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What Entrepreneurs Should Know About Health Insurance

For many small businesses, finding a group health insurance policy that is affordable can be a tough situation. Entrepreneurs should consider their own health insurance costs and those of future employees.

Why is group health insurance expensive for small businesses?

The cost of small business health insurance is dependent on a number of factors including:

Overall size of the company. The smaller the company, typically, the more health insurance costs will be due to the fact that the risk is spread over a small number of people. Large companies have better rates because there are more insured individuals, spreading the risk.
General health of the company. As more individuals make claims, the health insurance rates will increase.
Average age of the company. Young adults are more affordable to insure than older adults because they use health care services less often.

There are different options for entrepreneurs who want to provide their employees access to health insurance.

Here are some alternative options:

Find individual plans. Compare group health rates with individual health insurance coverage on the private market. GoHealth Workplace is one program employers can use to make it easy for individuals to find health insurance.
Offer to subsidize individual coverage. For employees that are buying individual plans, offer to pay a portion of the monthly premium.
Utilize high deductible plans. High deductible plans have low monthly premiums but leave employees picking up more of the cost. While this may not be the best option for all employees, it will help business owners save money. These plans can also be combined with a Health Savings Account (HSA) to accumulate funds for health care services and business owners can contribute funds to these accounts for employees.
Avoid mini-med plans. This type of policy provides employees with restricted coverage which could leave them with a lot of out-of-pocket costs and these plans will be completely phased out by 2014. The government is allowing only select employers to continue offering these plans currently.
Pick health insurance plans with limited networks. Health insurers can negotiate rates with select health care providers in an area to cut costs. A plan with a limited network will help cut the cost of monthly premiums but could be a hassle if the entrepreneur or employees travel frequently. This could also be a problem for employees that commute far to work.

Check out the original source here.

Five Health Insurance Tips for Starting a Family

Starting a family is an exciting and happy time in a couple’s life. However, before you start making room for a baby, it’s important to think about health insurance and if your policy can offer you and your new family the coverage you need.

Before getting pregnant consider the following:

Get covered now. Don’t wait until after you are pregnant to get a health insurance plan. And, remember, not every insurance plan will cover all of your costs. Read up on your policy or give the company a call. Maternity hospital stays can be very costly, and the last thing you want is a surprise months from now on your bill. Figure out if your plan offers everything you need, and don’t be afraid to ask questions. Learn how many visits your insurance group will allow and if there is any program they can offer to help defray your costs.

Add on a rider. Let’s say your insurance plan will not cover your pregnancy costs – and many plans do not. In this case, you can add on a rider to your existing plan to help pay for your costs in the future months.

Talk to your health insurer and employer. If you are having a baby, you need to make sure that your insurance company is aware of it, as well as your employer. Give your insurance company a call and ask them to list out your benefits, and then address any concerns or questions you might have. The same goes for your employer plan. You need to learn about the maternity leave offered at your office, or the paternity leave if you are the father.

Learn the latest insurance news. Thanks to the recent health care reform provision, breast pumps and lactation support can be provided without a copayment. Women can also be screened for gestational diabetes without a copayment during pregnancy as well.

Add on a dependent. Once the baby arrives, don’t forget to add him or her on as a dependent to your insurance plan. Make sure that your plan will cover your new bundle of joy before getting pregnant, and consider making a will or living trust to help secure his or her future.

Remember, when it comes to health insurance coverage, the rule always is: Get it before you need it. And this couldn’t be truer than when you are thinking about having a baby!

Check out the original source here.

When a Group Health Insurance Plan Isn’t the Best Option

There are many benefits to group health insurance plans but they aren’t always the best option.

Sure, the employer picks up part of the tab but employers are also passing more of the cost to employees than ever before.

Here are a couple examples of when a group plan may not be the best option:

The group plan is considered a mini-med health plan. Mini-med plans are typically offered by restaurants and to part-time workers but there are a lot of exclusions in the plan and they will only coverage a percentage of health costs.
Deductibles on high deductible plans continue to get more expensive. At some point, certain deductibles are no longer affordable to consumers depending on their budget. For the really high deductible plans, consumers should either open a Health Savings Account (HSA) or find an individual health insurance plan.
Costs for dependents and the spouse continue to increase. Some companies are increasing the employee’s share of costs for dependents or a spouse to save money. In this case, spouses should either stay on separate plans or consider an individual plan instead of adding a dependent.
Maternity coverage is not provided and it’s a wanted benefit. If a couple wants to start a family but the group plan doesn’t provide maternity coverage, they should look to get a rider from the health insurance company or purchase an individual plan.

Consumers should also be aware of additions to employer health plans. Many companies offer Flexible Spending Accounts (FSAs) which are a nice benefit and addition to a health insurance plan but they also have a lot more limitations when compared to an HSA.

Check out the original source here.

Nutrition Labels for Health Insurance Plans

The Department of Health and Human Services (HHS) has released final rules about creating nutrition labels for health plans. These labels will be used to describe every health insurance plan in a uniform and easy to read format.

All employers and health insurance companies that offer individual or group plans will have to comply with the rules by September 23, 2012 – giving health insurers and employers only six months to adopt the changes.

Health plan labels will include six pages of information for consumers to review including price estimates for health care services, maximum out-of-pocket costs and a glossary.

The labels will not include the monthly premium amounts but consumers will know what the baseline of the premium is before they look at the plan details. Premiums are subject to underwriting and can change based on that process.

Here are six steps to compare plans with the new labels:

Figure out how much you can afford to spend every month to pay the monthly premium.
Review deductibles and find one that you would be comfortable with – if you can match the deductible in case of an emergency then it should be a good fit.
Does the plan cover in-network and out-of-network visits? Is that important to you and your family?
Do you have a primary care physician? If so, is that physician covered with the plan?
Highlight any out-of-pocket health care costs are you susceptible to and determine if you can afford them.
Read the complete health plan nutrition label to have a complete understanding of what you are buying.

Check out the original source here.

Five Common Reasons for Group Rate Increases

Every year as individuals go through open enrollment they learn whether or not their group health insurance rates have changed. Unfortunately they may not fully understand the explanation behind the increases or decreases.

Here are five common reasons for rate increases:

1. As a whole the company filed a lot of claims. The more claims a company files, the more likely their health insurance rates are going to increase.

2. Company is insuring fewer employees. If a company downsizes then it could be subject to higher health insurance costs. In general the bigger the pool of employees – the better – because the risk of those who frequently use health care services are balanced with those who do not use it very often.

3. Group plan had to comply with health care reform provisions. Certain health care provisions require companies to add benefits which could lead to greater costs. One of the most popular reform provisions requires new plans to provide health insurance to dependents until the age of 26, which can lead to higher costs.

4. Experience rating is used to identify premium amounts. The age and the utilization of health care services are taken into account along with the overall health of the employees. If the health of the company declines and the average age or utilization of services increases, then the company plan could be subject to changes.

5. State has issued new mandates for coverage which can include autism coverage, changes in mental health or maternity benefits. Any time there are mandates requiring additional coverage, it is likely that health insurance rates will increase.

Check out the original source here.