Group Health Insurance Companies

What Is Group Health Insurance?

Updated as of June 2018.

Health insurance is bookended in volumes of mystery. You know you need it, you want to have it, but odds are, you don’t know enough about it to make the first two points happen.

If you’re an employer thinking about offering group health insurance to your employees for the first time, it can be unclear why you should provide something that’s saddled with so much confusion. In this article, we’ll define what health insurance is, show you how it works, and explain how you can buy it for your team.

What is group health insurance?

Put simply, health coverage helps pay for your medical treatment when you’re sick and covers doctor visits that help you stay healthy. Group health insurance is a plan that covers all the employees who work for a given company or organization (and potentially their dependents).

Why would you want it? Well, outfitting your team with health benefits makes it a lot easier for your employees to cover their regular and urgent doctor visits, hospital stays, and medical treatments like physical therapy. It also allows employees to buy additional insurance to cover their entire families in one fell swoop.

A health plan is the number one benefit most people seek when they’re applying for jobs. Picture it this way — if your benefits offering was an ice cream sundae, health insurance would be the actual ice cream in the dish. All the other stuff, like free food and unlimited vacation, are just the cherries on top. So, if you want to keep your team happy, it’s a good idea to scoop health coverage into your overall compensation package. Then, tell your employees to dig in.

How do I get group health insurance?

Group health coverage is basically like a cushion that you or your employees probably won’t use right away. However, you keep it in case something happens. Aside from the monthly premiums, you can simply forget about it when you’re not using it.

You can snag a plan through SHOP (Small Business Health Options Program), a benefits service like Gusto , or an insurance company. Here’s a bit more color on each of the options you have at your fingertips:

How group health insurance works (in a nutshell)

Step 1. You buy a health plan.

For group health insurance, this happens through a few different avenues.

  • There’s SHOP , the Small Business Health Options Program for companies with 50 employees or fewer. It’s a federal (and in some places, state) marketplace that sells health insurance plans for you and your team.
  • A service like Gusto , which can recommend health plans specifically for your company. We have experienced advisors that are available to guide you at each step.
  • If you choose to purchase a health plan directly through an insurance company, you can simply call Anthem, Aetna, Blue Cross, Blue Shield, Cigna, or another insurer to get set up.

Working with a broker is highly recommended if you’re a small business that is still getting used to the idea of health benefits. A broker will help you zero in on the carrier and plan that works best for where you are. Also, the price is exactly the same for small employers, whether you have a broker or not. Since it won’t cost you any more than doing it alone, you may want to seriously consider getting that extra dose of help.

Step 2. If you’re an individual, you get put into a statewide risk pool.

Once you pin your plan down, you get placed into a particular group. Keep in mind that small businesses aren’t a part of this pool, but individuals are. The group is based on your risk level — the likelihood you will need care — along with everyone else who purchased the same plan as you. It’s like the ultimate secret society.

Step 3. You give and take from that pool.

If someone needs care, the insurance carrier uses a sliver of the money in your group to foot the bill. The type of plan you have will influence whether or not you can take more or less money from the collective pot. For example, if you have a platinum plan, more money will be taken out than if you had a bronze plan, because you spent more dollars to nab that extra level of care.

It’s natural to feel unclear about spreading the health insurance love. Luckily, after you see how easy it is to buy coverage, it will make it a whole lot easier to get comfortable with.

Group Health Insurance Plan

What is a ‘Group Health Insurance Plan’

A group health insurance plan is a health insurance plan that provides coverage to members of a group that tends to be employees of a company or members of an organization. Members of the group usually receive insurance at a reduced cost because the insurer’s risk is spread across a group of policyholders.

Health Insurance

Universal Health Care Coverage

Assigned Risk

Insurance Industry ETF

BREAKING DOWN ‘Group Health Insurance Plan’

Group health insurance in the United States has evolved during the 20th century. The idea of collective coverage first entered into public discussion during World War I and the Great Depression. Soldiers fighting in the First World War received coverage through the War Risk Insurance Act, which Congress later extended to cover servicemen’s dependents. In the 1920s, healthcare costs increased to the point that they exceeded most consumers’ ability to pay. The Great Depression exacerbated this problem dramatically, but resistance from the American Medical Association and the life insurance industry defeated several efforts to establish any form of a national health insurance system. This opposition would remain strong into the 21st century.

