How Are Health Insurance Premiums Calculated for Small Businesses in Oklahoma?

If you're a small business (2 – 50 employees) in Oklahoma, understanding how your group health insurance premiums are calculated can help you make informed choices—and possibly even manage costs. Here’s a quick breakdown of the driving factors behind how small group health insurance premiums are calculated.

1. Age of Employees

Older employees tend to use more healthcare services, so plans with an older workforce generally cost more. Premiums aren’t usually guaranteed until coverage is written because the average age of enrollees plays a large role in determining the cost of coverage.

2. Location

Premiums vary by region. In Oklahoma, healthcare costs differ by county and ZIP code. It is important to provide your broker with both your county and your ZIP code when requesting a quote so that it can be as accurate as possible.

3. Plan Type and Coverage Level

Plans with lower deductibles, wider provider networks, and more comprehensive coverage typically come with higher premiums. Often, employers can choose to offer more than one plan to help offset the higher premiums for those who do not need lower deductibles or wider networks, for example.

4. Family vs. Individual Coverage

Covering spouses or children increases the total premium compared to employee-only plans. While many employees do not cover the cost of dependent healthcare it is important to keep in mind that dependents on your plan do still play a factor in the final premiums for those plans.

8. Employer Contribution & Participation

The more the employer contributes to the cost of premiums, can correlate to more employees enrolling. When you have a larger group of employees enrolling in coverage, it can help to lower rates since the risk is spread over a more diverse range of ages.