Employer Sponsored Insurance
Group health plans can be purchased by employers or organizations that wish to help their employees or members get access to affordable health care coverage. The benefit of group health plans is primarily the low premium costs for these plans. Because the risk to the insurer is spread across a larger number of people, they are able to provide coverage at lower costs than individual plans.
This makes the cost for employer sponsored insurance much lower, creating a win win situation for employers and employees. Employers get to save on insurance coverage, while employers get to offer their employers the health care coverage they need to stay healthy and continue working.
Group Health Plans For Small Businesses
As a small business owner, you may not have access to the largest plans that are designed for enterprise organizations. If you have between 1-50 employees, you will likely be better off purchasing a small business health insurance plan. These plans are structured to provide small companies with affordable coverage for a limited number of employees.
Types Of Small Employer Group Health Plans
There are several different types of group health plans that you can opt into. They are as follows:
- Health Maintenance Organization (HMO) – HMO plans offer extensive coverage with relatively low out-of-pocket costs for the beneficiaries. The downside to HMO plans is the fact that they typically require most care to be done by health care providers that are within their specific service network. You will also need referrals to see a specialist.
- Preferred Provider Organization (PPO) – PPO plans are more flexible, as they allow members to see a broader range of health care providers. While many PPO plans do have a network of providers, members have the option to see out-of-network providers at a higher cost. Because PPO plans are more versatile, they often have higher premiums than other types of health insurance. You won’t need a referral to see specialists.
- Point of Service Plan (POS) – POS plans combine the best features of PPO and HMO plans. They cost less than PPO plans, but more than HMO plans. While you can see out-of-network providers with a POS plan, you will still need a referral from a primary care physician to see a specialist.