Understanding Today’s Employer Health Plan Options, Beyond Major Medical

Employers today have more ways to structure health benefits. Depending on the size and makeup of the workforce, budget, employee needs and regulatory requirements, the right solution may involve a different funding model, a different plan design, or a combination of health and supplemental benefits.

The goal is to find the right balance between cost, coverage, employee needs and risk and to understand the tradeoffs involved.

There’s More Than One Way to Structure

Health Benefits

Before comparing health plan options, it helps to understand that they don't all do the same job. Different options can change fundamental aspects of an employer's healthcare strategy.

Understanding these distinctions makes it easier to compare the options that follow and to see why two approaches with similar price tags may work very differently for an employer and its employees.

Employer Health Plan Options at a Glance

Today’s employers can choose from a range of health plan designs, funding approaches and supplemental solutions. Each option works differently and may fit different types of employers and workforces.

Health Plan Option	How it Works	May Be a Fit For
Traditional Major Medical	Comprehensive medical coverage, often provided through a fully insured plan in which the employer pays a set premium to an insurance carrier that assumes responsibility for covered claims.	Employers seeking broad coverage, predictable premiums and a familiar insurance structure.
High-Deductible Health Plan	Generally features a higher deductible in exchange for lower premiums, with employees paying more initial healthcare costs. Plans that meet federal HSA eligibility requirements can be paired with a Health Savings Account.	Employers looking to manage premiums and workforces comfortable assuming more initial out-of-pocket costs.
Level-Funded Plan	A form of self-funded coverage that combines fixed monthly payments for estimated claims, administration and stop-loss insurance. Depending on the arrangement, employers may receive a portion of unused claims funds, while claims experience can affect renewal costs.	Small and midsize employers interested in more predictable monthly payments, potential savings and greater claims visibility, while accepting some claims risk.
Self-Funded Plan	Employer assumes financial responsibility for covered medical claims, often using a third-party administrator to manage the plan. Stop-loss insurance may be purchased to help limit exposure to unusually high claims.	Larger employers, or employers with sufficient financial resources, administrative support and tolerance for claims risk.
Individual Coverage HRA (ICHRA)	An employer-funded arrangement that reimburses employees for qualifying individual health insurance premiums and, depending on plan design, other eligible medical expenses. Employees must have qualifying individual coverage or Medicare.	Employers with geographically dispersed workers, varied employee needs or an interest in a defined-contribution approach.
Qualified Small Employer HRA (QSEHRA)	Allows eligible small employers that do not offer a group health plan to reimburse employees for qualifying health insurance premiums and medical expenses, subject to federal annual limits and other requirements.	Employers that are not subject to the ACA employer mandate, generally those with fewer than 50 full-time and full-time-equivalent employees, and that do not offer a group health plan.
ACA Coverage Standards: MEC / Minimum Value	Minimum Essential Coverage (MEC) is a category of qualifying health coverage under the ACA. Minimum Value is a separate standard requiring an employer plan to cover at least 60% of expected allowed benefit costs and provide substantial inpatient hospital and physician coverage. MEC alone does not guarantee Minimum Value.	Employers, particularly those subject to the ACA employer mandate, evaluating whether their coverage offerings satisfy applicable requirements.
Supplemental & Access Solutions	Benefits and services such as accident, critical illness, hospital indemnity, telehealth and direct primary care that can provide additional financial protection or improve access to care. These generally complement, rather than replace, comprehensive medical coverage.	Employers looking to address specific risks, improve everyday access to care or help employees manage out-of-pocket expenses.

Which Approach Makes Sense?

Start With Your Workforce.

There is no single health plan structure that makes sense for every employer.

A 25-person professional firm with relatively high salaries and employees concentrated in one geographic area has a different set of considerations than a 150-person hospitality company with hourly employees, variable schedules and higher turnover. A 500-person organization operating in multiple states introduces still another set of needs.

That's why employers should consider factors such as:

• Number of employees and the full-time/part-time mix

• Employee compensation levels and ability to contribute toward coverage

• Geographic concentration or dispersion of the workforce

• Workforce demographics and healthcare utilization

• Employee turnover

• Recruiting and retention priorities

• Employer budget and tolerance for claims risk

• Administrative resources

• ACA and other compliance obligations

Size matters, but it is only one factor. The right question is not, "What plan do companies our size buy?" It is, "What structure makes sense for this workforce and this business?"

Employers Have Levers They Can Adjust

Choosing a health plan is not necessarily an all-or-nothing decision between "good coverage" and "lower cost." Employers have several levers they can that can affect both premium and employee benefits.

Each lever has consequences:

• A lower premium may result in a higher deductible. 

• A narrower network may save money but create access issues. 

• Reducing one benefit may make another benefit more important.

That's why the objective should not simply be to remove benefits until the premium comes down. It should be to determine which benefits provide meaningful value to the workforce and how to deliver them as efficiently as possible.

More Options Are Useful Only If You Can

Navigate Them

Choice is valuable. Complexity isn't.

With more health plan options available, the challenge for employers is not simply finding them. It is understanding what each option is designed to do. TeamREX gives employers access to a range of health plan structures and supplemental benefits through our partners. We also provide the expertise to help determine how those options may apply to a particular workforce.

That means an employer doesn't have to arrive knowing whether it needs a traditional major medical plan, level-funded arrangement, reimbursement strategy or another approach. The conversation can begin with the employer's requirements and work toward the available solutions not the other way around.

The value isn't simply having more plans to choose from. It's having more ways to solve the problem.

TeamREX connects employers with health plan options through our partners, Premier Health USA and Otegrity Insurance Solutions, Inc. Dental, vision, life, critical illness, and other insurance options are also available through Otegrity Insurance Solutions, Inc.