How Group Health Plans Benefit You!
How Group Health Plans Benefit You!
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Group plans are a relatively simple way for companies to ensure that all their employees are taken care of. Companies are quoted health insurance rates based on the general makeup of their personnel, and employees can choose to opt into the programs for coverage. Group health plans are particularly beneficial for individuals with major health problems, such as a history of cancer, tumors, heart attacks, and chronic conditions. Because they\’re part of a group, their rates never increase even if their conditions worsen. Group coverage also tends to have a minimum of a million dollar lifetime benefit per covered individual. That said, there are some policies with lifetime limits of up to 5 million, and there are also group policies that offer less than 1 million in lifetime limits. Generally, the larger lifetime limit is greater the cost of the policy.
Group health plans also keep co-pay costs in check for the participants in the program. Co-pays can range from $10 to $30 for family doctors and often rise for visits to specialists. These costs were created to discourage people from seeking excessive medical attention. Because something has to be paid out-of-pocket immediately, most patients seriously consider whether their ailment is worth seeking medical attention before making an appointment.
The other expense that comes directly from the participant is the deductible. If a deductible is required, it must be paid before the participant s other medical expenses are paid each year. Once the deductible is met, the group insurance covers all expenses as indicated in the policy. The deductible\’s amount tends to be directly tied to the premium paid for the policy. The lower premium is the higher the deductible. The premiums for these plans may seem very affordable, but before deciding to seek
, participants should also consider the deductible, which can be as low as a few hundred dollars to as much as a few thousand. Still, the deductibles for group health insurance plans are generally affordable and are yet another thing which can be deducted from an individual\’s taxes at the end of the year.
The greatest immediate benefit a group health insurance participant receives is that the premium deducted from the participant s paycheck is deducted before taxes, so the participant gets to keep a larger portion of his or her paycheck. If the participant\’s monthly premium is for the whole family, the company pays taxes on the participant\’s income less $200.
Overall, group health plans often have smaller premiums, smaller co-pays and deductibles, but this is not always the case. For some companies, none of the above proves consistently to be a lesser amount than it would be for covered independent individuals. The one consistent benefit that each employee has the right to receive is the tax benefit. Every company can deduct the cost of health insurance form the employee or the participant s paycheck before taxes, saving the cost of taxes on the premiums paid. Before diving into the world of group health plans, it is important to understand your needs and the policies available to you. There are lots of options out there; it s important to find the right one for you.
Steven Dallar is a financial planner and insurance expert. Recently, while searching for life insurance providers for a client, he came across
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