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What Kind of Business Health Insurance Do You Need?

Around two-thirds of employees focus on their health over everything else—even a higher salary. They usually turn to their company for help, so this matter is in your hands.

Do you want to increase productivity and keep happy employees? Take a closer look at your health insurance benefits.

As a business, how do you take care of your employees’ health? Offering strong health benefits is the easiest method. Keep reading to learn the different types of business health insurance for your needs.

Preferred Provider Organization (PPO)

As the name suggests, a PPO business health insurance plan has preferred doctors or hospitals. Employees covered under this plan must get their medical care from the providers on this list to get the highest coverage.

The members pay higher out-of-pocket costs when choosing out-of-network physicians. There’s also more paperwork involved. Some PPO plans pay out a small sum, but some might not provide coverage at all.

The benefit of this health insurance plan is that employees can enjoy a moderate amount of freedom in their choice of healthcare provider. They do not need a designated primary care physician. They can go to a specialist without a referral from their PCP.

Members must pay an annual deductible before the coverage applies to their bills. They may also have a copayment or co-insurance.

It is a good option for your business if you want a balance between freedom and lower premiums. It also saves your employees from the burden of getting a referral from their primary care doctor to see a specialist.

Health Maintenance Organization (HMO)

An HMO is a group insurance policy allowing members to seek healthcare within a network. It limits the employee in their choice of healthcare provider. They usually have to stick to the network of HMO-contracted companies.

An HMO plan offers lower out-of-pocket expenses for the employee. It also has a broader coverage for preventative services than other options.

It requires the employees to choose a primary care doctor for all their health concerns. When needed, the PCP can refer the member to a specialist. The member must have a referral first to get coverage from the HMO plan.

Employees usually have a copayment, but they may not need to pay a deductible before the policy kicks in. They have no coverage for going outside their network, except in cases of emergencies.

HMOs are a great option when you want to pay a lower premium for health benefit plans. The trade-off is the employee must stick to a network to get coverage.

Point-of-Service (POS)

A point-of-service plan has the features of both HMO and PPO. Like HMOs, employees must select a PCP to refer them to a specialist.

The primary care doctor must be in the network of a POS plan. However, the plan does not limit them to a list of providers.

Members can choose out-of-network healthcare providers, like in PPO. They have to pay more, though.

They are also likely to get a lower coverage for non-network provider services. Employees must pay for the service first and file a claim for the POS plan to pay them back.

If you want a primary care physician to coordinate care for employees, this is a better choice than HMO and PPO. POS has more flexibility while providing lower premiums.

Exclusive Provider Organization (EPO)

EPO has an even more specific network of doctors and hospitals. Members have to use their services to get coverage. Otherwise, the plan does not cover the medical bills, except in emergency cases.

In an EPO plan, employees do not need to select a PCP or get a referral to see specialists. Still, they have to stick to in-network specialists.

Members usually have a co-pay, while deductibles depend on the insurance plan. They rarely have to deal with paperwork.

EPO business health insurance plans offer even lower premiums than a PPO. The network is restrictive, but the advantage is that members do not have to coordinate through a PCP.

High-Deductible Health Plan with a Health Savings Account (HSA)

A health savings account works like a 401(k) or flexible spending account (FSA). It’s a bank account for members to save money, specifically for medical expenses in the future. For non-medical events, they may have to pay a penalty fee and interest.

Participants can make pre-tax or tax-deductible contributions. However, the IRS sets a contribution limit each year. For 2022, the limit is $3,650 for self coverage and $7,300 for family.

Unlike an FSA, HSA funds roll over every year and earn interest tax free. The employees own this account, but you can contribute.

HSAs must pair with a compatible high-deductible health plan (HDHP). This means employees have higher out-of-pocket costs to pay. However, the plan pays for 100% of the costs beyond the deductible amount.

Preventive care is also free, like other plans, even if the member hasn’t met the deductible. For other medical care, they can use their HSAs to cover the costs.

The IRS also sets the maximum out-of-pocket costs. For 2022, it’s $7,050 and $14,100 for self and family coverage, respectively. The minimum deductible is $1,400 and $2,800.

The healthcare providers you can use depend on the plan. It can either be PPO, HMO, POS, or EPO.

The premiums for HDHP plans are lower, making it a good choice for businesses that cannot afford a group health insurance policy. It also gives you greater control over the amount you want to contribute to health employee benefits.

Choose the Right Business Health Insurance Plan Now

The best business health insurance plan depends on the needs of your employees. Of course, the capacity of your business to provide is an enormous factor. Yet, remember that it’s your employees who will have to live with the policy.

Consider what’s better for your employees to make them productive and loyal in the long run. Contact us today and let us help you with insurance plans.