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| Posted on: Monday, August 10, 2009 |
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Many Employers would like to offer limited medical insurance coverage to their non-benefit eligible Employees (part-time, seasonal, contract, entry-level, high turnover Employees, etc.) but typically the cost, network access, restricted eligibility, and/or underwriting guidelines have prevented Employers from offering this coverage. Some recent changes in the marketplace make these plans more viable. Several specialty Insurance Carriers have rolled out improved Limited-Benefit plans for those Employee’s who do not qualify for their Employer’s regular Medical plan.
Frequently Asked Questions
• What is the difference between a Limited-Benefit plan and an Employer’s
regular Medical Plan? Benefits are significantly reduced under the
Limited-Benefit plans and are subject to a variety of plan maximums by
type of care (i.e. Number of Office Visits, Maximum In-patient Care, Rx
Maximums, Annual Plan Benefit Maximum). The trade-off of a Limited-
Benefit plan is that it has substantially lower premium rates when
compared to the Employer’s regular Medical Plan.
• What do Limited-Benefit Plans typically cover? Most plans cover: Doctor’s
office visits, Out-patient and In-patient Care (Hospitalizations), Preventive
Care services and Prescriptions – all up to the Policy’s benefit
maximums (in total and by type of care) which typically range from $2,000
to $25,000 – each insurance carrier has specific policy provisions, so
refer to any specific benefit summaries for illustrative plan details.
• Do Employees have to use a certain network of physicians, hospitals and
pharmacies under the Limited-Benefit plans? Similar to regular Medical
Plans, Limited-Benefit plans have In-network and Out-of-network benefits,
and by using In-network providers and facilities Employees will have
greater benefits.
• Are Employers required to contribute towards the Limited-Benefit plan
premiums? Typically yes, anywhere from 25% to 100% of the Employee
Only premium rate. Generally the required percentage of Employer
contributions will decrease if more Employees enroll in the Limited-
Benefit plan. Every carrier differs depending on their underwriting
guidelines.
• How much will my Employees have to pay for the Limited-Benefit plan?
On average, weekly rates for these plans range from $10 to $45
depending on what medical and ancillary plans are selected by the
Employee.
• What other benefits could be offered to Employees through these Limited-
Benefit insurance carriers? Some Limited-Benefit insurance carriers
also offer Dental, Life/AD&D and Disability coverage for an additional
premium.
• Are the Limited-Benefit plans HIPAA and COBRA compliant? It depends
on how they are filed with the state Department of Insurance. If the
Limited-Benefit plan is compliant, this means that the plan would be
considered HIPAA creditable coverage and COBRA continuation coverage
would be offered.
• What are the eligibility requirements in order to offer a Limited-Benefit
plan? They vary by carrier, ranging from a minimum of three (3) enrolled
Employees to 25% of Employees who fall into a Class eligible for the
program.
Should you have any additional employee benefit questions or would like to discuss this material in detail, please don’t hesitate to call the Denman Team. |
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