group health Archives

The Pros & Cons of ICHRAs

Individual Coverage Health Reimbursement Arrangements, or ICHRAs, have been available since January 2020, and have been growing in popularity over the past year. This is because they allow employers to save money while offering employees a way to get healthcare benefits. They are a great alternative to group health insurance, especially since the rules surrounding them are less restrictive than those surrounding traditional healthcare plans, or even those of other HRAs. For example, there are no contribution maximums and no company size restrictions on ICHRAs. Before deciding if an ICHRA is right for you, you should first weigh the pros and cons.

ICHRA Pros

tax free written on a blackboard in white and yellow — *All reimbursements for each employee are tax-free.*

ICHRAs are a type of health reimbursement arrangement, a health benefit that differs from an HSA in that it is an arrangement, as opposed to an account. Employees don’t put money aside for their healthcare expenses; rather, you reimburse them for their medical expenses. You provide a set monthly allowance for employees’ premiums and medical expenses. ICHRAs have a lot of advantages for both you and your employees, including:

You can choose how much you want to contribute every month, and there is no minimum or maximum. Once set, you will give that amount to employees monthly; they cannot exceed that amount, which will help you budget accordingly.
Reimbursements are tax-free.
You can offer different monthly allowances to different groups of employees based on the type of job they do, how many hours they work, and even family status.
Employees use the money you offer them to find an individual healthcare plan that suits their needs. This is empowering to them, and will allow you to focus on your business instead of trying to find a group health insurance plan that fits all of your employees’ needs.
Employees need to have an individual insurance policy to participate in an ICHRA, so if you enroll and start reimbursing employees mid-year, employees will become eligible for a Special Enrollment Period to choose a major medical health insurance plan. This means that they will not have to wait until the Open Enrollment Period, November 1- December 15, to buy a health insurance plan.

ICHRA Cons

There are many positives to offering an ICHRA, but sometimes with the good comes some bad. The disadvantages of ICHRAs include:

red warning sign — *Employees who are on their spouse’s health insurance plan cannot participate.*

This type of arrangement prevents employees from being eligible for advanced premium tax credits on ACA Marketplace plans. So if an employee decides not to take part in an ICHRA that is considered “affordable,” they will not be able to receive tax credits with an ACA plan.
Employees who are on their spouse’s health insurance plan cannot participate. The only way to participate is if they purchase their own individual health insurance and get reimbursed for it through the HRA.

Need Help?

For many employers, ICHRA pros outweigh the cons and can seem like a no brainer, which is why they are growing in popularity. You get to help your employees purchase health insurance plans that meet their specific needs, and you also get to save money in the process. Reimbursements are tax-free for both employees and employers, meaning that they are tax-deductible for employers, and income tax-free for employees, which will save you on employer payroll taxes. It’s a win-win situation.

If you are interested in an ICHRA, or want to explore your options for a group health insurance plan, reach out to an EZ agent in your area. Our agents are highly trained and work with the top-rated insurance companies in the country. We can assess your needs and compare plans instantly, for free. To get started simply enter your zip code in the bar above, or to speak directly with a local licensed agent, call 888-998-2027.

Employee Assistance Programs 101

Employee Assistance Programs (EAPs) have been around for longer than you might think, and have an interesting origin. They began in the 1940s as programs to help combat employee alcoholism, and from there the Employee Assistance Program evolved to help employees manage daily challenges in work and life. Maintaining a healthy work life balance can be difficult for many employees, which can cause stress, affect well-being, and lower productivity levels. As an employer, an EAP can be a major benefit to you; having one in place can help keep your employees healthy and happy, which will in turn help boost your bottom line. Before you can decide whether an EAP is right for your business and your employees, you need to know exactly what they are and what you can offer your employees through them.

What Is An Employee Assistance Program?

EAPs are voluntary benefits that employers can choose to offer. You are not required to provide them, but they can be useful. Not all Employee Assistance Programs offer the same services, but services offered can include:

Counseling for personal and work-related issues, including anger management, anxiety, depression, substance abuse, psychological problems, psychiatric disorders, chronic disease, stress management, and grief.
Training and development for things like communication skills, conflict resolution, team-building, leadership coaching, and more.
Resources and referrals for childcare, and other forms of care.
Financial or legal resources for planning, retirement, divorce, custody cases, debt, and more.
Access to wellness programs such as those for weight management and substance abuse, as well as gym memberships.

Services provided are free to employees, and sometimes for their families, as well.

Why Offer an EAP?

