How To: Get Group Health Insurance

by: Jen Udan | ChooseWhat.com

If your company is bigger than two people, you should get a group medical plan. Group insurance gives you both personal and professional benefits over individual plans.

 
Why get a group medical plan?

• Keep yourself and your employees healthy.  You are a lot more likely to go to the doctor when you need to if you’re paying for a medical plan.  Staying healthy will keep you and your people in the office operating at maximum capacity.
• Stay competitive.  Good people are your biggest asset and you need to offer them competitive benefit packages, such that they might get from someone else who would hire them away.
• Get better coverage. Even if the cost is similar to an individual plan, the coverage is usually a lot better with a group medical plan.  The laws governing group medical plans don’t allow carriers to exclude coverage as liberally as they can with an individual plan.

Who qualifies for a group medical plan? 

Two or more people.

How much does it cost? 

The cost depends on the risk profile of your group.  When Leo and Gaines founded Zilker Ventures in 2007, they were two young, healthy single men, and their premium was less than $100 per month per person.  As the company grew and they added some young women (child-bearing age), married people and middle-aged men, the premiums increased significantly, but are still less than $300 per month per person.

How much does the company have to pay? 

The company pays at least 50% of the employee’s premium.  Most carriers offer plans for Employee Only, Employee + Spouse, Employee + Child or Employee + Family.  For any of the higher level plans, you still have to pay only 50% of the employee’s portion.  You don’t have to pay anything for dependents (spouse, child or family) if you don’t want to.  However, you can elect to pay more, which you might want to do to stay competitive. 

1. Assemble the necessary information.

   In order for you to get quotes for business insurance, you will need to have the following information readily available:

   • Your zip code
   • Number of employees enrolling in the plan
   • Desired insurance types (i.e. group health, vision, dental)
   • Date company started operating
   • Name of your business
   • Your SIC code
   • Personal information of employees, including dependents (e.g. date of birth, gender, number of children, etc.)
   • Your email address
   • Your phone number

2. Get group medical insurance quotes.
   
   

   • Search for Insurance Quotes Online
     
     
     • Advantages: You can do it yourself.  Some discount carriers may not work with insurance brokers, so contacting them yourself will be the only way to get a quote.
     • Disadvantages: Unless you’re an expert yourself, you don’t have anyone knowledgeable in your corner, advising you about what to do.
     • Where to Find Quotes: eHealthInsurance, a licensed health insurance agency, helps you compare over 10,000 plans from 180 top companies. Since they are a health insurance agency and not a health insurance company, they can offer plans from multiple insurance companies in your area.
       
       
   
   
   • Hire a Group Health Insurance Broker
     
     
     • Advantages: We strongly recommend getting a broker for your medical plan. Your broker will help you digest all the paperwork involved with getting an insurance plan. Your broker will also shop your policy every year to make sure you’re getting the best rate.  This is especially important with a group medical plan because the demographics of your group (e.g. marriage, divorce, child birth, average age of your group, group size) are constantly changing, which affects your rates.Your broker can deal directly with your employees and the insurance company to deal with coverage issues.   This means you won’t have to get involved in personal health issues with your employees.
     • Disadvantages: There are no real disadvantages to using an insurance broker. However, some discount carriers may not work with insurance brokers.
     • Where to Find Brokers:  Once you’ve narrowed your search down to a few insurance providers, you can usually contact the provider to work with one of their brokers. If you want to work with a local insurance broker, just do a quick Google search for “commercial insurance broker + your city” to find brokers in your area.

3. Sign up with an insurance provider and pay the premium.

   Typically, you must pay a monthly premium, but you can often receive discounts if you prepay.

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What to Look for When Hiring an Insurance Broker

• Good service.  You can sign up for a medical plan yourself, but you want to hire a broker that will provide you with the highest level of service. Check out the agent or broker handling your account and the back office resources available to that broker. You want to make sure that you your main point of contact is reliable and someone you want to work with. Make sure they have time to give you the attention you need and that they’re not operating on an island with no support. If possible, hire someone local. There will be times when it will be very helpful for your broker to drop by your office or meet face to face.
• The firm you’re dealing with is set up to handle your size business.  Different firms specialize in differently sized businesses.  A large company with a fully staffed HR department needs a different type of service than a 3-person sales office.
• Good reputation. Do your homework on the firm and the broker/agent’s reputation.
  -- Ask for and check references.
  -- Look online to see if anyone is talking about them.
  -- See if they’re members of the Better Business Bureau or other trade organizations, and look for any comments or reviews from those organizations.