Understanding Different Types of Group Health Insurance Plans

Group health insurance can be valuable for both employees and businesses. These arrangements can help organizations enable their staff to maintain good health and wellness while potentially fulfilling compliance obligations and assisting with attraction and retention. Meanwhile, this approach to health insurance can also benefit eligible workers who may find coverage offered by their employer more affordable. But group health plans can be complicated and nuanced, necessitating understanding from all parties.

How Do These Plans Work?

Group health insurance allows multiple insureds to be covered under the same plan, sharing risk and often leading to lower premiums. These arrangements are often organized and maintained by an employer, who can then offer enrollment opportunities to eligible employees. Eligibility may depend on payroll, meaning contracted workers and part-time employees may not be offered coverage. Enrollees may also be able to purchase coverage for their spouses and dependents.

What Types of Group Health Insurance Plans Are There?

Like individual and family plans, group health coverage may come in many forms. Employees and businesses alike should familiarize themselves with the following before deciding on which may be ideal for their needs:

• Health maintenance organizations (HMOs)—These group health plans can provide affordable rates while requiring insureds to select a primary care provider (PCP). Covered services are generally limited to the HMO’s network and PCPs must make referrals for specialist care.

• Preferred provider organizations (PPOs)—Under these plans, enrollees can typically enjoy more flexible coverage options, such as out-of-network care, than they might through an HMO, albeit often at greater prices. PPOs do not require insureds to select a PCP or get a referral to visit specialists.

• Exclusive provider organizations (EPOs)—This type of group health insurance policy can offer a hybrid option between HMOs and PPOs. Insureds select a PCP and are typically limited to in-network providers; however, specialist care can usually be accessed without a referral.

• Point of service (POS) plans—These policies can also provide a mixture of elements from HMOs and PPOs. The enrolled select a PCP responsible for referring them to specialists. Out-of-network care may be more accessible, albeit at greater cost than under an HMO.

• High-deductible health plans (HDHPs)— As their name suggests, these policies typically have higher deductibles, which may help with lower premiums. Many insureds couple HDHPs with a health savings account, which can provide tax-free funds to put toward medical care, decreasing the impact of having to meet a high deductible.

We’re Here to Help

At Insurance Solutions USA in Grapevine, Texas, we’re well-equipped to help employers and their staff find the right group health plan. Contact us today to learn more.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.