High deductible health plans (HDHPs) have become popular since the implementation of the Affordable Care Act as a means to secure basic coverage and avoid noncompliance penalties. But these plans clearly leave their claimants vulnerable to a wide variety of costly health issues. Most employers and human resource directors know this, but the challenge is finding an affordable solution that benefits everyone. Spend too much of your HR budget and you risk dragging or company into the red. Offer too little in coverages and you’ll have difficulty retaining highly qualified employees.
For many years, Health Savings Accounts (HSAs) have been the defacto supplement to HDHPs. But these accounts have proven unattractive to employees for a variety of reasons, from complexity of use to perceived value. Group GAP coverages, however, have begun to change the way people think about health insurance. Here’s an example from our own consulting experience:
Challenge: Workers were offered a high deductible health plan (HDHP) along with a Health Saving Account (HSA). Employees were urged to put away monies to cover deductibles and cost sharing expenses. However, the company was facing poor employee participation and employee morale was low.
Solution: At renewal, the Employer offered a second plan option for employees: a HDHP with Doctor’s Office Visit and RX copays PLUS several GAP insurance plan options employees could “pick and purchase” to fill in high deductibles and cost sharing expenses.
Result: Enrollment response was overwhelming with the new Bronze/Group GAP plan, that the following year, the employer dropped the HSA plan and kept the HDHP with Doctor’s office visit and RX copays and GAP plan offerings.
To learn more about how your HR team can control costs and improve employee morale with GAP coverages, contact us.