Small businesses are trying several strategies to bring down their healthcare costs, reports an article in USA Today. Average healthcare premiums for firms with three to 199 employees rose 10% from 2004 to 2006, compared with 9% for larger companies. One option for small employers is to purchase health insurance through professional employer organizations, which function as a personnel office for a cost of 2% to 7% of annual payroll. The clout that PEOs exercise buying health plans for a large pool of small employers resulted in an average premium increase of only 3% from 2005 to 2006, according to the group’s national association. Health savings accounts have also become popular among small businesses, with 33% of small companies that had not previously offered health insurance now providing an HSA for employees. Keeping employees healthy is yet another tactic small businesses are taking. One employer offered incentives to his 25 workers to lose weight and quit smoking and his expected premium increase of 40% dropped to 15%.
