đź’ˇ ICHRA 101 Guide: A Breakdown of the Basics

Everything brokers, employers, and HR professionals need to know about providing ICHRAs.

How Are Individual Marketplace Plans Different?

When you switch from a traditional group health insurance plan to individual Marketplace plans for employees, the benefits are endless! This transition is easier than you may think, which means it’s time to take advantage of these individual health insurance plans that have been flipping the script on traditional health benefits for over a decade! 

In our last blog, we defined individual health insurance plans as health benefits purchased on the Health Insurance Marketplace. We also discussed why 60% of employees choose these plans when given the choice to select their own health benefits. Data shows that the industry shift to individual health insurance is happening – and it’s clear that employees want these plans now more than ever!

This striking statistic brings attention to the fact that Marketplace plans are different and ultimately better than traditional group plans. 

What makes individual Marketplace plans different?

There are two primary differences between Marketplace plans and traditional group plans. These differences ultimately reveal the benefits of letting employees choose their own health benefits. After evaluating these factors, it will be clear why so many employees want these plans!

Individual plans are guaranteed-issue.

This is one of the most prominent differences between Marketplace plans and traditional group plans. Guaranteed-issue refers to the requirement of healthcare coverage to be issued without the insured incurring additional costs based on medical condition(s). The Affordable Care Act changed individual health insurance by determining that Marketplace plans would cover preexisting conditions. Traditional group plans, however, are not always guaranteed-issue, which could lead to unexpected price increases for employees. Utilizing these plans ensures that your team is receiving the best benefits at a price that’s more affordable for everyone!

Individual plans unlock tax credit discounts.

Tax credits provide government assistance to pay for items that would otherwise cost more money. When the Affordable Care Act was introduced, the Advanced Premium Tax Credit (APTC) was established to help bring down the cost of Marketplace plans. These plans are discounted based on annual household income. It’s important to note that an individual is not eligible for APTCs through traditional group plans.

How do APTCs strengthen Marketplace plans?

After an individual becomes eligible for APTCs, the cost of their Marketplace plan is significantly lowered. In some cases, an individual health insurance plan on the Marketplace can even be discounted to $0! 

Are you ready to get your hands on these discounts? Luckily, it’s easy to be eligible for APTCs! In fact, 79.5% of all individuals are eligible for tax credits, which is a game changer for employees and employers alike! APTCs make Marketplace plans more affordable while providing an opportunity to strengthen your organization’s health benefits. Imagine what your organization and your people could do with those savings!

How does this benefit me?

Understanding how Marketplace plans differ from traditional group plans can help you utilize the best plans while getting the most bang for your buck. One of the key factors that make Marketplace plans different is the convenience of guaranteed health insurance. With these guaranteed-issue plans, your past, present, or future medical conditions do not determine your health coverage. 

It’s also important to understand that the results of using Advanced Premium Tax Credits are profound. When you switch to individual health insurance and utilize APTCs, you can improve your overall benefit using newly regained resources. This serves as a strategy for attracting and retaining top talent at your company. It’s clear that Marketplace plans are different, and now we’re able to see why they’re a better option, too!

With Remodel Health, it’s never been easier for employers to take advantage of the benefits of individual health insurance. Interested in learning more? Our custom Health Benefits Analysis provides a data-based breakdown of how to improve your company’s benefits and meet the needs of your people. Click the button below to learn more!

Important Notice: Remodel Health does not intend to provide specific insurance, legal, or tax advice. Remodel Health always recommends consulting with your own professional representation to properly evaluate the information presented and its appropriate application to your particular situation.