Small business group insurance plans can be categorized into 2 types - indemnity plans and managed care plans
Small Business Group Insurance Plans - Indemnity and Managed
Indemnity Plans are also called traditional indemnity. Fee-For-Service is another term used to identify the indemnity plans. These plans were very popular in the eastern coast of United States sometime back. However, these plans have lost their luster now. These small business group insurance plans differ from managed care plans in several aspects like the coverage offered, the deductible amount and the mode of payment of bills. They have a big network of hospitals and medical practitioners when compared to the managed health care plans.
Managed health care plans are more popular in the west cost of the United States. Of late, these plans have been gaining enormous popularity in US. PPOs, HMOs and POS plans come under this category of small business group insurance plans.
The Numbers of a Small Business Group Insurance Plan
When you talk about small business health insurance, the number of people who opt for the plan is what really matters. More the number, the better would be the coverage offered. According to the 1999 reports of the Wall Street Journal, 70% of Americans purchase health insurance from their employers.
But as a small business owner, you just don't need to worry. Have a look at online websites. Make use of the tools provided there and opt for the plan that gives the maximum coverage at a low price. If you are running a small business, the number of your employees might be in the range of 2-100. In such a scenario, the group health insurance rates are generally based on a couple of the following factors.
Visualized total cost incurred on the health care in a given location
Visualized usage of services offered by the insurer
The above two factors affect the premium rates and in turn acts as determinants of the overall price of the health insurance plans. The higher the risk existing amidst the group of employees, the higher would be the premium paid by the employees for their health insurance.
Underwriting is the process of analyzing the risk existing within the defined group of people. An underwriter researches the medical history of the individuals who fall under the small business group health insurance plan and provide with an estimation of the prospective claims and determine the maximum eligibility of the claims that can be made by the group. The insurer aims at offering maximum coverage at nominal rates amidst generating profits for the business that he runs.
Irrespective of the size of your company, it's very important to check whether you are getting the coverage that you pay for. An in-depth analysis of the advantages and disadvantages of the different plans offered by numerous insurers is very critical. Understand that the premiums, deductibles and coverage options do vary with the insurer you opt for. It's your duty to find the right choice of coverage from the right insurer at nominal rates for your small business group health insurance plan.
