Group health benefits were once a way for employers to express gratitude to their employees. Employees dedicated their time, energy, and talents to the employer. And in return, employers showed their appreciation with an offer of strong health benefits.
They were like a social contract between employer and employee: “You help our business, and we will take care of you by choosing health insurance for you and helping you pay for it.”
But today, this social contract is complicated and strained. Rising costs and administrative burdens have turned group health benefits into a source of stress. Many employers are choosing plans based on affordability rather than what their people need, leaving employees to settle for what their employer provides, even if it’s not an ideal fit.
Instead of being a joy to offer and receive, traditional group health insurance has become an unpredictable and stressful ordeal — one that can create tension between employers and employees.
As a health insurance broker, you can bring joy back to health benefits by introducing clients to the promise of defined contribution health plans.
Bring the joy back to group health insurance.
Revising the social contract of group health benefits with defined contributions
Defined contribution health plans, like Individual Coverage Health Reimbursement Arrangements (ICHRAs), have created a new era for group health insurance. With them, we can revise the social contract of employer-sponsored health benefits in a way that makes sense for both employers and employees.
With these plans, employers still help employees pay for their health insurance and other benefits (pre- or post-tax). But they do it in a way that gives the employee freedom to choose whichever individual health insurance policy fits their needs best. With defined contribution health plans, the new social contract becomes:
“You help our business, and we will take care of you by helping you pay for your health insurance — while giving you the freedom to choose your coverage.”
Defined contribution health plans are a refreshing alternative to one-size-fits-all group plans because they offer employees real choice and give employers controlled and predictable costs.
The future of employer-sponsored benefits is defined contribution health plans
Defined contribution health plans are simple thanks to technology advancements (like Nexben) that simplify administration: Employers give employees a set amount of money each month, and then employees use it to shop for and buy coverage from the individual health insurance market. The result for employers?:
- Controlled healthcare costs through a predictable budget
- Stronger benefits that are still tax-advantaged and ACA-compliant
- More flexible options to meet the diverse needs of employees
And for employees? Employees are happier because they get access to far more coverage options and can choose the health insurance policy they want, can afford, and can take with them if they leave the company. Even better: Their employer isn’t the one making important decisions about their healthcare.
Because here’s the thing: It never should have been an employer’s job to tell employees how to take care of their health by choosing health coverage for them. It’s time to empower employees with the choice they want and deserve.
Learn how much your client could save with a defined contribution health plan.
Where brokers and Nexben fit into the new social contract
The traditional group health insurance system is no longer the best option for many companies. Employers are either dropping their health benefits altogether or offering plans that don’t meet employee expectations.
Defined contribution health plans are addressing this and getting businesses back to what they initially set out to do with health benefits: support their employees in a way that’s sustainable, effective, and empowering. It’s the social contract we should all strive for.
So, where do Nexben, brokers, and distribution partners fit into this equation?
Nexben is a financial technology company that powers up the defined contribution industry. We make what was complex about defined contribution health plans — payments — simple. Here’s how:
- We distribute and reconcile payments to all of the insurance carriers employees choose. The employer’s responsibility? One click to pay a single invoice.
- We give employees access to their employer’s contribution through a unique, secure, and compliant account. Employees never have to front their full premium cost.
- We provide employers with necessary reports to support payroll deduction and ACA reporting requirements.
- We give you — brokers and distribution partners — a way to retain clients facing impossibly high group rate increases and simplify defined contribution solutions for everyone.
We’re at a turning point in the industry. One that mirrors the same shift we saw when 401(k)s replaced pension plans. You have the opportunity to help reshape the social contract of employer-sponsored health insurance. And we’re here to provide you with the resources and technology to make the switch simple, empowering, and financially smart for you, your clients, and their employees.
Get in touch anytime to discuss how to position your clients for success in this changing landscape.
About Nexben
Nexben is a financial technology company that makes it easy for health insurance brokers and distribution partners to offer defined contribution health plans by simplifying defined contribution solutions. Get in touch if you’d like to learn more about how offering Nexben solutions can help you earn and retain business.