“As health insurance costs continue to rise, some employers are adopting a controversial new approach: ending group coverage and giving employees $50 to $200 or so a month to help them buy their own.
The shift is touted as a lower-cost way for employers to offer workers some kind of health coverage, while making smaller and more predictable financial contributions toward that coverage. Like other companies considering the switch, Ilios will pay a portion of employees' medical costs into tax-free accounts that workers can tap. It also will provide a link to an independent website where workers can compare price quotes from a variety of insurers. “
One main advantage of course is that the employee selects which plan to purchase. The policy belongs to the employee and they control their health care spending decisions. This relieves the employer of burden of selecting a policy that is cost effect across a wide spectrum of employees, with varying health concerns and needs. The market is searching for appropriate solutions because the current group insurance structure is flawed in so many ways.