Group health insurance plans offer coverage to policyholders, usually included in an organization or business’s staff. The insurer of the group health plan obtains reduced premium payments from the employer who has provided the group coverage. Group health policies are usually offered at a uniform rate by all companies that participate in the plan.

Premiums

Under a group health insurance plan, employees can often reduce their premiums by coughing up a portion of their income tax (usually 10 percent) and contributing a portion of their health care costs to the plan. In exchange, the employer covers the rest of the expenses. The insured employees can then use any medical benefits available under the plan, regardless of whether they need them. The cost of group health insurance plans is usually less than individual policies because of many policyholders and the relatively low monthly premiums paid.

However, despite the lower premiums, some employers may not offer this kind of benefit to employees. These include large employers with many employees or employers who have a large concentration of employees that are on long-term disability. Some people and families are under the misconception that these plans are only for large companies that employ many employees. These plans are sometimes offered to small businesses with two to fifty employees. Many of these “small business” plans are considered “family” health-related expenses.

Means-based supplemental insurance plans

Means-based supplemental insurance plans cover most small business health-related expenses. Supplemental insurance plans often include reduced-cost coinsurance for outpatient treatment. In addition, many plans offer coverage against inflation. Some plans often require the use of an HMO. The Small Business Association (SBA) offers various plans, but any provider organization does not guarantee the plans. If you decide to join a local SBA provider organization, you will receive financial assistance from your local office.

Health maintenance organizations (HMOs)

Health maintenance organizations (HMOs) provide the lowest premiums in co pays and deductibles among all the health insurance plans. There are usually fewer restrictions on the type of providers one can use, although some HMOs limit the types of medical treatment a group member can receive. Generally, most HMO plans require a minimum amount of coverage that each member must maintain. Coverage usually requires the member to visit the doctor twice a year for a specific medical condition.

Preferred provider organizations (PPOs)

Preferred provider organizations (PPOs) offer a more expensive plan of benefits. Although you will pay higher premiums than an HMO plan, the benefits and coverage are not limited to only the hospital stay covered under the group health plan. This plan allows you the freedom to choose your physician and to use the emergency room of your choice if a medical emergency arises. The deductible also comes at a higher rate in a PPO plan, although the deductible may be lower if you have good health insurance coverage.

Most large employers usually offer their employees a choice of participating in a health plan. Most large employers have an option to participate in either short-term or long-term health plans. Under a short-term plan, an employee must enroll in the plan within a certain period. Once the employee begins a new coverage, they will lose coverage at that time. Long-term health plans are usually renewable, so employees will continue to pay for the plan even when they leave the company.

Each state has its guidelines regarding what types of plans are allowed for state employees. In general, however, public health plans are required to cover all basic health care needs of employees. Coverage includes medical treatments necessary to overcome health problems and prevent illness; the cost of prescribed drugs; maternity care; dental care; mental health services; and basic chiropractic services, under most state laws.