Group Health Insurance
Despite increases in costs and the cutback of health-related benefits in recent years, close to 60% of Americans who have health insurance receive employer-based group medical benefits. While the market for individual or private health insurance is expanding, there are still many advantages to getting your health insurance coverage through a group health insurance plan. Many people will seek or keep a specific job just so they can obtain or retain their health insurance benefits.
However, the number of companies that still offer full medical coverage at no cost to the employee and their dependent family is decreasing annually. The cost of group healthcare insurance has risen dramatically over the years, forcing many companies to reduce or eliminate employee medical benefits under group health insurance plans. Several companies are asking their employees to pay a more for their share of the monthly premium or insisting that they pay 100% for medical coverage for their dependents.
Advantages of Employer-Based Group Health Benefits
Many Americans believe they have to remain employed by a company only for the sake of maintaining access to affordable health insurance coverage. This is only partially true. People with known health problems, or so-called pre-existing conditions, have a major advantage with employer based group health insurance in that they are less likely to be turned down due to the condition if they are part of a group plan. In a group plan, the collective risk of the individuals are “pooled”, which provides more effective risk-management from a probability standpoint for the insurer. Conversely, a healthy person, may save money on an individual health insurance policy purchased outside of the group plan if he or she work for a firm that does not pay 100% of his/her monthly premium costs.
Despite the additional costs of insuring their employees, companies that offer their employees group health insurance plans see an advantage in providing health benefits to their employees, the primary of which is a means to attract and keep good people.
Low Cost Group Health Insurance Options
There have been recent changes impacting the healthcare insurance industry that have affected the rates for group health insurance. However, for the business owner who wishes to provide employee medical benefits, there are still many options for low-cost group health insurance.
In most states, a company that employs two or more people can apply for affordable group health insurance. Actual eligibility requirements vary from state to state, and often companies will be required to verify their business operations to be approved for low-cost group medical coverage.
The size of the group coverage also matters in determining cost. Whether your business is ascribed “small” or “large” business status may effect the types of group health insurance available to you. Most health insurers in the U.S. will have three classification levels based on the number of enrolled employees on the group healthcare insurance plan:
- Small group
- Mid-size group
- Large group
The determinants of how many employees make up a given designation may vary from state to state and insurance company to insurance company. Given the complexity of selecting plan options for group coverage, certain health insurance brokers have specialized around providing group benefits.