What You Need to Know About Coverage Requirements for Employers Group Insurance?

What You Need to Know About Coverage Requirements for Employers Group Insurance?

Like many small business owners, you may wonder how to get affordable employers group insurance and health coverage for your employees when you don’t have enough employees to fill out the insurance forms. If this sounds like your business, you’re not alone. Small businesses account for 50% of all new jobs, and 48% of all small businesses are family-owned and operated, according to the US Chamber of Commerce Foundation’s research and polling about small business owners’ attitudes toward health care reform and the Affordable Care Act. No Matter What State You Live in, You Still Need to Follow the Affordable Care Act (ACA) The ACA requires employers with 50 or more full-time equivalent employees to provide health insurance to at least 95% of their full-time employees and their dependents up to age 26. If an employer does not comply, they may be subject to a penalty of $2,320 per full-time employee, excluding the first 30 employees. The good news is that there are many options for employers group insurance and employer group benefits that can help you meet these requirements and provide your employees with quality coverage. With Whom Can Employers with Fewer than 50 Employees Buy Group Insurance? Most employers with fewer than 50 employees are small businesses. To buy group insurance from an insurance company, the employer must have a minimum number of employees, usually two or more. Most small businesses do not have enough employees to meet this requirement. However, there are a few exceptions.  Types of Benefits You May Want as Part of Your Employer’s Group Policy Health insurance is employers’ most common type of...
Is My Business Ready for Self-Funded Insurance Plans?

Is My Business Ready for Self-Funded Insurance Plans?

As health insurance costs continue to rise, more businesses are considering self-funding their health plans. Self-funded insurance plans can be a great way to save money on premiums, but it’s not right for every business. Before switching to a self-funded insurance plan, here are a few things to consider.  Do you Have a Good Relationship With Your Current Insurer?  If you’re happy with the service and support you’re getting from your current health insurance provider, switching to a self-funded plan may not make sense. You’ll need to partner with a third-party administrator (TPA) to set up and manage a self-funded plan, and it can be helpful to have a carrier you’re already familiar with to help with that process.  Do you Know Your Company’s Health Care Usage and Costs?  To self-fund your health plan, you’ll need to make regular contributions to a claims fund. The amount you contribute will be based on your employees’ health care usage and claims costs. So, if you don’t know what your employees are using and how much it’s costing you, self-funding may not be the right choice. Are you Comfortable With More Risk?  You’re taking on more risk with self-funded insurance plans than a traditional fully insured plan, but with the proper reinsurance, your exposure can be limited. If your employees have many health problems or file many claims, you could pay more than you would with an insured plan. On the other hand, if your employees are healthy and don’t use much health care, you could save money by self-funding.  Do you Have the Cash Flow to Fund a Self-Funded Plan? Self-funding...
What are Level-Funded Health Plans?

What are Level-Funded Health Plans?

The passage of the Affordable Care Act (ACA) means businesses with two or more full-time or full-time equivalent employees must provide health insurance coverage for those employees. As a business grows, its owner may look to transition from using a fully insured health plan to using self-insurance to avoid the high cost of health insurance premiums. Switching without a transition period, however, can cause a shock to the business’s bottom line if many employees experience illness or injury in a single year. Using level-funded health plans bridges that gap. What’s the difference between fully insured and self-insured? When you fully insure a business, you purchase an insurance plan that covers your employees with group health insurance that provides major medical coverage for preventative care and a broad range of inpatient and outpatient services. This means that it covers any visit they make to the doctor or hospital as long as the insurance plan covers the type of visit. Self-insured businesses typically cover major medical, such as emergency care, and other care levels required by US federal law.  So, the difference between the two vis-a-vis an employer’s bottom line comes down to the monthly, quarterly, and annual expenses. Paying premiums provides a static expense. Self-insuring causes variable expenses. With self-insurance, a business might need to pay $2,000 in insurance claims in June but $10,000 in July. When you move your business to a level-funded method of coverage, you balance the two options. How Level Funded Health Plans Help Some businesses try this using just stop-loss insurance, but that insurance places a cap on total annual losses, which doesn’t help the...
What are Average Group Rate Health Insurance Costs?

What are Average Group Rate Health Insurance Costs?

According to Forbes, almost half of insured Americans get health insurance coverage via group plans their employers provide. But, many of these individuals have little knowledge of how group health insurance works. Several aspects make up the core of employee insurance packages that are the most successful. How can your HR team determine your insurance plan’s success while ensuring it meets your employees’ needs? The following are some metrics that you can institute to assist you in determining the success of your group health plan.   Loss Ratio The loss ratio is calculated by dividing your premiums by the amount the insurer pays out in claims. The importance of this ratio is that it helps find out how healthy your plan is. It is also used to determine premium increases. It is essential to know the ratio of your health plan. It would help if you also compared this ratio with industry standards to help you have a proper negotiation tool, particularly regarding the negotiation of coverage elements. You may also use current and historical loss ratios to estimate future premium increases.   Average Claims Per Member You will determine the average claims per member by assessing the number of claims submitted by covered employees. You can compare this number to a benchmark in the industry or a historical average. This is important in helping you estimate the general utilization and satisfaction with your group health insurance plan.  It is essential to track this metric because it helps come up with rich data on group health plans. This data will help you better comprehend plan utilization and act as...
5 Things You Need to Know About Group Health Benefits for Large Businesses

5 Things You Need to Know About Group Health Benefits for Large Businesses

The Affordable Care Act requires large companies with 50 employees and more to offer health insurance. One of the best ways companies can comply is through group health coverage. Group health coverage is very valuable to employers and their employees. The plan offers health insurance at a low cost. It also spreads risk to all employees in the group health plan. If you intend to get the group health coverage plan, you should know everything it concerns. Here are the top things you need to know about group health benefits for large businesses. 1. How the Group Health Insurance Plan Works Large companies purchase the group health insurance plan to offer medical coverage to 95% of their full-time employees. One thing that employers should note is that group health insurance plans vary. However, they have the following same characteristics: Employees’ children below 26 are included in the plan Employees and company share the health premiums Group members can choose to enroll or decline the coverage Companies need to offer coverage to at least 95% of their full-time workers or full-time equivalents or face penalties. A large company needs more than 50 employees to qualify for group health insurance. The critical point is that the employees need to be full time. 2.  The Premium Benefits of Group Health Coverage Premiums are monthly payments that businesses need to pay for coverage. The employer is typically responsible for paying at least half the employee-only premium. Thus, they get to enjoy the benefits that come with group health insurance. If you compare individual and group health insurance plans, the group plans are more...