A veterinary clinic's guide to health benefits

Your veterinary team understands the importance of preventive care. Offering health benefits for your employees is another way to show that you value their health and well-being.

Traditional group health insurance: Familiar, but often out of reach

Traditional group health insurance is one of the most common employee health benefits offered by employers. With a group health plan, a veterinary clinic selects a single health insurance policy and contributes toward employees’ monthly premiums. Employees then enroll in the available plan options through the employer. Alternatively, some clinics may self-fund their group health plan by paying for employee medical claims directly.

Common types of group health plans include:

• Preferred provider organization plans (PPOs)
• Health maintenance organizations (HMOs)
• Exclusive provider organizations (EPOs)
• Point of service plans (POSs)

Veterinary practices can purchase fully-insured group coverage through an insurance carrier, broker, or the Small Business Health Options Program (SHOP) Marketplace, if you meet the eligibility requirements. Some eligible small employers with SHOP coverage may also qualify for the small business health care tax credit.

While group health plans can provide comprehensive coverage, they may not work for every veterinary practice. Plans often come with fixed designs, minimum participation requirements, limited employee choice, and unpredictable annual rate increases.

To enhance a group health plan, some employers offer additional health benefits, such as:

• Dental insurance
• Vision insurance
• Health savings accounts (HSAs)
• Flexible spending accounts (FSAs)

Health reimbursement arrangements (HRAs): The modern way to support your veterinary clinic

Stand-alone HRAs offer veterinary clinics a flexible way to provide employee health benefits while maintaining control over costs. With an HRA, employers set a monthly allowance that employees can use toward eligible healthcare expenses, including individual health insurance premiums.

Other HRA-eligible expenses include:

• Prescription drugs
• Over-the-counter medication
• Lab fees
• Hospital care
• Physical therapy

Unlike traditional group health insurance, HRAs allow employees to choose coverage that best fits their personal healthcare needs rather than limiting them to a single employer-selected plan.

The most popular HRAs employers can offer at their animal clinics include:

• The individual coverage HRA (ICHRA): The ICHRA is an excellent health benefit for clinics of all sizes. It has no maximum contribution limits and allows you to vary eligibility and allowance amounts by job-based employee classes. If you have 50 or more FTEs, an ICHRA can help you satisfy the Affordable Care Act (ACA)'s employer mandate as an alternative to group medical insurance, as long as your allowance is affordable and your employees have a qualifying form of individual health coverage.
• The qualified small employer HRA (QSEHRA): The QSEHRA is a stand-alone HRA for employers with fewer than 50 full-time equivalent employees (FTEs). You can’t offer any group health or ancillary plans alongside the QSEHRA. Even though the QSEHRA has maximum annual limits on employer contributions, it has simple design options, making it optimal for small veterinary practice owners providing a health benefit for the first time. Employees must have a health plan with minimum essential coverage (MEC) to participate.
• The group coverage HRA (GCHRA): If you want to or already offer a group plan, you can supplement it with a GCHRA. Also known as an integrated HRA, employers of all sizes can reimburse their employees for out-of-pocket costs their group plan doesn’t fully cover, like deductibles and copays. Only employees enrolled in your group health plan can participate. However, you have employee class customization options and no maximum contribution limits for greater flexibility.