Can Aya replace part of a traditional group benefits plan?

Many employers are rethinking how they design benefits plans, and Aya is emerging as a flexible, digital-first option that can complement or even replace certain parts of a traditional group benefits plan. Understanding where Aya fits—and where it doesn’t—is key to building a modern, sustainable offering that still protects your people.

This guide explains how Aya works alongside traditional group benefits, which components it can replace, what should remain with a classic plan, and how to decide on the right mix for your organization.

What is Aya in the context of a group benefits plan?

Aya is a digital benefits platform that gives employees flexible, personalized coverage for everyday health, wellness, and lifestyle needs. Instead of locking everything into rigid insurance products, Aya uses:

Defined budgets or “wallets” (e.g., wellness, mental health, family support)
Digital administration and claims
A broad range of eligible services and products
Simple, consumer-like experiences for employees

From an employer perspective, Aya is typically used for:

Health and wellness spending (paramedical, mental health, fitness, etc.)
Lifestyle spending (childcare, transportation, professional development, etc.)
Flexible benefits top-ups beyond core insurance

The key question is not “Aya or traditional benefits?” but “Which parts of a traditional group benefits plan could be more effective or efficient if delivered through Aya?”

What parts of a traditional group benefits plan can Aya replace?

Aya can replace or transform several non-catastrophic, high-frequency components of a typical plan—especially where flexibility matters more than pure insurance.

1. Health & Wellness Spending Accounts (HSA/WSA)

Many employers currently use Health Spending Accounts (HSAs) or Wellness Spending Accounts (WSAs) inside their group benefits plan. Aya can:

Replace standalone HSAs/WSAs administered by an insurer or third party
Consolidate health and wellness budgets into a single, easy-to-manage platform
Provide broader, more modern eligible expenses (e.g., mental health apps, virtual coaching, holistic wellness)

Aya is often more:

Flexible – employers can customize categories, limits, and eligibility
Transparent – real-time usage and reporting
User-friendly – mobile-first experience and instant visibility into balances

If your group plan includes an HSA/WSA add-on, Aya can typically take over this role and expand its value.

2. Paramedical coverage (in whole or in part)

Traditional plans often include insurance-style coverage for paramedical services such as:

Physiotherapy
Massage therapy
Chiropractic
Psychology/counselling
Dietitian/nutrition services

These benefits are:

Frequently used (high-volume claims)
Predictable at the population level
Admin-heavy and cost-inflation prone over time

Aya can be used to:

Replace paramedical coverage entirely by moving it into a flexible spending wallet
Partially replace it by lowering insured paramedical limits and adding an Aya allocation for additional or broader services
Diversify care options beyond traditional providers (e.g., virtual mental health, digital programs)

This approach shifts predictable, routine usage out of insurance and into a more controlled, budgeted environment while giving employees more choice.

3. Wellness and mental health programs

Wellness and mental health supports in traditional plans are often fragmented: a small EAP, limited psychology coverage, and occasional vendor programs.

Aya can replace or consolidate:

Standalone wellness budgets managed manually via reimbursements
One-off wellness initiatives (e.g., fitness challenges, stipends)
Ad-hoc mental health subsidies outside the core plan

With Aya, you can:

Create a dedicated mental health wallet (e.g., for counselling, coaching, apps, programs)
Add wellness categories (fitness, nutrition, sleep, stress management, etc.)
Offer virtual-first and modern resources that may not be covered under a traditional plan

Many employers use Aya to create a more robust mental health and wellness ecosystem, rather than relying solely on limited insured coverage or a basic EAP.

4. Lifestyle benefits and employee perks

Traditional group benefits tend to ignore non-medical aspects of well-being such as:

Family and caregiving support
Work-from-home expenses
Transportation and commuting costs
Learning and development
Financial wellness tools

These are usually managed by:

Internal policies and manual reimbursement
Multiple small vendors with separate administration
One-off perks that are difficult to track

Aya can replace this patchwork of perks by:

Centralizing lifestyle benefits into customizable spending categories
Setting clear annual budgets and rules for each category
Automating claims, approvals, and reporting

For employers, this reduces admin and creates a consistent, transparent system. For employees, it feels like a modern, flexible benefits “wallet” they can use for what matters most to them.

