Choosing a group health insurance plan for your business may require a great deal of consideration and time. It can be a challenge to find the right plan to suit the needs and budgets of everyone concerned. The following are four important questions to ask when you are shopping for group health insurance.
What Type of Group Plan Do You Want to Offer Your Employees?
Group health insurance is available in several different types of plans. These include:
- Health maintenance organization plans (HMOs)
- Preferred provider organization plans (PPOs)
- High-deductible health plans with savings options (HDHP/SO)
Each type of plan offers different types of benefits, and each type has its own pros and cons. For example, HMOs tend to be more affordable than other types of group health insurance, but services are strictly limited to providers in the plan’s network. PPOs are similar to HMOs, except they offer more flexibility in terms of providers. An important question to ask is which type of plan is best suited to your business and employees.
How Much Are the Premiums?
The cost of health coverage is important to both you and your employees. The plan you select will need to fit into the budgets of both your employees and your business. You will need to decide how much your business can afford to contribute toward monthly premiums and what percentage of the premiums the business will cover. Employers are generally required to pay at least 50% of the premiums for each employee, and the remainder is deducted from the employee’s pay. Bear in mind that employer contributions toward employees’ monthly health insurance premiums are typically tax-deductible.
What Providers Participate in the Plan’s Network?
Request a list of in-network providers from each plan you are comparing. You may be prohibited under the law from asking your employees what doctors they see. It may not be possible to ensure every employee can keep his or her current doctor under the new plan. However, you can ensure your employees have plenty of local providers to choose from.
What Are the Deductibles, Copayments, Coinsurance, and Out-of-Pocket Limits?
Premiums are not the only financial factor to consider in choosing a group health insurance plan. Deductibles, copayments, and coinsurance determine how much your employees will pay out of pocket for medical services. Compare these amounts carefully, as deductibles and other out-of-pocket expenses can be significant. It is also important to compare annual limits for out-of-pocket expenses in case someone suffers an injury or illness that requires extensive medical treatment.
Once you have answers to the above questions, consider all factors together to determine how much coverage your employees will have and how much all concerned will have to pay with each plan you are considering. Health insurance is an important benefit to offer your employees, which is also tax-deductible for your business. Choosing the right health plan can be a complicated and time-consuming process. If you need knowledgeable assistance, our experienced agent can provide it.