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Types Of Group Health Insurance Plans You Can Get

April 5, 2021, by New City Insurance

Purchasing health insurance for a business has a different set of rules than shopping for individual coverage. Group health insurance refers to a single policy issued to a group that covers all eligible employees and sometimes their dependents.

With group health insurance, the insurer’s risk is calculated differently than with an individual plan. Group health insurance rates are determined based on risk factors balanced over an entire group, using general information such as age and gender.

Business owners choose between several types of group health insurance plans that offer varying levels of coverage and requirements. Here is a look at some of the most common types of group health insurance plans a business can purchase.

Health Maintenance Organization (HMO) Plans

HMO on Blackboard with Yellow InitialsAn HMO is designed to keep costs low and predictable for plan participants. Under an HMO, a person has just one primary care doctor to coordinate their care for a more personalized doctor-patient relationship. HMO health plans also offer monthly premiums, deductibles, and copays that are generally lower than other plans.

Patients have access to a team of doctors and hospitals in their HMO provider network that helps limit expenses. An HMO network is usually made up of doctors, hospitals, labs, clinics, pharmacies, medical equipment vendors, and imaging centers. HMOs can also save employers on health care costs.

Preferred Provider Organization (PPO) Plans

PPO plans provide employees with the flexibility of choosing their doctors, hospitals, and other healthcare providers. This type of group health insurance does not require an employee to get a referral from the primary care provider (PCP) and workers can see providers out of the plan’s network.

However, this freedom to see any provider comes at a cost. PPO plans have higher monthly premiums and out-of-pocket expenses like coinsurance, copay, and deductibles.

Although PPOs offer a wide range of deductible options, a PPO with a small deductible is likely to be the most expensive of all health plans. In addition, these plans generally become more costly as employees age.

Exclusive Provider Organization (EPO) Plans

EPO Wooden Alphabets with Stethoscope

An EPO plan allows employees to use doctors and hospitals within the plan’s network. There are no out-of-network benefits, meaning employees that see providers out-of-network must cover the full cost themselves.

However, EPO plans are an excellent option for employees that do not want to get a referral to see a specialist. EPO plans are often more affordable than PPO plans.

The network of providers and medical facilities is often fairly limited with EPO plans. When employees stay in-network, they can enjoy minimal out-of-pocket costs.

Fully-Insured vs. Self-Funded vs. Level-Funded Plans

Employers looking to save money on group health insurance are often interested in learning about alternative options to group health care for employees. There are three main types of health care options offered by businesses, including the following:

Fully-Insured

Fully-insured health care is the most common type. The employee or the employer pays a premium to the insurance carrier and in return, the insurance carrier assumes responsibility for paying any future medical claims that are covered in the policy’s contract.

There is usually an out-of-pocket maximum that the individual or family must pay upfront for medical services with a fully-insured plan.

Self-Funded

Self-funded insurance refers to a structure in which a company provides the funds needed to pay for employees’ expected medical claims. The employer forms an “insurance pool” with the participants in the pool consisting of eligible employees.

Self-funded employers usually require reinsurance or stop-loss insurance that helps cover any claims that exceed the predicted expenses. Self-funded insurance is more common among larger businesses and can save employers a significant amount of money.

Agent Explaining Insurance Plans

Level-Funded

Level-funded insurance is a popular option among both small and large employers. In simple terms, level-funding is essentially self-funding that is done on a smaller scale.

A level-funded health plan combines the customization aspect and cost-savings of a self-funded plan with the predictability and safety of a fully-funded plan.

There are benefits of level-funding for both employers and employees, including cost-savings, flexible plan design, and fewer regulatory requirements than traditional, fully-insured plans.

Speak With An Benefits Consulting Firm About Group Health Insurance

Offering group health coverage to employees is a major decision for any business that should not be taken lightly. However, choosing between the various types of group health insurance plans can sometimes be challenging.

When selecting a group health insurance plan, it is important to consider aspects like cost, flexibility, amount of coverage, and the age and overall health of the employees. To learn more about the types of group health insurance plans available to businesses or to speak with an experienced benefits consulting firm, contact New City Insurance today.

