Many employers are unfamiliar with the health insurance options available to them, and even fewer understand the benefits that come with establishing one. Group health insurance enables employers to offer coverage to groups of employees on a single health plan. Employers can choose policies depending on their needs, which might include making certain categories of employees eligible for health coverage.
There are numerous benefits that come with establishing a group health insurance plan. Among the most important, employees feel valued and respected by their employers, helping to improve satisfaction and even boosting retention rates. This helps employers cut costs and cultivate a more cohesive company culture.
Continue reading to learn more about group health insurance and the perks it can offer to employers.
The basics of group health insurance
Group health insurance is a type of employer-sponsored insurance plan that offers cover to members of a group. These plans tend to be cheaper for both the employer and each employee, as products are based on healthier demographics.
When they opt for a group health insurance plan, organisations will establish a plan and then offer coverage to each of their employees. Individuals are usually entitled to opt out of the plan, but group health insurance coverage tends to require a substantial participation rate. Beyond that requirement, companies can establish group health insurance with minimal numbers of employees. Costs, plan types, terms and conditions vary considerably across different plans, so very few of them are exactly alike.
The amount paid on the premium is usually split between the employer and staff members, so most employees can expect to pay significantly less for their insurance coverage than they would if they had their own insurance plan.
Types of employees covered under a group plan
If an organisation offers a group insurance plan to any of its full-time employees, it generally is obliged to offer the same coverage to all of those workers. Coverage options can be made available for part-time employees as well, though this depends largely on the employer and the plan itself. Under most corporate plans, coverage is extended through the employee to include spouses, dependents and even unmarried partners.
With the emergence of the so-called “gig economy,” contracted work is increasingly becoming the norm. Contractors are normally considered a different category than regular, full-time employees. Employers are not required to extend the same benefits — including health insurance — to contractors.
However, many insurance companies do allow employers to extend their corporate coverage to contractors, so it’s important to be aware of the specific terms of your coverage plan. Some employers establish plans that allow them to offer coverage to contractors, especially if they work full-time hours, to help create better cohesion and camaraderie within the company.
The benefits of group health insurance coverage
One of the main benefits of group plans is that premiums tend to be cheaper than individual health insurance. That’s because risk is spread out across a larger number of people who are at work and healthy, so even if one individual accrues high insurance costs, it won’t have a great effect on other members of the health plan.
Employees also benefit from cheaper premiums than individual plans, giving them more disposable income to invest in other priorities.
The advantages of group health insurance go beyond premium amounts. Employees want to feel valued by their employers. One of the best methods for doing so is to offer extensive health care coverage for them and their families at a fraction of the cost. Happy, healthy employees will be more productive at work, they’re less likely to leave your organisation in search of other opportunities, and they will miss fewer days due to illness. The long-term benefits for the organisation are enormous.
Group health insurance is not a common feature of employee benefit plans in Australia, but there’s little reason why it shouldn’t be. Some companies have realised the benefits of offering a group health plan, and this has made them stand out from their competitors and attract the best talent from among the labour pool.
If you’re ready to consider group health insurance for your company, you need the right partner on your side. As Australia’s leading independently-owned health insurance brokerage, our team at HICA is dedicated to helping you find the right coverage for your organisation’s situation.
With more than 35 years of experience in the corporate sector, you can feel comfortable and confident that our range of services will help you make an informed decision about your health coverage.
Contact us today for a free, no-obligation consultation and find out more about your options.