Small Business Insurance Premiums May Rise up to 15 Percent (Bottom Line)

Depending on the insurer, small business owners in Arkansas can expect health insurance prices to go up noticeably in 2008.

This is probably doesn’t come as a surprise, as rates tend to increase more than decrease.

Mike Stock, CEO of QualChoice/QCA, said he expects rates for most small business policies will go up between 8 percent and 9 percent in 2008.

Some policies might only increase slightly, while others could go up by 15 percent, depending on the health and age of each business’s workforce and where it’s located.

Overall, rates for businesses in Northwest Arkansas will probably increase by 8 percent to 9 percent, he said.

Next year, QualChoice will begin offering some policies with lower premiums. But these policies exclude some previously state-mandated benefits such as mental health and maternity coverage. Excluding this coverage will likely lower premium costs by 5 percent to 10 percent.

QualChoice offers policies that range in price, with deductibles that run from $250 to $5,000.

Arkansas Blue Cross & Blue Shield offers nine preferred provider organizations and six health savings accounts tailored for small businesses, said Max Heuer, a spokeswoman with the insurer.

Heur said rates for BCBS small business plans will likely increase by 8 percent to 10 percent next year.

Chamber Program Insures Members

Since it was introduced through the North Little Rock Chamber of Commerce in 2004, the Chamber Alliance Program has offered health insurance to businesses with fewer than 199 employees.

As of Nov. 1, there are 137 organizations taking part in the program statewide, with 894 covered employees and 1,310 total enrollments, including family members.

Insurance agents who are members of their local chamber can sell the policies, which are underwritten by QualChoice.

The Fayetteville Chamber of Commerce currently has nine members that have enrolled 29 people in the program, said Virgil Neuroth, vice president of the Chamber.

“[Enrollment] is continuing to grow,” he said. “The Chamber employees themselves have that coverage, and our experience with it has been good.”

The Bentonville/Bella Vista Chamber of Commerce has 10 businesses enrolled through the program, including the Chamber itself and the Crystal Bridges Museum of American Art, said Ed Clifford, president and CEO of the Chamber.

Wayne Calhoun, an independent insurance agent in Bentonville, sells many of the policies to BBV Chamber members.

“We’ve got several companies using it and they all seem to be very pleased with it,” he said.

The Rogers-Lowell Area Chamber of Commerce has 17 employees in five organizations covered through the program.

The Springdale Chamber of Commerce does not participate in the program.

Computer Dealer Splits Premiums

Of course, there are many ways for small business owners to address employee health insurance.

One business that does things a bit differently is MegaByte Computer Center in Fayetteville, said owner Jhonnie Taylor. The certified Apple computer retailer employs 13 full-time and part-time workers, and pays for half the cost of each employee’s individual policy.

Taylor lets each employee shop around to find the best policy and price for themselves, or allows them to keep their existing policies, she said.

If a worker needs help finding a policy, Taylor will help with that as well.

“The advantage to the individual is if they leave, they take their policy with them,” she said.

Some of MegaByte’s employees are students and are covered through school or their parents, while others are covered through their spouses’ policies, Taylor said.