Health Insurance Costs in Arizona

Goals

For employees and employers, determine the average cost of healthcare for small businesses in the Phoenix area per employee. Assume that Medical, Dental, and Vision are all included, and the co-pay and annual deduction are affordable. This information will inform a forecast budget for an increase in employee headcount.

Early Findings

Arizona Averages

  • The lowest average health insurance premiums for small businesses in Phoenix are $343.73 per employee per month.
  • In 2018 in Arizona, the average annual employee contribution per health insurance premium was $1,554 and the annual employer contribution per health insurance premium per employee was $4,675.

Small Group Coverage in Arizona

  • Employers with between 1 and 50 full-time employees can offer health insurance through the Small Business Health Options Program (SHOP). The total costs per employee per month range from $143.36 to $906.31.
  • With SHOP health insurance plans, premiums are less expensive for younger employees and more expensive for older employees. Pricing also depends on whether the premium is Bronze, Silver, or Gold, with Bronze having the least coverage and Gold having the most.
  • Some other most popular types of small group health coverage in Arizona include Point of Service (POS) plans, Exclusive Provider Organization (EPO) plans, Preferred Provider Organization (PPO) plans, and Health Maintenance Organizations (HMO) plans.
  • Wellthie, health insurance marketplace for small businesses, lists health insurance plans starting at $255.625 per employee per month.

National Averages

  • A 2018 national survey by the Kaiser Family Foundation found that on average, employers paid 82% of the health insurance premium, or $5,711 a year, while employees paid the remaining 18%, or $1,186 a year.

Proposed next steps:

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In our preliminary research, we were able to find some averages for healthcare costs in Phoenix. We recommend continuing our research by identifying the average cost to the employee and the employer by creating a request that will research some of the most common health care plans for small businesses in Arizona: Point of Service (POS) plans, Exclusive Provider Organization (EPO) plans, Preferred Provider Organization (PPO) plans, and Health Maintenance Organizations (HMO) plans. For each plan, we will identify the average cost to the employer and the employee for a small business in Phoenix, assuming that Medical, Dental, and Vision are all included, and the co-pay and annual deduction are affordable.
Alternatively, we could search for more accurate average cost information by identifying 4-5 major providers of healthcare to small businesses in Phoenix, and then determining the average cost to the employer and the employee for a small business in Phoenix, assuming that Medical, Dental, and Vision are all included, and the co-pay and annual deduction are affordable.
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