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Filed Under: Group Health Insurance,  Insurance

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New City Insurance
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Carol Zhang
Carol Zhang
04:29 06 Mar 22
As a rapidly expanding national media organization, the employee benefits strategy and administration that New City has provided us during our growth has been invaluable. They have been proactive about informing us of the different benefit strategies available to us as we grow as well as managing the additional compliance laws and reporting requirements at each stage of our growth.
Claudia Villalobos
Claudia Villalobos
20:14 03 Mar 22
New City Insurance made navigating through all the health insurances super EASY. Their documents are highly informative, professional, and easy to work with. Thank you for making the process of choosing a health plan so simple. You guys are THE BEST!
Philippe Salas
Philippe Salas
17:02 22 Feb 22
I never expected to have a good time talking to an insurance salesman, but let me tell you Brendan was quite the treat. He was very helpful explaining the options and has a wonderful sense of humor. I hope to speak with him every time I call.
Jennifer Polito
Jennifer Polito
17:15 09 Feb 22
Super easy enrollment process. Fast and friendly customer service. If you are looking for an insurance company that is there for you every step of the way I highly recommend New City Insurance.
Rocky Salas
Rocky Salas
23:46 07 Jan 22
So friendly, I hope to speak to him again in all my future insurance needs.
Rocky Salas
Rocky Salas
23:38 07 Jan 22
So friendly and soft spoken. I hope to speak to him again in all my future insurance needs.
Jose Brena
Jose Brena
13:20 06 Jan 22
Eric Calciano has been extremely helpful in finding and selecting the right insurance coverage for our company. With many options out there Eric assisted us on getting a low cost provider saving more than 20% than from our competitors and providing excellent coverage for our employees.
Anastasia Beaverhousen
Anastasia Beaverhousen
17:05 28 Dec 21
Signing up for insurance was quick and easy. Felicity Sundsboe
SFCC
SFCC
22:08 29 Nov 21
Jeff Stoltey and his team provide excellent customer service. Jeff has always provided my company SFCC with straightforward options. I went to a larger insurance company only to RUN BACK to Jeff at New City Insurance. I recommend them to anyone needing insurance without hesitation.
Kevin Luby
Kevin Luby
19:13 22 Oct 21
Quick, easy & informative. We were able to secure quality insurance for our small business on a tight deadline. Thanks for the help New City.
Theresa Ruybol
Theresa Ruybol
19:30 01 Jul 21
Eric was so great with us. He was very patient and kind as we are a newer smaller organization who is growing rapidly. With that said, we had made our inquiry, he had great rapid response and mostly had to wait on me. Any request that we made and/or questions we had, he was great answering and helping us understand. Then when we were ready for all documents and to move forward, Brendan helped with getting that together and the two of them worked their magic on New City's end to notify me of what was needed, assist me in that process and confirming that all was complete and approved for the coverage. I just want to say thank you all again so much, as insurance has always been confusing to me, and you all made that process go a lot smoother.Thank you
Andrea Ordendorff
Andrea Ordendorff
21:06 07 May 21
I've been working with both Clayton and Brendan for well over a year. As the purchase of our dental practice was delayed well over 14 months they both patiently supported me and continued to make themselves available. When we were officially ready to sign up they made the whole process seamless and super easy. This team is highly knowledgeable, professional, supportive, and efficient! I can't thank them enough for everything they've done.
T W
T W
22:32 30 Aug 20
I love New City Insurance. I never had a good experience dealing with insurance brokers until I started working with Brendan. He’s awesome! He is patient with me and takes the time to answer all my questions. I’m very grateful for all his help and hard work!
Mary Jane Deyette
Mary Jane Deyette
00:57 11 May 20
Jeff Stoltey is so awesome...even thru my company had only two employees, he took the time each year to research and find the best plan for us. The only reason I am leaving New City Insurance is because we no longer have any employees. Thank you Jeff
Alma Ortiz
Alma Ortiz
22:25 23 Feb 20
Brendan was awesome! I couldn't figure out how to pick my plan and he returned my call on a weekend to help me. Outstansing service!
jessica kavanagh
jessica kavanagh
19:53 13 Feb 20
Brendan was so helpful I definitely recommend him if you’re in need of good help and getting it done promptly. Thankyou so much again.
Tricia DeYoung
Tricia DeYoung
19:49 13 Feb 20
I was very thankful I inquired about this info. with Brendan. He was very helpful so I understand the benefits available much better now. Thank you Brendan.
B Bayer
B Bayer
17:43 24 Sep 19
NCI handled almost everything from start to finish. Clayton and Brendan made the plans easy to understand and walked me through the application process. They got me my ID numbers before my cards arrived so that I could keep an appointment I had already scheduled. My last broker wouldn't have done that. 5 stars!
Jessica Lehr
Jessica Lehr
03:36 07 Jun 19
Our staff was interested in a health plan, but we didn't know how beneficial a solid employee benefits package would be for our business to expand. We'd lose prospective employees because they had more options for their medical insurance which was sometimes more valuable than more pay. The New City team was amazing and gave us as many affordable options as possible so that everyone had their needs met.
Mike McClay
Mike McClay
19:36 03 May 19
My employer uses New City as their insurance broker, and I'm always amazed when I call in for assistance by how knowledgeable and attentive their staff is with my requests. Their online benefits platform makes selecting insurance plans pretty darn easy. I would highly recommend their services.
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