Every week brings changes to your construction workforce, whether it’s a new employee joining your crew or a new project kicking off. While your schedules and staff move quickly to keep up with project demands, you can’t say the same for the one-size-fits-all healthcare benefits your construction company provides.
While static plans don’t always reflect the realities of your business, there’s another health benefits strategy that offers greater alignment with how your team works, with more flexibility than traditional options.
Individual Coverage Health Reimbursement Arrangements (ICHRAs) are built for your ever-changing construction workforce. They give your construction company a way to offer health coverage that gives employees choices over their coverage while keeping your finances in check.
Before you make your next benefits decision, consider how ICHRAs align with your workforce and operations.
What ICHRAs are and how they work
ICHRAs provide an alternative type of health benefit: Employer-sponsored coverage for diverse, mobile construction teams that puts flexibility and choice at the center. Instead of your HR department purchasing a traditional group health insurance plan that covers everyone, you set an “allowance” for employees to purchase their own plan.
That “defined contribution” is provided pre-tax to employees, who then put those funds toward whichever individual health insurance plan they choose, whether it’s with a familiar national carrier or a cost-effective marketplace option.
Regardless of your workforce size — a handful of skilled tradespeople or hundreds or even thousands of field and office staff — you can offer an ICHRA.
The process is straightforward:
- You choose the contribution level for each employee class (hourly employees, salaried employees, etc.).
- Your employees evaluate their options and enroll in a plan that fits their needs.
- Your employees are reimbursed for eligible insurance costs up to the amount you agreed to provide.
Modern health benefits that flex with your business
ICHRAs let you offer tailored benefits, ensuring that the right people — high-value employees and hard-to-replace roles — stay on your roster. The flexibility the plans provide may give you a recruiting edge for critical positions, such as project managers, skilled tradespeople and technology specialists.
Staffing up for a large project typically means acquiring a group policy for a full year, even if staffing needs shrink as the project winds down. But with an ICHRA, employers fund only active, eligible workers. You aren’t locked into paying for benefits when workers move on.
ICHRAs also streamline benefits administration for HR, especially for multi-state or multi-site contractors. Instead of juggling several group plans and managing location-based restrictions, you can offer consistent benefits across worksites (and with far less administrative burden).
Finally, the financial advantages of ICHRAs can make it possible to offer benefits to a larger portion of your workforce, thereby reducing the risk and impact of injury claims. By offering more workers access to preventive care and timely treatment for non-work-related conditions, you may support a healthier workforce and potentially reduce the likelihood of minor health issues escalating into more serious concerns.
Empowering crews with care options and portability
ICHRAs make health coverage truly portable, delivering meaningful advantages for your construction crews and especially for workers whose jobs and locations change often. As workers move from project to project, or when they switch to another employer offering an ICHRA, they can keep their plan — they’ll just transition off of your employer reimbursement. They are able to avoid interruptions in care, and they won’t need to re-enroll after a job change.
Unlike traditional group health insurance, which puts employees into a one-size-fits-all plan, ICHRAs let each crew member pick the coverage they need based on their network preferences, pre-existing conditions, or family situation.
ICHRAs give employees a financial advantage because employer contributions used for qualified medical expenses are not treated as taxable income. Compared with receiving the same amount as cash compensation, employees keep more of each dollar.
Health benefits that move as fast as your business
Rethinking your approach to health benefits with ICHRAs is a unique way to build loyalty, protect your people, defend your bottom line and future-proof your construction operation for whatever comes next.
ICHRAs give you and your workers real choice and control over health benefits. While your crews are busy building future cities, communities and neighborhoods, you can show them how much they matter by giving them healthcare options that keep pace with their lives.
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