Add-On or Voluntary Benefits for Your Health Insurance Policy

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Doctor selecting a benefits icon

 

First let’s go over a common question, what is an “add-on?”  An add-on to your traditional health insurance coverage is defined as an optional benefit that subscribers can choose to include in their plan for an additional cost. This type of benefit is voluntary for subscribers. The beautiful thing about add-ons is that it allows subscribers to pick the benefits that they need.

The team at AUI is here to help you navigate some of the more common voluntary benefits for your health insurance plan.  Here are a few options for your consideration.

Direct Primary Care (DCP)

In recent years Direct Primary Care has grown in popularity because it can be offered to part-time, laid-off, or furloughed workers who may not have health insurance through a primary employer. For many small businesses this type of benefit is great because subscribers can visit their primary care physicians for a low monthly fee and have unlimited access to in-office visits, telemedicine (virtual visits), and more.  This option gives users the preventative care they need while keeping employer costs down.

According to the Direct Primary Care Coalition “Affordable, transparent costs based on a periodic overall flat rate (i.e. membership or subscription).  Patients pay for their care directly to the physician.  No third parties or Fee for Service billing (“FFS”) to inflate costs. Most DPC memberships/subscriptions cost less than the average cell phone bill.”

Critical Illness Plans

Today, medical expenses continue to be on the rise.  A critical illness plan helps policyholders with coverage that expenses that were not part of their traditional health insurance programs.  Advocates believe that offering this as additional coverage can help when medical emergencies arise like a cancer diagnosis or a heart attack. When medical visits require regular office check-ups critical care insurance can help with out-of-pocket expenses like copays and deductibles.  Today, employees tend to pay for the extra coverage through a discounted group rate.

According to the company Aflac, 44% of employers now include the option for critical illness insurance.  It is worth looking into as the annual premium for health insurance coverage continues to rise.  According to the Kaiser Family Foundation, the average increase rose from $3600 to more than $5300 in one decade.

Health Savings Accounts (HSA)

A Health Savings Account is used to pay for current or future medical expenses.  This option is very popular when combined with high-deductible healthcare plans.  It also has tax advantages for those who contribute to them through their place of employment.  Contributions made to an HSA are not subject to federal income taxes.  However, you may still be subject to State taxes, so it is important to know your local tax laws regarding HSA accounts.

Some of the things that qualify for eligible medical expenses include co-insurance, prescriptions, vision, and dental care. If you do not use your funds in a year, they roll over to the next year.  You never lose the money you have allocated to the HSA fund.  A full list of benefits that are covered with HSA plans can be found on the IRS website HERE.

Flexible Spending Account (FSA)

Typically, a flexible spending account is offered through an employer and works much like the HAS account we just covered.  It is designed to set aside tax-free funds to cover out-of-pocket costs.  It is important to note that if you have a high deductible healthcare plan through your employer you cannot have both an FSA and an HSA.

Let’s Compare these voluntary benefits:

Infographic for PSA vs. HSA

Count on AUI for Help Choosing Voluntary Benefits

Not all voluntary benefits will be right for you as an individual or as an employer providing plans for your employees.  It is important to learn more about all of your options and the experts at AUI are here to help you navigate the pros and cons of all your additional benefit choices.  Contact us today to learn more and get started.

Additional Reading:

IRS Allows Employers to Recover Mistaken HSA Contributions

Educating Employees on HSAs

 

We do more than cover small businesses and individuals with the right insurance policies and benefit plans – what motivates our team is helping you save more so you can invest more in your team, family, and goals.

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