Paying For Individual Health Plans For Employees

Health Plans — Tags: , , , , — admin @ 10:23 pm

Many employers in California do not grasp that paying for employee’s individual health indemnity policies presents many problems. There can be liability for the employer in doing so. Let’s look at the implications and know why providing Small Group health indemnity to your California employees is vital.

Initially, we need to know the differences between Small Group health or employer sponsored health indemnity and individual/family or private indemnity. Small Group is practically uncommon in a few key ways. Initially, it is governed by California law AB 1672. Among many provisions set forth in AB 1672, Small Group coverage is guaranteed issue to qualified small companies with 2-50 employees. This means that a person with a legitimate employer-employee relationship (can be full or part-time depending on group preference) cannot be declined due to health.

Individual/Family health indemnity is practically uncommon in this respect. Individuals must be eligible based on health in a process called medical underwriting. They can be declined coverage have tariff increased based on their health history or status. This difference in medical qualification is a huge issue for small groups that pay for individual health indemnity plans for their employees if the group is eligible or competent of providing group health. If an employee is declined coverage and/or suffers a major medical bill, he/she can go after the employer saying that the employer should have sponsored a qualified (guaranteed issue) group health plot. This assumes that the employer met the requirements under AB 1672 to offer such a plot. As an employer, you also do not want to know too much about an employee’s health status. If you need to let the employee go, there can be issues in knowing that they were declined individual health indemnity. Keep a excellent separation from this knowledge to avoid issues in hiring/firing.

Employers usually offer individual plans based on cost but the difference hardly justifies this exposure to liability. In California, the employer can pay as small as 50% of the employees health indemnity premium and with options such as Employee Elect through Anthem Blue Cross, an employer can now offer a full range of plans to each employee with a fixed role (dollar amount or a percentage of a given plot).

The other main issue deals with the tax treatment of employers paying for employee’s individual health plans. Officially, only a qualified group plot premium for employees can be deducted as a business expense. Paying for individual health plans generally cannot be deducted. Make sure to run your companionship’s circumstances by a tax professional but this is a major drawback for paying for individual health plans.

In summary, with all the options, both from a plot and cost perspective, on the market, small group health indemnity makes the most sense. Run your instant quote and please let us know how we can help investigate your Small Group health indemnity options. It is vital to avoid the liability of employees not qualifying for individual health plans due to health history and to make sure you take advantage of the tax benefits associated with paying for be eligible Group health plans.  

Dennis Jarvis is a licensed California group health indemnity broker with extensive knowledge of the Small Group health market in California.

Mental Health Insurance And Health Plan

Health Plans — Tags: , , , — admin @ 7:19 am

There are many facets to the planet of mental health, especially when it comes to health indemnity and finding adequate coverage for a variety of afflictions and disorders. We’ve place together some answers to some of the more common questions rotating around these topics for you not more than.

Do most health plans include mental health coverage? The answer, simply place, is yes. The vast majority of insurers and health plans cover at least a limited amount of mental health care.

According to a recent employer survey in print in the journal Health Contact:
•91 percent of small firms (10-499 employees) and 99 percent of large firms offer mental health and substance abuse coverage in their most used medical plans.
•Mental health and substance abuse coverage was included in 87 percent of indemnity plans, 88 percent of HMOs, 97 percent of Point of Service (POS) plans and 93 percent of Preferred Provider Organizations (PPOs).

It is commonly acknowledged today, in 2006, that most employees who have employer-based health indemnity have access to mental health coverage, and many of the employees who don’t have coverage have simply chosen not to join an employer’s plot that includes mental health services.

Does mental health coverage cost more? Yes, this is generally the case. There are limits to mental health coverage and the reason why most employers impose limits is due to cost. Estimates vary widely of how much more mental health coverage costs. Here are some results from some studies:

•A 1998 study sponsored by Inhabitant Advisory Mental Health Council (NAMHC) Parity Workgroup, a division of the federal Inhabitant Institute of Mental Health, estimated that mental health services would add less than 1 percent to the cost of a health indemnity policy for an HMO.

•A 1998 study by Mathematica estimated a 3.6 percent increase crosswise all plans, with a range of 0.6 percent increase for HMOs up to a 5 percent increase for fee-for-service plans.

•A 1997 analysis by the actuarial firm Milliman & Robertson for the Inhabitant Focal point for Policy Analysis, examining the cost of a predictable mental health mandate (not specific legislation), concluded that mental health services parity legislation tends to drive up costs by 5 percent to 10 percent.

With regard to mental indemnity in general, how do indemnity companies treat mental illness? Indemnity companies tend to be somewhat wary of mental health claims due to the increase of fraudulent claims. When Medicare looked for fraud in the community mental health centers last year, it barred 80 of them in nine states from participating in the curriculum.

The Health Care Financing Administration (HCFA), which administers Medicare, knew something was amiss when the average yearly cost for each senior getting mental health services jumped from $1,642 in 1993 to more than $10,000 by 1997.

Medicare administrator Nancy-Ann DeParle contended at the time that 90 percent of the patients had no mental illness honest enough to be eligible for special treatment.

That being said, it’s straightforward to know why there is trepidation on the part of health indemnity providers.

What mental conditions are typically covered, and not covered by health plans? Generally speaking, a health plot pays for only those services included in the procedure list of covered services. In the case of mental health services, inpatient and outpatient treatment are most often covered by health plans.

But, there is a continuum of services between inpatient (mental health clinic) and outpatient care that effectively treat many mental disorders and are often more cost-effective than inpatient care at a mental health clinic.

These intermediate services include nonhospital residential services, partial hospitalization services, and intensive outpatient services such as case management and psychosocial rehabilitation. Psychosocial rehabilitation includes pharmacologic treatment, social skills training, and vocational rehabilitation.

Such services are covered by approximately half of employer-sponsored health plans.
Prescriptions. Are they covered? Coverage of prescription medications is also vital in providing access to treatment for mental health disorders. And, on a positive note, Prescription medications are nearly always covered by health plans (U.S. Department of Labor, 1996; 1998), but this coverage is sometimes limited by formulary restrictions.

Check with your healthcare provider for the exact fine points on what applies to you and your family with regard to your specific circumstances.

Kurt Stammberger is VP, Marketing at Healthia Inc. Healthia provides integrated comparison-shopping information on health care products and services, doctors and health indemnity plans to empower the drive towards Consumer-Driven Health Care.

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