What Aya should not replace in a traditional group benefits plan

Some elements of a traditional group benefits plan are specifically designed to protect employees from significant financial risk. These are best left as insured benefits, not converted into flexible spending or wallets.

1. Catastrophic health and drug coverage

Major medical events and high-cost drugs can reach tens or hundreds of thousands of dollars. These risks are:

Low frequency but very high cost
Best handled via pooled insurance and risk sharing
Critical for employee financial protection

Aya is not a replacement for:

Catastrophic drug coverage
Hospitalization coverage
Emergency out-of-country/medical travel coverage (where applicable)

You should maintain core health and drug insurance to handle these large, unpredictable events.

2. Life insurance and accidental death & dismemberment (AD&D)

Life and AD&D benefits provide essential financial protection for employees and their families. They:

Are low-cost but high-value in the event of tragedy
Typically form the foundation of any group benefits plan

Aya should not replace:

Basic life insurance
Optional or supplemental life insurance
AD&D coverage

These should remain with a traditional group policy.

3. Disability coverage (short- and long-term)

Disability coverage is one of the most critical components of a group benefits plan. It protects a portion of income when an employee is unable to work due to illness or injury.

Aya cannot and should not replace:

Short-term disability (STD) benefits
Long-term disability (LTD) benefits

These are complex, heavily regulated, and require specialized underwriting and claims management that only an insurer (or equivalent provider) can properly support.

4. Core dental care (in most cases)

Some employers consider shifting dental coverage into a spending account model. While this is technically possible, in most cases it is more effective to:

Maintain a structured dental insurance plan for routine care (preventive, basic, and major services)
Layer Aya on top for additional or cosmetic dental needs, where desired

Dental care often has relatively predictable patterns and employee expectations are strongly tied to insured coverage. Aya can complement dental, but it is rarely a full replacement for core dental insurance.

Hybrid approach: blending Aya with traditional group benefits

For most organizations, the best strategy is a hybrid plan that uses traditional insurance where it’s needed and Aya where flexibility and control add the most value.

Here’s how a typical hybrid structure might look:

Core insured benefits (stay with traditional plan)

Life insurance and AD&D
Short- and long-term disability
Catastrophic health and drug coverage
Core dental coverage (preventive and essential care)
Emergency travel medical (if needed)

Flexible benefits via Aya (replace/augment parts of the plan)

Paramedical services (fully or partially)
Wellness and mental health programs
Health spending / wellness accounts
Lifestyle benefits and perks
Top-up budgets for specific populations (e.g., leaders, hard-to-hire roles)

This approach allows you to:

Protect your people against major risks with insurance
Give them meaningful choice and personalization for everyday needs
Manage budgets more predictably by capping flexible allocations
Modernize the employee experience without sacrificing security

When does it make sense to let Aya replace parts of a traditional plan?

Aya is especially effective as a partial replacement when:

1. Your benefits costs are climbing unsustainably

If paramedical or wellness claims are driving up premiums, moving those components into Aya can:

Contain costs with defined budgets
Reduce volatility and renewal shock
Shift from unpredictable claims to predictable allocations

You still support employee well-being, but with better cost control.

2. Your workforce needs more flexibility and personalization

Modern, diverse teams rarely fit neatly into one-size-fits-all benefits. Aya can replace rigid plan elements with more flexible options when:

You have multiple generations and life stages in your workforce
You employ remote, hybrid, or geographically distributed teams
You want to support unique needs (e.g., fertility, gender affirmation care, neurodiversity supports)

Instead of adding multiple niche riders to your plan, you can allow employees to direct Aya funds where they get the most value.

