Choosing the Right Group Health Insurance Company
In order to attract new employees and keep old ones, many employers offer group health insurance as an employee benefit. Usually the employer pays all or part of the insurance premium. Good group insurance policies can be the deciding factor that convinces the best employees to choose one employer over another. The cost of group health insurance that employers furnish is nearly 100% tax deductible.
Group health insurance is not just an employee benefit, but also a business strategy to catch the attention of the top employees. To succeed, employers need to choose the right group health insurance company that is most beneficial to the employees. An employee questionnaire, or survey, can help business owners choose features that are beneficial to the largest number of employees.
Three basic types of group health insurance are available. A health maintenance organization (HMO) is the least expensive, but also the least flexible. Members are required to use physicians in a specific network. A preferred provider program (PPO) allows members to use out-of-network services, but it will cost the member more. Out-of-pocket expenses usually cost more in a PPO than those in an HMO.
A point of service (POS) plan allows members to venture out of network, but usually requires an in-network primary care physician to make any necessary referrals. A deciding factor is the availability of in network health care providers, especially in rural areas. If employees have to drive a long distance for health care, it diminishes the value of the insurance policy.
To purchase customized insurance for employees, take into consideration the general age, sex, and health status of the employees. For example, a predominately young workforce will find maternity benefits important while an older workforce generally has no need for it. While not all employees are going to fit into the same category, there is normally a dominant group.
Some parts of a group health insurance policy that affects the cost, such as location and statistics, are out of your control and unchangeable. However, you directly control other costs of an insurance policy. Focus on the features of an insurance plan that benefit employees the most. Keep premiums lower by removing little used or extravagant options. Co-payments, co-insurance, out-of-pocket expenses and maximum lifetime benefits are all features that differ with different plans. Prescription drug, dental, and vision coverage are optional.
Do a background check on the insurance company you are considering doing business with to make sure they are legitimate. Ensure that the company is financially stable and pays claims fairly and in a reasonable time. Investigate the insurance company by checking with the Department of Insurance in your state. Make sure the insurance company has a valid license to sell insurance.
Insurance is complicated and not everyone completely understands all the services that an insurance policy may cover as well as its limitations. If there is any doubt about any services provided by the chosen insurance policy, ask questions. Keep in mind that an extremely low quote, compared to the other ones received, can signal a possible scam. While all quotes will vary, they are usually somewhat close in nature.
In some cases, it is more cost effective to use an insurance broker. A broker can offer policies from different companies saving a business owner a lot of time. Brokers earn their income by selling insurance, so they are better equipped to answer questions in simple terms. The only way to receive accurate quotes from each insurance company is to choose the same policy coverage and options from each once. The coverage has to be the same in order to determine which insurance company is offering the best available rates.
Reevaluate a group health insurance policy at least once a year. Determine if the needs of the employees have changed significantly enough to warrant a different kind of coverage. Spend some time comparison shopping to make sure the amounts you pay out in insurance premiums are still the best available rates for the chosen coverage. Health care is constantly changing because of new laws, new techniques, and new discoveries. Make an effort to stay updated, so the policy you choose is the best one for your employees.