Employer-sponsored group health insurance plans first emerged in the 1940s as a way for employers to attract employees when wartime legislation mandated flattened wages. This was a popular tax-free benefit which employers continued to offer after the war’s end, but it failed to address the needs of retirees and other non-working adults. Federal efforts to provide coverage to those groups led to the Social Security Amendments of 1965, which laid the foundation for Medicare and Medicaid. These government-sponsored health plans continue to provide care to those left out of employer-sponsored group health insurance plans. As national health expenditures have climbed past 15 percent of gross domestic product (GDP), the Affordable Care Act of 2010 substituted a nationwide mandate that each taxpayer join a group plan for the sort of single-payer solution that has faced stiff opposition since the 1930s.

Benefits of a Group Health Insurance Plan

The primary advantage of a group plan is that it spreads risk across a pool of insured individuals. This benefits the group members by keeping premiums low, and insurers can better manage risk when they have a clearer idea of who they are covering. Insurers can exert even greater control over costs through health maintenance organizations (HMOs), in which providers contract with insurers to provide care to members. The HMO model tends to keep costs low, at the cost of restrictions on the flexibility of care afforded to individuals. Preferred provider organizations (PPOs) offer the patient greater choice of doctors and easier access to specialists, but tend to charge higher premiums than HMOs.

The vast majority of group health insurance plans are employer-sponsored benefit plans. It is possible, however, to purchase group coverage through an association or other organizations. Examples of such plans include those offered by the American Association of Retired Persons, the Freelancers Union and wholesale membership clubs.

Looking for Health Insurance?

Health Care and Coverage Together. Welcome to Kaiser Permanente Washington.

Kaiser Permanente Washington brings competitively priced, diverse health plans together with high-quality doctors and hospitals. You can get a wide variety of medical services within our medical offices, plus our health plans are built to cover the benefits you and your family need.

Take a look at what we have to offer and choose the plan, doctors, locations, and services that are right for you.

View 2018 Kaiser Permanente Washington rates and plans, or enroll now.

Get the Care You Need from High-Quality Providers

Washington Permanente Medical Group offers more than 1,000 physicians practicing in 25 locations in Washington state and in 7 community hospitals.* We are one of the largest multispecialty groups in the state, with 53 specialties, including 15 surgical specialties.

Our doctors and other health care providers have been recognized for the quality of care we offer:

  • Our medical group is one of only 15 groups nationally to have been honored with the American Medical Group Association’s annual Acclaim award for care that is safe, effective, patient-centered, timely, efficient, and equitable.
  • Local magazines named 56 Washington Permanente Medical Group physicians “top docs” in 2016; more than 250 of our doctors have been named “top docs” since 2011.

* OIC Provider Network Form A

Make Sure You Live Where our Plans Are Available
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Find the Health Plan That’s Right for You and Your Family

About our Care
Kaiser Permanente Washington individual and family health plans offer the benefits you and your family need, delivered in an environment that puts preventive care and your overall wellness first. So our plans cover routine appointments, preventive screenings, wellness programs, and more to help prevent you from getting sick in the first place.

About our Plans
Gold, Silver, and Bronze plans: Plans in three metal levels that span the range of cost shares and premiums.

Bronze plan: All services subject to the deductible except for preventive care services, which are covered in full.

Catastrophic plan (not a metal plan): Offers three primary care visits covered in full, in addition to preventive care visits. All other services are subject to the annual deductible.

Core and Flex plans: Offer the greatest value of all of our plans with access to the Core network of specially selected providers. Flex plans include a specific number of office visits (“up-front visits”) for just a copay as well as up-front coverage for some medications; the deductible doesn’t apply to either.

VisitsPlus HD plan: Unlimited office visits and generic and brand-name drugs are not subject to the deductible. (All other services subject to deductible.)

HSA-compatible plans: Open your own health savings account (HSA) to use for eligible medical expenses.

Choose the Right Coverage Level

Which metal tier works best? Consider your monthly budget and how much you’ll pay when you access care.

Group Health Insurance

As an employer, you know benefits such as health insurance can attract the best and brightest to your company.