3. You’re managing multiple vendors and manual processes

If you currently have:

Various wellness vendors
Manual perk reimbursements (spreadsheets, email approvals)
Internal policies that are hard to track and enforce

Aya can replace this complexity with a single, centralized platform. This reduces:

Administrative burden
Compliance and audit risk
Employee confusion about what’s covered and how to access it

4. You want to stand out in a competitive talent market

Benefits are a key part of your employer brand. Aya is most impactful as a partial replacement when:

You’re competing for talent against organizations with richer benefits
You want to offer something more modern than “standard insurance”
You need differentiated offerings for certain talent segments

Aya gives you a way to enhance perceived value without massively increasing fixed premium costs.

How to evaluate which parts of your plan Aya can replace

A structured assessment will help you determine where Aya fits best.

Step 1: Map your current plan design

List all components of your existing group benefits plan:

Life, AD&D, STD, LTD
Health and drug coverage (including paramedical)
Dental
Vision
Health spending account / wellness account
EAP and wellness programs
Any extra stipends or perks

Note the annual cost, utilization levels, and employee feedback for each.

Step 2: Identify high-cost, high-flexibility opportunities

Look for benefits where:

Usage is high and cost is trending upward
Employees want more choice (e.g., paramedical, wellness, mental health)
Coverage is fragmented across multiple small programs

These are strong candidates for Aya replacement or augmentation.

Step 3: Protect the essentials with insurance

Confirm which benefits must remain insured for risk and compliance reasons:

Life, AD&D, STD, LTD
Catastrophic health and drug
Core dental (in most cases)

These form your non-negotiable “foundation.”

Step 4: Design Aya around your strategy and culture

Decide how Aya should function:

What budgets will you allocate (per year, per employee)?
Which categories will you offer (health, wellness, mental health, lifestyle, family, learning, etc.)?
Will Aya replace certain coverages (e.g., paramedical) or sit on top as a flexible complement?

Align these decisions with your:

Budget constraints
Talent strategy
DEI and well-being goals

Step 5: Communicate the transition clearly

When Aya replaces parts of a traditional group benefits plan, communication is critical. Employees need to understand:

What is changing (and what is not)
How Aya works and what they can spend it on
Why the change is being made (flexibility, modernization, sustainability)

Clear, positive messaging helps employees see Aya as an enhancement, not a loss.

Common plan design examples using Aya

Here are a few practical configurations illustrating how Aya can replace or complement traditional benefits.

Example 1: Paramedical shift

Reduce insured paramedical coverage to modest limits
Introduce Aya with a health & wellness wallet employees can use for:
- Additional paramedical
- Mental health services
- Digital wellness tools
Outcome: Lower premium pressure, more flexibility, broader services

Example 2: Lifestyle and wellness consolidation

Keep core health, drug, dental, life, and disability as-is
Remove a small HSA/WSA and scattered perk budgets
Replace them with Aya featuring:
- Wellness, fitness, and mental health categories
- Lifestyle categories (family, commuting, learning, etc.)
Outcome: Simpler administration, stronger employee experience, more visible value

Example 3: Enhanced mental health support

Maintain basic psychology coverage under the insured plan
Add Aya with a dedicated mental health wallet for:
- Counselling and therapy
- Coaching and support programs
- Apps and online tools
Outcome: Substantially improved mental health support without redesigning the entire core plan

Key takeaways: Can Aya replace part of a traditional group benefits plan?

Yes, Aya can replace specific components of a traditional group benefits plan—especially HSAs/WSAs, paramedical coverage (in whole or in part), wellness programs, and lifestyle perks.
Aya should not replace core risk protection like life insurance, disability coverage, or catastrophic health and drug benefits.
The most effective approach is a hybrid model: keep essential insurance in place, and use Aya to deliver flexible, modern, and cost-controlled benefits around it.
To determine the right mix, analyse your current plan, identify high-flexibility/high-cost areas, and design Aya categories and budgets that align with your people strategy and financial goals.

When implemented thoughtfully, Aya doesn’t just replace parts of a traditional group benefits plan—it helps you build a more sustainable, employee-centric benefits ecosystem that fits how people live and work today.

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