5 Tips for Designing a Comprehensive Health Plan for Your Employees

Tip 2: Choose a funding strategy that fits your goals

One of the most important steps in designing a comprehensive health plan is choosing a funding strategy that fits your company’s goals and budget. The right choice can help you manage costs effectively while still providing great coverage to your team.

Fully Insured 

Fully insured health plans are the traditional option many employers are familiar with. In this arrangement, employers pay a fixed monthly premium to a health insurance company, who then assumes the financial risk, handles all claims and administration. 

Pros: Predictable monthly costs, minimal administrative burden, and protection from large, unexpected claims. 

Cons: Generally higher long-term costs, less flexibility to customize your plan, and limited access to detailed claims data, since carriers typically own the data and share only summary reports. 

Self-Insured 

On the other hand, self-insured (or self-funded plans) mean your business takes on the financial risk and pays employee claims directly, often with the help of a third-party administrator (TPA). 

Pros: Greater flexibility to design benefits, potential cost savings if claims are lower than expected, and more transparent healthcare spending.

Cons: Higher financial risk, potentially unpredictable costs, and the need for stronger administrative support and stop-loss insurance for protection.*

*However, options like level-funded plans and stop-loss insurance can help mitigate some of this financial risk by providing more predictable monthly costs and protection against large, unexpected claims. 

Learn more about self-funded plans: https://resources.planstin.com/blog/self-fundedbenefits

Consumer-Directed Health Plans

Consumer-directed health plan (CDHP) options are another approach that can work with either funding model. These plans are designed to encourage employees to take a more active role in their healthcare choices and spending. CDHPs usually feature a high-deductible health plan (HDHP) combined with tax-advantaged accounts, such as:

• Health Savings Accounts (HSAs): Allow employees to set aside pre-tax dollars for qualified medical expenses. HSAs can only be paired with HDHPs and offer the added benefit of funds rolling over year to year.

• Health Reimbursement Arrangements (HRAs): Employer-funded accounts that reimburse employees for certain medical expenses.

• Flexible Spending Accounts (FSAs): Let employees use pre-tax dollars for healthcare costs but typically have a “use it or lose it” rule each year.

By giving employees more control over their healthcare dollars, CDHPs can encourage smarter spending and promote a stronger sense of ownership over health decisions.

Tip 3: Structure the plan to support how employees want to access care

Plan structure has a major impact on how employees experience their benefits, from flexibility and provider choice to what services are covered and how easily they can access care. Designing a structure that supports your employees’ goals makes a big difference in satisfaction and utilization. Here’s a quick breakdown of the most common options:

Preferred Provider Organization (PPO)

Offers the most flexibility, allowing employees to see any healthcare provider — including out-of-network — without needing referrals.

Pros: Flexible provider choice, no referrals needed, large networks. 

Cons:  Higher premiums and higher out-of-pocket costs when using out-of-network providers. 

Health Maintenance Organization (HMO)

Requires employees to select a primary care physician (PCP) and get referrals to see specialists; typically only covers in-network care. 

Pros: Lower premiums and out-of-pocket costs, strong focus on guided care and preventive services. 

Cons:  Less flexibility, limited network, requires referrals. 

High Deductible Health Plan (HDHP)

Offers lower premiums and higher deductibles, often paired with Health Savings Accounts (HSAs) to help employees cover out-of-pocket expenses.

Pros: Lower premiums, potential tax advantages with HSA, encourages cost-conscious care decisions.

Cons:  Higher upfront out-of-pocket costs before coverage starts, may deter employees from seeking care early.

Hybrid Structures

Some employers choose to combine traditional plan features with direct primary care (DPC) or other integrated options. These hybrid structures provide comprehensive coverage of a major medical plan along with the convenience and personalized attention of DPC, giving employees easier access to primary care while controlling overall costs. 

Check out Planstin’s Care+ Direct plan, a hybrid solution that brings together the best of both approaches. 

In addition to the types listed above, there are other important structural elements to consider:

• Level-funded plans: Offer predictive costs with more flexibility than fully-insured plans. 

• On-site clinics and telehealth programs: Convenient access that reduces absenteeism and supports early care. 

• Wellness programs and preventive care initiatives: Gym memberships, mental health resources, and wellness coaching help employees stay healthier and more engaged.

Tip takeaway:  By matching your plan structure to how your employees want to access care, you create a plan they’ll actually use — and appreciate. 

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