If you’re weighing your options on what benefits to offer employees—the cost of group health insurance can leave you with a little sticker shock. The cost is high enough to at least make you question what the real value is of paying for this benefit. Let’s take a look at how different employees can use their group health coverage.
Large group health insurance plans are required to provide no-cost preventative care. There are generally limits, like one physical per year or one set of immunizations. But the actual cost to receive these preventative care services is covered 100% by the insurance policy with no need to meet the deductible.
Preventative health services cover a large range of screenings, treatments, and other interventions intended to prevent a serious illness or condition that might be detrimental to an individual’s health or costly to the insurance company. So, essentially, covering preventative care services works in the best interest of everyone.
These services go beyond an annual physical. For youth, they might include fluoride treatments at the dentist, STD screening for sexually active teens, or autism screening for developmental concerns during adolescence.
For women, preventative care can include birth control, STD screening, breast cancer screenings, and bone density tests to detect osteoporosis, among other things. And for all adults, preventative care includes things like alcohol abuse counseling, cholesterol screenings, diabetes screenings, and nutrition counseling.
Almost one-third (32%) of all working women are also juggling the demands of motherhood. That’s a significant slice of your workforce. When it comes to pregnancy and birth, it’s an expensive ordeal. For 40 weeks, pregnant women receive routine screenings and check-ups to monitor the health of their pregnancy.
Costs can vary widely by provider and region, but we’ll say that the average cost of a doctor’s visit is $150. During a healthy pregnancy, a female patient might have 12 prenatal appointments totaling $1,800 just to see a doctor. Plus, the average cost of an ultrasound at $1,500, and additional testing and screening add another $1,500 to the bill. When it’s all said and done, prenatal care can be $5K – $8K or more.
With a group health plan, the patient pays the deductible and co-insurance. On an 80/20 plan with a $1,500 deductible, the patient pays $2,200 on a $5,000 bill. And that’s before the baby even arrives.
Let’s pile on the cost of a typical delivery which can cost up to $30k depending on the type of delivery and where it’s at, as well as hospital care, and newborn care for expenses that can top $65k easily. With a group health plan, the patient doesn’t get stuck with a $65K bill though. They’ll pay to their plan maximum so if the same 80/20 plan is set at a $10k annual maximum and they already paid $2,200 in prenatal care, the patient pays $7,800 of that $65K medical bill.
There are 1.5 million new cases of Type 2 diabetes diagnosed in the US every year. Obesity is a pandemic that is contributing to the rising costs of healthcare. This chronic condition is responsible for increased absenteeism, lower productivity, and early mortality in addition to racking up staggering annual healthcare costs between $9k and $16k per patient. Group health insurance is the only way that healthcare services for chronic conditions are affordable for the average worker.
Depression and anxiety-related disorders are on the rise. And the stress of the COVID-19 pandemic has only intensified mental health concerns. Your group health insurance provides access to essential treatments that can keep your workforce happy, healthy, and productive. These benefits extend to substance abuse interventions which are a big part of the estimated $44 billion that employers lose every year due to the mental health of their employees.
Even as healthcare and insurance costs continue to rise, the potential benefits of providing group health extend far beyond the dollars and cents. There are many intangible benefits like worker productivity and good-will towards their employers that simply cannot be measured in the same terms. While the Affordable Care Act mandates group health coverage for employers with 51 or more employees, it’s a great investment for companies of all sizes.
Access to quality healthcare is directly tied to the productivity of your company. Healthy employees work harder and miss work less often. Plus, the financial benefit of group health insurance is significant. If you’re measuring the cost of premiums against the potential expenses, insurance is an easy choice. Your employees will view you as a favorable employer for providing them with a benefit that helps them financially. So, in a word, yes—it’s well worth the cost to provide group health insurance as a benefit and your company is getting as much out of it as your employees are.
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