The Latest Money Saving Group Health Insurance Strategies for California Employers
1. Health Savings Accounts (HSA)
This is a strategy where the employer buys a health plan with a large deductible. Typically, these are groups that are coming from a plan with a very low deductible. Since the higher deductible plans are usually much less money, the money saved is used to put into the employee’s “Health Savings Account.” The money in this account is used by the employee to pay qualified medical expenses. If it’s not used, the money rolls over to the next year. The money belongs to the employee, even if they leave the company.
2. Health Reimbursement Arrangements (HRA)
This is very similar to the HSA above but a portion of the qualified medical expenses not covered by the insurance is “pledged” by the employer, that is, the employer only spends the money, if there is a portion of the bill not paid by the insurance. This would be more favorable to the employer since on an HSA the money goes to the employee, whether there are claims or not. The problem with HRAs is that there are very few carriers that offer...
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