If you’re a leader at a nonprofit organization, chances are you're grappling with the challenge of providing your employees with top-notch health insurance that doesn't break the bank. After all, the more you spend on healthcare, the less you can utilize to fulfill your organization’s mission.
Amidst these challenges, nonprofits are exploring innovative solutions, with one notable option being the Individual Coverage Health Reimbursement Arrangement (ICHRA). This departure from the conventional group health insurance model empowers nonprofits to allocate pre-tax contributions towards their employees' premiums in the individual market. This approach grants employees the freedom to select the plan that aligns best with their specific needs while enabling your nonprofit to rein in costs by mitigating the risk of exorbitant claims that could drive up prices.
This quiz has been crafted to help you assess whether an ICHRA could be a viable fit for your nonprofit organization. Let's dive in.
Question 1: How much was your most recent renewal increase for your team's health insurance?
A: No increase
D: 11% or more
Question 2: How geographically diverse is your workforce?
A: All employees live in and around one city
B: Employees are dispersed across one state
C: Workforce is distributed across 2 or 3 states
D: You have employees in more than 3 states
Question 3: How satisfied are your employees with your current health coverage plan offerings?
A: Not very satisfied
B: Somewhat satisfied
D: Extremely satisfied
Question 4: How dynamic is your workforce in terms of turnover and hiring frequency?
A: Low turnover, infrequent hiring
B: Moderate turnover, periodic hiring
C: High turnover, frequent hiring, sometimes reliant on contract workers
D: Very high turnover, continuous hiring, often reliant on contract workers
Question 5: What is the size of your current workforce?
A: Small (1-50 employees)
B: Medium (51-500 employees)
C: Large (501-2,500 employees)
D: Very large (2,501+ employees)
Question 6: How receptive is your workforce to technology and digital solutions for managing healthcare benefits?
A: Very resistant
B: Somewhat resistant
C: Somewhat receptive
D: Very receptive
Mostly As: Your organization's health insurance costs are relatively stable. If you are looking to lock in predictable rates for the long term, an ICHRA may still be a good choice. Additionally, ICHRAs allow you to offer your employees significantly more plan options to meet their health needs better.
Mostly Bs: Overall, your health insurance benefits plan works for you. However, implementing an ICHRA could help you attract and retain more workers. ICHRAs often help companies raise employee satisfaction scores, reduce turnover, and bring in top talent.
Mostly Cs: Your organization demonstrates considerable diversity in workforce demographics and values employee flexibility. An ICHRA could be a good fit, reducing costs and offering a streamlined approach to healthcare benefits administration for your distributed workforce.
Mostly Ds: With a large and dynamic workforce, your organization could greatly benefit from the flexibility and scalability of an ICHRA. While you may have made it work until now, there are only so many years in a row that you can absorb a double-digit rate increase. It would be best if you made a change to ensure long-term success. Adopting an ICHRA is a great way to reduce turnover and retain full-time workers at a lower rate than you're paying contract workers.
Understanding your nonprofit organization's unique needs is paramount when considering the adoption of an ICHRA. When tailored to fit your situation, ICHRAs can be a game-changer for employee benefits.
To learn more about ICHRA and how it could benefit your workforce, read our guide: ICHRA: Health Benefits for the Nonprofit Sector.