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DO YOU REALLY NEED HEALTH INSURANCE?

Health insurance is the type of insurance that covers the cost of all your medical requirements. Whether you need surgery or need to pay a visit to your doctor, the right health insurance will cover all your bills.

In today’s world, there are a lot of infections and bacteria present around you. These may affect your body and can lead to surgery, ( I pray nobody contracts these). Surgeries are very expensive and lead to your savings taking a hit. You don’t want to disturb your financial condition at any point of time and for this, you need health insurance.

TYPES OF HEALTH INSURANCE PLANS

There are different types of health insurance plans covering different varieties of medical care. Let’s talk about these different types of health insurance and see which one is suitable for you.

1. Health Maintenance Organization (HMO)

With an HMO plan, people generally have a low expense but also have less flexibility in the choice of physicians or hospitals than other plans. An HMO may require to choose a primary care physician (PCP). To see a specialist, employees will need to obtain a referral from their PCP.

HMOs generally provide coverage for a broader range of preventative services other than policies. A person may or may not be required to pay a deductible before their coverage starts, and will usually have a copayment.

Most of the time, there are no claim forms to file on an HMO. The main thing you will want to keep in mind is that with most HMO plans, employees have no coverage if they go outside of their network without proper authorizations from their PCP or in cases of certain emergency situations.

An HMO may be a good option for your small business if you:

  • Prefer lower premiums
  • Like the trade-off of in-network services
  • Desire good preventive services such as coverage for checkups and immunizations

2. Exclusive Provider Organization (EPOs)

EPO plans are similar to HMO plans because they have a network of physicians their members are required to use except in the case of emergency. members of EPO will have a Primary Care Physician (PCP) who will provide referrals to in-network specialists. EPO members are responsible for small co-payments and may require a deductible.

An EPO may be a good option for your small business if you:

  • Like the balance of less provider choice in exchange for lower rates
  • Have employees who can find value with a smaller panel of providers
  • Have employees who are comfortable shouldering higher costs for unplanned events

3. Health Savings Account (HSA)

An HSA is a tax-favored savings account that is used in conjunction with an HSA-compatible high deductible health plan to pay for qualifying medical expenses. Though HSAs can be attached to group health insurance, they’re owned by employees and small businesses can contribute to them whether they offer a group policy or not.

The contributions to an HSA may be made pre-tax, up to certain limits set by the IRS. Unused funds in an HSA account roll over each year and accrue interest, tax-free. Funds may be used for other life events as well but may incur penalties and interest to be paid. 

An HSA may be a good option for your small business if you:

  • Can’t afford a group health insurance policy
  • Want to have greater control over how much you contribute to health benefits
  • Have a large number of employees who have an HSA

4. Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs)

A QSEHRA is a small business health insurance benefit specifically designed for businesses with fewer than 50 employees. With a QSEHRA, small businesses offer employees a monthly allowance of tax-free money. Employees then choose and pay for the health care services they want, including an individual health insurance policy. They submit proof of purchase, and the business reimburses them up to their allowance amount.

QSEHRAs are a good solution for small businesses because there are no minimum contribution requirements and all full-time employees receive value.

A QSEHRA may be a good option for your small business if you:

  • Can’t afford a group health insurance policy
  • Want to have greater control over how much you contribute to health benefits
  • Want to offer a benefit to employees regardless of their personal health insurance situation

5. Indemnity Health Insurance Plans

Indemnity health plans are known as fee-for-service plans because of pre-determined amounts or percentages of costs paid to the member for covered services. The member may be responsible for deductibles and co-insurance amounts.

In most cases, the member will pay first out of pocket and then file a claim to be reimbursed for the covered amount.

An indemnity plan may be a good option for your business if you:

  • Can accept the burden of potentially increased administration for referral and claims paperwork
  • Are find with the balance of higher rates in exchange for more service control
  • Have employees who need high levels of flexibility for doctors and hospitals

6.Point of Service (POS)

A POS is a Point of Service group health insurance policy.

POS plans combine features of an HMO and a PPO plan. Just like an HMO, POS plans may require employees to choose a Primary Care Physician (PCP) from the plan’s network providers. Generally, services rendered by the PCP aren’t subject to the policy’s deductible. 

If employees utilize covered services that are rendered or referred by their PCP, they may receive the higher level of coverage. If they utilize services by a non-network provider, they may be subject to a deductible and lower level of coverage. They may also have to pay up-front and submit a claim for reimbursement.

A POS may be a good option for your small business if your employees:

  • Need flexibility when choosing physicians and other providers
  • Desire primary care physicians to coordinate care
  • Like the balance of greater provider choice versus lower premiums

7. Preferred Provider Organization (PPO)

With a PPO plan, employees are encouraged to use a network of preferred doctors and hospitals. These providers are contracted to provide service to plan members at a negotiated or discounted rate. Employees generally aren’t required to designate a primary care physician but will have the choice to see any doctors or specialists within the network of the plan.

Employees have an annual deductible they’ll be required to meet before the insurance company begins covering their medical bills. They may also have a copayment for certain services or a co-insurance where they’re responsible for a percentage of the total charges of their medical expenses.

With a PPO, services rendered outside of the network may result in a higher out-of-pocket cost.

A PPO may be a good option for your small business if your employees:

  • Need flexibility when choosing physicians and other providers
  • Want the burden of obtaining a referral to see a specialist
  • Like the balance of greater provider choice versus lower premiums

These are the different types of health insurance plans. You should sit with you family and a health insurance specialist to decide which one is the best for you. What may be suitable for your friend might not be the suitable one for you and this, one should not flow with the crowd when it comes to health insurance.

Do tell us more about the health insurance you have taken. If you liked this blog or have something to add, let us know in the comments below.

Happy insuring!

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