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EANJ finding success with its health plan

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The Employers Association of New Jersey said Tuesday it is now enrolling about 70 of its members a month in the self-funded health plan it offers through a partnership with QualCare, a health care network that specializes in running self-insured plans for employers.

EANJ focuses on helping small and mid-sized employers address human resources issues — and for many years, the spiraling cost of health coverage has been their biggest headache.

In 2011, EANJ partnered with QualCare to offer its members a new health plan via QualCare’s Affiliated Physicians & Employers Health Plan, a self-insured multiple employer plan that currently covers about 14,500 people.

EANJ President John Sarno said he expected the 2010 Affordable Care Act to increase the cost of coverage for small employers, and he wanted EANJ to offer its members an alternative. 

To date, EANJ has signed up 1,250 of its members with QualCare, and said the retention rate is 96 percent. That is in contrast to the longstanding practice in which employers switch from one health insurer to another — sometimes on a yearly basis — to avoid double-digit premium spikes.

Edward Marra is plant comptroller for Somerset-based Power Container Corp., whose 35 employees make packaging materials for the health and beauty and pharmaceutical industries. He said that, in the past six years, the company has switched health insurers four times to avoid premium increases as high as 20 percent.

Last November, he joined EANJ and signed up with the QualCare plan. Marra said his health care costs rose only about 2 percent compared with his previous insurance carrier.

“No one is getting hammered with crazy rates, and the employees are able to keep the providers they want to use,” he said.

That said, decades of rising health care costs mean health coverage is an expensive proposition.

For a family under the new QualCare plan, the total monthly cost is $1,616. The company pays $1,085 and the employee contributes $531 a month.

Barry Fields is vice president of employee benefits for JGS Insurance in Holmdel, and he recommended that Marra's company make the switch to QualCare. He said he has placed several clients with QualCare, and "their experience has been good and their renewal (rates) have been competitive and stable."

He said employers switch health insurers because they can get lower rates that insurers offer to attract new business: "That is why companies end up switching every year — so they can take advantage of the new business rate from the new carrier."

He said that, last year, he took on a new client, an equipment manufacturer with 50 employees, that had been with the same insurer for more than 30 years and was absorbing premium increases year after year. Fields said he moved that business to QualCare last October, for a cost saving of  more than 40 percent.

Marra said the QualCare product works well for his company, which has several employees based outside the state, including in Pennsylvania and Florida, since the QualCare network has doctors and hospitals throughout the country.

Health coverage is an essential benefit that his company must offer in order to recruit and retain good employees, Marra said.

“If we want to keep employees, we have to be willing to do this; it’s not just the paycheck.”

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Beth Fitzgerald

Beth Fitzgerald

Beth Fitzgerald reports on health care, small business and higher education. She joined NJBIZ in 2008 after a 34-year career at the Star-Ledger and has been reporting on business in New Jersey since 1978. Her email is beth@njbiz.com and she is @bethfitzgerald8 on Twitter.

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