Truths about Group Health Insurance
As a physician, you may find yourself running a private practice. That means that you will be regarded as a business owner.
Group health insurance seems like a comfortable solution to getting employee benefits, but have you ever stopped to think that you may be doing yourself a disservice?
Your insurance broker will probably never tell you the truth because they earn from you going ahead and getting that cover.
However, small group plans come with some disadvantages and we are here to let you know about them.
1. It Will Take up Much of your Time
Conventional group health insurance is typically administered through the owner. This means that every year, you are tasked with the responsibility of picking health insurance for your entire staff.
Now, this may sound easy, but between finding options within your budget, reviewing existing and new options as well as trying to save against premium inflation, that could take weeks or even months.
Separate health insurance plans for small enterprises are set up on a one-on-one basis by an assigned health insurance agent.
Once they assess your business needs with you, they will then set up meetings with each of your employees.
The meetings are supposed to help the employees pick plans that suit their distinct needs while you sit back and watch or concentrate on other things that will grow your practice.
2. You will be the Decision Maker
As the business owner, the administration of group insurance for your employees will be your job. That means that most coverage options will be your call to make before your employees assess their options.
From the lowest paid to the highest, your choices will determine networks, out-of-pocket expenses, and premium costs for the employees.
Ask yourself if you can carry the weight of such responsibility. Most business owners would rather have insurance plan decisions made by their employees because they know best what their needs and budget are.
3. You will be Included in the Coverage
When it comes to group plans, the cost of coverage is usually split between the employer and employees. Often, your practice will be required to contribute a minimum rate to your employees’ premiums.
Most business owners will tell you that this is not the ideal scenario.
4. There will be no Subsidies for you
Group plans do not offer subsidies and there is no way around it. On the other hand, individual health plans do as long as one qualifies.
Moreover, obtaining a subsidy when under an individual health plan is not a rare occurrence.
If your employees have individual plans, they get to apply for subsidies as part of your practice’s health insurance program.
Subsidies can reduce monthly premiums or out-of-pocket expenses for your employees quite significantly.
5. You will Pay Higher Premiums
Now that you know group plans do not offer subsidies, then you better prepare yourself for the possibility that you and your employees may have to pay higher premiums to get coverage.
For instance, the average premium paid monthly by a group enrollee costs approximately $450. Individual plans with subsidies on the other hand cost $82 monthly on average.
6. There is no Continuous Coverage
Usually, group coverage ends when employment ceases. However, if an individual wants to, they can go on with their plan for some time.
The only difference is that the individual would be responsible for up to 102% of the plan’s cost.
This is because the employer ceases to cover their part which makes the cost go higher. Individual plans go on with coverage regardless of employment status.
7. Choices are Limited
Lastly, group health insurance offers limited choices. Since the health plan choices are made by one or two people, they will not necessarily meet your employees’ distinct needs.
On the other hand, individual plans offer various choices based on where an individual resides.
Employees get to pick a plan that suits their needs and budget with the help of a qualified agent.
Final Thoughts on Group Health Insurance
Insurance brokers for group health plans will never tell you the aforementioned truths.
You just have to do your due diligence before opting for the same and as you have seen, such plans are hardly in your favor.
You would be better off allowing your employees to pick their plans.