Choosing a health plan is essential for businesses of all sizes, new and established.
Choosing a health plan is essential for businesses of all sizes, new and established. It is also a decision with several nuances and choices. While you want the best for your employees, there are costs to consider. Whether providing group health coverage for the first time as a new business or switching health plans, here’s what to look for when searching for a health plan.
Fully Insured or Self-Funded Health Policies
Your health policy’s cost can significantly impact the plan type you choose. If your group health insurance is fully insured, that means you bought health insurance from an insurer. Most small to medium businesses select a fully insured health plan because it limits risk and offers the most cost predictability. On the other hand, you develop and operate your health policy with a self-funded plan, typically with the assistance of a third-party administrator.
However, a self-insured plan comes with financial risks, and costs are less predictable than those of a fully insured health policy. Moreover, some prominent organizations choose to implement this approach because it saves money, and they can tolerate the additional risk.
Network Size & Structure
The network size of your group health insurance will affect how many choices your employees have in selecting their care and how much the out-of-pocket fees are. Some plans offer “preferred” providers like hospitals, doctors, and specialty care. This means members receive the most coverage and pay less out-of-pocket when viewing preferred providers.
Other plans also offer a wider network of providers—members can choose from more hospitals and physicians. However, they must choose a primary care doctor (PCP), and their out-of-pocket costs are higher for specialty and out-of-network care unless their PCP provides them with a referral.
Review FSA, HSA, and HRA Health Options
Flexible spending accounts (FSAs) and health savings accounts (HSAs) are not insurance policies but rather tax-advantaged savings accounts that assist employees pay for health care expenses. Both permit employees to set aside pretax money from their paychecks to cover appropriate medical costs. Furthermore, the funds roll over every year with HSAs. With FSAs, the funds should typically be spent yearly, or they will be lost.
Health reimbursement arrangements (HRAs) are employer-funded health policies. Your employees will submit out-of-pocket medical expenses such as copays, coinsurance, and deductibles to their employer’s HRA for tax-free reimbursement.
Get in Your Voluntary, Supplemental, and Health Insurance Policies with the MWE Partnership!
Are you a business looking to provide your employees with essential voluntary benefits? If so, look no further than The MWE Partnership. When you choose The MWE Partnership, you get experienced service and comprehensive voluntary benefit options that will meet all your employees’ needs. With over 17 years of experience, The MWE Partnership is your go-to provider for all your supplemental benefit needs. If you are interested in finding out how The MWE Partnership can help your business, contact us today! We encourage you to like our Facebook page and follow us on X and LinkedIn for the latest voluntary benefit news!