Prioritize your employees
It’s essential to constantly explore what is best for your company and employees on a yearly basis as health insurance options change each year. It may seem best to keep offering the same group health insurance that you offered last year, but you may need to explore other options such as ICHRA instead. In this article, we explore what you should know about comparing group health insurance plans and ICHRA as far as coverage options, affordability, and what’s best for your employees.
Review your current group health plan
You should take some time to analyze the coverage options when choosing a health insurance plan for your company. In spite of staying with last year’s group plan, you will need to make sure you choose a plan based on what your team needs and what they can afford. If no one in your company can effectively utilize or afford a group plan, there is no point in paying high premiums.
Limitations of in-network providers
A group health insurance plan limits your employees in terms of in-network providers and coverage. Not everyone has the same doctors, household budgets, or healthcare needs. Participating employees, however, have the power to choose their own plans based on their preferred providers and unique circumstances with an ICHRA model.
Costs at the company and employee levels should be evaluated
You should compare the costs of rolling over to last year’s group health plan with ICHRA. You should review any changes to premiums and direct contributions you will have to pay, as well as any contributions your employees will be required to make. As a result of the dramatic increase in costs on both sides, ICHRA offers the most cost-effective solution to many businesses.
Group Health Plan vs. ICHRA
It is important to keep in mind that the two models are fundamentally different when comparing ICHRA to group health insurance:
- All enrollees have access to the same coverage and are subject to the same costs, in-network considerations, and plans.
- ICHRA – you’re customizing a reimbursement ecosystem designed to pay employees for out-of-pocket health costs after they choose their own health plans either off-exchange or through the ACA Marketplace.
ICHRA can be customized to meet your needs.
It is a great solution if budgets are tight because it allows businesses to remain compliant while customizing reimbursement limits and requirements. There will be no surprises or exorbitant premiums. As ICHRAs are completely managed by you, you can continue to make adjustments based on benefits budgets and employee needs by collecting ongoing enrollment and reimbursement data.
Provide reimbursements to full-time, part-time, seasonal, and temporary employees
The traditional group health insurance plans are typically only available to full-time employees. But ICHRA can be customized to extend reimbursements to other valuable members of your teams. Seasonal staff during peak times of the year, part-time employees, and even temporary workers can all be eligible for your ICHRA platform.
Furthermore, you can set up a reimbursement policy that aligns with how you already manage expense reporting, so that reimbursements can be paid out as well. Checks or direct deposits can be issued on any reasonable timeline that corresponds to your existing standards.
Employee feedback is important
If the numbers make sense and the coverage option comparisons are helpful, you might also consider talking with your employees to see what they think. Remember, the company health plan is intended to help them. In this way, your company can decide what type of health insurance offering it should offer based on their feedback.
Plans can be customized with ICHRAs
Employees are responsible for enrolling themselves in their own individual health plans with an ICHRA. With ICHRA, they can take back control of their coverage options based on their household budgets, healthcare provider preferences, and dependent needs. Based on what they spend throughout the year, they can submit receipts for reimbursement for qualified medical expenses with ICHRA.
Actual out-of-pocket expenses are reimbursed by ICHRAs
ICHRAs are becoming a popular choice among employees for their ability to get coverage for only what they need. They can decide on their own plans, and are reimbursed for out-of-pocket expenses. This could be a way to cover the monthly premiums of ACA coverage, as well as prescriptions, copays, vision and dental expenses.
