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All You Need to Know About Group Health Insurance for Your Business

A group health insurance plan offers coverage to employees of a company and is much cheaper compared to individual health insurance. However small businesses tend to shy away from offering such plans due to lack of understanding of resources.

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In today’s blog post, we will be going over group health insurance for small businesses and discussing why this type of health insurance plan is important.

What is Group Health Insurance?

Group health insurance is a health insurance plan which covers a group of employees in an organization or company. Unlike individual health insurance, in which one would purchase the plan themselves, employers purchase the plans and then offer them to the employees.

One primary benefit of group health insurance is that plans usually cost considerably less than its individual counterpart, as risks on behalf of the insurer spread over the entire group. Moreover, plans may also be able to provide superior coverage to individual health insurance.

Among the superior coverage granted by is its ability to cover pre-existing conditions, something individual health insurance plans generally don’t cover.

Benefits

Below are the three typical options businesses have when selecting group health insurance benefits:

  • Basic Benefits: The basic benefits include coverage for inpatient and outpatient care. Inpatient care refers to whenever an employee needs overnight hospitalization, while outpatient care refers to cases when employees don’t need overnight hospitalization. 
  • Middle-Cost Benefits: Serving as additions to the basic benefits, the middle cost benefits cover dental, vision, maternity, or fertility care. However, with these additions, the cost of the overall group health insurance package can also increase.
  • High-Cost Benefits: Known as a comprehensive plan, high-cost benefits cover a wide range of treatments and can include preventative healthcare such as wellness programs. As such, high-cost benefits are the most expensive.

Cost

The exact cost of your selected group health insurance plan will depend on certain factors such as the type of occupation, number of insured employees, or the covered geographical area. Below are common factors that could contribute to the cost:

  • Number of Insured Employees: The larger the number of insured employees, the lower the premium. Companies with 50 employees or less will not be able to negotiate premiums with their insurance companies. 
  • Insured Employees’ Age: The younger the employees, the lower the premiums, while older employees involve higher premiums due to dealing with ongoing health issues.
  • Insured Employees’ Gender: If a business mostly consists of women in their 20s or 30s, coverage may be higher due to their need for maternity care.
  • Type of Business: Certain businesses, such as construction work, forestry, or paramedics have higher risk of injuries, will have higher costs. Meanwhile, low-injury risk businesses such as web design or banking will cost less.
  • Employer’s Claims History: The employer’s past claims is one way insurance companies can predict future claims costs based on factors such as ongoing large claims or prescription drug claims.
  • Covered Geographical Area: The cost of your selected plan will also vary depending on the geographical location of your business.
  • Level of Benefits: As mentioned before, higher tier benefit options such as mid or high-level benefits will cost more due to additional benefits on top of basic inpatient and outpatient care.

Why Group Health Insurance for Small Businesses Matter

Incorporating a group health insurance plan will grant small businesses a multitude of benefits. First off, your business will be able to stand out among competitors, allowing you to attract and retain talent. This will also prove to be substantially cost-effective for your small business.

Furthermore, as your employees’ health outcomes improve thanks to access to quality healthcare, you also lower the rate of health-related work absences and productivity deficiency. Thus, employees would take less sick leaves and become more productive at work.

The Path to Success for Group Health Insurance for Small Businesses

Beyond the benefits to group health insurance plans, it’s important to measure the success of your selected plans upon implementation while ensuring they meet the unique healthcare needs of your employees.

Aside from the number of employees covered and the demographics, it’s also important to consider the employees’ dependants, loss ratio, average claims per employee, and the insurer’s claims processing and response time.

Conclusion

In conclusion, group health insurance can offer superior benefits to individual health insurance and can play a pivotal role in both attracting and retaining talent for small businesses.

From benefits such as inpatient and outpatient care to additions such as dental or maternity coverage, employers can ensure their employees’ voices are not only heard, but that their unique healthcare needs are equally met.

As a leading international health insurance broker and employee benefits specialist, Pacific Prime has not only 20 years in matching both expats and locals to their health insurance plan of choice, but also offering advice on employee benefits to ensure all employees’ voices are heard.

If you have any further questions, whether it’s about finding the right health insurance plan or employee benefits solutions, don’t hesitate to get in touch with us.

Content Writer at Pacific Prime Thailand
Wish Sutthatothon (Nickname: Guy) is currently a content writer at Pacific Prime Thailand, an insurance broker that connects individuals and businesses with insurance providers worldwide. He creates and edits blog articles, guides, reports, webpages, and other types of digital content.

He graduated with a Bachelor’s Degree in Communication Arts, Media & Communication major (concentration: Creative Content) from Mahidol University International College (MUIC). During the compulsory major elective period in the summer of 2021 and voluntarily during the summer of 2022, he also interned as a video and photo editor at Mbrella Films.

He has experience working as an English Content Writer at a real estate buying/renting/selling platform in Thonglor. There, he crafted company blog posts on a multitude of topics. Topics include market trends, legal issues and disputes in property businesses, financial guides, expat guides, home insurance, home decoration and maintenance, and weekly real estate news quick-recaps. Occasionally, as part of the blog-writing process, he would also translate existing Thai blogs to English.

In his free time, Guy enjoys doing scriptwriting and storytelling for comic strips, watching movies, and listening to music (particularly film scores).