Small Group Health Insurance
Many employers with fewer than 50 employees would love to offer their employees a choice of health plans, especially employers that ask employees to pay a portion of the health insurance premiums. We in California are fortunate to have several such plans available to the small business market.
The three major programs providing choice of plans to employees are: PacAdvantage, California Choice, and Blue Cross Elect. PacAdvantage (originally the HIPC) started in 1993 as a purchasing pool to bring a variety of insurers and plan designs to small employers. Employees may choose from a number of HMO carriers (including Kaiser and some regional carriers as well as many larger carriers) and a couple PPO and POS plan designs. Employers receive one bill listing the cost for each employee based on choice of plans.
California Choice, a marketing organization, started offering their program a couple years later using similar concepts: several HMO carriers and plan designs, along with the popular Blue Shield PPO plan designs that employees may choose from on one bill to the employer. Although their program does not include Kaiser, it may be written along side Kaiser, providing participation requirements are met.
Blue Cross Elect is a newer program offered by Blue Cross of California. If an employer chooses to offer Blue Cross Elect (and no other health carriers), employees may choose from six Blue Cross PPOs and two Blue Cross HMOs, depending on costs and needs.
Many employers use these plans in conjunction with Defined Benefit / Fixed Percentage premium arrangements and Section 125 Premium Only Plans (see articles on these subjects). These plans can help the employer control costs while giving the employees a wide choice of plans available. Employees choose to pay for plans with perceived richer benefits.
In addition to the above programs, several carriers will offer their plans in conjunction with another carrier, provided certain enrollment restrictions are met. Most often, Kaiser is permitted to be enrolled along with another HMO if each carrier gets a certain percent or number of enrollees.
Choice plans work for many, but certainly not all employers. Sometimes the overall cost is higher for choices. And these programs usually do not have good resources for out-of-state employees. Please call either Jean Strouf or Terri Carver at 619-668-5200 for more information on these plans.
