Lots of myths swirl around group and individual health insurance, but the truth is the breakdown of each is rather predictable. Simply put, group coverage is offered through an employer while individual coverage is procured on a personal basis.
Group vs. Individual Coverage: Understanding the Differences
What gets complicated is preconceived notions about each type of health insurance plan. One might think that individual coverage is better: it lets you customize your package to your needs and on your own schedule. While this may be true, it can also be much more expensive. Since group coverage is provided by your company, premiums are paid through salary deferrals on a pre-tax basis. And despite what you may think, group health insurance offers a broader selection of carriers: a solid ten offer group plans to employers across New Jersey. These plans do offer prescription copays, and depending on the size of your company and thus its group, the rate can be negotiable. To instill security, rates are guaranteed for a full twelve-month period. COBRA — the Consolidated Omnibus Budget Reconciliation Act — is also offered, which, as a health insurance program, allows eligible employees and their dependents the continued benefits of coverage in case that employee loses their job or experiences a work cut.
But what about individual coverage?
The insured, in this case, work directly with the carrier for individual health insurance plans and premiums are paid post-tax. There is also a more limited selection of carriers; just three remain in New Jersey that offer plans to individuals. These types of coverage also do not come with prescription plans, and rates are filled with the State meaning they are sadly not negotiable. Additionally, rates can change as frequently as every three months, once a quarter, and COBRA is not offered since this type of plan won’t come from an employer. This can affect not only you but your dependents.
With group coverage, sharing really is caring
In a group health insurance plan, your company can play with various options and offer more employees the healthcare they need. In need of a group plan but unsure of which to work with? These are not decisions to make hastily: the mean age of your employees, the frequency of their doctors visit, and the specific needs they have will all influence which plan you should embrace. Dawson Benefits can help you find a plan and then also be your conduit between the insurance company and your own.