Health Care Alternative

Author: Dwight Grant

The Affordable Care Act (ACA) changed many of the existing plans that employers provided their employees. For businesses over 50 FTE healthcare was mandated. For those with less than 50 FTE it was optional.
One small Christian non-profit had been providing a Blue Cross health insurance plan for several years. This had been a struggle to keep up with and with the ACA changes, the rates were about to go up again. There had to be a better way to approach this. I reviewed their situation and here is what happened.

The Challenge:

The organization spent over $140,000 per year on heath care insurance.
Employees spent on average $2,000 per year paying the employee contribution. This did not include deductibles and other medical expenses not covered by the insurance.
A couple of staff opted out of the insurance plan since they would have paid more to elect the plan than to keep their alternative health care options.
Many staff worked part time and did not qualify for the plan.
The company had laid off staff in order to meet their budget.

The Solution:

Ran an analysis per staff member to determine the impact to each individual.
Developed a communication/transition plan and implemented the changes.
Discontinued the insurance plan. (Savings of $150,000/yr.)
Introduced Christian health sharing plan options. (non-insurance) (qualifies as an exemption for ACA)
The plans were available to all staff at a discounted rate but they had to enroll and pay for it themselves.
An example of an annual fee was $300/yr per couple. Deductibles could range from $0 - $500 per incident.
Increase compensation by $3-7K per year for each full time qualified staff member. This money could be used to purchase insurance, enroll in health sharing or for general spending. The company did not dictate the use but wanted to spend some of the $150,000 they were saving to help their staff.