We are seeing rate increases come in across employers for 2022, and the news is not good. Fully-insured renewal rates are between 10%-20%, and self-insured stop loss is at 5%-10%. Employers have approximately 70 days until coverage takes effect, and there is only one step that can have an impact at this point. 

In 2021, rate increases started high because of ambiguity around the impact of COVID-19 and high utilization. But utilization ended up relatively low as elective surgeries fell nearly 30% in 2020 from the run rate. The vast majority of COVID hospitalizations and ICU utilization were from Medicare patients, not employer-sponsored patients. This begs the question for employers: Did you get a refund? The answer is probably not. 

In 2022, the reasoning behind the sharp rise in rates is the pent-up demand for services, specifically for procedures pushed out until the coming year and catastrophic events that are now more likely to occur because of delayed care. Catastrophic events from chronic patients are indeed more likely, but surgical utilization and high-cost emergency events, e.g., trauma and burn, are still expected to be below 2019 levels. When this nets out, does this equate to a 10%+ increase? 


So, what now? Narrower network? Reference-based pricing? Direct primary care? Captive? High-cost drug carveouts? New TPA? None of these solutions are feasible for 2022 at this point, and some offer little to no benefit regardless of the year. 

You have one option in the 70 days left of 2021. It’s a mantra we often use at Mployer Advisor that bears repeating here: Who you choose as your employee benefits advisor or broker has the single largest impact on your benefit plan’s cost and quality. I was speaking to a broker yesterday who was excited they moved a new client from 25% renewal down to 4% based on working with the carrier. It was not magic, it was just standard diligence by a strong broker. 

If you get dinged with the same high increase every year and think, “I need to do something about this,” let this be a sign that the time is now. A quote often used and mistakenly attributed to Albert Einstein comes to mind: “Insanity is doing the same thing over and over and expecting different results.”  

 At some point, it is no longer the broker or carrier’s fault–the blame must fall to you. 

You pay the carrier, and you pay the broker–you, the employer, are in control. If you are not happy, make a change. There are 70 days left in the year. It took the Europeans in the 1500’s 40 days on average to sail across the Atlantic to the Americas on a wooden boat with no internet and only a compass. You can find a new benefits advisor and carrier in the 70 days left. The decision is up to you.  

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