Balancing the Books: Navigating Rising Pharmacy Costs in Your Group Health Plan
Published: May 1, 2026 | Last updated: October 22, 2026
Affordable Group Health Insurance for South Carolina Small Businesses
In short: South Carolina small businesses have more options than ever to offer health insurance while controlling costs. The main choices are a traditional fully insured group plan with predictable premiums, a level-funded plan that can return unused claims dollars, and an ICHRA that gives employees a tax-free allowance to buy their own coverage. Adding supplemental benefits can also keep premiums down. A local broker can compare these side by side at no cost to you.
As a small business ourselves, we know employee health insurance is one of your biggest priorities and investments. You want competitive coverage that helps you attract and keep great people, without breaking the budget.
Why Are Group Health Insurance Costs Rising?
According to Mercer, general health benefit costs rose about 6% in 2025, while prescription drug spending rose nearly 9.4%. The biggest driver isn't how many prescriptions are filled. It's which medications are prescribed.
- Specialty drugs: These treat complex conditions like cancer and autoimmune disorders. They're a small share of prescriptions but a large share of spending. One employee on a specialty therapy can noticeably affect a small group's premiums.
- GLP-1 medications: Drugs used for diabetes and weight loss are in high demand and carry high prices, which creates a new cost challenge for employer plans.
What Are the Group Health Insurance Options for Small Businesses?
1. Fully insured small group plan You pay a fixed monthly premium, and the insurance carrier takes on the risk. Plans come in Bronze, Silver, Gold, and Platinum levels, meet ACA requirements, and cover essential health benefits like doctor visits, hospital stays, and preventive care. Best for businesses that want predictable costs.
2. Level-funded plan You pay a set monthly amount, and part of it goes into a claims fund. If your group's claims are lower than expected, you may get money back at the end of the year. Best for healthier groups that want predictable payments with upside.
3. ICHRA (Individual Coverage Health Reimbursement Arrangement) You give employees a tax-free monthly allowance to buy their own individual health plans. This shifts risk away from your business and gives employees more choice. Best for owners who want to control spending while offering flexibility.
Watch and learn more about these options in our YouTube video.
How Can Supplemental Benefits Lower Costs?
Some employers choose a higher-deductible primary plan to lower premiums, then add accident, critical illness, or hospital indemnity coverage. These "gap" benefits help employees with out-of-pocket costs if they need care.
What Does a Group Health Broker Do?
We're more than a policy. We act as your year-round consultant:
- Help choose the right funding model for your business
- Onboard new employees and answer coverage questions
- Support life transitions, like employees turning 65 and moving to Medicare, or children aging off at 26
- Help with billing, claims, and ID card issues
Have employees approaching 65? Share our free Medicare Guidebook to help them understand their options.
Frequently Asked Questions
Do small businesses in South Carolina have to offer health insurance?
No. Under the ACA, only employers with 50 or more full-time equivalent employees must offer coverage or risk a penalty. Many smaller businesses offer it anyway to attract and keep employees.
What is a level-funded health plan?
It's a plan where you pay a fixed monthly amount, part of which funds employee claims. If claims come in lower than expected, you may receive a refund.
What is an ICHRA?
An Individual Coverage Health Reimbursement Arrangement lets employers give employees a tax-free allowance to buy their own individual health insurance.
How can I lower my group health insurance costs?
Options include switching to a level-funded plan or an ICHRA, adjusting deductibles, and adding supplemental benefits. A broker can compare what fits your group.
Does it cost anything to work with a group health broker?
No. Lourie Life & Health's service is at no cost to you.
Let's Review Your Options
Whether you want to review your pharmacy spending or explore a level-funded plan or an ICHRA, our local South Carolina team is here to help.
Call us today: Columbia (803) 256-2067 · Greenville (864) 551-2300 · Myrtle Beach (843) 800-1195