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Group Health Insurance
If you're an employee, you are most likely covered by a group health insurance plan provided by your employer. The majority of working people under the age of 65 have access to a group insurance plan.
Joining a plan is highly advantageous for the employee, as even a small business has access to better rates for health coverage which can in turn be passed on to the employee in the form of lower premiums. Another advantage to joining a group health insurance plan is that generally medical examinations and exhaustive questionnaires are not required.
Group plans can either be indemnity plans or managed care plans. If you are a member of an indemnity plan, you are most likely to have the basics, such as hospitalization and doctors visits covered by your employer. “Major Medical” is a common top up plan used to increase coverage for serious illness. A combination of both gives an employee comprehensive health coverage.
Alternatively, your employer may sponsor a managed care program, often in the form of a PPO or Preferred Provider Organization plan. A PPO gives the employee access to a network of healthcare professionals that provide services to a specific group. All service providers operating in the network offer reduced cost treatment for employees. The PPO is usually sponsored by the employer, who reimburses the employee directly for medical expenses.
Using a PPO gives an employee the freedom to choose the type of healthcare professional he visits. While he is not obliged to use the PPO's network, his employer will encourage him to do so. He can obtain up to 90 percent reimbursement for seeking care from the network, while only 60 percent of the costs he incurs outside the network will be reimbursed. Another advantage is that the cost of deductibles and out of pocket expenses are kept to a minimum and costs for seeking treatment outside the network are capped.
However, every plan has its drawbacks. Some of the disadvantages associated with PPO plans include a higher amount of paperwork and administration. Individuals must fill out forms every time they wish to be reimbursed. There is also the lower reimbursement amount for non-PPO treatment that should be taken into account.
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