I was looking for health insurance plan for my new start-up. When I started comparing group plans vs. individual plans, I found out that individual health insurance plans are a lot cheaper then group plans probably because all the employees in my company are in good health. Since most states don't allow insurance carriers to deny group coverage to small businesses, they tend to be a lot more expensive. The other reason is that group plans tends to be richer.
After comparing price and features, I wanted to go with individual health insurance for my company but I ran into following challenge:
Premiums (both employer and employee contributions) for group plans can be paid for from pre-tax dollars where as there is not a simple mechanism to pay for individual health insurance using pre-tax dollars. I found out that HRA (Health Reimbursement Accounts or Health Reimbursement Arrangements) can be a great way to facilitate this but setting up and adminsitering such a plan can be complex.
There are many companies that can help one setup and administer such a plan but I could not found any one with integrated solution that also includes letting employees seamlessly use the HRA funds to buy and automatically pay insurance premiums. Because of this experience, I am considering making it a high priorty for my company, hCentive, to offer a seamless HRA solution. I would like to hear from you, your wish-list for such a solution.
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