If the worker purchases his own policy, it is considered an individual plan. There is no place for a melding of the two, which is basically what a defined contribution plan entails. Group and individual plans are subject to separate sets of regulations and have different tax implications. Although defined contribution plans are being widely discussed, companies may be reluctant to take initial steps. I can't see the first three or five employers just jumping in.
People contribute to the account and use the money to pay for eligible medical expenses.
Rob Mahoney, senior benefits consultant at Haake Benefits Consulting Group in Kansas City, Mo., says these accounts will be utilized somehow. That's going to happen. Defined contribution will be built into some MSA or look-alike program.