |
| Emergency Room | $300 Copay | $250 Copay + 20% Coinsurance |
We Also Looked at the ACA Alternative
For comparison, we also reviewed what moving to an ACA-compliant version of comparable coverage would look like.
That illustration offered a slightly lower deductible but also included:
- A substantially higher maximum out-of-pocket.
- A less favorable emergency room benefit.
- Higher prescription drug copays across multiple tiers.
One of the most surprising findings was the premium.
The ACA alternative produced an increase of approximately 141% for this particular employer.
For this employer, the comparison looked like this.
| Benefit | Alternate Legacy Plan | ACA Alternative |
|---|---|---|
| Premium Increase | 9.7% | 141% |
| Individual Deductible | $2,500 | $2,400 |
| Family Deductible | $5,000 | $4,800 |
| Coinsurance After Deductible | 80% | 100% |
| Maximum Out-of-Pocket | $3,500 Individual $7,000 Family |
$5,750 Individual $11,500 Family |
| Primary Care Visit | $30 Copay | $30 Copay |
| Specialist Visit | $60 Copay | $60 Copay |
| Urgent Care | $75 Copay | $75 Copay |
| Emergency Room | $250 Copay + 20% Coinsurance | Deductible + $450 Copay |
| Prescription Drugs | $10 / $25 / $40 Tier 4: 25% (Max $200) |
$15 / $60 / $120 Tier 4: $400 Copay |
That result doesn’t mean ACA plans are always more expensive or that they are the wrong choice for every business. Every employer’s situation is different.
It simply illustrates why we evaluate each renewal individually instead of assuming one approach will fit every group.
The Employer’s Decision
After reviewing the available options, the employer chose the alternate legacy plan.
Reducing the renewal increase from 22.69% to 9.7% while keeping the deductible the same and minimizing changes to employee benefits met their primary goal.
Because preserving their existing legacy coverage was important to them, they also decided not to complete a broader health insurance prescreen this year.
Could additional options have been available?
Possibly.
But every renewal involves balancing premium, benefits, disruption, and administrative effort. In this case, the employer felt the revised renewal struck the right balance.
What Other Employers Can Learn
One renewal doesn’t predict another, but this case illustrates several principles we see regularly.
A large renewal increase doesn’t automatically mean you need to change carriers.
Sometimes relatively modest benefit adjustments can significantly reduce a renewal increase while keeping the overall employee experience largely intact.
Sometimes the best decision is to explore the broader market through a health insurance prescreen.
And sometimes the best decision is to stay exactly where you are.
Our role isn’t to push employers toward one particular type of plan. It’s to evaluate the available options, explain the tradeoffs, and help each employer choose the approach that best fits their goals.
Case Study Note: This article is based on an actual employer renewal. Certain plan details have been simplified or omitted, and identifying information has been changed to protect client confidentiality. Every employer’s situation is different, and renewal options vary based on plan design, carrier, underwriting, and other factors.
About the Author: Ted Stevenot is a Partner at McCarthy Stevenot Agency and has helped Ohio employers evaluate employee benefits since 1991. His work focuses on helping small businesses compare traditional group health insurance, level-funded plans, MEWAs, and ICHRAs while balancing cost, employee benefits, and long-term sustainability.
The case studies in this series are based on real employer situations, with identifying details modified to protect client confidentiality.