Medical Insurance Products
Group health insurance plans provide coverage to members or employees of an organization. Members or employees of the group usually receive insurance at a reduced cost because the insurer’s risk is spread across a group of policyholders. Types of medical health plans include Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), Exclusive Provider Organization (EPO), Point-of-Service (POS), Catastrophic, and High-Deductible Health plans with or without a Health Savings Account (H.S.A.).
A fully-insured health plan is purchased from an insurance carrier and the employer pays the monthly premium directly to the insurance carrier. If applicable, the employer then deducts the employee’s portion of the premium from their paycheck. This is the more traditional way of setting up a group health insurance plan. For companies with less than 50 employees, the premium is community rated. In other wordsAnother wards, premiums remain unchanged regardless of the health of the group. For companies with more than 50 employees, premiums can be adjusted based upon the group’s claims utilization.
A self-insured (self-funded) health plan allows employers to operate their own health plan, versus purchasing a fully-insured plan from an insurance company. Some companies prefer to administer their own group health insurance plan as it allows them the opportunity to save the profit margin that an insurance company would add to its premiums for fully-insured plans. It is important to note than in a self-insured scenario, the company is exposed to a much larger risk should more claims be processed than expected. A self-insured plan is more suitable for companies with at least 150+ enrolled employees, however, a partially self-insured plan can mitigate the risk and can be an excellent way for a smaller company with good claims history to reduce premium costs.
Interested in group health insurance for your organization? Blue Chip Benefits can help you select a group health insurance plan to meet your organization’s needs.