Top 3 Healthcare Plans for Hourly Workers

The 2024 SHRM State of the Workplace report found that the top three priorities for businesses in 2024, according to Human Resources (HR) professionals, were:

1. Maintaining employee morale and engagement
2. Retaining top talent
3. Finding and recruiting talent with the necessary skills

To meet these goals, 60% of HR professionals agreed that the most effective approach employers can take is to offer affordable and comprehensive healthcare coverage to their workforce. Ensuring that all workers, whether salaried or hourly, can access and afford the healthcare they need is one of the most important things an employer can do to retain their loyalty, engagement, and overall well-being.

However, in the current job market, significant gaps exist between salaried and hourly workers, with the number of hourly workers dissatisfied with their benefits packages increasing since 2023. For businesses seeking a competitive edge in attracting and retaining top-performing talent, offering comprehensive healthcare benefits to hourly workers is crucial.

From an ICHRA or QSEHRA to a DPC membership combined with a MEC plan, this article will explore three healthcare benefit solutions that offer excellent value while remaining cost-effective for both employers and employees.

1. ICHRA Health Insurance + Direct Primary Care (DPC)

While individual coverage health reimbursement arrangements (ICHRAs) and Direct Primary Care (DPC) memberships are still relatively new, companies are increasingly relying on the unique combination of these two models because they offer flexibility and big tax advantages for employees and employers alike.

Best for: Businesses of all sizes looking for budget control and better care access.

What is ICHRA Health Insurance?

ICHRAs are a flexible benefit model in which employers of any size can use pre-tax dollars to reimburse employees for premiums paid for an individual market health plan purchased on their own. This type of HRA can offer employers more cost control because they can choose their own reimbursement contribution amount; there are no minimum contribution requirements, nor any limits on how much an employer can reimburse. Visit our guide on the ICHRA for more details!

What is a Direct Primary Care (DPC) Membership?

Direct Primary Care (DPC) is a healthcare model where an employer (or individual) pays a monthly subscription fee directly to a primary care provider for access to a range of primary care and preventative services. Vitable’s Primary Care solution offers affordable access to same-day virtual visits, with no copays or deductibles, free prescriptions, and complimentary dependent coverage. DPC memberships operate separately from the traditional insurance-based billing system, offering individuals quicker access to quality primary care services at predictable pricing. Read more here about how DPC works.

Why Combine ICHRA and DPC?

Integrating these two benefit models creates a powerful coverage option for employers of all sizes. For example, the DPC membership can address employees’ ongoing primary care needs, and the accompanying ICHRA can be used to reimburse other healthcare expenses, such as specialist visits, hospitalizations, and prescription medications. This approach provides comprehensive coverage for hourly workers, while employers benefit from controlled costs and greater employee satisfaction.

Benefits of ICHRA + DPC:

• Potential long-term cost savings: An ICHRA allows employers to create a predictable budget of healthcare reimbursements, while DPC reduces employees’ need for high-cost urgent care and emergency visits.
• Tax incentives: Employers who contribute reimbursement amounts into an ICHRA are exempt from paying payroll taxes, and contributions are tax-deductible. Employees are also exempt from paying income tax on their reimbursements.
• Access to quality healthcare: DPC providers deliver more personalized, attentive care to patients with shorter wait times. DPC memberships also eliminate per-visit costs, which is especially important for those needing chronic disease management.
• Health plan and provider flexibility: Employer-provided reimbursements through an ICHRA enable employees to select the health plan that best suits their needs, while DPC allows workers access to a primary care provider without restrictions on network access.
• Simplicity: ICHRAs and DPC memberships provide more straightforward health coverage than traditional group health plans for employers, making it easier for employees to understand and utilize their benefits.

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