In general, think about:
- The overall value of each plan. Does it provide ample coverage at a reasonable cost?
- Choice of providers. Will your employees be able to visit doctors and other providers they want?
- The insurer or health plan itself. Is it a stable company with quality customer services?
Plan Value: Balancing Benefits and Costs
Health insurance products are complicated, and getting more so. When shopping for plans, you’ll want to look carefully at coverage for the services your employees will use most, such as office visits and prescription drugs. Even though it’s used less frequently, coverage for hospitalization is also critical.
In addition to these basics, below we list some specific benefit categories that may be worth a careful review. Depending on your employees’ circumstances, some or all of these may make a big difference for your business.
- The specific structure of the pharmacy benefit. Coverage may involve different levels of payment depending on whether drugs are generic or brand name, and whether they are included in the health plan’s formulary.
- Annual out-of-pocket maximum. If the consumer reaches the out-of-pocket maximum, the health plan waives out-of-pocket charges for the remainder of the year. Lately these maximums have been rising. Though it’s unlikely that any of your employees will reach this level, it can bring peace of mind to know that no matter what unforeseen needs emerge, there is a limit to how much a particular individual or family will have to pay if you choose a plan with lots of cost-sharing features.
Choice of Providers
As we mentioned earlier, choice of providers may be an important issue to you and your employees. Make sure you understand which providers, hospitals and medical groups are available to plan participants. If you or your employees aren’t comfortable with the choices offered, you may want to consider a different plan.
Reputation and Quality of Insurer
A plan may look good, but if the insurer turns out to be hard to deal with—or if the insurer goes bankrupt, for that matter—you’ll likely wish you had picked a different plan. Do a little research to make sure that your potential insurer:
- Is financially stable.
- Gets high marks in quality from an unbiased source.
- Makes customer service a priority.
You can find out if your insurer is financially stable by researching its financial rating. A number of companies provide this service, usually for free, though some companies may offer more information at a price.
Quality of Healthcare
The quality of healthcare varies widely. In addition to doctors, hospitals and medical groups, insurers play an important role in seeing that you receive high-quality health services. Be sure to look into the insurer’s reputation and ratings for the quality of care provided under their plan.
Look for an insurer who makes it easy for you to pay the bill and get help when you need it. Your broker can advise you on which insurers provide great service, and which give employers health care headaches.
The best insurers also make it easy for employees to:
- Find provider information. Most insurers have printed provider directories that customer service representatives can mail to participants upon request. Some also offer provider directories online.
- Resolve claims quickly and efficiently. There’s nothing more annoying for employees and employers alike than dealing with an insurer who incorrectly processes claims or processes them so long after a service that errors become difficult to fix.
- Reach someone who can help them resolve a problem. Look for insurer customer service representatives who can handle both claims and member service requests, such as ordering a member ID card or changing primary care physicians.
If you’ve found a plan that suits your needs, it’s time to move to the next step, which involves signing a contract and implementing the plan. You can skip the rest of this section and move to Step 6: Close the Deal.
If, on the other hand, after evaluating several plans you decide that none of the options look affordable, you’ll need to put some thought into what to do next. If you’re way off your target budget, it may not be the right time to purchase group coverage (especially considering that the costs will likely increase each year). If you’re in the ballpark, however, there may be ways to shave the costs down.
If it really looks like you won’t be able to afford group coverage, you should consider some alternatives.
Signing the Contract
Once you’ve reviewed your options and made your decision, it’s time to sign your contract and make your first payment. Remember that the rates you are quoted will be available for only a limited time—usually 30 days—so if you find a plan that will work for your business, don’t delay too long.
Communicating Information to Employees
You need to tell employees some critical details about how the health plan will work for them, such as:
- What you’re offering. Tell employees which plan types and designs they can choose from, and what their costs will be for both premiums and cost-sharing arrangements such as copayments or deductibles.
- How it works. You will save yourself many headaches if you ensure that employees know how to use their health coverage, including choosing doctors, understanding in- and out-of-network rules, and so on.
- How to enroll and use the plan. Enrollment and coverage start dates are especially important to anyone who is new to the plan. Explain how to complete the enrollment form and begin using the insurance.
- How much it will cost. Make sure employees know what premiums will be deducted and what, if any, copayments or co-insurance they’ll be responsible for. Remember to lay the groundwork for how you plan to share costs in the future.
- How to waive coverage. Some employees may have coverage through a spouse or family member, or may simply not want to participate. If so, they will need to know how to refuse coverage through your company’s health plan.
Employees typically need to complete an enrollment form, and may need to choose a primary care physician (PCP) from the provider directory (typically with HMO and POS plans). Some insurers are moving to online enrollment to minimize errors and speed up coverage.
After employees enroll, they will receive an ID card to present at the doctor’s office or hospital. Sometimes the ID cards do not arrive for a month or so after coverage begins. You will want to let employees know when they can expect it, and whether it will be mailed to their home or to the office. In the meantime, the insurer can provide you with the group and member numbers, as well as how to get prescriptions filled or receive care before the card arrives.
It’s a good idea to hold an employee meeting to answer questions and to explain how to fill out enrollment forms, choose the primary care physician, and file claims. An agent can assist you before, during, and after the meeting.
Offering group coverage requires a lot of paperwork. You’ll need to pay attention to:
- Monthly invoices. Failure to pay premiums is one of the few reasons that an insurer can drop your coverage. Be sure to get your payments in on time, with the accurate amounts for each employee.
- Eligibility. Make sure that you provide updates to the insurer to reflect any changes, including new employees, terminated employees, and dependent changes. (For details regarding your obligations toward terminated employees, see “Laws Related to Health Insurance,” particularly the sections on COBRA and HIPAA.)
- Helping employees with questions. Your employees are likely to have questions about referral procedures, incorrectly processed claims, network providers, or covering loved ones. Making sure that employees have current plan information may cut down on the number of questions you receive.
Speak to an agent today to determine the best plan for your business.
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