Group insurance is a health care coverage plan where employees or members are included in a master policy from their employer or organization. It provides coverage for more services at a lower cost per participant, but may have limitations on doctors and treatments. Premiums are usually automatically deducted and cover routine and emergency medical procedures, extended care, mental health needs, and prescription drugs. However, coverage for spouses and dependents may vary.
Group insurance is a health care coverage plan in which employees or individual members are included in a master policy from their employers. Because the plan has so many contributors, the policy often provides coverage for more services at a much lower cost per participant. This type of insurance may be provided by organizations other than for-profit businesses. Unions, churches and other service groups can also get group insurance for recognized members and possibly their dependents.
Individual members of a group insurance plan receive certificates of insurance showing their eligibility for benefits. If the employer’s primary policy requires participation in a Health Maintenance Organization (HMO), individuals also register as members. Other group policies may be associated with major medical groups like Blue Cross/Blue Shield. A major medical policy may or may not restrict the choice of a primary care physician and a specialist. HMO policies often require a patient to use a specific doctor, who must approve any visits to eligible specialists.
Funding for a group insurance policy is commonly a flexible payroll deduction, although some companies will absorb the full cost of the policy as an employee benefit. However, as with many insurance policies, the cost of premiums can increase significantly without notice. If some participants receive expensive treatment for serious medical conditions, the rest of the group may have to absorb the costs of higher premiums over time. Group insurers do not always require physicals before issuing a master policy, so some participants may benefit from treatment for pre-existing conditions.
Group policy benefits can vary widely from company to company. Almost all policies cover routine and emergency medical procedures, such as regular doctor appointments and hospital treatment for accidents. Most cover extended care in hospitals or rehabilitation centers. However, the insurance may or may not cover the employee’s spouse or dependents. Some offer assistance with vision care or dental work, but coverage may be limited to specific procedures. Mental health needs may also be covered by group insurance. Prescription drug expenses are often included in group benefits, but most likely with a copay provision. Under a copay plan, the covered person must pay a set out-of-pocket price for brand name and generic drugs.
Group insurance is definitely more affordable than a similar number of individual policies, but there are some drawbacks. Some members find that their doctor and treatment options are very limited under an HMO insurance plan. Even major medical plans can restrict the list of approved doctors, often called a PMD (preferred doctor) policy. Employers who fear large increases in premiums may take an unusual interest in the private health problems of their employees. Companies may suddenly implement strict ‘no smoking’ policies or strongly encourage other preventative health care programs. Some may find this interest in their personal health intrusive.
Many employees view group insurance coverage as an important benefit to faithful company service. Premium payments are usually automatically deducted and pay for themselves after a typical trip to the ER. Extended coverage for spouses and dependents also provides peace of mind and a sense of security.
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