Employers pay as much as 67% of the cost of their employees’ traditional health insurance—sometimes more.1 Traditional health insurance can include managed care plans from Health Maintenance Organizations (HMO) or Preferred Provider Organizations (PPO). These plans offer comprehensive care and require participants to use providers within their network. Depending on the plan, participants can pay insurance premiums, co-pays, and a range of deductibles. Preferred Provider Organizations (PPOs) and point-of-service (POS) plans are also traditional models, but they allow non-network providers for an additional cost.
Alternatives to traditional health insurance are low-cost options that cover some healthcare needs but don’t fit the traditional managed-care model. They include health savings accounts (HSAs), non-traditional group health plans, medical cost-sharing programs, limited medical (or catastrophic care) plans, and more. Depending on the plan, they can:
- Control costs and reduce overall benefits spend.
- Provide more affordable healthcare coverage to small and mid-sized businesses.
- Allow employers to offer coverage to non-traditional, low-income, and younger employees.
- Have more flexibility and customization, especially in the choice of providers.
- Supplement other benefits to attract and retain employees.