According to the Journal of the American Medical Association, in 2003, U.S. companies lost more than $44 billion due to low productivity related to employee depression. Companies also lost $100 billion annually, or $3,000 per employee, because of substance abuse and mental illness. If you can help your employees manage their stress, you can help avoid this decrease in productivity.

blue arrow going downward with a blue background. — *Employee Assistance Programs will help decrease turnover rate of your employees, as well as absenteeism due to stress.*

Employee Assistance Programs provide emotional support and help employees maintain a healthier lifestyle. Employees can meet with EAP consultants by telephone or in person for assistance with problems that keep them from doing their best. Offering an EAP can increase employee satisfaction and productivity, while decreasing:

The cost to your business of employee stress
The risk of workplace violence
Turnover
The risk of litigation
Absenteeism

Determine What To Offer

Your employees have different needs, so it can be difficult to determine which benefits to provide. In order to determine which services to offer, you should conduct a healthcare survey. Ask your employees what matters most to them, but remember to keep it confidential.

The well-being of your employees matters. There are a variety of Employee Assistance Programs to choose from, and even some comprehensive group health insurance plans that offer some of these services. EZ can help sort through all of your options. Our highly-trained agents can assess your business and what your employees need. We will provide you with guidance to find a great plan that works for everyone and will save you money. To compare quotes instantly, simply enter your zip code in the bar above, or to speak directly with an agent, call 888-998-2027.

Group Health vs Blanket Health

As a small business owner, you want to provide the best for your employees. That includes offering group health insurance that will not break the bank. When researching group health plans for your employees, you’ve probably come across the terms “group health” and “blanket health”. Both are different in what type of coverage they provide your employees, so you need to understand how each type of plan works in order to determine which might be right for your employees and your business.

torso of a person with a suit in holding a green umbrella over blocks with peoples silhouettes on them — *Group health insurance will provide comprehensive coverage for your employees and their spouses and children.*

Group Health Insurance

Group health insurance provides health benefits to your employees, their spouses, and any other eligible dependents. With a group health plan, they will have coverage for visits to the doctor, hospital, or any urgent care facility. If you choose to offer a group health plan, you can also include coverage for prescription drugs and vision and dental care.

Blanket Health Insurance

Blanket health insurance is similar to group health insurance, except it is less comprehensive. It is meant to cover a group of individuals engaged in a specific activity. This type of insurance is often referred to as an accident-only policy, because it provides only basic coverage in the event that your employee is involved in an accident or is injured. The benefit of this kind of insurance is that you don’t have to purchase multiple individual policies to get coverage; the coverage you purchase is a “blanket” policy that covers all of your employees.

You can purchase blanket health coverage to provide health benefits in connection with accidental injury, but the policy usually has a limit on the type of procedures and services that are covered.

How They Are Different

While both offer some type of healthcare coverage, group health insurance and blanket health insurance have many key differences. Group health insurance:

post it note with limited time offer on it — *Unlike group health, blanket health has a limited time duration.*

Covers the 10 essential health benefits that are required to be covered by the Affordable Care Act.
Does not have a dollar limit on what it will pay for care received by your employees.
Is more comprehensive in what it covers and has more coverage options than blanket health.
Has policy terms of a full year.

Blanket health insurance:

Does not have to cover the 10 essential benefits; these plans usually are limited in the types of procedures, tests, and services they offer.
Usually has a maximum covered benefit amount for each person covered.
Has a limited term duration.

If you choose group health insurance, you can tailor your plan to your employees’ financial and medical needs. Blanket health insurance is more cost-effective, but you will not be providing full-coverage health insurance for your employees. You need to consider your employees’ different needs, which a single policy, like blanket health, might not be able to meet.

It can be difficult and time-consuming to compare all the different group health insurance plans in your area, but with the help of an EZ.Insure agent, you are guaranteed to find a group health plan that meets your employees’ needs and saves you money. Our agent will assess your business and employees, and will research and compare all available plans in your area, for free. No hassle and no obligation, just free quotes! Easily compare plans now by entering the zip code in the bar above, or to speak directly to an agent, call 888-998-2027.

Should You Go for Gold?

Silver or gold? If given the option, which would you choose? You’d probably be tempted to immediately answer gold. But when it comes to group health insurance, it’s not that easy. It turns out that the group health plans known as “Silver plans” are far more popular than “Gold plans.” So when is it worth it to go for gold?

The ACA Marketplace

family of 4 in a bubble being held by caucasian hands. — *People can now go to this “marketplace” and shop for the plan that is right for them,*

The Affordable Care Act, otherwise known as the ACA or Obamacare, was signed into law in 2010. It mandated that health insurance exchanges be created in each state. It changed the way insurance worked. People can now go to this “marketplace” and shop for the plan that is right for them, choosing between different metal tiers of coverage (Bronze, Silver, Gold, and Platinum).

