The renewal is decided long before the letter arrives.
A renewal letter is an output, not an event. By the time it reaches you, the claims that set it have already been paid, the trend assumption has already been applied, and the carrier has already decided how much of its own margin it needs to hold. The work that changes the number happens in the eleven months before it arrives — and the first honest question is not how big the increase is, but which parts of it are yours. Between renewals, our health and cost strategy works on the part of the rate your claims set.
An increase is never one number. It is three.
Every renewal decomposes into trend, your own claims experience, and the carrier’s own pricing decisions. They are negotiable to very different degrees, and treating them as a single percentage is how employers end up conceding the part that was arguable.
Trend Is Three Lines, Not One
National medical trend is running about 9 to 10 percent before plan changes, and roughly 6.5 to 7.6 percent after them — the gap is cost shifting, not cost control. Michigan small group filings tell a third story: 11.1 percent approved for 2026, 9.6 percent filed for 2027.
Above fifty lives, rates are not filed with the state at all, so a filed average is context and nothing more.
Whose Claims Are Being Priced
Below fifty employees you are community rated. Your increase is not about your claims, because the carrier is not allowed to price them. At fifty and above it is — partially at first, then more heavily as the group grows and the experience becomes statistically credible.
Credibility weighting is the single most misunderstood line in a renewal, and the one where a bad month gets over-charged.
The Same Increase, Three Sizes
One employer, one renewal year, three defensible ways to describe the same change: +21 percent total premium, +9.55 percent blended PEPM, +6.80 percent on a held census.
All three are arithmetically correct. Only the held-census number tells you what happened to the cost of covering the same person for the same benefit, which is why it is the one we quote.
Three models, modeled against each other with your own numbers.
Fully insured, level funded and self funded with stop-loss are not three products. They are three answers to one question: how much of your own risk do you want to hold, and what do you get back for holding it. We price all three against your actual experience before you commit to any of them.
Fully Insured
The carrier holds the risk and keeps the upside. Below fifty lives this is usually the whole conversation, because community rating means a good claims year earns you nothing back.
What to negotiate here is plan design, contribution strategy and timing — not experience you are not being charged for.
Level Funded
You fund expected claims in even monthly installments and buy stop-loss above them. A good year can return surplus; a bad year is capped. It is self funding up to the attachment point, and the obligations follow.
That means the PCORI fee is owed by you rather than the carrier, and Section 105(h) nondiscrimination testing applies. Both are routinely missed in the first year.
Self Funded with Stop-Loss
You pay actual claims and buy protection above a chosen attachment point. The contract terms matter as much as the rate: paid versus incurred basis, lasering language, and how a known large claimant is treated at renewal.
A word on vocabulary, because it trips up filings: in everyday use “funded” means you pay your own claims, but under ERISA it means plan assets sit in a trust. Most self-funded plans paid from general assets are unfunded in the second sense.
Two clocks run on every renewal, and only one of them is ours.
The carrier clock governs when quotes are released and how long questions take to answer. It is not ours to control. The CFH clock is the one we hold ourselves to: next business day once proposals land, and a first read on a renewal letter while there is still time to use it.
Two to Fifty Employees
Community rated, no claims experience required, so a complete submission can come back in about seven days. The constraint is almost never the analysis — it is whether the enrolled counts and contribution split are accurate. Because the price comes off the carrier’s filed rates, the work at this size is choosing the plan designs and contribution splits worth quoting, then comparing carriers on the same census.
Fifty-One to Two Hundred Fifty
About fourteen days, because at this size the carrier’s routine path includes questions about your last three renewals and your claims experience. That is the normal process, not an obstacle, which is why we ask for those documents up front.
Two Hundred Fifty and Above
Up to three weeks. More carriers, more plan options, more underwriting questions, and usually a funding comparison running alongside the renewal rather than after it. Larger groups also get detailed questions about large claimants and pharmacy spend, so we assemble that information before the submission rather than answering it piecemeal.
Analysis you can hand to a CFO, not a recommendation you have to trust.
The Funding Comparison
All three models priced against your own claims history, with the assumptions written down where you can argue with them. If the answer is stay where you are, that is the answer. Each model shows the expected cost, the worst case under the stop-loss terms and the monthly cash flow, so a CFO sees the downside as clearly as the upside. More on how self-funded health plans are priced.
The Negotiation Record
What the carrier asked for first, what was implemented, and what changed in between. An initial ask and a final rate are two different numbers, and the distance between them is the part of this work nobody else can show you.
A plan for next year, not just this one
Plan changes staged over two or three years land better with staff and hold cost better than a single painful year. That plan gets built now, while there is still room to choose. Typical moves include stepping deductibles, adding an HSA-qualified option beside the current plan or shifting the contribution split by tier over time. Employees see the direction in advance, so no single open enrollment carries the whole change.
