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Group Health Insurance - Seven Myths
By admin | December 25, 2007
Myth #1
“There are no cost effective plans out there. They all cost the same so why offer health insurance to my employees.”
There’s a variety of plans based on certain models that are offered by all companies. Some of these plans are less expensive but better suited for a younger group that doesn’t require the medical care that an older group would. Look into consumer directed plans and HSA’s. HSA’s offer low premiums for a high deductible health plan and an interest bearing savings component for money set aside to pay regular doctor visits.
Myth #2
“All plans require us to go through the referral process.”
Most plans are currently written on an OA (open access) basis that requires no referral. Though some plans may still require a referral, it is best to ask your health and group benefits broker to guide you in your decision.
Myth #3
“All HMO plans are the same.”
Every insurance company has different underwriting standards based on their claims experience. One company may charge a higher premium and offer more plans that require the insured to participate in the cost sharing portion of the plan, while another company may offer richer plans for the same premium or less. A spreadsheet comparison provided to you by a broker will help you sort the plans out.
Myth #4
“We can save money by switching carriers now but we have to wait until our renewal date.”
Certain issues have to be addressed but changing carriers is a relatively simple process and can be done at any time with no penalty to the policyholder. There’s no reason to wait for a planned change of carriers to realize savings from a reduction in costs if your business is in a position to do so. Preexisting conditions are not a concern in most cases.
Myth #5
“I have to pay a fee to a broker to get the best plans”.
Nonsense!! No business should have to pay an extra fee to a consultant/broker for services they can access at no cost over the premium. There are many out of area consultants that act as third party administrators and charge a fee for that service when there is no need for them. An independent broker, such as Foundation Financial Services, will not charge you a fee.
Myth#6
“The HMO requires that all employees be included on the same plan.”
State and Federal law mandates that any business can be divided into “classes” where a richer plan can be written for executives for example, and a less benefits rich plan can be written for staff or line employees. Employees who have coverage through their spouse can elect to retain coverage on their spouses plan.
Myth# 7
“Our knowledge of the health insurance market is sufficient enough that we have no need of any outside assistance.”
You have a business to run. You probably don’t have the time to keep up with all of the changes in the health insurance, dental, vision care, disability and retirement markets. An independent broker such as Foundation Financial Services can create a spreadsheet of all available health plans, provide you with free software to manage your benefit plan and provide you with claims and renewal services at no extra charge to your business.
Alan S. Fernandez is president of Foundation Financial Services with a BBA in Finance and Economics from Iona College, studied under the Life Underwriters Training Council and Certified Financial Planner programs and with 15 years in the insurance industry is a well known problem solver among businesses and individuals alike. He is also an insurance instructor with Citicorp. He can be contacted at afern109@optonline.net or visit the FFS website at http://www.foundationfinancialservicesny.com
Tags: cost savings, Group health, independent broker
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Topics: Insurance |