Most Americans enjoy health insurance coverage at their jobs through their group health plans. When this is obviously the best and the most feasible solution to stay covered against the rising cost of private health policies, group health insurance has certain limitations of its own. This write up would reveal the negative side of a group health plan to help you make better choice.
The employer participating group health plan covers the workforce without discriminating against their age, sex, ethnicity and most importantly health condition. This is, hence, the source of health coverage for people with health condition. The cost of the policy gets distributed amongst the participating members of the group. But, since group health policies ensures guaranteed issue the healthy members of the group end up paying more than required for older members and members with health conditions. The cost of group health plan can be more than private health plans in the long run for the healthy members of the group.
Another disadvantage of group health plan is that you are not allowed to shop around for better rates and also, can’t customize the policy to meet your needs. A group health plan is a packaged deal and you have to accept what is offered to you. Often the group health plans offer only basic coverage and don’t shield against more intensive health conditions. Further, you can’t terminate the plan in between or switch your insurer easily.
A group health plan is also more expensive than private health plans. You can enjoy a cheaper rate in a group plan as long as the employer is contributing to it. But during the COBRA continuation period your premium rate increases to 102 percent for the same amount of coverage.
The most significant disadvantage of group health plan, however, is that you lose coverage when you leave employment and if you don’t opt for COBRA, your health plan gets discontinued.
Health is wealth is what the wise men said. And health is wealth is what the clever employers believe. The employers know that for each workday lost by an employee due to illness can cause some loss to the company. It is never desirable and punishing an employee for absence due to illness is inhuman, unethical and will certainly attract strong action from the government. So instead of facing so much troubles it is easier and wise to let the employees stay healthy and also pay for their medical expenses in case they get ill.
But what are the ways to do it? Group Health Insurance is the answer. These days almost all the employers offer health insurance plans for their employees under Group Health Insurance Plans. Such plans not only cover the employee but also his or her spouse and family depending on the type of plan.
Since the plans involves a large number of people and the total amount of premium for all the employees come to a good sum, the individual cost per employee gets drastically reduced. The employer can choose from various plans and depending on the number of employees involved the companies offer group health insurance plans for small groups, mid sized groups and large groups. Often due to the large premium amount, the companies extend special facilities for the employees like providing free health check up once a year, special facilities at the hospitals, etc.
The employers can provide the Group Health Insurance plans to the employees as a choice or as a compulsory add on to their emoluments and perks. Even if offered as a choice, it has been seen that the employees prefer coming under such plans because they are either offered free of cost or offered at drastically reduced rates that often proves very cheap compared to individual or family health insurance plans.
However, many companies as well as employees find it difficult to come under the right plans due to lack of proper orientation to the benefits and cost involved for them. So it is advisable to go through all the terms and conditions of the plans and understand them clearly before buying one. Also it is necessary to educate the employees about the benefits of the plan.