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HMO plans often cover medical needs
with low co payments. HMO
plans have increased over 10% annually the past 5 years. The trend
is physicians and hospitals are cutting back on the number
of HMOs they work with making it hard for an employer to
meet the needs of all employees.
PPO plans include deductibles, co insurance
and often co payments which increase out of pocket costs. Most PPO
plans have increased over 10% annually over the past 5 years.
Trend is for physicians to prefer PPO plans over HMO plans
because they have more freedom to practice medicine within
a PPO format.
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High Deductible Health Plans are PPO
plans. Once
the member meets the annual deductible they pay a percentage
of the bill up to an annual out of pocket maximum. Once
the maximum is reached the insurance plan pays 100% of all
covered medical costs. High Deductible PPO plans have
increased less than 10% annually over the past 5 years
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Budget Options for Business Owners
Business owners have a number of ways to economically manage the transition to these plans. With our clients we generally have the company offer to cover 100% of the cost of the high
deductible plan for employees only. Some employers also make a contribution
to the employee’s Health Saving Account which provides
a strong incentive for employees to move away from the HMO
plan. Each case is unique but employers can often budget
for this change as they see the insurance cost savings between
the HMO and the High Deductible Plan is 20% or more. The
employee makes a choice and can take the HMO plan if they pay
a portion of the insurance cost. Their share of the insurance
cost is usually the difference between the cost of the HMO
and the high deductible plan. Based on a financial analysis,
some employers only commit to fund the employee’s account
up to the plan deductible or a percentage of the deductible. Funding
is often done quarterly and employer’s may elect to offer
lower funding amounts after the first year. We can consult
with you to review your plan design options.
Sample Monthly Rates For Orange County, CA
| |
Ages
|
| |
Under 30 |
30-39 |
40-49 |
50-54 |
55-59 |
60-64 |
Employee |
$125 |
$175 |
$200 |
$300 |
$375 |
$ 465 |
Employee and Spouse |
$265 |
$350 |
$500 |
$600 |
$750 |
$ 925 |
Employee and Family |
$370 |
$480 |
$600 |
$800 |
$935 |
$1,170 |
