The impact of choosing the correct or incorrect health plan for your employees can make an enormous difference in how your business flourishes and grows, from the inside out. A health plan that is received well can decrease turnover, attract better workers, and increase employee satisfaction, motivating all team members to do their very best in the common interest of the company. A quality employee who knows their worth will not settle for less!
So, which health plan is right for you? To decide this, you must first understand the different health plans available, and then decide which is the right fit for you and your employees.
Types of Health Plans
Preferred Provider Organizations/PPOs
PPOs are popular because their flexibility allows members to receive care from any provider they want– in or out of network– though there are higher fees for out-of-network providers. PPOs also do not require the use of a PCP (Primary Care Physician) or referrals, which can be a headache when life’s unexpected occurrences happen and you need to see a specialist, often in a timely manner.
Though the benefits of these plans are wonderful, they often come with higher out-of-pocket costs, monthly premiums and office co-pays.
High Deductible Health Plans/HDHP s
These plans often combine a Health Savings Account (HSA) or Health Reimbursement Account (HRA), traditional medical coverage and a tax-advantaged way to save for future medical expenses.
A higher annual deductible keeps monthly premiums much lower than other types of health plans. Participants are required to pay for health care costs until the deductible is met before becoming eligible for the plan’s copays, but once the pre-determined catastrophic limit has been met, the plan will then cover the rest of the expenses for the remainder of the calendar year.
Health Savings Plans/HSAs
An HSA is a type of savings account designed to lower overall health costs. Participants are allowed to set aside money on a pre-tax basis to pay for qualified medical expenses such as dental care, chiropractic services, prescription medication, vision, copays for prescriptions and office visits, and more. These funds are generally not able to be used to pay for premiums, but the funds do roll over year to year if they are unspent. Some health insurance companies offer an HSA as part of an HDHP plan.
Health Maintenance Organizations/HMOs
These plans allow for lower monthly or annual premiums, though members are more limited to in-network providers only. Members are also required to have a PCP (Primary Care Physician) and need referrals from their PCP in order to see an in-network specialist.
Exclusive Provider Organizations/EPO Plans
These health plans offer a local network of doctors and hospitals for participants to choose from. An EPO usually comes with lower monthly premiums than a PPO plan. However, if one chooses to get care outside of the plan’s network, it usually will not be covered (except in an emergency). Referrals are not required, though a PCP may be.
Point of Service Plans/POS Plans
POS plans are hybrids of PPO and HMO plans. They act much like an HMO plan, as members are required to have a PCP, but they are not required to have referrals to see specialists. Participants may see an out-of-network provider for additional fees, though there may be more paperwork involved than with a PPO plan. These premiums are often less than a PPO plan, but slightly more than an HMO plan.
Indemnity Plans/Fee For Service Plans/FFS
These types of plans will either pay the medical provider directly or reimburse the member after they have filed an insurance claim for each covered medical expense. When participants need medical attention, they visit the doctor or hospital of their choice. This approach may be more expensive and require extra paperwork, though it allows much freedom. Because comprehensive coverage is not included, these plans are often used as an add-on to another health plan.
Choosing the Right Fit
There are many factors to consider when choosing your company’s offered health plan. These may include but are not limited to:
- Employee ages and other needs
- Size of business
- Your budget
- Metal level (gold, silver, bronze, platinum)
- Any extra benefits you may want to include such as dental or vision
With such a large and impactful decision to make, it is highly recommended to seek the aid of a Professional Employer Organization, or HR Outsourcing Broker, such as BRG Advisory Group. Since there are numerous options when it comes to choosing your company’s healthcare plans, a quality PEO will give you the expert advice you need when looking for the best solution. In addition, a PEO will be able to group employees of small businesses into one larger pool as a way to negotiate better health plans at lower rates. This allows small businesses to offer top-rated health insurance plans and enterprise-level benefit packages similar to those only available to large corporations! Contact BRG Advisory Group today at 800-971-3006 to set your business up with a health plan both you and your employees will be satisfied with!