85 per cent of US citizens avails some health insurance cover with half of it coming from health benefit schemes offered by employers that covers the entire family of the insured person. Health insurance is one of the top employee benefits that companies take a lot of interest because it is attractive to employers too. When developing benefits packages for employees, employers consider health insurance as the foundation, and any employer who includes it in the benefits package earns the distinction of a preferred employer or employer of choice by candidates looking for jobs.
Medical treatment is costly, and it can become a burden for people if the employer does not arrange for suitable health insurance. The health insurance acts a motivation for employees as they need not worry about the medical costs if they fall sick. Moreover, employers too would like the employees to stay healthy and attend work regularly for which the health insurance coverage to employees help them a lot.
By offering health insurance benefits, employers make a statement about how much they care for ensuring a better quality of life of their employees that helps to earn their trust which with time turns them loyal towards the company. The benefit scheme generates a healthy relationship between employers and employees, which is mutually beneficial.
Mandatory for employers
According to the federal and state laws, companies with fifty or more employees must offer certain benefits to its employees like worker’s compensation, social security and health benefits that constitute a package termed as employer-sponsored benefits. It comes in the form of non-cash compensation and is part of the cost to the company towards each employee. Companies develop benefits packages for its employees by evaluating their needs, and it creates a healthy relationship that keeps employees happy and improves productivity.
Employer-sponsored health insurance plans are generally group health insurance plans that employers can select by comparing Group Health Insurance Quotes online. Various kinds of policies are available under group insurance plans and employers can find a suitable plan for their employees. Employers must pay the entire amount of the policy or at least a major sum with some small contribution of employees in some cases. The health care expenses covered by the policy would depend on the type of benefits offered under the policy.
What is group health insurance?
In principle as well as application, group health insurance policy is similar to any other health insurance policy with the only difference that it covers a group of 50 to 500 people or even more. Employers can take a single policy to cover all employees under the scheme, or they can take multiple policies for different groups depending on the cost implications. Such policies suit big organizations the most, although smaller organizations can also take its advantage.
Every group insurance policy must suit the needs of employees in the way perceived by employers, and thus, custom made policies are most prevalent. The kinds of health benefits employers want to extend to the employees to determine the choice of policy. Insurance companies also benefit from group health policies as they collect a huge premium for covering many members under a single policy. Since employers are buying a big policy, they can bargain for a lower premium with more benefits as they would be paying a high premium for buying the policy.
Benefits of group health insurance cover
Group health insurance policies are attractive for both employers and employees and now let us look at some of the benefits that come from it.
Medical checkups not required
Unlike standard health policy for individuals that require medical checkups at the time of taking the policy, there is no medical checkup required when including an employee under the policy that covers a group of which the employee is a member. The employee, together with his or her family, automatically qualifies for coverage without any medical checkup for any of the members. Group health insurance policy ensures a hassle-free process of enrolment that keeps employees and their families covered from the first day of enrolment.
No waiting periods
Group health insurance policies do not entail any waiting period to avail the benefit because the coverage starts from the day of enrolment. Regardless of the illness, employees and their families can avail the benefits from the first day because the policy includes pre-existing diseases too. This is a great benefit because individual health policies normally exclude pre-existing diseases. This is a specialty of group insurance policy and not available with any other kinds of health insurance policies that normally come with a long list of exclusions.
In line with the principle of including pre-existing disease, group health insurance policies offer maternity coverage from the very first day of joining the group. It means that if someone is already pregnant, she qualifies for the benefit. Individual health insurance coverage for maternity benefit is often much restricted, and it will never provide coverage from the first day.
Cost effective for employers
The benefits that come with group insurance cover are usually much more than what employers pay for the policy. Insurance companies go by the logic of economies of scale, and since it earns a hefty premium from a single policy, it does not mind to offer a good discount, which makes it very cost-effective. In some cases, even if employees pay for the policy, they would enjoy the benefits of low premium and wider coverage which makes sense to have group insurance cover over and above any individual health plan that you may have.
From an employee’s perspective, the only drawback of group health insurance is that they do not have any control over the policy as the employer enjoys the control. Therefore, it is better to have an individual health policy alongside the group insurance policy because the latter can stop at any time or the benefits revised if the employer wishes. Moreover, the policy is effective only during your period of employment, and when thinking in longer terms, especially after retiring from service, you cannot ignore the importance of taking individual health policy.