If you’re one of the many small- to medium-sized employers looking for the best health insurance plan, you’re not alone. The right plan is not just about the price, but also how useful it is for your employees.
Before determining the right health insurance your employees should have access to, these three questions might help you out.
1. How Much Does the Plan Cost?
Generally, there are two different types of health insurance plans. Your company can go with a low-deductible, high-premium plan, which ensures that out-of-pocket costs are low. However, the high premium can be more expensive for the company. Or, the company can go with high-deductible, low-premium plan, which ensures that the company’s premiums are much lower.
Your company demographics may influence which option is better. For example, younger demographic may be willing to pay higher deductibles because they don’t go to the doctor often. On the other hand, if your age bracket is older, they’ll want as much covered as possible.
Can't keep up with all the health insurance terms out there?
When evaluating different plans, look for the four “metal tiers” that offer guidance on how much the health insurance covers.
- Bronze: 60% Covered; 40% deductible
- Silver: 70% Covered; 30% deductible
- Gold: 80% Covered; 20% deductible
- Platinum: 90% Covered; 10% deductible
Alternatively, some insurance companies use the following format:
- No Deductible: The premium covers everything
- Low Deductible: The premium covers a significant amount with some employee out-of-pocket expense
- High Deductible: The premium covers a small amount with a significant amount of employee out-of-pocket expense.
However, insurance costs aren’t only measured by how much the premium is. You also need to look at the total deductible and the out-of-pocket limit. The plan costs the premium plus the deductible. So while the plan might seem really cheap from a premium perspective, if the total deductible is maxed out, it may be better for your employees to have access to other options.
There’s also the out-of-pocket limit. Before the ACA, this was a much more important number to keep track of. However, with current health insurance regulation, the maximum out-of-pocket limit for an individual is $7,150 and $14,300 for a family. Deductibles typically increase every year.
2. What Does The Plan Cover?
Cost is an important aspect of the health insurance plan, but it’s not the only thing that matters. Also track what the insurance covers, because the more services your employees can have access to, the more it will cost.
Most plans will cover the following, at the minimum:
- Outpatient care: Treatment without being admitted to the hospital
- Emergency room visits
- Inpatient care: Treatment you get in the hospital
- Pre- and post-natal care
- Mental health and substance use disorder services
- Prescription drugs
- Treatments for chronic conditions
- Lab tests
- Preventative services, such as vaccines
- Pediatric services
Dig in to see how much health insurance your employees can have access to. There could be caps and rules in place to prevent too much use of any of the services.
3. What About Networks of Doctors?
Before selecting a plan, always look at the network of doctors. Smaller networks are less expensive because the healthcare plan has arrangements with those doctors. Health Maintenance Organizations (HMOs) require employees to only visit approved doctors and often times require employees to get approval to see another doctor. These tend to be cheaper than the Preferred Provider Organization (PPO) which lets employees choose their own doctor.
Many insurance companies will cover out-of-network doctor’s visits, but they are more expensive because they don’t have arrangements with the doctor.
Pick Insurance Through Justworks
Justworks helps small- to medium-sized businesses provide access to quality health insurance at affordable rates. Your employees will have access to a variety of insurance plans including no deductible, low deductible, or high deductible. You can learn more about us here.
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.