Small Business HMO
Aunt Bee couldn’t see throwing away $5 to go to the doctor, while Opie was happy to spend $.05 on a candy bar. Life may not be like it is on television, but even “The Andy Griffith Show” captured the real costs of what Americans once paid.
Today that same candy bar will cost you about $1, and that doctor’s visit will set you back $50 (the average out-of-pocket expense); but unlike in Aunt Bee’s day, we’re now required to have medical insurance, and it can be confusing for a lot of people. Imagine looking at insurance options and trying to differentiate between EPO (Exclusive Provider Organization), HMO (Health Maintenance Organization), POS (Point of Service), and PPO (Preferred Provider Organization).
The scarier reality for most Americans though, isn’t the available options, but the costs associated with insurance and who is providing that coverage (state/public health insurance vs private insurance vs employer sponsored health insurance). Did you know that small businesses in the US, with less than 50 employees, are not required to provide health care coverage? Did you also know that 23% of the US population over the age of 65 are still working, and plan to remain in the workforce until they are physically unable to work?
Evelyn recently passed away. She worked part-time for a small business well into her late ‘70s, and right up to her death. The company that she worked for did not provide health care benefits, and so she was on Medicaid. When Evelyn died, Medicaid took her house. She was a widow, and her children lost their case against the government.
According to Medicaid.gov: State Medicaid programs must recover certain Medicaid benefits paid on behalf of a Medicaid enrollee. For individuals age 55 or older, states are required to seek recovery of payments from the individual's estate for nursing facility services, home and community-based services, and related hospital and prescription drug services. States have the option to recover payments for all other Medicaid services provided to these individuals, except Medicare cost-sharing paid on behalf of Medicare Savings Program beneficiaries.
Could this have been avoided if Evelyn’s job offered employer sponsored health insurance? Yes, but could her employer afford it? There are rules and regulation that protect small businesses on what insurance companies can charge the owners of the company and their employees. Beginning in 2014, they may only vary premiums based on scope of coverage (individual vs. family), geography, tobacco use, wellness program participation and age. The latter is limited to a 3-to-1 ratio. Rating can no longer take into account gender, health status, occupation, genetic information or claims history. Deductibles can’t exceed $2,000 annually for individuals and $4,000 for families and cost-sharing can’t exceed limits for HSAs.
It won’t be $5, but it is worth looking into health insurance options for you and your employees. It is easy to browse, compare, and purchase insurance through SHOP (Small Business Health Options Program) through the HealthCare.gov website. If anything, it will at least help educate you on the costs of health care so that you can answer your employee’s questions next time they ask about benefits.
April Salsbury, MBA is a strategist, an analyst, an operational guru, a recognized leader and C-suite global healthcare executive with drive and focus for competitive markets. Co-host of The Business Forum Show and regular contributor to various business journals, she possess multi-functional and multi-national competencies with more than 15 years experience in business and healthcare. Her expertise is in invigorating revenue growth and infusing value of lean practices in growing companies through improvements to cash flow and operations management.
Fueling revenue, growth and profit, Salsbury & Co. is a consultancy firm focused on helping businesses and healthcare organizations achieve excellency. Our specialists have executive experience combined with deep functional expertise to provide our clients with services that drive real impact and results.
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