There’s a lot of buzz and surge in popularity among businesses regarding Individual Coverage Health Reimbursement Arrangements. Companies large and small are recognizing the many benefits an ICHRA offering has for the bottom line and employees alike. With the ability to tap into the flexibility to cost savings, business owners are choosing to offer the ICHRA as a method to provide benefits for their teams without taking the costly hit of financing a group plan. If you’re curious about leveraging an ICHRA platform for your business, here are a few attractive perks that might help you make your 2021 benefits plan decisions.
Why Companies Adopt ICHRAs
Whether you’re a one-employee bricklayer or a multi-location call center with 100 staff members, there are a host of benefits an ICHRA plan can offer your business. There are three primary reasons why adopting an ICHRA platform is attractive for most companies. These bottom-line perks might just persuade you to change, too.
The ICHRA plan is owned and sponsored by the company. This means as a business owner, you can decide the expenses and parameters you put in place. Having the flexibility to carve out a plan that fits you, your company, and your employees instead of a one-size-fits-all group plan is often the main reason that owners switch. Meeting the requirements for offering an “affordable” healthcare solution is easy and manageable.
After a year like we’ve had, businesses that managed to survive shuttered economies and costly furloughs are also facing a narrower operational budget in the new year. The ICHRA offers companies a way to predict anticipated costs that are in line with those budgets. Considering so many are one or two unforeseen expenses away from dipping into the red, the ICHRA is a game-changing solution to company benefits in a controlled cost manner.
Stand Alone or with a Group Plan
The ICHRA plan platform can be offered as a stand-alone benefit to employees or in tandem with a group plan. Employees are usually required to pick one or the other. But this flexibility in a benefits offering allows companies to maintain a group plan for full-time or salaried staff and still offer an ICHRA benefit to part-time workers, temporary workers, and seasonal team members, as well.
Why Employees Appreciate ICHRAs
ICHRAs aren’t just popular among business owners, CEOs, and human resources department heads. Employees are appreciating these benefits as well. And switching to an ICHRA plan is an easy decision when you realize your employees will prefer and appreciate it just as much as you do.
Freedom to Choose a Plan
Individuals enjoy having the freedom to choose their own health insurance plans. Because the ICHRA is not a health insurance product and requires participants to secure their own health insurance, it creates a flexible environment at the employee level. Younger, single individuals on your teams might opt for a lower premium plan and expense only routine healthcare visit costs throughout the year. Employees with dependents or increased health maintenance expenses can choose a higher premium, lower deductible plan and submit for reimbursements accordingly.
Ability to Receive Reimbursements
Getting reimbursed for out of pocket health expenses alone can be the reason employees opt in to an ICHRA plan. They’ll be more apt to follow through on routine health screenings and prescriptions, too. Knowing they can submit for a reimbursement will encourage better health initiatives throughout the year.
Only Pay for Services Needed
Another reason your staff will appreciate an ICHRA is knowing they only have to spend what they can afford to pay. Choosing their own Marketplace plans will allow them to keep within their household budgets. Having the added benefit of reimbursements, sometimes even for monthly premiums, means they can spend knowing they’ll recoup those dollars. Group plans sometimes require employees to pay hefty costs for coverages or services they never use. The ICHRA allows staff to control their own costs just as much you do as a business owner.
How to Tell Your Business Is Ready to Switch
Knowing the increased benefits of adopting an ICHRA plan may help you take a closer look at making a switch. But there are also other ways to determine if your company can benefit from a separation from a group plan partnership. Here are just a few of the determining-factor scenarios that might resonate with your situation and help you decide.
Your Group Plan Is Proving Costly
Group health insurance plans can be expensive and routinely increase in cost. You could try to shop for a less expensive group plan, but you’ll likely run into not-so-impressive benefits parameters, too. If you’re overspending on a group plan or want to avoid cutting corners in coverage, it may be time for an ICHRA solution.
You’re Looking for a Better Way to Offer Benefits
Managing a group plan means having a disconnect between your employees and their health benefits. Group plans are also incredibly burdensome on business owners and human resources staff. Alleviating time coordinating between employees and group plan coordinators can free up time to introduce and launch an ICHRA.
Tired of the Group Plan Grind
Businesses are recognizing they can reduce risks by removing the hassles of managing renewals and monitoring participation rates. If you’re done with trying to choose a plan that fits every employee’s provider network or with group insurance price hikes, it may be time for an ICHRA. Let the employee manage his or her own plan and alleviate the one-size-fits-all grind.
HHS is predicting that over the next five to ten years, more than 800,000 companies will transition to offer Individual Coverage Health Insurance Reimbursements. Many are suggesting an even higher adoption rate. If you think you’re ready to explore your ICHRA options, contact us! W3ll can help you develop a plan that fits your company structure, budget, and employees. From the start-up to the execution, you can have an ICHRA partner, which may be all you need to make the change.