How we take a renewal to market, step by step.
The Number Is Set Before the Market Sets It
Your renewal is taken apart and a defensible number built before any carrier is asked to quote.
Whether to Go Out Is Part of the Advice
The signs that say test the market, and the signs that say renegotiate instead.
Comparable, Not Merely Collected
Every proposal restated on one census, so a cheaper rate that costs more is caught.
You Get an Answer, Not a Comparison to Interpret
One recommendation, what it costs, and what you give up if you take it.
What employers ask about a renewal.
When should we start work on a renewal?
The work that changes the number happens in the months before the letter, not after it. For a January renewal the useful conversations start in the spring, while claims are still forming and there is time to change plan design or funding before the carrier prices you.
Can a renewal increase actually be negotiated down?
Sometimes, and the honest answer turns on credibility. A group large enough for its own claims to set the rate has room to argue the claims. A smaller group priced off a pool is arguing about the pool, which is a shorter conversation.
Does changing carriers always save money?
No. Moving carries costs that never appear on a rate sheet — employees who lose a doctor, a deductible clock that restarts, an administrative rebuild. A first-year discount that disappears at the second renewal is a delay, not a saving.
Renewal and Funding Strategy in Bloomfield Hills Before Your Next Increase
Many employers get their health renewal late, with a big increase and little time to act. They sign because the deadline is close. A real renewal and funding strategy in Bloomfield Hills gives you time, choices and a clear reason for each decision.
We are CFH Insurance Consultants, an independent benefits firm on Woodward Avenue since 2007. No carrier owns us. We work with employers in Troy, Southfield, Auburn Hills, Rochester Hills and across Michigan.
Renewal & Funding Strategy
Your renewal is the new price and terms your carrier offers for next year. Your funding method is how you pay for health claims. Both decisions work together.
There are three main ways to fund a health plan:
- Fully insured. You pay a fixed premium. The carrier pays the claims and takes the risk.
- Level-funded. You pay a steady monthly amount. Part of it pays claims, and part buys protection against large claims.
- Self-funded. You pay your own claims as they happen. Most self-funded employers buy stop-loss insurance. Stop-loss is coverage that pays when claims go above a set limit.
Here is how we help with renewal and funding strategy in Bloomfield Hills. We start before the renewal arrives. We read it line by line and question the increase. We compare carriers and funding methods. Then we show you the cost and risk of each choice in plain words.
Why did my health insurance renewal go up?
Several things push rates up. Medical and drug costs rise every year. For 2027, small-group rate filings with Michigan’s Department of Insurance and Financial Services (DIFS) average close to 10%.
Group size matters too. In Michigan, small group means 50 or fewer employees. For those groups, rates come from carrier filings, employee ages and ZIP codes. Above 50 employees, your own claims start to count. A bad claims year can raise your rate. A good one gives you room to push back.
Is level funding a good idea for a small business?
It can be, but not for everyone. Level funding may suit a group with healthy claims and steady cash flow. It asks you to share more of the risk than a fully insured plan does.
Before you switch, ask a few questions. What happens if claims run high? What happens when you leave the plan? What does the stop-loss contract cover? We walk through each answer with you before you sign.
Common questions
When does a January 1 renewal usually arrive?
Most January 1 renewals arrive in October or November. We like to start earlier so you are not rushed. Carriers can release them later when claims data or underwriting questions are pending, so we ask for the renewal and claims reports as early as the carrier will provide them. That leaves time to test the market before open enrollment.
Do we have to accept the first renewal number?
Not always. Small-group rates are set by filings, so your choices are mostly plan and carrier. Larger groups can often push back on the number itself. For a small group, the lever is usually a different plan design or carrier. For a larger group, it is a competing quote on the same plan design and a clear read of the claims behind the increase.
Can we look at other carriers every year?
Yes. We compare carriers Michigan employers use, like Blue Cross Blue Shield of Michigan, Priority Health, HAP, UnitedHealthcare, Aetna and Cigna. Looking every year does not mean moving every year. We quote only the carriers whose networks fit your employees, and the results can be used to hold the incumbent to a better renewal.
Talk to us about renewal and funding strategy in Bloomfield Hills
Send us your renewal or book a 30-minute call. We will tell you what we see and what we would ask the carrier. Visit 41000 Woodward Avenue, Suite 350 East, Bloomfield Hills, MI 48304, or call 248.370.8853.
Send us your renewal.
We’ll tell you whether it looks competitive, where we see opportunity, and the five questions we’d put to your carrier. No cost, and no obligation to move anything.
The renewal letter
Your current plan summary
Contribution split by tier
Enrolled counts by tier
Four documents — two more if your group is 50 or more. Nothing else; every extra one is a reason to postpone.
An independent employee benefits consulting firm. We look at the entire benefits program — cost, plan performance, risk and administration.
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