Under the ACA, small employers (businesses with 1- 50 employees) can also benefit from this marketplace. In the past, it could be challenging for small business owners to find multiple options for group insurance. But now they can shop around to choose between the same metal tiers as individuals can.

What is a “Metal Tier”?

Just like with individual plans, the metal tier options available to small businesses are Bronze, Silver, Gold, and Platinum. While it may sound like it, the different tiers do not indicate different levels of care.. After all, under the ACA, all plans must cover at least the 10 essential health benefits. What the metal tier actually represents is the cost-sharing split between the employee and the insurance company, meaning how much they will pay versus how much the insurance company will pay for medical care.

Employees with Bronze plans will pay the lowest monthly premiums, while those with Platinum plans will pay the highest premiums. However, premiums are not the only cost to consider: there are cost-sharing requirements, as well, including:

Deductibles – the amount you need to pay for medical care before insurance “kicks in”
Coinsurance – the percentage the insurance company will pay for services after you have met your deductible
Copays – the amount of money you are responsible for, over and above what your insurance company pays – for example, it may cost you a flat copay of $35 to visit your doctor

The metal tier offers coverage within different premiums, copays, and deductibles. Usually the silver plan is preferred.

Because Bronze plans are the lowest tier and have the lowest monthly premiums, they have the highest cost-sharing requirements, while Platinum plans, on the other hand, have the lowest out-of-pocket costs. The cost of premiums and these cost-sharing requirements varies between the metal tiers: for example, with a Bronze plan, employees will pay 40% of costs (with the insurance company paying 60%), while with a Platinum plan, the split is 10% / 90%. That being said, there is an out-of-pocket limit for every plan, which for 2020 is $8,200 for individuals and $16,400 for families. The out-of-pocket limit varies and will probably be highest for those with Bronze plans.

Silver Versus Gold Plans

The most popular plan among employers is the Silver plan, around 50% of employers choose this type of plan. Coming in second is the Gold plan, with almost 30% of employers choosing that type of plan. Leaving out Bronze plans with their high out-of-pocket costs, and Platinum plans, with their high premiums, let’s look at Silver and Gold plans.

With a Silver plan, employees will pay 30% of costs, and with a Gold plan they will pay 20%. These numbers are really dependent on how much healthcare they need throughout the year. For example, if an employee only uses their plan to see the doctor for an annual visit plus one or two other minor visits, they will be paying far less than 20% or 30%. But if they end up with a serious illness and need hospitalization or long-term care, they will be paying far more.

a pile of blocks of gold stacked on top of each other. — *Gold plans are perfect for people with chronic conditions or are in higher risk categories or have children in sports.*

It is understandable, then, that many employers choose Silver plans as a one-size-fits-all option. The premiums are lower, and you might be banking on an able-bodied, working-age group of employees who will use medical services an “average” amount. In this case, the 30% cost sharing doesn’t seem too daunting.

When to Go for Gold

If lower monthly premiums are important to you as a small business owner in order to attract employees, then Silver may be the way to go. But when is Gold worth it?

Simply stated, a Gold plan is worth it for people who expect to use their health insurance. They are perfect for people with (or who have dependents with) chronic conditions or are in higher risk categories for things like the flu – or even those with very young children or children who play sports.

Remember, because of HIPAA (Health Insurance and Portability Act), you cannot directly ask employees about any specific health conditions they may have. You can, however, send out an anonymous survey and ask your employees what they are looking for generally in a healthcare plan. You may find that they are willing to pay more for premiums in order to lower their out-of-pocket costs. If they are worried about being faced with high bills when they need care, then a gold plan might be the right option.

Remember, if you are at a loss at where to begin in choosing group health insurance, EZ.Insure can help. You can start by simply entering your zip code in the bar above to get a quote, or you can contact us by email at [email protected] or call 888-998-2027.

Offer Your Employees More Choices with a Cafeteria Plan

What comes to mind when you hear the term “cafeteria plan”? Lunch! Well, these plans have nothing to do with what’s on the menu. “Cafeteria plan” is the informal name for Section 125 of the Internal Revenue Code, which allows employers to offer a la carte benefit options to employees. Employees can choose which of the offered benefits are right for them, and pay for them pre-tax.

