Every fall, a familiar letter arrives. It's about your plan options for the next year, and once again, it's higher than the last.
It's not a shock. It's barely a surprise. Most of us can't say why the number moved, only that it probably would.
Understanding health insurance pricing won't automatically lower your premium. But it will help you understand what you're paying for, and maybe help you make changes that will save you money.
Once you know what actually decided that number, you're in a better position to make decisions at renewal time than you were before.
Two Myths, One Real Story
Picture two versions of an insurance company.
One is a faceless machine, padding profits at your expense. The other absorbs the true cost of care so your church doesn't have to.
But neither picture is accurate. Group premiums come from a handful of concrete factors:
- Claims experience: how much a group actually spent on care in a given year
- Group size: a larger pool spreads risk more evenly than a small one
- Plan design: a lower deductible with richer benefits costs more to insure than a high-deductible plan
- Medical trend: the annual rise in healthcare costs across the entire industry
Add those together, and you have most of the equation.
This isn't secret math and it’s not a closed door group of people making an arbitrary decision. It's statistical formulas working with a unique set of data. They're pricing risk based on what a group has cost to insure, and what similar groups are likely to cost going forward.
The American Academy of Actuaries explains it this way: premiums are built by pooling a group's medical costs together, and larger pools generally produce more stable, predictable pricing than smaller ones.
So why not just join a larger pool on your own? Unfortunately, it doesn’t work that way. Insurer pools are created by individual organizations and membership is not “for sale” to outsiders. An association like RBA is a legal way to create a pool big enough to find partners willing to negotiate with insurance carriers on your behalf.
The Renewal Buffer
Most individual congregations are small, sometimes just a handful of employees.
When a church insures on its own, one bad year can move the whole number. A surgery, a premature birth, a cancer diagnosis: any one of these is enough to shift the group's risk profile.
Insurers price for that volatility. A church going it alone often absorbs the full cost of it by itself.
This problem is documented enough that most states restrict how insurers can rate small employer groups. This is because small groups are more exposed to this kind of swing than large ones.
We see this pattern every renewal season across churches that go it alone: a single hard year follows them straight into next year's number.
This is part of why RBA exists. By bringing hundreds of churches together under one group, no single staff member’s hard year determines the whole group's rate.
We call this the Renewal Buffer: the protection that comes from sharing risk across a much larger pool instead of carrying it alone. That buffer also gives experienced benefits consultants more room to negotiate on the group's behalf, room a single small church wouldn't have on its own.
That's the relief: you're not the only line of defense against a hard year anymore. But it's worth being honest about what that relief does and doesn't cover.
What You Can Control
It can be frustrating when claims experience, group size, and medical trends move the number no matter what you do. But what you can control is whether your plan still fits what your church actually needs.
That's a different question than, "why did this go up?" It's "are we still paying for the right things?"
Download the Church Health Insurance Assessment and walk through it yourself, from staff satisfaction to service level to cost. It won't change your renewal number, but it will tell you whether your plan is still earning its place. And this will give you the clarity you need to understand your renewal.
The information in this blog is for educational purposes only. Please seek professional advice before acting on anything you've read above.