When to Offer Multiple Health Plan Options

May 23, 2023

Making decisions around health plan options can be daunting. Gain knowledge of factors to consider when determining what health plans to offer employees.

When to Offer Multiple Health Plan Options

When it comes to benefits, health care coverage is one of the most valuable offerings an employer provides. Providing one health plan to your employees may not cut it; not all medical needs are the same. Multiple health plans provide employees with a range of choices to select from based on their individual needs and preferences.

For instance, some employees may prefer a lower premium plan with higher out-of-pocket costs, while others may opt for a higher premium plan with lower out-of-pocket expenses. The flexibility to choose can lead to greater employee satisfaction, better retention and overall higher morale towards available benefits.

Employers should consider the benefits and risks when offering multiple plans to their employees before deciding what is best for them.

Factors to consider with multiple health plans

Several factors can contribute to an employer’s decision to offer multiple health plan options.


Providing multiple health plans may seem daunting for companies with smaller budgets. Many employers now pay the same amount for all their health insurance plans. Employees can then choose to pay extra money if they want a more comprehensive plan.

Depending on the plans offered, employees with lower medical needs can opt for a plan with less coverage. Employees with chronic health issues can opt for a more comprehensive plan that offers a wide range of health care services such as hospitalizations, emergency room visits, etc. This decision can result in lower health care costs for the company overall.  

Workforce composition

Having a diverse range of ages and health needs can dictate whether an employer provides multiple plans or not. For companies where the majority have similar medical needs, one health plan option with varying levels of coverage can be enough. Companies with a wide range of ages and medical requirements should consider offering multiple health plans to ensure all needs are met.

Range of coverage

Figuring out the coverage needs of your employees is crucial to determine if multiple plans are right for you. Some workers may require more elaborate coverage options such as for long-term specialist visits, while others only need basic coverage such as yearly doctor visits or one-off urgent care visits.

Meeting the needs of your employees will guarantee that everyone receives the correct level of coverage and will increase employee satisfaction.

Types of plans

Ultimately, the health plan options an organization offers depend on the needs of the company and its employees.

Preferred provider organization (PPO) plans

PPO plans allow employees to see specialists and out-of-network providers without referrals, although premiums can be higher. The plan offers higher flexibility and lower in-network costs with a bit more paperwork.

Exclusive provider organization (EPO) plans

EPO plans cover in-network care only and employees can choose their healthcare providers. This plan does not require specialist referrals. With moderate freedom, these plans offer a lower premium than PPO plans.

High deductible health plans (HDHP)

For those on a tight budget, HDHP plans have lower premiums and can be paired with a health savings account (HSA) with unused funds rolling over into the next year. With lower premiums, these plans do have a higher out-of-pocket cost for the employee.

Employers should take into consideration their company’s budget, average age of employees and their overall medical needs when selecting health plans to offer. When employees are provided with more options, their satisfaction and overall happiness increases. Health plan options are crucial to any benefits package; it’s important to choose multiple plans that work best for your company’s situation.  

About The Author

Mark Lambertz

Mark Lambertz
Email As Senior Vice President, Benefits Production Leader, Mark has more than 33 years of experience with employee benefits. Mark’s specializes in benefits plan design, alternative funding, industry technology and guiding clients through the Affordable Care Act. He is also a mentor for new producers at The Miller Group, helping to build a results-driven team.

Find Related Posts

Employee Benefits