“ For the first time in 40 years, I don’t have to worry about plan renewals, costs, outliers, stop loss, PBM’s and all the other crap……”
By Bill Rusteberg
Group health insurance used to be cheaper and better than individual health insurance policies. That’s not necessarily true anymore.
Plan sponsors, tired of fighting a losing battle, want out of the health insurance business. They are turning to individual health insurance policies, ceding risk and tempering economic, social and to a large extent punishing government mandates and sanctions. Individual health insurance policies bring freedom back for both plan sponsors and plan members.
These employers fund Individual Coverage Health Reimbursement Accounts (ICHRA) through which employees may purchase health insurance for themselves and their families.
What can that look like?
A 35 year old employee living in deep South Texas can enroll on a Blue Cross plan with a $1,500 deductible, $15 doctor office visit copay, $25 urgent care visit copay, free generic drugs for about $340 per month. The employer’s contribution reduces the premium.
ICHRA administrators (There are more than you can shake a stick at) provide the tools and resources making it easy for employees to navigate different plan options and selecting the coverage best for their individual needs.
If you’re an employer reading this you’re probably wondering why you’ve never heard of this before. Legacy health insurance brokers and consultants don’t go out of their way to recommend ICHRAs for two reasons……they lose relevancy and they lose commission dollars.
Most are prepared to offer assistance though. Most of the big national brokerages are prepared to assist and have systems in place to do that. They know their future in health care depends on it.
Consultants have a duty to advise their clients of market trends and alternatives even if it puts their income at risk. Several years ago a self-funded client moved to ICHRAs. It was the right move for them. They no longer needed a consultant so we shook hands and have remained in touch ever since. Recently we received the following email from the owner of the company:
“So far, the ICHRA is great. For the first time in 40 years, I don’t have to worry about plan renewals, costs, outliers, stop loss, PBM’s and all the other crap (government regulation) that comes with this line item. And let’s not forget risk. I lived in fear each week those pay apps came through, not knowing what they were going to be.”
“Businesses should NOT be in the health insurance business. It’s a complete misallocation of resources and risk. Employees need to be weaned from the employer tit. I don’t like single payer either. Employees need choices that fit their particular needs. ICHRA seems to fulfill that requirement.”
“And that’s the truth!!”
