Preventive Care Benefits vs Traditional Health Insurance: Complete Comparison
Employer-sponsored health insurance is one of the largest expenses a business carries. The Kaiser Family Foundation reports that the average annual premium for employer-sponsored family health coverage reached $23,968 in 2024, with premiums increasing 8-15% annually. For small businesses, this cost is often prohibitive — which is why many employers offer no benefits at all.
The Preventive Care Benefits Program (PCBP), built on a Self Insured Medical Reimbursement Program (SIMRP) structure, offers an alternative approach. But how does it actually compare to traditional group health insurance?
Side-by-Side Comparison
| Feature | PCBP (SIMRP) | Traditional Group Health |
|---|---|---|
| Employer Expense | $0 out-of-pocket expenses | $7,000–$23,968+/year per employee |
| FICA Savings | $1,119–$1,186/employee/year | $0 |
| Preventive Rx | 1,000+ medications included | Varies; copays typically apply |
| Telemedicine | Unlimited, no out-of-pocket expenses | Often included; copay may apply |
| Life Insurance | $150,000 included | Usually separate purchase |
| Implementation | 2–3 weeks | 4–8 weeks typical |
| COBRA Required? | No | Yes (20+ employees) |
| Replaces Insurance? | No — supplemental | Yes — primary coverage |
The Critical Distinction
The most important thing to understand: SIMRP-based programs are not a replacement for health insurance. They are a supplemental preventive care layer that works alongside existing coverage — or independently if no coverage exists.
Traditional group health insurance covers major medical events: surgeries, hospitalizations, specialist care, emergency rooms. The PCBP covers the preventive layer: prescriptions, telemedicine, mental health counseling, wellness services, and life insurance.
When to Use Each
Use the PCBP when: You want to add comprehensive preventive benefits with no out-of-pocket expenses, generate FICA tax savings, and improve employee retention — whether or not you already offer health insurance.
Use traditional insurance when: Your employees need major medical coverage for hospitalizations, surgeries, and specialist care.
Use both together when: You want the most competitive benefits package possible. The PCBP stacks on top of any existing health plan without conflict, adding preventive benefits and $150,000 in life insurance while generating employer tax savings.
The Financial Reality
For a business with 50 employees, traditional group health insurance could cost $350,000–$1.2 million per year. The PCBP costs $0 in employer expenses and generates approximately $55,998 in annual FICA tax savings. Even businesses that already offer health insurance can add the PCBP to enhance their benefits package while offsetting some of those insurance costs through FICA savings.