Helping Local Manufacturing Shop Save $125,000 on Health Insurance Costs
- Small Business Benefits
- Feb 18
- 4 min read
Updated: Jun 20
Introduction
For small businesses, rising healthcare costs can feel insurmountable. A local manufacturing shop, with a 15-employee sized business in Grand Rapids, MI, was no stranger to this challenge. Annual health insurance premiums for their group health plan were increasing by 15–20%, choking their budget and limiting growth opportunities. Determined to address the issue without sacrificing quality healthcare for employees, the local manufacturing business partnered with Small Business Benefits to implement a smart, tailored strategy.
The result? A dramatic $125,000 in annual savings for the company, happier employees, and a streamlined HR process. Read more about how our team can help your small business.
Table of Contents
Client Overview
Business Type: Manufacturing
Location: Grand Rapids, MI
Employees: 15
The Challenge
Local manufacturing’s health insurance dilemma was rooted in three key pain points:
Unsustainable Costs
Premium increases of 15–20% each year were making it progressively harder to sustain a group health plan. The rising costs not only threatened their financial health but also left little room for new investments in equipment, marketing, or talent development.
One-Size-Fits-All Coverage
Employees had limited choices under the group plan, often receiving generic coverage that didn’t account for their individual or family healthcare needs. This caused dissatisfaction among employees who felt the company-provided options didn’t meet their expectations.
Administrative Burden on HR
The HR team struggled to manage the group plan renewal process every year, selecting a limited number of plans and fielding employee concerns about inadequate coverage. This administrative overload distracted them from other pressing workplace priorities.
Faced with these challenges, the local manufacturer realized their current approach to health benefits was unsustainable and began exploring alternatives to regain control of their insurance costs while keeping employees satisfied.
The Solution
Small Business Benefits customized a forward-looking solution designed to meet their financial and employee needs. This solution revolved around transitioning from a costly, rigid group plan to more affordable and flexible individual ACA health plans.
1. Transitioning to Individual ACA Plans
Our team guided the manufacturing business employees through the ACA marketplace, helping them compare and select personalized health plans tailored to their specific needs. Moving from a group plan to individual plans ensured employees could access coverage that matched their unique health, family, and financial situations.
2. Maximizing Subsidies on the ACA Exchange
Through personalized consulting, many of shop's employees discovered they were eligible for federal subsidies under the ACA. These subsidies significantly reduced their monthly premiums and out-of-pocket costs, giving them affordable access to robust coverage options. Our guidance ensured employees leveraged these subsidies effectively, creating notable savings.
3. Streamlining HR Responsibilities
By partnering with Small Business Benefits, the local manufacturing's HR team no longer had to handle the stressful and time-consuming process of selecting, renewing, and managing group health plans. Instead, our dedicated consultants worked one-on-one with employees to provide seamless support. This freed up the HR team to focus on operational needs and enhanced daily productivity.
4. Creating Long-Term Financial Stability
Switching to ACA individual plans not only reduced immediate costs but also eliminated the unpredictability of annual premium increases. Without a single, company-wide monthly insurance bill, the business gained greater control of their long-term budget.
The Results
The benefits of this revamped approach were profound and went beyond just cost savings.
$125,000 Annual Savings on Health Insurance Costs
Transitioning to individual ACA plans and utilizing subsidies resulted in a staggering $125,000 in yearly savings for the Manufacturing business. This surplus allowed the company to reinvest in operations and focus on future growth.
Better, Tailored Coverage for Employees
Employees experienced greater satisfaction by selecting plans suited to their specific needs and priorities. This flexibility improved morale and reinforced the company’s commitment to supporting their workforce.
Elimination of Financial Surprises
By replacing an unpredictable group premium with individual plans, they secured financial predictability and avoided the risk of unsustainable future cost increases.
Streamlined HR Operations
The HR team no longer wrestled with insurance renewals or employee coverage dissatisfaction, enabling them to focus on core responsibilities—resulting in a more efficient operation overall.
Testimonial from Local Manufacturer
"We were at a point where the rising costs of healthcare were unsustainable for our business. The team at Small Business Benefits revolutionized the way we approach employee healthcare. The service was seamless, and the savings are incredible. Just as important, our employees now have plans that truly work for them. It's been a win on all fronts." – Business Owner
Broader Implications
The local manufacturing case showcases how small businesses can break free from the limitations of traditional group health plans. It demonstrates the power of ACA individual plans not only to reduce costs but also to build flexibility and satisfaction among employees. For businesses struggling with similar challenges, the ACA marketplace paired with expert consulting represents a sustainable and strategic path forward.
Conclusion
The partnership between local manufacturer and Small Business Benefits exemplifies how small businesses can overcome the burden of rising healthcare costs. By switching from group coverage to individual ACA plans, they reduced their annual healthcare costs by $125,000 while ensuring employees felt supported and empowered in their healthcare decisions.
If your business is struggling with rising health insurance expenses, there’s a smarter solution available. Contact Small Business Benefits today at 616-425-9740 to learn how we can help you rethink your benefits strategy, cut costs, and improve employee satisfaction.
For additional resources, explore Healthcare.gov and the Small Business Benefits resource hub.