Choosing a health care plan is one of the most important decisions your company will ever make. There are many options to choose from, and you may struggle to find the perfect fit.
Regardless of whether your business is big, small, or somewhere in between, a quality health care plan is indicative of the overall character of your company.
Employees tend to want the highest quality, lowest costing health plans for them and their families, so a better overall health plan will tend to attract better overall applicants.
Since your health plan is such an important decision, be sure to shop around and weigh your options before making your final choice.
Deciding what is right for your business is no easy feat. SOCA is here to help! Below we have assembled some tips and terms you must know if you hope to build the best health care plan possible.
If you have investigated setting up a health care plan for your business, then you likely encountered these terms, self-funded health plan and fully insured health plan. It may not be apparent what these terms mean, and which option is right for you.
Let’s clear up the confusion.
Self-Funded Health Plans are created and operated by your business and work in-house. Usually, businesses will have help from a third-party administrator, but this type of plan works almost entirely from and within your business.
Fully Insured Health Plans are more traditional health plans. When your business buys a health insurance plan from an outside insurance company, that is a fully insured health plan.
Self-funded plans are best for large businesses and corporations. They include great financial risk but can also include lower monthly costs if properly managed.
Fully insured plans are better for small and medium businesses. Mom-and-pop operations often cannot assume the risk of their employee’s health and are willing to pay more to a private insurance firm to ensure that the financial risks of creating a health insurance plan are mitigated.
Your network size is extremely important when determining the benefits your employees will receive. Network size determines how much your employees will pay out of pocket and other financial responsibilities.
Plans with more narrow networks have preferred providers that your employees are encouraged to see. These select providers are cheaper for your employees to see and out-of-pocket costs are generally low. Narrow networks do allow employees to see providers outside of the network, but out-of-pocket costs can be high. Narrow networks can make healthcare inconvenient for your employees, especially in times of crisis.
There are other, less narrow networks, sometimes call open-access networks. These networks give your employees more freedom to choose from many different doctors and hospitals. However, the downside is that open access networks tend to cost you more on the front end.
When you are shopping around for different health care plans, you will encounter a few different types of account options. These terms can be confusing. Don’t worry, we will define them here!
Health Savings Accounts (HSAs) are a type of savings account that helps employees pay for health expenses. Used in conjunction with a high-deductible health insurance policy, they allow users to save tax-free money to be used for health issues.
Flexible Spending Accounts (FSAs) are very similar to HSAs in that they are a type of savings account set up to help employees pay health expenses. However, where HSA funds roll over from year to year, FSA funds do not and must be spent within a given year or they are lost.
Both HSAs and FSAs provide your employees with much more flexibility, so be sure to look for those options when shopping for plans.
Health Reimbursement Arrangements (HRAs) are employer-funded plans. Employees submit out-of-pocket expenses such as co-pays, deductibles, and coinsurance to their employer's HRA for tax-free reimbursement. Instead of an account controlled by the employee (like with HSAs and FSAs), HRAs are employer controlled.
Your employees need a plan that fits their budget and lifestyle. When applicants are looking for new employment, health insurance is one of the key factors they use to decide which position is an ideal fit for them.
Beyond lifestyle, employees need support that makes it easy to get and manage health care, a broad network for both primary and specialty care, and discounts and perks for leading a healthy lifestyle.
For these reasons, choosing a healthcare plan is one of the most important decisions your business will make.
You don’t have to go it alone. SOCA is here to help. If you need better access to healthcare, including multiple employer welfare arrangements, the SOCA benefit plan administered by Anthem, access to the Anthem Blue Cross Shield Chamber Saver Plan, or other benefits, then it's time to tell your local chamber of commerce to join forces with SOCA.
Browse SOCA’s benefits page for a complete list of the benefits we can offer your business.