Tips for Selecting an HSA Health Plan for Your Business
Steps
to identifying and choosing a high-deductible health plan include:
-
Know the qualification rules for a high-deductible health
plan.
- Ask others (insurance agent, colleagues, associations, etc.)
for recommendations and referrals to brokers and health insurance
providers.
- Be
aware that health insurance regulations vary by state;
find out your
state’s regulations.
- Checkout
the insurance provider and broker for service quality and
licensing.
- Consider
using a smaller firm, where your business will make a difference
to their business.
- Have
insurance data of current health plan available (total cost,
employee data such as health,
age, gender,
residency).
- Consider
the cost of a plan as an individual or group (a “pool” of
individuals/businesses).
- Call
vendors and ask if they offer any HSA-qualified high-deductible
coverage plans; mention
you are reviewing health insurance
providers, and would like to see what they can present. Also,
explore and
use online insurance brokers.
- Fill out the insurance application form completely and accurately,
noting pre-existing conditions, age, gender, and residency.
- Use
at least three vendors and get at least three competitive
bids for high-deductible policies. It is important to get
each bid broken down into inclusions and exclusions, for
comparison.
Note: HSAs cannot be initiated unless a high-deductible health
plan is already is place.
Additional Considerations
Know qualification rules for a high-deductible health plan:
Deductible minimums of $1,000 for an individual, or $2,000
for a family plan.
Out-of-pocket
maximums not to exceed $5,000 for individuals, or $10,000 for
families.
No
co-pays allowed (no "first dollar" coverage)
until after the minimum deductible amount has been met (no “first
dollar” coverage at all after Jan.1, 2006). Checkout agents for licensing and certification, they should
have a professional designation, such as Registered Health Underwriter
(RHU) or Registered Employee Benefits Consultant (REBC), or hold
membership in the National Association of Health Insurance Agents
(AHIA) or National Association of Insurance and Financial Advisors
(NAIFA).
To
know with whom you are dealing, use rating services, such as
A.M.
Best (www.ambest.com) and NCQA (www.ncqa.org) that monitor
customer satisfaction with insurance providers. Check with state
licensing agencies for proof of a broker’s/agent’s
current license.
Cost
of health insurance is often higher for smaller businesses.
Consider
joining a “pool’ with others to lower costs.
Trade associations, local business groups, state and local governments
may offer you the chance to join a "pool” with others.
Check to insure this is advantageous for your business.
Fill out the insurance application form completely and accurately,
if any applications are incomplete or inaccurate, the company
may either refuse to pay your claims or cancel your policy.
Get the details, ask insurance providers to provide you with:
- Premium
schedule (dates premium payments are due)
- Benefits
schedule (detailed list of what is or is not covered)
- Premium
rates and ALL applicable administrative fees
(monthly and setup fees)
- Copy
of a sample agreement and application form (to review before
you sign up)
- Checkable
references from other clients with similar needs
Be aware of the most overlooked aspect when selecting a company
health plan Guarantee of Renewal. This means that the insurer
will not be able to, at a whim, cancel your policy, as long
as you continue to pay the premiums on time. If possible, also
get a cap on percentage increases over the first three years.
Get this in writing.
Other considerations: Befoe
you sign on the dotted line…READ the policy. Have
someone else look at it. Make sure you're getting what you asked
for.
Key
Financial Considerations for Any Policy Plan
-
Cost of premium(s) on monthly basis for the year.
- Amount
of deductible for year.
- Maximum
Lifetime Benefit amount for life of the policyholder.
- Exclusion
of preventative care from deductible amounts.
- Discounts
for use of in-network services or doctors.
- Additional
costs for desirable options (i.e. maternity, prescription
drug benefits).
- Guaranteed
of renewal.
- Reasonable
assurance of insurer's financial stability and ability to
pay claims.
- Insurer's
reputation for good customer service and rapid response to
questions
when they arise.
Good
rules of thumb to keep in mind when choosing a vendor:
-
Companies with good reputations generally earn them and
try to keep that reputation.
- Capping
expenses for the next three years is more important than
the cheapest
rate this year.
- Providing
quality health care is still the main objective and should
be kept in mind at all times.
- Keeping
on top of your health care program can make a difference
in your employee morale.
Health Insurance Checklist
Good plans should cover:
- Inpatient
hospital services
- Outpatient
surgery
- Emergency
services
- Physician
visits (in the hospital)
- Office
visits
- Care
by specialists
- Skilled
nursing care
- Medical
tests and X-rays
- Preventive
care and checkups
Good plans may or may not cover these options:
- Prescription
drugs
- Mental
health care
- Drug
and alcohol abuse treatment
- Home
health-care visits
- Rehabilitation
facility care
- Physical
therapy
- Hospice
care
- Maternity
care
- Chiropractic
care
- Alternative
health care
- Well-baby
care
The best plans may waive the deductible for preventative care,
and effectively pay 100 percent of all costs for routine procedures,
such as annual physicals, age-appropriate cancer screenings,
pre-natal care, and required immunization for children covered
by the policy.
When you buy a policy, the first premium is usually due at the
time you sign the purchase agreement. Your check for will also
include monthly administrative fees, and perhaps an initial setup
fee as well.
Remember that direct agents, independent agents, and brokers
all get a commission on the policies they sell.
Tips for smaller businesses
Trade
associations, local business groups, state and local governments
may offer you the chance to join a "pool" of
businesses in a group plan; often these groups, because they
are larger, get better rates. If the group plan offers a qualifying
high-deductible policy, this may be a good route for your small
business. If your small business has three or more employees,
you can be your own "group," and usually get a
better rate than an individual would.
Be
aware that if you are self-employed and a sole proprietor,
a major insurance company may not actively seek your business.
You may be small commission to them – or you may
be, in their estimation, uninsurable. This is particularly
true
if you have not had a health insurance policy in force
within the last year.
Big
insurance companies generally charge smaller business more,
even for high-deductible policies. They may advertise
what
seem to be comparatively low rates, but their application
forms usually state that, upon reviewing your application,
they will
reserve the right to offer you a slightly different plan
at a higher premium cost. |
