Every year at renewal, most small business owners in North Dakota and Minnesota get a stack of plan proposals from carriers and proceed to compare them by looking at one number: the monthly premium. That approach produces the cheapest plan, not the best plan for your employees or your total cost over time. Understanding what to actually compare — and in what order — changes the quality of the decision significantly.
Why Premium Alone Is a Misleading Comparison
The monthly premium is the most visible number in a plan proposal, but it's also the number that most reliably misleads comparisons. Two plans with similar premiums can have dramatically different employee experiences, cost exposures, and network access. And two plans with different premiums can have the same or similar actual cost when you account for what employees pay out of pocket and how often they use care.
The fundamental problem with premium-only comparison: you're comparing your cost as an employer without accounting for your employees' costs as plan participants. A plan that saves you $50/month per employee by moving to a high-deductible structure may shift $1,500–$3,000 in annual out-of-pocket costs onto each employee who uses the plan. If that results in employees skipping care (which research shows it does), the long-term cost — in productivity, turnover, and health deterioration — exceeds the premium savings.
A proper comparison evaluates the full cost structure: premium, deductible, out-of-pocket maximum, copays, coinsurance, and Rx costs.
The Key Elements to Compare Across Plans
Premium: Your monthly cost as an employer plus the employee contribution amount. Compare these separately — the employer cost and the employee cost are both relevant.
Deductible: The amount the employee pays before insurance begins covering services (beyond preventive care). A $500 deductible vs. a $3,000 HDHP deductible is the difference between an employee paying $500 before coverage kicks in and paying $3,000. The premium difference rarely compensates fully for the deductible difference for employees who use care regularly.
Out-of-pocket maximum (OOPM): The most the employee pays in a year before insurance covers 100% of in-network costs. The OOPM is the employee's maximum exposure. ACA limits the OOPM for 2025 to $9,200 for single coverage. Plans with higher OOPMs protect the premium line at the expense of employee financial risk.
Copays and coinsurance: After the deductible, how does cost-sharing work? A plan with a $30 specialist copay vs. 20% coinsurance has different financial implications depending on how frequently your employees see specialists. For populations with chronic conditions that require regular specialist visits, copay structures are generally more predictable and often lower-cost.
Prescription drug formulary: Which drugs are covered, at what tier, and at what cost share? If several employees take brand-name medications, the difference between a plan that covers those drugs at Tier 2 vs. Tier 3 (or doesn't cover them without prior authorization) is meaningful. Request the formulary comparison, not just the tier structure.
Mental health and behavioral health coverage: ACA requires mental health parity — plans must cover mental health services at parity with medical/surgical benefits. But how those benefits are structured (copay amounts, visit limits, telehealth access) varies. Mental health utilization has increased significantly in the post-pandemic workforce, and plan quality in this area matters more than it did five years ago.
How Carrier Networks Differ in ND and MN
Network is one of the most important variables in plan comparison and one of the least discussed. In North Dakota and Minnesota, the major carrier networks have distinct provider relationships:
Sanford Health Plan: Strong network within the Sanford system, which has a significant presence in Fargo, Bismarck, and across the Dakotas. Employees who use Sanford providers frequently get efficient, low-cost access within the network. Employees with established care relationships at Essentia, Altru, or independent providers may find Sanford network plans less convenient.
Blue Cross Blue Shield of North Dakota (BCBS ND): The largest network in North Dakota, with broad coverage across independent and health system providers. Generally the network with the fewest access problems in rural ND. Often more expensive than narrower network options.
Medica / HealthPartners / UCare / PreferredOne: Primarily Minnesota-focused carriers with strong Twin Cities and regional coverage. For businesses with employees primarily in Minnesota, these carriers offer competitive options with well-developed provider relationships.
The practical question: for each carrier proposal you receive, verify that your employees' primary care physicians and any frequently-used specialists are in-network. A plan that excludes the providers your employees have established relationships with will generate friction, dissatisfaction, and out-of-network costs that erode the value of the premium savings.
Plan Year Cost vs. Total Cost of Risk
The comparison framework that consistently produces the best outcome is total cost of risk rather than just the premium. Total cost of risk adds:
- Employer premium contribution
- Employee premium contributions (which affect your ability to attract and retain employees)
- Employee out-of-pocket costs (deductibles, copays, coinsurance, Rx)
- Administrative costs associated with plan management
A plan with a $600/month employer cost per employee but a $6,000 HDHP deductible may have a higher total cost of risk than a plan with a $750/month employer cost and a $1,000 deductible — because your employees bear the additional $5,000 in deductible exposure, which shows up in their financial stress, care avoidance, and potentially in their decision to leave for an employer with better benefits.
How to Read a Summary of Benefits and Coverage (SBC)
Every qualified health plan is required to provide a Summary of Benefits and Coverage — a standardized document that allows apples-to-apples comparison across plans. The SBC includes:
- Deductible and out-of-pocket maximum
- What's covered before and after the deductible for common services
- Prescription drug coverage at each tier
- Coverage examples (a standardized calculation showing cost for a simulated childbirth and a simulated chronic disease management scenario)
Reviewing the SBC side by side across multiple plan proposals is more reliable than comparing marketing summaries, which are designed by carriers to highlight strengths rather than expose limitations.
Red Flags in Plan Proposals
Unusually low premium without explanation: If one proposal is significantly lower than others for similar coverage, ask what's different. Narrow network, high deductible, limited formulary, or a carrier with a poor claims-handling reputation can all drive below-market premiums.
Vague network descriptions: A carrier that can't quickly tell you whether specific providers are in-network, or who provides a geographic access map that doesn't match your employees' actual locations, deserves scrutiny.
One-year rate guarantees with aggressive renewal increase history: A carrier that wins your business with a low first-year rate and then increases 25–30% at renewal has effectively borrowed your business rather than earned it. Ask about the carrier's historical renewal increase patterns for comparable groups.
Proposals that omit total cost structure: A proposal that shows only the employer premium without a clear breakdown of employee contributions, deductibles, and OOPMs is designed to make comparison harder, not easier.
Why Using an Independent Broker Changes the Comparison Process
An independent broker shops your group to multiple carriers simultaneously and presents the results with a consistent comparison framework — same metrics, same structure, across all proposals. This eliminates the time you'd spend requesting and structuring carrier proposals yourself, and it ensures you're comparing what's actually comparable rather than what each carrier chose to highlight.
More importantly, an independent broker knows your business. When Kain reviews proposals for a client group, the comparison accounts for that group's specific characteristics — the age distribution, the care utilization patterns, the geographic distribution of employees, the providers they use. A generic premium comparison doesn't account for any of that.
To see how this works in practice for your group, visit /employee-benefits or schedule a conversation to discuss your upcoming renewal.
Kain Carlson is an independent insurance advisor based in Fargo, ND, licensed in North Dakota and Minnesota. He works with owner-operated businesses across all three coverage pillars — commercial, benefits, and personal — under one advisory relationship. Schedule a review to see where your coverage stands.