The Allure of The Free Plan

The Allure of The Free Plan

Given the razor thin labor pool and long-term positive economic and employment forecasts, the battle for quality talent will be waged for some time to come. Add to that, the Millennial Invasion, and you have a full on war for these sharp young minds as they enter the work force.

The thought of paycheck, let a alone payroll deductions, is a new concept and one that comes with education and adjustments to the working world. Enter the free health plan concept.

While many employers charge 30% or better of health plan costs to their employees, Millennials approach the health plan selection process with a ‘Friday Beer Money’ frame of mind. Thus the allure of a low or no cost health insurance plan selection. The combined H S A / HMO program, presents the lowest price offer to employers, and when structured properly, often times can be at or below the 70% threshold of pricier plans offered by employers. The result, a free plan offering to entice not only younger personnel, but any employees blessed with good health that are non-users of the plan.

Many health insurance carriers will allow multiple plan offerings, of two to four options, depending on the number of insured / eligible employees. Designing at least one plan offering that comes in at no cost to your employees, is something that many employers have not offered for years. This can be a game changer when competing for talent, where wages are comparable, but benefit costs may vary greatly.

The price point of some H S A / HMO combo plans, can provide such a savings that it allows room for some employer seed money in to the H S A program. Employer seed money could also be done on a match basis, to incent employees to contribute to their own H S A, which oftentimes is viewed as a medical 401(k) plan. Given a few years of H S A growth under their belt, when they reach the ‘I just might need this’ thought process, they will have built a small nest egg to offset eventual health care costs that we all face at some time in our lives.

Bottom line, as employers look to hyper creative ideas to recruit and retain talent, the ability to offer free health plan is something familiar only to the prior generation of employees. Its rarity is eye-catching today.


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Mike DiLorenzo

mdilorenzo@miplanners.com

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