Choosing an ICHRA Health Plan by Value, Not Just Premium

As an ICHRA administrator, we help employees navigate health plan decisions every day. As ICHRA continues to expand across the country, employees are faced with more plan options than ever before. Many gravitate toward the cheapest plan available or the most expensive one their ICHRA funds will cover, but neither extreme may deliver the best value and care over the course of the year.

Choosing a health plan can feel daunting, but a few focused steps can help narrow the field and make a confident, informed decision for yourself and your family.

Check Provider Networks

Most consumers know to verify that their existing providers participate in a plan's network. But that's not always the end of the story.

If your current provider is only available on the most expensive plans, pause and ask: how often do I actually see this provider? You may find that a lower-premium plan, combined with occasional out-of-pocket visits, saves you significantly over the year.

Your current provider may even be able to refer you to an in-network colleague. In some cases, a physician who learns patients are leaving due to insurance may explore joining that carrier's network.

Check Prescription Drug Coverage

Medication costs can vary substantially from one carrier to another. While inexpensive maintenance drugs are generally affordable across the board, some carriers cover a selection of maintenance medications at no cost to the consumer.

Specialty medications can vary even more dramatically. Semaglutide (Ozempic), for example, is classified as a Tier 2 or Tier 3 brand drug with a flat copay by some carriers, while others place it at Tier 5 as a specialty medication with high coinsurance that often applies after the deductible.

Reviewing carrier formularies and using resources like GoodRx can help you anticipate and plan for these costs.

Add It All Up

Many consumers think of their monthly premium as their total insurance cost. In reality, your true financial exposure includes your premium, your regular out-of-pocket costs and your maximum out-of-pocket limit.

Running the full-year math can be illuminating and may save you thousands of dollars.

Consider two scenarios.

If You Expect Significant Medical Expenses

You might lean toward a Gold plan with a lower deductible. But compare the full picture.

A Gold plan with a $500 monthly premium, a $1,000 deductible and an $8,000 out-of-pocket maximum carries a total annual risk of $14,000.

A Bronze plan with a $300 monthly premium, a $6,000 deductible and a $9,000 out-of-pocket maximum carries a total annual risk of $12,600.

If you expect to hit your out-of-pocket maximum either way, the Bronze plan may actually cost less.

If You're Generally Healthy

If you rarely use medical services, paying a higher premium for a lower maximum may be unnecessary.

Choosing a lower-premium plan and directing the savings into an HSA can allow your money to go toward your actual care rather than to the insurance company. If you're considering this strategy, be sure to verify that the plan you're selecting is HSA eligible.

Make an Informed ICHRA Health Plan Decision

The best health plan is not always the cheapest option or the most expensive option. The right choice depends on your healthcare needs, prescription requirements, provider preferences and financial goals.

At Kyra Health, we help members take the time to understand their needs, review provider networks, evaluate prescription coverage and run the numbers. Your health plan is one of the most important financial decisions you'll make each year and it deserves the same level of attention as any other major financial commitment.

Our six-tier recommendation system is built around listening to each member's medical history, healthcare priorities, prescription needs and financial goals so we can help identify the health plan that offers the best overall value for their situation.

Michelle Mc Laren

Director, Carrier Relations