Choosing the right health insurance plan, whether you’re an employer or an individual, is a crucial decision that impacts the financial well-being of employees and their families. For small businesses, without an HR department or a benefits specialist, the process can be confusing and overwhelming. However, investing time into selecting the right health benefits for your team can significantly pay off in the long run.
Providing health insurance to employees can improve retention, help attract top talent, and contribute to an overall healthier and happier workforce. In this article, we’ll take a closer look at the top 25 health insurance providers in the U.S., offering insights on the best companies by market share. Additionally, we’ll discuss flexible alternatives such as Health Reimbursement Arrangements (HRAs), which may offer a more cost-effective and customizable approach than traditional group health plans.
What You’ll Learn:
- How the leading health insurance companies generated approximately $1.08 trillion in net premiums in 2023.
- The health insurance providers with the largest market share in the U.S.
- How HRAs can provide employees with more flexibility compared to standard group coverage plans.
Want to learn more about health benefits? Explore what percentage of health insurance premiums are covered by employers.
What is Traditional Group Health Insurance?
When comparing health insurance providers, many employers opt for a traditional group health plan. Let’s go over how these policies work before we dive into the top health insurance companies in the U.S.
With group health insurance, employers select a medical plan for their business, offering coverage to employees and their eligible dependents at a discounted rate. Most insurance providers require at least a 70% participation rate from employees in order for the plan to be effective. If not enough employees sign up, the plan will not be offered.
There are several types of health insurance plans, including:
- Health Maintenance Organizations (HMOs)
- Preferred Provider Organizations (PPOs)
- Exclusive Provider Organizations (EPOs)
- Point-of-Service (POS) plans
In these plans, employees are responsible for paying part of the premiums and must meet their annual deductible before insurance coverage kicks in.
Employers can acquire group health insurance directly from an insurance carrier, a licensed agent, or a broker. Additionally, small businesses in certain states can buy plans through the Small Business Health Options (SHOP) marketplace and may be eligible for the Small Business Health Care Tax Credit to reduce premiums.
The cost of group health insurance typically increases every year. As reported by the Kaiser Family Foundation (KFF), the average annual premium for group health coverage in 2024 was:
- $8,951 for individual coverage
- $25,572 for family coverage
Employers contributed, on average, the following amounts toward premiums:
- $7,584 for employee-only plans
- $19,276 for family plans
Although group health insurance is a popular option, the high costs may make it unaffordable for smaller businesses.
Alternative Health Coverage Options
There are alternative ways to provide health coverage, such as through individual health insurance plans available on the Health Insurance Marketplace or state exchanges. Many of the same insurance carriers that offer group health plans also provide individual coverage.
Employers also have the option of providing a Health Reimbursement Arrangement (HRA) to reimburse employees for their premiums instead of offering a group health plan.
The 25 Leading Health Insurance Companies in the U.S.
Understanding the top health insurance companies in the U.S. is key to selecting a reliable and competitive plan. Below is a list of the top 25 health insurance companies based on market share, according to the National Association of Insurance Commissioners (NAIC) for 2023:
| Rank | Company | Market Share in 2022 | Market Share in 2023 |
|---|---|---|---|
| 1 | UnitedHealth Group (UnitedHealthcare) | 15.34% | 16.37% |
| 2 | Elevance Health Inc. (formerly Anthem) | 7.16% | 7.08% |
| 3 | Centene Corp. | 6.68% | 6.76% |
| 4 | Humana | 6.03% | 6.61% |
| 5 | CVS Health (including Aetna Health) | 5.82% | 6.43% |
Market share is an important metric to consider when choosing a health insurance provider, as it reflects the company’s financial stability, the extent of its network, and its competitiveness in the market. Larger companies often have a broader range of plans and medical providers, offering more flexibility for businesses.
Premiums and Market Trends
In 2023, U.S. health insurers earned over $1.08 trillion in premiums. Among the largest insurers, UnitedHealth Group topped the list with $248 billion in premiums. This growth represents an increase in consumer spending on health coverage, as the demand for medical services rises due to inflation and the aging population.
Why HRAs Are a Better Option for Small Employers
For small businesses, traditional group plans can be expensive. Health Reimbursement Arrangements (HRAs) offer a more cost-effective and flexible option. HRAs allow employers to reimburse employees tax-free for medical expenses and health insurance premiums, providing more customization than group plans.
HRAs come in several types, including:
- Individual Coverage HRA (ICHRA): Offers tax-free reimbursement for individual health insurance premiums.
- Qualified Small Employer HRA (QSEHRA): Available for businesses with fewer than 50 employees, allowing them to offer a fixed allowance for insurance premiums.
- Integrated HRA (GCHRA): Supplements a group health plan by covering out-of-pocket costs such as deductibles.
- Health Stipends: A more straightforward approach, offering employees a fixed amount to use on medical expenses.
These alternatives to traditional group health insurance allow small businesses to provide employees with meaningful benefits without the high costs.
Offering the Right Health Benefits for Your Team
As healthcare costs continue to rise, it’s essential for businesses to explore all available options to provide employees with affordable health coverage. Whether you choose a traditional group health plan or an alternative like HRAs or health stipends, offering these benefits can help attract and retain talent while supporting employee health and satisfaction.
