It’s important to explore your company’s options for health insurance benefits each year. And while it seems best to stick with what you know and offer the same group health insurance you had last year, you can’t help but recognize all the buzz about ICHRA. Before you officially make the decision, you’ll need to consider a few key elements. Here’s what you should know about comparing group health insurance plans and ICHRA in terms of coverage options, affordability, and what’s best for your employees.
Scrutinize and Analyze the Group Plan’s Offering
When choosing a health insurance model for your company, you’ll want to sit down and analyze the coverage options. Even if you stick with last year’s group plan, there could be changes to coverage and requirements. You’ll want to make sure you’re selecting the best-fit plan for your teams based on what they need and what they can afford. The last thing you need is for your company to pay the lofty premiums for a group plan that no one in your organization can effectively leverage or afford.
In-Network Provider Parameters
Not everyone among your employees will have the same doctors, the same household budgets, nor the same healthcare needs. And choosing a group health insurance plan means you’re essentially limiting them regarding in-network providers and coverage. With an ICHRA model, participating employees have the control to choose their own plans based on their preferred providers and unique situations.
Verify Company and Employee Level Costs
Consider the costs involved with rolling over into last year’s group health plan versus ICHRA. Check to verify any changes in premiums you’ll be responsible for paying as well as direct contributions your enrolled employees will be required to make. For many businesses, costs on both sides have risen dramatically, making ICHRA the most cost-effective choice.
Comparing ICHRA to the Group Plan
When comparing ICHRA to the group health insurance plan, you’re not looking at apples to apples. The group model is inherently different, primarily because you’re electing the coverage for all enrollees and subjecting them to required costs, in-network considerations, and plans. With ICHRA, you’re customizing a reimbursement ecosystem designed to pay employees for out-of-pocket health costs they submit after they choose their own health plans, either off-exchange or via the ACA Marketplace.
ICHRA Reimbursement Models Are Different
If budgets are tight, ICHRA is a great solution because it allows companies to remain compliant while customizing annual reimbursement limits and requirements. There won’t be surprises or exorbitant premiums to pay. And ICHRAs are completely managed by you, so you have ongoing enrollment and reimbursement data to collect to help you continue making adjustments based on benefits budgets and employee needs.
Costs Can Be Customized
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. Additionally, how you pay out those reimbursements can be customized, as well. You can set up a reimbursement policy for submitting receipts and finalizing approvals that aligns with how you already manage expense reporting. You can issue checks or direct deposits on any reasonable timeline that makes sense to your existing standards.
Ask Your Employees What Matters to Them
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. So, getting their feedback can help solidify which type of health insurance offering is best for your company.
ICHRAs Provide Customizable Plan Selections
With an ICHRA, your employees are responsible for enrolling themselves in their own individual health plans. They will enjoy taking control back of their coverage options based on their household budgets, healthcare provider preferences, and dependent needs. With ICHRA, they can then submit receipts for reimbursement for qualified medical expenses, based on what they spend throughout the year.
ICHRAs Reimburse Actual Out-of-Pocket Expenses
ICHRAs are popular among employees for several reasons. But the big perk is getting reimbursed for actual out-of-pocket expenses. In a group plan, employees pay their contribution for coverage, sometimes without using the plan at all. Being able to choose their own plans and paying only for what they actually need is appealing. And your ICHRA could help cover the costs of their monthly premiums for ACA coverage, prescriptions costs, copays, vision, and dental expenses.
If you’re sifting through the various advantages of the ICHRA, consider these key factors. And when you’re ready to implement an ICHRA for your organization, W3LL can help with every step of the process, from communicating the change to your staff to ongoing data management and submission.
Pete English
With nearly two decades in health insurance, Pete English’s diverse experience makes him uniquely qualified to help health plans and brokers leverage innovative technology in partnership with W3LL. From growing sales staff by 126% over 4 years at a large health plan, to building his own health insurance brokerage firm with over $7.2MM in annualized premium, Pete has done it all.
