A Group Health Insurance plan helps you and your employees pay for health care expenses. Businesses with one or more employees are eligible to purchase Group Health Insurance, although there are other kinds of groups that can get group coverage as well. The rules are a bit different for group coverage versus individual coverage, mostly because the insurer’s risk is calculated differently. With individual coverage, the insurer has historically based its premium rates (or denied coverage) on the detailed medical history of the person seeking to be insured, including eliminating the ability of insurers to deny coverage based on preexisting conditions.
With groups such as small businesses, the insurer will determine a premium based on risk factors balanced over the entire group, using general information on members of the group, such as age or gender. Insurers are required by law to offer coverage to small groups.
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Is Your Business Eligible for Group Health Insurance Coverage?
Under the federal law, small employers are guaranteed group coverage should they choose to purchase it, regardless of the employees’ health status. A “small employer” is defined as a business with 2 to 50 full time employees. Owners are generally counted as employees, so sole proprietorships with one employee usually fall into this category, as do partnerships without any employees (by definition partnerships have two or more partners). Some states define the self-employed as “groups of one” and require insurers to guarantee them coverage in the small group market.
Why choose a Group Health Insurance Plan?
Great question! Group Health Insurance Plans are designed to be more cost-effective for businesses. Employee premiums are typically less expensive than those for an individual health plan. Premiums are paid with pretax dollars, which help employees pay less in annual taxes. Employers also pay lower payroll taxes and can deduct their annual contributions when calculating income taxes.
How does Group Health Insurance work?
Health insurance helps businesses pay for health care expenses for their employees. When you pay a premium, insurance companies pay a portion of your medical costs, including regular doctor checkups or injuries and even treatments for accidents and long-term illnesses. The amount and services that are covered would, of course, vary by plan.
Who will be covered under this Group Health Insurance?
As a small business owner, the first thing you need to know is who will be covered under your new Group Health Insurance plan. You probably intend to cover yourself and your family. You probably also intend to cover your employees – but which ones? If you have full-time as well as part-time employees, you are not always obligated to offer coverage to employees in both categories, but if you offer it to one employee in one category, you generally must offer it to all employees within the same category. Will you extend coverage to your employees’ dependents? Most employers do, but it may not be required to do so.
How much can I afford to contribute toward monthly premiums for a Group Health Insurance plan?
With Group Health Insurance plans, the employer is required to make contributions toward the premiums of his or her employees. Generally speaking, employers are required to pay the health insurance company at least 50% of the monthly premiums for each employee, while the employee contributes the remainder from his or her pay. Typically there are fewer rules about how much you should contribute toward the health insurance premiums of your employees’ dependent spouses or children, but be aware of the burdens they may face when it comes to covering their families under your new plan.
As a small business owner, making contributions toward the premium of your employees may seem expensive. However, when you take the cost of applying coverage to your employees into consideration, remember that your contributions toward their monthly premiums are generally deductible from your business taxes. Work with a licensed tax professional to really understand the tax deductibility of employee health insurance premiums may mean for you.
Would you and your employees rather pay more up-front and less when sick, or vice versa?
There are two main categories of costs associated with any health insurance plan. First, there’s the monthly premium that must be paid to maintain the coverage. Second, there are “cost-sharing” expenses which only really come into play when you actually receive covered medical care. Cost-sharing can take the form of copayments, deductibles, and coinsurance, while plans with higher monthly premiums tend to come with lower copayments, deductibles, and coinsurance.
If you rarely have the need to visit the doctor and don’t use prescription drugs on a regular basis, a plan with a lower monthly premium and higher cost-sharing may make sense for you, so long as you can afford to pay your deductible in an emergency. Now on the other hand, if you take prescription drugs on a regular basis or visit the doctor frequently for a chronic condition, you might be better off with a plan that has higher monthly premiums but lower copayments, deductibles and coinsurance.
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Can I afford to bundle vision or dental care when purchasing a Group Health Insurance plan?
When you’re shopping for a Group Health Insurance plan, you may also want to consider dental insurance or vision insurance. These insurance products are generally purchased separately, but you may be able to purchase them at the same time, or to purchase them as “riders” or add-ons to your Group Health Insurance plan. When you add vision and dental insurance to your Group Health Insurance plan, you’re offering your employees a valuable total benefits package. Some employers fee that by offering a strong benefits package, it helps them retain the best workers.
What Group Health Insurance coverage options can my licensed health insurance agent or broker recommend?
When shopping around for a Group Health Insurance plan, it’s a. great idea to work with a Licensed Health Insurance Agent or Broker. A licensed professional can show you coverage options from difference insurance companies in your area and answer your questions about the coverage offered under each, which is extremely helpful and beneficial with all of the various plans and options available. A licensed agent can provide you with the personal help and advice you need to make an informed decision, and it doesn’t cost anything extra to work with one! What’s even more, is that once you have picked a plan, your licensed agent can help you enroll your employees in coverage as well. When your annual enrollment period comes around each year, your agent can help you review new coverage options in your are to make sure you still have the best plan for your personal needs and budget!
Group Plans, Inc is a family-owned and operated, fully licensed and insured company that specializes in premier Group Health Insurance. Our independent agents have been working hard to provide our clients with excellent customer service and exceptional results since 1977. We have an extensive variety of carrier choices, and our rates are cost-effective. We understand the importance of ensuring you that your employees are sufficiently covered and will work hard to prove that you’re in reliable hands.
We’ve got your company covered, no matter the size or how many employees!
For all-inclusive Group Health Insurance in Phoenix and the surrounding areas, call or visit Group Plans today! We always take your demands seriously because we want you to be happy with the policy that you select for years to come. Contact us today at 623-889-7600 to start exploring your options for Group Health Insurance plans!