Finding the Right Coverage

To help you choose which health insurance policy best fits the needs of your employees and your business' financial needs, here are some important factors to consider:

The cost of your small group health insurance.

The premium rates an insurer can charge a small business are set in a range by Wisconsin law for employers offering plans which have similar "case characteristics" and with the same "benefits design characteristics."

Case characteristics include the age and sex of employees, the geographic location and other objective information which insurers use to determine rates.

Case characteristics do not include loss or claims history, health status, occupation of the group, or how long the policy has been in force.

Benefits design characteristics refers to the medical services covered under the plan, the deductibles and copayments, the managed care, or utilization review aspects of the plan, and other features included in the plan.

The specific benefits design you select.

  • The level of the deductible. A general rule of thumb: the higher the deductible, the lower the premiums. (The deductible is the amount the employee must pay out-of-pocket before payments from the insurance company begin.) Typical deductibles might range from $50 to $250, though there are some policies with much higher deductibles (e.g., $1,000 to $5,000) for "catastrophic" coverage.
  • The copay amounts. Copays are the out-of-pocket amount the employee must pay towards a doctor visit or medical services. Selecting a PPP or POS health plan with higher copayments can reduce premiums.
  • The lifetime medical coverage. This is the maximum amount covered by the health insurance policy per individual over the course of his/her life. At least $1 million is often recommended to cover serious illness.
  • Maximum out-of-pocket limit. Many plans have a cap—a maximum limit on the amount of out-of-pocket expense that an employee is expected to pay for health care in each calendar year.
  • Other health coverage. You will also need to decide if you want to choose a health insurance plan with prescription drug benefits; some include dental insurance benefits. Note that every benefit you add will raise the cost of your premiums.

The amount of health insurance costs you transfer to your employees.

Most small employers ask their employees to contribute toward a portion of the cost of their health insurance premiums for themselves and their dependents.

Educate your employees about your health plan coverage and health care.

The more they understand exactly what is—and what is not—covered and follow the right procedures, the better you'll be able to manage your premiums.

Be sure your employees understand provisions in your plan that pertain to the need for pre-admission certification before entering a hospital or using an emergency room.

Encourage employees to ask their doctors about fees and the cost of procedures and to check their doctor and hospital bills to be sure there are no errors. When appropriate, they should seek second opinions before complicated or expensive procedures or surgery.

Encourage employees to engage in healthy habits. Provide information about exercise, weight loss, smoking cessation, etc.

Fake Health Insurance Plans

In the last several years unlicensed insurance companies have attempted to sell fake health insurance plans in Wisconsin. These plans falsely claimed to be affiliated with well known insurers, to be self-funded employer plans or union plans.

According to Wisconsin law, with very few exceptions, no insurance product can be sold by individual agents, brokers or insurance companies without the approval of the Office of the Commissioner of Insurance (OCI). Fake insurance is any insurance plan that is intended to defraud consumers or businesses.

All insurance agents and companies doing business in Wisconsin are licensed by the OCI. Before you sign up for any insurance plan verify that the company is legitimate and that the agent and the company are properly licensed to do business in Wisconsin. To find out if an agent or company is licensed you can call toll-free 1-800-236-8517 or you can use the agent and company lookups on OCI's Web site at http://oci.wi.gov.