Traditional Group
Benefit Plans
- Cost Predictability
- Comprehensive Coverage
- Reduced Administrative Burden
Review Your Options with a Benefit Specialist
Key Benefits
Offers a straightforward structure that enhances employee understanding of benefits, ensuring they can easily navigate their coverage and maximize their health resources effectively.
Provides clients with security, ensuring their coverage remains intact as long as premiums are paid. This feature minimizes disruptions, allowing businesses to maintain consistent benefits for employees.
Provide consistent coverage across your organization, simplifying administration. This ensures all employees in a division receive the same level of essential services, promoting fairness and clarity.
What is a Traditional plan
A Fully Insured Group Benefit Plan is a traditional approach where the insurance company assumes full responsibility for managing employee claims and risk. This plan provides your business with predictable costs and minimal administrative tasks.
Questions on Your Mind?
Looking for same-day answers? Email us or schedule a call with one of our benefits specialists.
Comparison Chart
| Traditional | ASO | Hybrid | |
|---|---|---|---|
| Cost Predictability | |||
| Cost Predictability | Fixed premiums, predictable costs. | Variable costs based on claims. | Mix of fixed premiums and variable costs. |
| Financial Risk | |||
| Financial Risk | Low, insurer covers claims. | Highest, employer covers claims. | Shared, with capped risk. |
| Plan Flexibility | |||
| Plan Flexibility | Limited, insurer-defined | High, customizable options | Moderate, with flexible HSA |
| Administration | |||
| Administration | Minimal employer involvement. | Higher, employer-managed claims. | Moderate, mix of insured and HCSA options. |
| Best suited for | |||
| Best suited for | Small to Mid | Mid to large | All |
| Renewal Process | |||
| Renewal Process | At times unpredictable | Mid transparency | Could provide highest control over rates |
Best suited for
Small and Medium-Sized Businesses that prioritize simplicity and budget predictability. Ideal for companies with limited resources for managing complex benefit plans.
Traditional benefit packages include
Drugs
Antibiotics, narcotics, creams, etc.
Treatment
Teeth cleaning, braces, crowns, etc.
Expenses
Physiotherapy, massage therapists, chiropractic care, etc
Care
Glasses, contact lenses, eye exams, etc.
Equipment
Crutches, nebulizers, CPAP machines, etc.
Medical
Emergency medical expenses
Spending Account
Flexible allowance for additional health-related needs
Coverage
Disability Insurance, Term & Permanent Life Insurance
Upgrades
Semi-private or private rooms
Custom orthopedic shoes and compression socks, etc.
Why Is a Group Plan Important
Implementing a group benefit plan is essential for attracting and retaining top talent. It shows a company’s commitment to employee well-being, enhances job satisfaction, and promotes loyalty. A well-structured plan can also increase productivity by ensuring employees have access to necessary health services, ultimately reducing absenteeism.
By offering comprehensive benefits, companies can position themselves as competitive employers in the job market and build a positive workplace culture. In the end, investing in a group benefit plan contributes to a healthier, more engaged workforce.
FAQ
What are the advantages and disadvantages of a traditional group benefit plan?
Advantages: Traditional group benefit plans offer predictable costs with fixed premiums, and the coverage is standardized across employees. They also provide employees with essential health and financial security benefits at a lower cost than individual plans.
Disadvantages: The coverage is less flexible, with little room for customization. Additionally, premiums can be expensive for employers, especially for larger groups, and the plan may not fully meet the specific needs of all employees.
What are the eligibility requirements for employees to join a traditional group benefit plan?
Eligibility typically depends on factors such as employment status (full-time or part-time), length of service, and probation periods. Employers set these criteria, and employees must meet them to participate in the plan.
How do premiums and cost-sharing work in a traditional plan?
The employer often shares the cost of the premiums with employees, where the employer may cover a portion (e.g., 50-100%) and the employee pays the remaining balance through payroll deductions.
Are pre-existing conditions covered under a traditional group benefit plan?
Most traditional group plans do cover pre-existing conditions, but the extent of the coverage can vary based on the policy and provider.
How does claiming and reimbursement work for covered services?
Employees usually submit claims to the insurer for reimbursement or use a direct billing system. The coverage percentage (e.g., 80% of eligible expenses) and maximum amounts will affect how much they are reimbursed.