Insurance Broker and Employee Benefits in Massachusetts

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Group Health Insurance

There are several plans available in Massachusetts: Health Maintenance Organizations (HMO's), Preferred Provider Organizations (PPO's), Partial Self-Funding, Access plan, HSA plans, and now tired and limited network plans.

HMO's, such as Blue Cross Blue Shield, Fallon, Harvard Pilgrim, and Tufts, have certain distinctive features: preventative care, unlimited coverage, and an excellent list of doctors and hospitals. HMO’s include the need to choose a Primary Care Physician (PCP) and to stay within the plan's list of doctors and hospitals.

POS plans are offered by the aforementioned providers and a number of commercial carriers such as Aetna-USHealthcare. A POS plan offers the same "In Network" benefits as an HMO, coupled with an "Out of Network" feature that allows each employee to go to any doctor or hospital in the US, subject to a deductible and co-insurance. For example, you pay the first $250, and 20% of the next $5000 of medical expenses, thereafter you're covered at 100%.

PPO plans are provided by all of the above carriers. A PPO plan offers the same in-network benefits as the HMO, coupled with an out-of-network feature that allows each employee to go to any doctor or hospital in the United States, subject to a deductible and co-insurance. With a PPO, there is no need to choose a Primary Care Physician.

Partially Self-Funded plans are used by over 50% of companies in the United States that employ over 25 employees. Any of the plan designs listed above are available. A Partially Self-Funded plan has an individual deductible, determined by the employer. For example, the employer pays the first $10,000 of medical costs; the employer then purchases a "Specific Stop-Loss" policy that covers each individual employee for claims over the deductible ($10,000). The employer then purchases a second policy, called "Aggregate Stop-Loss" that limits the company's exposure to multiple sub-deductible claims, to a total dollar figure over a twelve-month period. These plans are extremely popular amongst larger businesses as they allow the employer to design the benefits and to receive management and cost information on a regular basis. The administration of these plans is handled by a Third Party Administrator and not by the employer directly.

The Insurance Partnership is a Massachusetts-based, government-funded plan designed to help lowly paid employees afford health insurance. It can be implemented alongside any "fully insured" health plan and can lower the cost for the qualifying employee. Recently, the Insurance Partnership has doubled the income requirements making the Partnership available to far more employers and employees. Further, the company receives a payment for each employee on the Insurance Partnership plan.

A Health Savings Account allows an employee and the employer to put money into an account to fund a high deductible health plan. If the HSA is not used, in a given year, it can be transferred to the next year. The money can be invested in CDs and mutual funds. Conceptually, the HSA gives the employee more of a vested interest in their health care expenses and provides an opportunity to reduce the rate of increase in health care costs for the employer.

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