Individual health insurance is a health policy that an individual purchases to shield themselves against unpredictable health issues. Individual health insurance plans unlike its name cover both the proposer and his family. These policies are usually purchased with the guidance of an insurance agent or broker to help navigate plan choices and their related costs. Individual health insurance plans are also a more affordable option than group health insurance. These insurance plans are beneficial for both employers and employees.
Individual health insurance plans, under the Affordable Care Act, must cover all individuals regardless of their health conditions. Furthermore, tax credits are available for qualifying employees. It offers employees more choice and gives employees an insurance plan they can keep no matter where they are employed. In this blog, we will discuss the top five benefits of individual health insurance plans and why it is more affordable than group health insurance.
As the cost of group health insurance plans is steadily increasing over the years, it becomes harder for small or medium-sized companies to afford health benefits for their employees.
Furthermore, individual health insurance policies are usually more affordable. By offering a health reimbursement arrangement (HRA), businesses can give their employees a set monthly allowance to spend on their health insurance premiums and qualifying medical expenses. HRA makes it easy and consistent to budget for every month.
Availability Of Discounts
Individual health insurance premiums are more affordable to begin with. However, employees can also qualify for additional discounts on their premiums. These discounts are known as health insurance subsidies or premium tax credits. They were created to help low-income people get affordable health coverage via the health insurance marketplaces.
If you offer an HRA, your employee may be required to coordinate their premium tax credit with their HRA allowance or choose between the two depending on the type of HRA you are offering.
If you reimburse your employees for their own individual health insurance, they will be able to select a plan that works with their present doctors, healthcare providers, and budget.
Group health insurance is full of strict requirements that can be hard to meet for small or medium-sized businesses. If businesses reimburse their employees for their individual health insurance policies, it will keep them from following these strict group requirements.
Also, it offers you the flexibility to contribute what you can afford and allows you to offer the benefit to any number of employees. It depends on the plan you choose to set up.
Individual health insurance policies are entirely portable. It means your employees can take their policy with them even after leaving the company. Reimbursing your employees for their individual health insurance with an HRA allows you to give a formal health benefit that takes care of them. It also empowers your employees to make their own healthcare decisions that aren’t dependent on their employment.
We hope you understand the benefits of individual health insurance plans as they are a more affordable option than group health insurance. Employees can also qualify for additional discounts on their premiums. Individual health insurance plans are a more beneficial option for both employers and employees than group health insurance.
Also, group health insurance is full of strict requirements that can be hard to meet for small or medium-sized businesses. Individual health insurance plans offer you the flexibility to contribute what you can afford.