|November 2022||Maximixe your HSA e-Newsletter||Vol. 18, Issue 19|
Providing Health Benefits to Your Small Business Employees – At a Cost You Can Afford
In today’s competitive labor market, offering health benefits is important to attracting and retaining the best talent. And of course, you want the best for your employees.
But as a small business owner, you already know that profits are squeezed by both inflation and competition. And traditional group health insurance premiums have skyrocketed, placing them out of reach for many small business owners.
But constantly losing good workers to competing employers and other opportunities because they need the health benefits is no path to lasting competitiveness either.
Fortunately, thousands of small businesses across the country are discovering that there is a better way.
In this newsletter, we’ll discuss several new and innovative approaches and strategies for small business owners to provide these valuable health benefits to employees – at a realistic and affordable cost. Which is probably much less than you think!
Here are some of these strategies that our small business owner clients are using to take care of their workers – and improve their own competitiveness, thanks to being able to recruit and retain their great workers:
1. Health Reimbursement Arrangements
With a health reimbursement arrangement, or HRA, employers simply reimburse employees tax-free for medical costs, up to a certain amount. Employees can use this money to buy their own health insurance, or cover other healthcare related costs. It’s flexible for employees, who aren’t shoehorned into an overpriced one-size-fits-all group health insurance policy.
Instead, your workers are empowered to make their own health care decisions, with the additional spending power that comes from a tax-free benefit. And their benefit is completely portable: They don’t lose their health insurance because it’s out of peak season for your business, or if they get laid off or have to relocate and leave your company.
If you do offer a group health insurance plan or health sharing plan, employees can use HRA money to pay deductibles, copays, and co-insurance, or any other healthcare-related out-of-pocket cost.
So your workers and your families don’t have to put off the care they need because of cost – only to create bigger and more expensive problems down the road.
There’s no minimum amount you have to contribute to an HRA. Instead, you decide the amount you contribute to your HRA program. And you can change it year to year, based on your business’s cash flows.
Your HRA contributions are tax-deductible to the business as a compensation expense. And you don’t have to fund them in advance. You can retain that money as operating capital until an employee needs it.
Many employers find that HRAs are a flexible and powerful benefit that is highly-appreciated by workers. Especially in industries that often don’t provide any health benefits to workers, such as in restaurants and service businesses.
2. Health Sharing
Health sharing is an increasingly popular and vastly more affordable alternative to health insurance. Don’t confuse health sharing with health insurance.
Health sharing is an arrangement where non-profit organizations called “health sharing ministry organizations” facilitate the voluntary sharing of unexpected health care expenses among like-minded members who have agreed to pursue a healthy lifestyle.
Thousands of our clients have already found that health sharing provides tremendous protection against the high cost of health care – at up to 50 percent less than the cost of an unsubsidized traditional health care premium.
We have more good news: You can offer health sharing as a group benefit, as well. You can subsidize the cost of your health sharing plan. You can offer it as a lower-cost option alongside a traditional group health insurance option, which may reduce costs both for your employee and your company. Or you can offer it as a voluntary employee-paid benefit.
Note: Unlike traditional group health insurance plans, health sharing plans don’t have to take members with pre-existing conditions. Some businesses offer an HRA or a group health plan for those with pre-existing conditions, alongside a health sharing plan that will be popular with workers who don’t have any such pre-existing conditions.
3. Direct Primary Care
Studies show that many workers and their families put off or avoid seeing the doctor because of the cost. Even with insurance, high deductibles and coinsurance costs can make seeing a primary care doctor regularly cost-prohibitive.
This leads to increased employer costs down the road, in the form of absenteeism, presenteeism, stress, depression, and other problems that affect productivity and performance.
Direct primary care, or DPC, is an innovative, affordable, and effective way to solve that problem.
Here’s how it works:
Instead of paying for a bloated, inflated traditional health insurance policy, thousands of employers now enroll workers and their families in a direct primary care plan. For an affordable and predictable flat monthly rate, your workers and family members can see a primary care doctor as often as they need to.
There are no copays, deductibles, or coinsurance costs to worry about.
Your workers and their family members can see their primary care doctor as often as they need to. Without it costing a dime other than the monthly subscription.
It’s ideal for all types of routine care that can be done in a doctor’s office and doesn’t require a specialist:
- Annual check-ups
- Sick note verifications
- Medication monitoring and prescription renewals
- Well baby visits
- Pap smears
- Immunizations and vaccinations
- Bumps, bruises, and sprains
With unlimited telehealth access, your employees don’t even need to take a half-day off work just to see a doctor, or take a child to the doctor’s office. They can make the call from work, if needed. And get right back to business.
It makes a difference. Especially for lower-income workers with families.
Want to learn more? That’s what we’re here for! We make it easy for small business owners to offer a full range of affordable health care benefits for all kinds of employees.
Just talk to your Personal Benefits Manager. We’ll help you analyze your work force and budget, and help you provide these critical health benefits to workers who desperately need them.
We’re looking forward to working with you!
Click here to schedule an appointment, or call 800-913-0172 to get started.
To your health and wealth,
Wiley P. Long, III
President - HSA for America
The HSA for America Maximize Your HSA Newsletter is published monthly and emailed to subscribers at no charge. Subscribe now to stay on top of the critical information you need to know about health insurance, healthshare plans and managing your finances to achieve financial security.
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