In prior years, it didn't make sense for small employers to self-insure when fully-insured rates were competitive. But as costs continue to skyrocket, self-insurance is becoming a better option for many small employers, with some plans available for groups as small as 15 lives. 

Unsustainable renewal rates will push more employers in this direction next year, especially as brokers and carriers find new and innovative ways to address self-insurance pain points. These concerns, like finding a provider network or maintaining cash flow for claims, have traditionally kept many groups fully-insured, but small employers may find the solutions to these issues more cost-effective than maintaining fully-insured rate increases. 

Reference-based pricing will follow 

Similarly, the often-inflated costs of health care and insurance will lead more of these self-insured groups to consider reference-based pricing in the coming year. Brokers should expect an increase of questions on this and other cost-containment methods. 

While the reference-based pricing approach does entail some challenges in regards to plan development and management, third-party administrators and other service providers are quickly filling in the gaps to make this a more workable solution for employers of all sizes. 

For example, more hospitals are accepting RBP rates than ever before, and plan administrators are increasingly offering legal services to employees to address balance billing concerns. 

Employers can also consider offering both a RBP plan as well as a network plan in year one, which is an option available to some groups and can be a good way to transition away from the traditional network model. 

Association health plans will take off

Separately, small groups who haven't offered group insurance may take advantage of association health plans. With backing from the Trump administration, this new strategy would allow employers and individuals to band together and take advantage of group bargaining power. 

With the individual mandate repealed and costs likely to rise, these groups may be particularly incentivized to enter the group market. The ability to form associations across state lines could also lead to more cost-effective benefit strategies for these small groups. 

The trait that these three trends have in common is employers' desire to have better, more direct control over their health care costs. As rates for traditional plans rise faster than inflation, more employers will adopt nontraditional solutions in 2018 and beyond.