Group Health Insurance Plans
Group health insurance is the most widely used form of health insurance in the United States. It is available mostly through employers, though trade groups, particularly those whose members are self-employed, also offer group health insurance. The premise behind group health insurance is that by pooling a number of people, which distributes risks, you achieve a reduced premium over individual health insurance --- a type of group discount.
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Employee Benefit
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Health insurance is a major benefit offered by employers. Many job seekers look for the availability of low out-of-pocket cost health insurance through a potential employer, especially those who are the primary wage earners and have a family. To further attract quality job candidates, employers often cover some, if not all, of a health insurance plan's monthly cost. Those who do not cover the whole cost deduct the balance of the premium amount prior to deducting payroll taxes, which creates a tax savings benefit.
HMOs
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Group health plans come is several different formats: health maintenance organizations, or HMOs; preferred provider organizations, or PPOs; and traditional 80/20 plans. HMOs focus on keeping costs down through promoting preventative care. To do this, most HMOs feature no to very low deductibles and co-pays on routine care such as primary physician visits, annual gynecological exams, routine physicals and medications. You must use a doctor from the HMO's list of providers to qualify for service coverage. However, to encourage people to use primary care resources first, HMOs require a referral to see a specialist and possibly an approval from the HMO, depending on the condition.
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Traditional 80/20
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Traditional 80/20 plans do not restrict the doctors a patient can visit to a list, but they do not cover the full cost of the visit. These plans pay 80 percent of the customary reasonable allowance --- a set fee based on the average charge of area providers for that service after the patient fulfills his required deductible, or required out-of-pocket expense. Deductibles can be anywhere from a few hundred dollars to several thousand dollars, depending on the plan, which means that coverage would only kick in once that patient has paid the full deductible amount for services first. The remaining amount of the provider's charge is the responsibility of the patient. This can be more than 20 percent of the charge, if the provider a patient chooses a provider who charges more than the customary reasonable allowance.
PPOs
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PPOs combine elements of both plans. PPOs offer a greater amount of choice by giving the patient the option of seeing doctors on a list of service providers for a low co-pay and no deductible, but permit patients to see doctors outside the list on a 80/20 basis with a deductible. Depending on the plan, PPOs generally covers visits to specialists seen with a referral in full, while those seen without a referral are partially covered.
Choosing a Plan
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When choosing a group health plan, it is wise for an employee to do her due diligence, especially when their employer offers more than one plan. "Consumer Reports" suggests looking at the following: what each plan covers, cost versus coverage and quality of care, and company rankings in major surveys of heath insurers. Employers can help with additional information about plans or can direct employees to the right resources. Organizations such as the National Committee for Quality Assurance and the government reference site HealthCare.gov can provide information and rankings.
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References
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