The problem with providing health insurance for your workforce is the cost. Health care costs are rising all for everyone — for physicians, insurance companies, and consumers. But that doesn’t mean there aren’t any affordable options available. It’s actually easier to find affordable group health insurance coverage than you might think.

Businesses of all sizes have a variety of group health plans to choose from. These plans range from comprehensive group health coverage to consumer-directed savings plans.

Let’s take a look at your group health insurance options.

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Consumer-Directed Group Health Insurance

Consumer-directed health insurance plans are becoming a popular choice among small and large businesses. They’re called “consumer-directed” because the policyholders take control of their health care dollars. These plans feature low monthly costs for you and your employee, along with tax-advantaged savings.

What are some consumer-directed group health insurance plans?

    Health Savings Account (HSA) Plans. An HSA is a bank account where you and your employees can contribute tax-free income to be used for almost any health-related cost. If savings aren’t used, the funds roll over to the next year — and they build interest. Alongside an HSA, your employees will have catastrophic coverage with a high-deductible health plan — which features low monthly premiums to fit your budget.

The most common plan compatible with an HSA is a managed care PPO with a high deductible. If you want to add an extra benefit for your employee, you can also contribute to a worker’s Health Savings Account.

Cafeteria Plans. This is a group health insurance plan in which your employees decide where their benefit dollars go. They’ll choose from a “menu” of coverage options, such as medical, dental, vision, disability, accident, and term life insurance. You and your employees share the cost of benefits with tax-free dollars — making insurance coverage more affordable for everyone.

One major difference from an HSA: in a cafeteria plan, the money contributed toward benefits does not roll over — it has to be spent the same year it’s deposited.

With a consumer-directed group health insurance plan, you can afford to provide your employees with the health benefits they want.

Comprehensive Group Health Insurance

If you’re looking for comprehensive group health insurance coverage, what are your most affordable options? Managed care group health insurance plans.

Managed care plans create networks of doctors, specialists, hospitals, and other health care professionals who provide discounted medical care. For you and your workers, that means lower monthly premiums, copayments, and coinsurance.

Here are the most common managed care group health insurance plans:

  • A PPO or Preferred Provider Organization provides comprehensive health benefits from an extensive network of care providers. When your employees receive care from in-network doctors, they’ll save money. But they also will have coverage with any physicians or specialists — even if they’re not in the preferred network. PPO plans with a high deductible are also compatible with Health Savings Accounts.
  • An HMO or Health Maintenance Organization is one of the most affordable group health insurance options available. Your employees must go to doctors within the network and choose a primary care physician, but HMO networks typically include thousands of health care professionals in your state.
  • A POS or Point of Service group plan is a combination of the HMO and PPO. You’ll choose a primary care physician, as you would in an HMO. But you won’t have to get a referral for specialist care. Your employees will have group health insurance coverage with both in and out-of-network doctors and hospitals, just like a PPO.

To learn more and find out which kind of group health insurance plans are best for your business, get free quotes to connect with a professional agent.

A Healthier Workforce

When your employees are healthy, your business is healthy. That’s why it’s important to promote healthy lifestyles for your workforce.

How can you help keep your employees active in staying healthy?

  • Look for discounts to gyms and fitness centers.
  • Provide programs for quitting smoking, managing weight, and managing chronic illness such as asthma or diabetes.
  • Choose healthier snack and beverage options for your vending machines.
  • Lead by example — practice healthier habits yourself.

Another key to keeping a healthier workforce is preventive care. Encourage your team to go in for routine doctor’s check-ups and physicals. Preventive care can detect and treat illnesses before they turn into serious — and expensive — health conditions.

Providing coverage for preventive care now can save your business big bucks down the road. And for many group health insurance plans, adding preventive care won’t put too much of a dent in your bottom line.

Exploring Your Group Health Insurance Options

By exploring different group health insurance plans from multiple leading health insurance companies, you’ll be able to compare rates and benefits to find the right coverage for your business.

You can view plans from the top names in group health insurance right here. You can also see which plans are available in your state.

Where can you find most valuable resource for health insurance information? With a professional agent. They can help assess your business’ situation to figure out which group plan will be best for your employees — and your budget.

