Group Health Insurance
Group health insurance is one of the most expensive benefits an employer can offer their employees; depending on the amount they pay toward the premium. If you carry group health insurance and find that even though you pay part of the premium, employees don’t take advantage of the health insurance you offer, you may need to delve further into the problem. After all, a benefit isn’t really a benefit if nobody wants it. You may be wasting funds without realizing it.
Sometimes the problem comes from the price of the group health insurance. This may be something you can solve without spending an extra dime and often saving quite a bit of money in the process. You simply have to shop around for a better deal.
If you’re a small group, insurance companies may put you into collection of other small groups to take advantage of the price for a large group. If one of the other companies has a high ratio of claims, the insurance company must increase the cost of the group health insurance premium proportionally. That means your rates increase. You might save money by shopping again for insurance. If your group is healthy, many times you’ll find the same coverage with a lower premium.
Whether you’re a large or small group, shopping is also important. Increases in group health insurance premiums may not be from the insurance company paying for claims but other factors that affect the premium of a policy. One of these is the overhead the insurance company has. If they have high salaries, huge office buildings and a lot of perks for their employees, they have to get the money from somewhere. The place is often from increases in the premium. Some companies are far more frugal or simply better at controlling their expenses. Their prices tend to be lower.
Insurance companies make money on the surplus group health insurance premium they collect. If the investment advisors for the company do a great job, they often don’t have to raise rates, regardless of the other factors. However, if they don’t invest wisely, you pay the price in increased premiums.
If you compare rates, and find that you are getting the best rate for the coverage, consider looking at an alternative type of plan for your group insurance. There are several different plans that could save your company quite a bit of money and at the same time improve your coverage.
One type of plan is a managed care plan. The insurance companies that offer these types of plans arrange with various health care providers to receive lower rates in exchange for making them a preferred provider. The plan member pays a small co-pay every time they seek the services of a health care provider. In the more strict type of plan, the HMO, the members have a primary care physician that makes the decisions on health care services. If you select one of these plans, make sure to check the proximity of the health care providers and make certain there are plenty in your area.
Another type of cost saving health insurance plan, particularly for the company that has a healthy group, is the high deductible plan combined with a side health savings account. Regardless of the type of plan you select, keeping the rates lower and improving your coverage will increase participation and make your group health insurance a true benefit.