What Are Cafeteria Plans?

a display of different foods in a buffet manner. — *Offer your employees more options of health insurance with a cafeteria plan.*

Just like walking through a cafeteria and choosing dishes, with a cafeteria plan, employees can decide which healthcare options they want. Examples include vision, dental, or HSAs/FSAs. It is important to note that cafeteria plans are not a type of health insurance. They are a way to let employees use pre-tax money to pay for the types of coverage they choose.

To qualify as a cafeteria plan, the plan must include:

At least one qualified pre-tax benefit – these can include things like HSAs and FSAs, which allow employees to put aside pre-tax money to pay for medical expenses throughout the year
At least one qualified taxable benefit – for example, an employer may allow employees who don’t want any of the offered benefits to choose a cash alternative as part of their salary. This is in contrast to traditional group plans, in which an employee isn’t compensated for opting out of coverage. This cash will, however, be taxed.

The Advantages of a Cafeteria Plan

Cafeteria plans are an attractive option for a diverse workforce that is used to having choices. For employees, not only do they get to choose only the benefits that are right for them, but they also get significant tax advantages. They can contribute pre-tax, thus saving money. Because they are taking pre-tax money out of their pay, their paychecks will be smaller, and they will end up paying less in taxes.

For employers, there are a few main advantages:

Employees with smaller paychecks mean paying less in payroll taxes.
Employers may be able to attract and keep staff with a personalized benefits plan.
Unused FSA funds remain with the employer.

The Disadvantages of Cafeteria Plan

For employees, there aren’t many big disadvantages to having a Section 125 cafeteria plan, but there are a few things for them to remember:

Employees are locked into the plan they choose for the entire year – with only a few exceptions,

One disadvantage of a cafeteria plan is that employees are locked in for a year.

employees must wait until the next enrollment season to make any changes

If employees choose a benefit like cash in place of coverage, they will incur a tax penalty.
Any funds put aside but not spent by the employee are forfeited – employees need to decide how much money to put aside at the beginning of the year, and they may not always get it right.

For employers, the main disadvantage of offering this type of plan to employees is the hassle. Because they are so individualized, they can take a lot of time and expense to manage.

Remember, whatever plan you’re considering offering to your employees, we can help sort through the mess. EZ.Insure is here to connect you to your own personal agent who can steer you in the right direction – for free! You will never be hounded by endless calls and you will always get the most accurate information. We promise everything will be quick, easy – and did we mention, free? To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected] or calling 888-998-2027.

Group Health Plan VS Group Health Insurance Plan

Group health plan, and group health insurance plan. These two words are used interchangeably, because they are almost the same thing. Almost. There are some key differences between the two. One is actual health insurance, while the other is a blanket term for different kinds of group plans. Knowing the difference will help you can use the terms correctly in conversation, without confusion.

Group Health Plan

a drawing of a light red umbrella — *Group health plan is an umbrella term used to define different kinds of employer-provided benefits plans.*

A group health plan, in a way, is an umbrella term. It is a term used to define different kinds of employer-provided benefits plans. This includes group health insurance plans, self-insured health plans, and self-insured medical reimbursement plans.

Group Health Insurance Plan

A group health insurance plan is a plan that provides actual health insurance coverage, and not just a general term like group health plan. Group health insurance plans are purchased by employers to be given to their employees that are eligible and their dependents.

Group health insurance is usually job-based, and can be a number of different kinds of plans such as HMO, PPO, POS, etc.

When referring to a group health plan, you can be talking about different kinds of employer-based plans. But if you refer to a group health insurance plan, you are talking about a plan that provides insurance coverage.

Looking For A Group Insurance Plan?

Because there are so many different group health insurance plans to choose from, and from many different companies, it can be time consuming, and downright frustrating. There are different things that go into what affects the premiums for your employees.

red location symbol over a colorful map — *Your business’ location factors into your group health insurance premiums.*

Factors That Affect Premiums

Business Location– This factor takes an average number from one overall area, meaning if you live in a more expensive state, then it will be used as an excuse to raise your premium. Here is more information on the most expensive states that you can operate in.
Enrollee’s Age– Like any health coverage, insurance companies judge heavily on age. The rule is set for a 21-year-old as the standard. The coverage grows in response to being older or younger than this.

Trying to figure out which plan is best to go with is not easy. It is best to have an experienced and qualified insurance agent help you with comparing plans, and how to get you the most for your money. EZ.Insure can assist with figuring everything out and making sure you get the best plan for your budget. Your agent will answer any questions you have, compare the plans for you, and even sign you up, free of charge. To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected] or calling 888-998-2027. EZ.Insure makes the entire process easy, and quick.

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