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In today’s evolving landscape of employee benefits, providing comprehensive health coverage has become crucial in retaining and attracting top talent. One of the most sought-after benefits is coverage for In Vitro Fertilization (IVF) procedures and treatments. Liferaft, dedicated to supporting its clients' evolving needs, facilitated a unique solution for a client seeking to enhance their current health insurance plan by offering IVF coverage for their employees.
Limitations in traditional health coverage often leave significant gaps, particularly in fertility treatments like IVF. For a Liferaft client in Washington, their existing insurance coverage did not adequately cover the expenses associated with IVF treatments and procedures. This led to substantial out-of-pocket costs for employees seeking this specific medical assistance, which caused financial strain.
Liferaft collaborated with the client to design a comprehensive strategy to mitigate employee expenses linked to IVF and fertility treatments by integrating a Standard Health Reimbursement Arrangement (HRA) to cover IVF-related expenses.
The employer was able to offer $5,000/year to each employee for IVF-related expenses. The first $1,000 was covered directly by the employer, and the remaining $4,000 in expenses was covered by their accounts' stop-loss insurance.
The level-funded Standard HRA with stop-loss insurance safeguards the employer against claims surpassing a predetermined limit, ensuring high-value benefits with low risk.
Setting up an HRA to cover IVF costs takes a different approach than setting up an ICHRA or a QSEHRA, where the amount the employer contributes each month to the HRA is determined by health insurance premiums and employee affordability metrics. IVF treatments are both expensive and infrequently used by employee populations, so it is often more cost-effective for an employer to set up a level-funded account backed by stop-loss insurance to provide the most comprehensive benefits at the lowest price point.
Based on the average costs of covered fertility expenses in Washington, Fertility HRA usage data from Liferaft’s other clients, and the cost of stop-loss insurance for this business in Washington, Liferaft determined how much the client would need to contribute each month to fund their Standard HRA.
Integrating HRAs and level-funded insurance means employees can seek reimbursement for IVF-related costs through the HRA, reducing out-of-pocket expenses. This approach provides financial support and helps mitigate the high costs associated with fertility treatments.
This combined approach sets a predetermined limit on yearly claim losses, safeguarding employers from unexpected financial burdens and providing cost predictability.
This specific plan configuration is designed to reimburse IVF-related costs, ensuring financial support for employees without subjecting employers to unmanageable claim amounts. Not all HRAs have to be created this way.
Liferaft's solution for IVF coverage within level-funded health plans is designed to offer flexibility. Employees can choose their healthcare providers and facilities, ensuring a broader range of options and reducing constraints typically associated with narrow networks.
Standard HRAs are tax-free Health Reimbursement Arrangements employers use to provide employees with funds for qualified out-of-pocket medical expenses. These accounts are employer-owned and employer-funded, allowing employers to choose the contribution amounts, eligible expenses, and reimbursement methods.
Our team knows the ins and outs of the health insurance marketplace and will guide you towards the solution that make the most sense for your business and your team. Come with questions! Our experts are happy to dig into the details to get you the clarity you need.
During the call, Liferaft will run a cost-benefit analysis on your company's current healthcare spending and show you different ways you can save—without sacrificing plan quality. After your consult, Liferaft will design a unique plan for your employee's health insurance, including suggested plans and accounts, plan policy documents, and the annual budget.