Florida Group Health Insurance

Florida group health insurance plan premiums have been going up at unprecedented rates each year. It doesn't appear that this trend will change any time soon. To control premium increases and still be able to provide quality health care to their employees, businesses will need to embrace creative solutions to the group health insurance problem.

This site will highlight some of those solutions and start you on your way to controlling group health insurance costs.

Why do Florida group health insurance plans cost so much?

Groups of less than 51 - Florida group health insurance is sold on a guaranteed to issue basis when the group size is 50 or less. This means that coverage cannot be denied regardless of the health of the group. Needless to say, this makes the underwriters very unhappy and many companies do not participate in this market. Those that do sell products in the small Florida group health insurance market have been raising rates at an alarming rate. Clearly, the rise in insurance rates have outpaced the rise in health care costs. It is a systemic problem that goes far beyond the scope of this web site.

Currently, there are not many choices for the small Florida group health insurance shopper. There are only a handful of carriers in this market and none of them can be considered a bargain. If you have less than 4 employees you are going to have a hard time finding an agent. The insurance agents compensation for groups of less than 4 would not even pay for a dinner in a good restaurant. To accommodate existing clients, some agents will go through the paperwork for groupd of 2 or 3. If you have a group of three employees and are having a problem finding an agent who will help you find and write a group of three employees, give us a call. We will help you. Our number is 800-986-4786.

Individual plans for small groups - One popular Florida group health insurance trend is to pay each employee a little extra, give them a name of a Florida health insurance agent, and wish them luck. With few exceptions, individual insurance cannot be paid with a company check. The problem is that if any employee has a medical problem that makes them uninsurable, they are out of luck and will not be able to obtain insurance. Nevertheless, this is the most cost effective insurance.

Health Reimbursement Accounts (HRA) - An HRA is an arrangement through which an individual health care
reimbursement account is set up with a fixed annual amount for each covered employee. These accounts are similar to a health care flexible spending account (FSA) because employees can submit their out of pocket medical expenses and get reimbursed from the accounts. However, there’s a significant difference. An FSA is funded with the employee’s money that is set aside on a pre-tax basis, while HRAs must be funded solely by the employer. Contributions an employer makes to the employees’ HRA accounts are tax deductible and if some relatively straight-forward rules are satisfied, any reimbursements from the accounts are nontaxable to the employees.

Any unspent money in an HRA at year-end can be carried forward from year to year until it is needed (even if the employee retires or leaves the company in the mean time). With an FSA, if an employee misjudges how much to put in the account and has some left over at year-end, the excess reverts back to the employer.

At this point, you may be wondering, why would an employer who currently offers an FSA (that’s funded by employee contributions) want to switch to or add on HRA accounts (that must be funded solely by the employer)? The key is what comes with the HRA.

Employers who are setting up HRA accounts are also switching to high deductible major medical plans. For example, let’s say the plan has a $2,000 deductible for singles and a $4,000 combined deductible for a family. An employer might put $1,000 annually into an HRA for someone who had employee-only coverage and $2,000 annually for someone with family coverage. The idea is that an employer’s savings from switching to a high deductible plan will more than offset the cost of setting up the HRA accounts. If this works, the employer saves money.

Employees can also come out ahead with the combination of an HRA and a high deductible plan if their total expenses for the year are less than what their employer puts in their HRA account. They’re allowed to bank the excess and carry it over to a future year. In fact, this result is touted as one of the big benefits of HRAs. It is supposed to give employees a greater incentive to make cost-effective decisions when they purchase health care services because if they exceed their HRA account balance, the next layer of medical expense comes straight out of their pocket. Thus, the bottom line is HRA accounts have the potential to save employer’s money and perhaps help rein in health care inflation by making employees better health care consumers.

The tax consequences and the proper setting up of this arrangement is not to be handled by the joker who sits in your living room trying to get a check out of you. This should be done by a very competent agent. Use the link at the top left hand corner of this page to contact a Florida group health insurance specialists.

Medical Expense Plans for small groups - Medical expense plans can be used as Florida group health insurance plans. They use a schedule to determine how much they will pay out for each medical expense. For example, they might pay $500 for each day in the hospital or reimburse the insured $50 for a certain number of physician visits. The benefits vary from plan to plan. We have plans that will cover up to $1000 a day for hospitalization, doctor visits, prescriptions, etc. A Florida group health insurance specialist can stack these plans and create a more robust plan that could in many instances substitute for a traditional health insurance plan at much less cost.

If you want an inexpensive Florida group health insurance plan this might be your answer. Unfortunately, the best plans of this type require a group size of 51+. However, nursing homes, manufacturing and other industries where cost is a factor can utilize these plans.

Excess Loss Coverage - A "Wrap Around"

The secret of low cost Florida group health insurance is the creative use of a combination of plans. A medical expense plan will cover the majority of routine medical expenses. A pharmacy benefit manager can be employed to construct a custom prescription plan. The excess loss plan will pick up expenses at a predetermined level to protect the employer and employee from catastrophic loss. The total cost will usually be 30-60% lower than traditional group plans.

This type of plan is amazingly effective with groups of 50 or more employees. It cuts the employer away from the never-ending premium increases. The underlying plans used to implement a medical expense plan rarely has any increase in premium.

Using Temporary Insurance for Small Groups - Temporary insurance can be used for small Florida group health insurance plans. These plans can be held for as long as three years before the insured must prove insurability. They are low in cost, permit the use of any medical provider, have more lenient underwriting than traditional individual plans and can be paid for with a company check. They can be enhanced with standalone Rx plans and PPO networks for a very small additional cost. Plus, there are no restrictions in regard to reimbursing an employee for this expense.

The Future

Many of the Florida group health insurance carriers are coming out with higher deductible plans. By using flexible spending accounts and health reimbursement accounts the employer is shifting some of the responsibility of health care to the employee. The day of the low copay for all health expenses is rapidly coming to a close. It will take some time before the employee accepts the inevitability of this change.