Choosing Health Insurance for Employees
As an employer, are you considering providing health insurance to your employees? Is it mandatory for you as an employer? What insurance choices do you have and what are their differences?
How do you choose an insurer? These are among the questions that will be answered by our basic guide.
Providing health insurance is an option that employers may or may not take. Most do, and those who do have higher chances of retaining employees over those who don't. Logically, people looking for work would consider whether they could avail of medical benefits from prospective employers. And weighing other factors, they are most likely to choose those who offer coverage for dental, disability and maternity needs.
Types of Health Insurance
Typically, employers could offer health insurance coverage to employees through traditional insurance, using health maintenance organizations (HMOs), or Preferred Provider Organizations (PPOs). Basic insurance for low-wage workers, disabled, and those over 65 come in the form of Medicare provided by the government.
Under a traditional health insurance, the insured employee has the freedom to choose any health care provider. Under managed care plans, the insurer works with a group of health care professionals and hospitals to provide medical care. The insured employee is limited to these identified health care providers. Between an HMO and a PPO, a PPO offers a narrower option of medical experts. Premiums are highest for traditional health insurance with that for HMOs coming second and for PPOs lowest.
Choosing Health Insurance
Traditional insurance premiums could be heavy for smaller businesses. An option they can take is to subscribe to local health providers through the state department insurance. But before embarking on a hunt, it is important for employers to identify what they want from an insurance plan. What services will be included in the policy? How much will the company be willing to pay? Will the employees contribute? Will it cover employees' dependents? Can both employer and employees afford the cost of the policy? If some form of a plan has been drafted, is the coverage reasonable in terms of maximum payment and type of medical conditions covered?
Managed health care plans can be limited to specific health care options. Check the terms they set regarding access to specialists and the process they require to avail of medical services. Research about the financial stability of your target insurers, their track record in paying claims, their reputation in providing services.
As a caveat, be aware as an employer that once you have provided health care benefits to your employees, such benefit must comply with laws and acts protecting employees' rights. For example, you could not refuse or provide lesser coverage to certain employees because of their gender, age or national origin as that would constitute discrimination. And your health insurance plan must comply with acts governing retirement.
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