How Business Health Suffers From Rising Insurance Costs

Finding Long-Term Solutions Through Transparency

Over the past year, I’ve evaluated the financial health of many businesses and noticed a troubling trend: the overwhelming cost of health insurance is making companies financially unwell. This "fever" impacts not only the bottom line but also the well-being of CEOs, CFOs, and, most critically, employees who may lose their jobs as a result. While benefits departments are rightly concerned about increasing deductibles, changing doctors, and the administrative burden these changes place on staff, it’s important to consider the bigger picture. Is it short-sighted to focus solely on the employees who remain, when there are always candidates ready to fill open positions?

Ensuring the financial health of a business should be the top priority for both employers and employees. Financial stability means long-term job security and the ability to weather economic challenges, improving the quality of life for everyone involved. Without solvency and profit, businesses simply cannot survive.

The solution to skyrocketing insurance costs isn’t quick—it requires a long-term strategy grounded in transparency. Contrary to popular belief, rate increases are not inevitable. The difference comes down to having the right tools at your disposal, tools that many benefits and human resources departments have yet to discover.

Why is your HR department unaware of how to keep health insurance costs down? The answer is simple: HR professionals are experts in people management, not in the complexities of purchasing insurance or negotiating contracts. Just as a CEO might struggle with payroll administration, HR teams may not know how to secure the best possible deal on health insurance. This isn’t a personal failing—it’s a systemic problem. The insurance system lacks transparency, often benefiting agents and carriers rather than employers. As a result, companies have been fed misleading data and have come to accept inflated costs as normal.

Types of misleading data statements – “Your group is running at 110% loss ratio”, “We’ve gone to every carrier and your carrier is still offering the best rates” "Your group has some really large claims" “Rates are going up everywhere there is nothing we can do”  “You received a “trend” rate increase of only 5%, it’s really good in this market”.  Have you heard of any of these?  Do you know why they are misleading?

You can’t lower costs if you don’t know what benchmarks to aim for. Think of it like running a marathon: to win, you need to know winning times, how much to train, the right nutrition, and strategies to improve your speed. Showing up without preparation won’t yield results.

While having a good insurance agent is important (for the record, we are insurance negotiators, not agents), businesses often judge their agents by factors like responsiveness, friendliness, or small rate reductions. But do you know what your premiums should actually be? What’s a good rate, and how do you get one? What are other companies paying? If your agent isn’t providing competitive rates, how do you find better options? Are you being offered every available service and choice?

In our experience, more than 80% of our clients believed they had a good agent—until they saw the hard numbers. Only then did they realize they were paying much more than others and missing out on better deals. Our clients can keep their agent they like and still fix the problem, that's a win!