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Survey: How COVID-19 is Transforming Northern California Small Business Health Insurance Needs
Part 4: Trends in the impact of COVID-19 on Northern California small businesses and their employees
Employee Health BenefitsTips for Small Businesses
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Part 4: Trends in the impact of COVID-19 on Northern California small businesses and their employees.
Small businesses are crucial to California’s economy, creating two-thirds of new jobs and employing nearly half of all private sector employees. The onset of the COVID-19 pandemic has presented significant challenges for small businesses, with up to 44% of businesses being at risk of shutting down, according to Small Business Majority (opens in new tab).
Cigna + Oscar (opens in new tab) launched to provide health solutions to small businesses in select markets, including San Francisco, California, where our survey found that as a result of the pandemic, 63% of small businesses have furloughed or laid off staff. Our survey also revealed that a quarter of small business decision-makers anticipate rehiring at least 50% of their workforce.
Looking ahead, small businesses nationwide (opens in new tab) and those in San Francisco, California view their top priority as providing affordable healthcare coverage to their employees.
Through our partnership, Cigna + Oscar aims to provide health insurance that truly understands business decision-makers in cities like San Francisco, as well as their employees and business needs over time. For Part 4 of our study, we share insights from our survey of San Francisco small business owners to better understand how the pandemic is shifting their needs.
Download this infographic of highlights from the survey, and continue reading below for detailed insights.
How the COVID-19 pandemic is impacting small business operations in San Francisco
Of the San Francisco small business decision-makers surveyed, half reported that their revenue has declined since the pandemic began. That’s lower than the national average of 70%, but still significant. Meanwhile, approximately 29% of small businesses in the area have actually seen an increase in revenue.
Among small businesses in San Francisco, 63% reported that they have laid off or furloughed employees. The majority (35%) of those have laid off an average 26-50% of their workforce.
San Francisco small businesses (89%) say that the health and well-being of their employees has become their highest priority during the pandemic—but financial health and operations are not far behind at 86%.
When asked how the pandemic has influenced the importance of key decision-making areas, new resources needed for operation—such as the ability to transition to virtual operations—have become more critical for 79% of respondents, and “how and where my business operates” for 81% of respondents.
A quarter of San Francisco small businesses have transitioned to having most employees work remotely. About 11% continue to offer in-person services, with most employees working onsite or in-office, and 24% are operating with a hybrid of in-person and remote services.
In terms of the workplace environment, 54% of San Francisco small business decision-makers said they’ve implemented more frequent sanitizing; 58% have moved more communications and meetings online; 54% have restricted interactions between employees; and 51% have limited interactions with customers and clients.
How San Francisco small businesses are thinking about employee health care
As small businesses navigate unprecedented challenges, many have implemented new safety practices along with a remote work policy. With these drastic changes, budget management will be more critical than ever. Small businesses will seek a balance between keeping their business running and their workers employed, as well as offering benefits to their employees.
Among common employer benefits, San Francisco small businesses ranked dental and vision as the most important (22%), followed by wellness benefits (21%) and health insurance (17%). Other benefits cited include paid time off (16%), flexible or remote work options (13%), and financial planning (11%).
At the same time, 78% of San Francisco small business decision-makers say that offering health insurance is now a greater priority in their overall business budget. That’s 7% higher than the national average (66%).
As San Francisco small businesses reopen and rehire employees, managing expenses will be top of mind. Small businesses need a health insurance partner that cares about their unique financial needs over time.
When asked how important certain factors related to their health insurance carrier have become following the COVID-19 outbreak, San Francisco small business decision-makers reported that cost is as important as ever; selecting communications and resources to stay informed about COVID-19 (74%); flexible options to support recovery from COVID-19 (74%); and flexible options and affordable co-pays (72%).
Yet they’re also prioritizing factors unrelated to cost, such as a broad network of doctors, hospitals, and specialists (75%); flexible options to support their business's recovery from COVID-19, and help their business and employees get the most from their plan (71%); and with local physicians similar to the ones they have within their network already (71%).
Our survey gave some insight into the health concerns that are common among San Francisco small businesses and their employees. When asked about the importance of affordable coverage for various types of care, pediatrics (83%) came out on top, followed by allergy and immunology (82%) and internal medicine, psychiatry and behavioral health, physical medicine and rehabilitation (80%).
What San Francisco small businesses want in a health insurance provider
As we shared, 78% of San Francisco small business decision-makers say that offering health insurance is now a higher priority in their overall budget. Similarly, 71% of respondents indicated that COVID-19 has increased demand for health insurance among their employees, and only 12% indicated that COVID-19 has decreased demand.
Small businesses are thinking more critically about their employees’ health care. In San Francisco, more than half (59%) of small businesses are considering changing their health insurance company ahead of 2021. (That’s 21% higher than the national average of 38%.) Another 11% are unsure whether they’ll keep their insurance provider, bringing the total of those who might switch to 70%.
Our survey also found that the demand from employees for health coverage has increased, with 71% of San Francisco small business owners indicating this shift.
When asked what would most influence their decision to change their organization's health insurance company, San Francisco small businesses say it would be a carrier who can “provide immediate savings through a lower monthly premium” and “better understands and cares about my business and employees” (30%), followed by “a larger network of top doctors, hospitals, and specialists,” “24/7 telemedicine service integrated into my plan,” and a brand that they trust (27%).
As health care companies such as Cigna and Oscar look to support the evolving needs of small businesses and their employees, these findings about San Francisco are significant. It’s clear that San Francisco’s small businesses want support from a true partner—one who understands the unprecedented challenges they’re dealing with.
Cigna + Oscar aims to deliver health insurance that fits the unique needs of small businesses and their employees: their budgets, communities, and more. By launching initially in select markets such as San Francisco, we can better understand what those needs are.
We offer monthly savings, behavioral health benefits, and dedicated Care Teams to guide employees to the right care—whether that’s a top in-network provider, or $0 copay 24/7 Virtual Urgent Care. Cigna + Oscar plans are designed for the unique needs of small businesses and their employees.
Looking for group health plans? We’ve got you covered.
The Cigna + Oscar mission is devoted to providing health insurance that’s helpful and easy to understand, with a personalized customer service experience and benefits that feel good to use.
Ready to learn more? Visit cignaoscar.com (opens in new tab), call our team directly at 1-855-672-2784, or talk to your broker about us.
About the study
This survey was conducted online within the United States by The Harris Poll on behalf of Cigna + Oscar from May 14 to 26, 2020, among 1,032 U.S. health insurance decision-makers at small businesses across a nationally-representative variety of industries with 11 to 50 employees (decision-makers for purposes of this survey include a mix of business owners and administrators). The panel of respondents included more than 500 individuals nationally, and an oversample of more than 150 individuals each of the following areas: Atlanta, GA, Nashville, TN, and San Francisco, CA. This online survey is not based on a probability sample, and therefore no estimate of theoretical sampling error can be calculated.
Cigna + Oscar coverage is insured by Cigna Health and Life Insurance Company.
CA: benefits administered by Oscar Health Administrators. Other states: benefits administered by Oscar Management Corporation. Pharmacy benefits provided by Express Scripts, Inc. Cigna + Oscar health insurance contains exclusions and limitations. For complete details on product availability and coverage, please refer to your plan documents or contact a representative.
C+O offerings are marketed and/or quoted pending regulatory approval by the California Department of Insurance. This does not constitute the issuance or delivery of a policy or offer of coverage to California residents. CIC §10717