When you use our service at, licensed agents representing leading carriers will provide you with free quotes.

Just tell us a bit about your business with this secure form, and we’ll match you with agents who can help you find the right group health insurance. Getting connected is absolutely free. There’s no risk and you have no obligation to buy anything.

Health Insurance: The 4 Best Options for Small Businesses

Health insurance is expensive, complicated, and sensitive–a lot can go wrong.

But small business health insurance is a must if you’re looking to grow. It can help attract and retain better employees , improve productivity by keeping everyone healthy , and might even save you some money with tax credits and deductions .

(Not to mention, if you have 50 or more full-time employees, you legally have to offer health insurance. Perhaps this could change next year, but for now, let’s assume so.)

Where do you start your search, though? These 4 options are some of the best out there. Take a look below and decide which is right for you and your small business.

1. Solo Entrepreneurs

If you’re a freelancer, consultant, or sole proprietor, then you’ll probably need to purchase individual health insurance. Check out or any one of dozens of health insurance providers or marketplaces to start your research and pick the best plan.

As an individual, you only need to satisfy your own health-related needs (and those of your dependents). Keep in mind the following while looking at plans:

  • Prescription medicine you need
  • Personal and family medical history
  • Your medical practitioner habits (How often do you visit a generalist or a specialist, for example?)

Most small businesses go with “small group” healthcare, where the risks are spread out among the employers and employees. But with a single individual, that doesn’t quite work so well–that’s why, in most states, only groups of 2 or more are eligible for small group health insurance.

However, some states do allow “groups of one” to quality for small business health insurance–which is especially useful if you have a chronic condition and might struggle to get affordable individual health insurance. So check your state to see if you’re eligible, and figure out what works best for you.

2. Small Business Health Options Program (SHOP)

SHOP, or the Small Business Health Options Program , is a part of the Affordable Care Act.

Each state runs its own SHOP marketplace–either on its own or with help from the federal government–that you can use to search through, learn about, and select the best healthcare options for your small business.

Here’s the rundown:

If you have between 1 and 50 employees (or up to 100 in Virginia), you’re eligible to select healthcare coverage plans from your state’s SHOP marketplace. You can filter through our different levels of plans –Bronze, Silver, Gold, and Platinum–that indicates their prices ( not their quality). Once you pick your “Metal level,” your employees can go into the marketplace and pick whichever plan that works best for them in your category.

You’ll rest assured knowing your expenses will remain the same no matter the specific plan, your employees will appreciate being able to choose their insurance plan, and your business might even benefit from a substantial tax credit . If you have 25 or fewer employees, you should investigate this possibility–it might save you quite a bit of money on your health insurance.

3. Private Health Exchanges

A private health exchange, also called a purchasing alliance, is sort of like a privatized version of a SHOP marketplace.

You pick a private health exchange to work with, paying only a set amount per employee depending on what percentage of their medical costs you want to cover. Meanwhile, your employees will get to pick and choose their specific plans based on those offered by the purchasing alliance.

With a private health exchange, you don’t get the tax credits or huge selection of the SHOP marketplace. However, these options can be more competitively priced or higher quality, come with success agents who can advise you, and often let your employees spend pre-tax dollars on health insurance to save money.

4. Direct Purchase

If you want to put in the time and energy, purchasing a small group health insurance plan directly from a provider could save you money.

While this might satisfy your inner entrepreneur and cut some costs, there are a few ways this could go sour .

First, some insurers simply don’t sell direct–so your selection is more limited than you’d think.

Second, you’ll be the one responsible for all paperwork regarding initial enrollments, yearly open enrollment periods, billing, eligibility, and claims. It’s not the most efficient process, and it won’t get easier as you grow.

Finally, there’s a good chance that you miss a better plan because you’re unfamiliar with the industry or make a purchasing mistake because of confusing terminology. Health insurance is a complicated area with lots of choices, and messing up could mean a lot of time and money wasted.

While there are a few other options–like checking out your local trade associations or subsidizing your employees’ individual health insurance plans–these 4 paths are some of the best choices for your small business. These paths could change in 2017 with the new administration, but for now, they’re the best place to start.

Remember: always keep in mind the health care needs of you and your employees, and figure out how much your business can spend!

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