United Benefit Advisors News and Press Releases

UBA Health Plan Survey: Best and Worst States for Group Health Insurance

Posted by: Geoff Mukhtar    January 26, 2017 at 8:30 AM

United Benefit Advisors Announces Top 5 Best and Worst States for Group Health Care Costs

Employer-sponsored health insurance is greatly affected by geographic region, industry, and employer size. While some cost trends have been fairly consistent since the Patient Protection and Affordable Care Act (ACA) was put in place, United Benefit Advisors (UBA) finds several surprises in their 2016 Health Plan Survey.

Based on responses from more than 11,000 employers, UBA announces the top five best and worst states for group health care costs.

The top five best (least expensive) states are: 1) Hawaii, 2) Idaho, 3) Utah, 4) Arkansas, and 5) Mississippi.

Hawaii, a perennial low-cost leader, actually experienced a nearly seven percent decrease in their single coverage in 2016. New Mexico, a state that was a low-cost winner in 2015, saw a 22 percent increase in monthly premiums for singles and nearly a 30 percent increase in monthly family premiums, dropping them from the “best” list.

The top five worst (most expensive) states are: 1) Alaska, 2) Wyoming, 3) New York, 4) Vermont, and 5) New Jersey.

Wyoming catapulted itself onto the list this year with monthly premiums for singles and families increasing from $534 and $1,326, respectively in 2015 to $662 and $1,453, respectively in 2016 (representing nearly a 24 percent increase in single coverage and nearly a 10 percent increase in family coverage).

“Benchmarking by state, region, industry, and group size is critical,” says Les McPhearson, CEO of UBA. “We see it time and time again, especially with new clients. An employer benchmarks their rates nationally and they seem at or below average, but once we look at their rates by plan type across multiple carriers and among their neighboring competitors or like-size groups, we find many employers leave a lot on the bargaining table.”

Group-Size Trends

After being hit the hardest in recent years, UBA finds small employer costs are lower than average overall, but family plans among these groups saw big rate hikes in 2016, making it harder for small businesses to be family-friendly employers.

Industry Cost Trends

According to the UBA Health Plan Survey, retail and construction employees are the cheapest to cover and employees in these sectors pick up more of the premium, so employers bear even less of the already low costs. Government employees get the richest and priciest plans, but are slowly being asked to pay more of the cost (albeit still far less than what other private sector employees pay).

“Benchmarking at this level offers tremendous benefits that result in approximately 44 percent savings,” says McPhearson. “Plus, being able to assure employees that they are getting a much better plan than their local competitors benefits UBA Partners from an attraction and retention standpoint.”

For further information about regional differences, UBA provides several free resources, including:

For a custom benchmarking report, contact a UBA Partner Firm near you.

About United Benefit Advisors
United Benefit Advisors® (UBA) is the nation’s leading independent employee benefits advisory organization with more than 200 offices throughout the United States, Canada, and the United Kingdom. UBA empowers more than 2,000 Partners to both maintain their individuality and pool their expertise, insight, and market presence to provide best-in-class services and solutions. Employers, advisors and industry-related organizations interested in obtaining powerful results from the shared wisdom of our Partners should visit www.UBAbenefits.com.

Topics: health care costs, Group health plans, Les McPhearson, UBA Health Plan Survey, employer-sponsored health insurance, health care benchmarking, industry benefit cost trends