Many people stay in jobs they don’t love because they receive health insurance from that job. However, with ACA health care coverage now available, it is reasonable to ask yourself why you should stay in a job that isn’t doing anything for you when you could move on and purchase your own health care coverage. What is the difference between individual coverage and group coverage anyway?
Companies receive benefits known as business health care cost reduction. This is because they are generally buying coverage for a whole group of people at the same time. They can receive rates that are far superior to the ACA health insurance rates because they are essentially buying in bulk. The insurance companies offer them a discount compared to ACA individual health insurance, and that is why health care benefits are such a big deal for employees. Their employer often covers most or even all of the cost for them.
All of that said, you should know that ACA health insurance enrollment is something that many individuals find that they have to do anyway. They may leave a job, or they may be in between jobs at this time. Whatever the case may be, it is nice to know that individual plans exist via the ACA to help them out.
If you find yourself to be one of the 99% of full-time workers who are allowed medical benefits, knowing the difference between types of health insurance plans can be difficult. As an employer, knowing the difference is vital. If you are switching from group coverage to individual coverage, it’s important to educate yourself on what to expect. Benefits are cited by 50% of employees as one of the main reasons they stay with their employer, which mirrors their importance to employees. Let’s take a look at the fundamental contrasts between individual and group health insurance plans.
Group Health Plans:
- Provided to employees by employer or by an association to its members
- May allow you to choose which plan works best for you
- All or a portion of your monthly premium is covered.
- Premium is deducted from your paycheck
- Plan documents are provided by employer
- Provide educated answers for questions you may have
- Insurance bought on your own
- Not provided through an employer
- Freedom to shop for and choose a plan that offers needed coverage
- Individual is responsible for purchasing the plan and making monthly premium payments
- Responsible for handling all documents and managing coverage
Overall, the main contract between the two coverage plans is that one is employee-sponsored while the other is not. If you work for a large corporation, chances are that your benefits and options are going to vary from small business employee benefits packages.
The employee benefits covered by group plans may vary depending on how many employees there are. The Patient Protection and Affordable Care Act requires organizations employing more than 50 full-time employees to offer health benefits to all employees.
Do you have experience with group health insurance plans? Have you ever made a transition between the two types of coverage? Sound off in the comments below!