Like many small businesses, Minnesota-based Elder-Jones, a leader in general contracting services in 49 states, Canada and Puerto Rico, has long struggled with the challenges of employer-sponsored group health coverage. High costs and limited choices with no end in sight drove the company to find a better alternative.
So in February 2014, Elder-Jones’ management transitioned employees out of traditional group insurance and into the individual market, with the help of Gravie and its full suite of services. Dennis Hill, Vice President of Finance, says that, while there was an initial learning curve for both the company and for the employees, the transition has been overwhelmingly positive.
“We were dealing with a situation where we had rising costs each year while still not delivering the right benefits to our employees,” says Hill. “We welcomed an approach that would help us rein in costs while at the same time providing our employees with more customized benefits that better met their individual needs.”
“Our employees are coming out better all the way around.”
Hill reports that, with Gravie’s help, employees are typically spending substantially less – half the amount – of their own money on benefits in the individual market (Elder- Jones’ contribution toward health insurance has remained flat) because the plans that Gravie is identifying are less expensive. On average, the total cost of the plans employees bought with Gravie were 24% cheaper than the total cost of plans with their former group insurance coverage.
On average, the total cost of the plans employees bought with Gravie were 24% cheaper than the total cost of plans with their former group insurance coverage.
What’s more, Hill says that most of the plans employees are selecting in the individual market offer richer benefits than the previous group plan. In the group model, Elder- Jones offered 3 plan options. With Gravie, employees were offered more choice (104 plans available to their employees within Gravie’s marketplace) and chose 18 unique plans. Also, when left to their own devices, they bought less expensive plans than what they previously had, which means that Elder-Jones picks up a larger portion of their total cost. “Our employees are coming out better all the way around,” Hill says.
In addition to very satisfied employees, Hill reports that the shift has also been good business for the company, as it has helped them reduce the amount of time management spends on administering a benefits program. “Working with Gravie takes that piece of frustration and staff time out of the equation for us,” Hill says. “And that’s invaluable.”