The Selection Process for the Type of Health Insurance for Staff in a Medium-Sized Company

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The selection process to making the most cost-effective and employee-friendly decision

Striking a desirable balance between cost and employee health benefits can be a difficult task for most employers. Indeed, it is often difficult to ascertain the correct healthcare package that addresses employee concerns, healthcare concerns and employer concerns. However, the most effective criteria for selecting a cost-effective and employee-friendly decision is to search for a healthcare insurance program that effectively meets employee needs at the best cost (GFIQ, 2012, p. 1). Employee needs are often at the center of this analysis because they dictate what the employer will look for (in the health insurance scheme). As a manager of a medium organization, employee needs will greatly inform the selection process for the right healthcare program. Unlike many large-scale organizations which prefer a group insurance program, a medium-sized organization would be best suited to take a health insurance policy that offers flexible benefits. Some crucial parameters to include in this process are the average age of the employees, the implication of work conditions on employees’ health and the basic needs of the employees.

Another important factor that has a significant bearing on the right type of health insurance program to take is the ‘cost’ element. It is important to ensure employees at the right cost because the welfare of the company (that pays for the healthcare program) also needs to be taken care of in the scheme. There is therefore no need to enroll in a very expensive health insurance program that will be difficult to finance. Several cost aspects need to be included in this analysis. For example, taxation dynamics play an important role in the determination of the right medical financing program. Comprehensively, the cost and benefit balance needs to be achieved throughout the selection process to find the right health insurance program that suits the organization.

Identification the information to make decision

Making the right decision for selecting the right health insurance program needs to be done, based on the right information. Having the right information ensures that the selection process is considerate to all stakeholders. Among the most important stakeholders are the employees and the organization that pays for the insurance. Ascertaining the right number of employees is an important piece of information to consider during the selection process. This information is ordinarily useful when determining the type of health insurance policies to consider (GFIQ, 2012, p. 1). For example, an organization with many employees would prefer a group policy while an organization with few employees would not.

The cost of health insurance would also be a useful piece of information for determining the right health insurance policy to take. The importance of this information is seen when determining the type of payment method to adopt. For example, if the cost of the health insurance program is cheap, the company can opt to pay for the scheme fully. However, if the costs are high, the company may opt to pay for the scheme partially (Berkowitz, 2010).

Information regarding the benefits to be enjoyed from taking the health insurance program will also be crucial in determining the right type of health insurance program. Different health insurance programs have unique benefits attached to them. For example, certain health insurance programs have added tax incentives which make them very attractive to employers. It is therefore also important to know this information to determine the right type of health insurance to take.

Discussion the ramifications of decision on employees

The ramifications for the health insurance decisions described above are mainly centered on the process of identifying the right health insurance program and the accrued benefits. This paper already shows that information pertaining to all stakeholders need to be collected and considered before the selection of the right health insurance program. Since it may take a lot of time to gather such information, a slow decision-making process is bound to be experienced. Therefore, as opposed to a simplified process of determining the right type of health insurance program, it would be crucial to ensure that all relevant information is collected before selecting the right type of health program. The slow-decision making process implies that employees have to wait a while longer before knowing which health insurance program they are enrolled in.

Evaluating the factors that influence selection of a package

If an employer considers the prospects of changing the employee benefits package, employees are supposed to be consulted because the entire process mainly affects the welfare of employees. As an employee, there are many factors to be considered during the reevaluation of the benefits package. Top among the factors informing this decision is the quality of healthcare offered within each package. Different insurance packages have different healthcare products which affect the quality of health services offered. It is therefore important to choose health packages that offer the best health services at the right costs (Berkowitz, 2010). Another factor that would influence the decision to choose the right medical package would be the range of benefits associated with each package. Some packages offer limited health benefits while others offer a wide range of health benefits. It is therefore desirable to go for packages that offer more health benefits.

Analysis of the Influences of Extent the Cost of the Program on Decision

As observed from previous sections of this paper, the cost is probably among the most vivid factors to consider before the selection of the right health insurance program. The cost of health insurance programs has a profound impact on the decision of selecting the right health insurance program. This analysis is especially true for employees because employees pay directly or indirectly for these health insurance costs (Berkowitz, 2010). The extent that costs affect the decision to take health insurance programs may be more profound than is ordinarily thought. For example, the mere decision of whether to take a health insurance program may be dictated by only one factor – cost. In organizations where health insurance is optional (for employees), the program cost has a strong influence on the decision to enroll in the healthcare program, or not.

Similarly, if the range of benefits to be accrued from the health insurance program is determined by cost, it would be easy to reduce the range of health benefits merely based on the cost of doing so. For example, if in-patient services are included in the health insurance package at an additional fee, it is very easy to exclude such services from the available range of medical benefits (if it is expensive).

Comprehensively, we can see that cost has a very profound impact on the decision to select the right healthcare package. Limitlessly, the cost has a profound impact on the range of benefits enjoyed from the health insurance package and the quality of healthcare services offered by the program. Therefore, it can be assumed that cost is the single most influential determinant for the selection of the right type of medical package.

Explaining possible alternatives if you choose not to participate in the benefits package for the upcoming year

It is common knowledge that health insurance is partly exclusive, based on different socio-economic parameters. Since this situation prevails, it is often important to consider other available options for health insurance for people who have not been enrolled in any health insurance program. Among the many alternatives that can be pursued is the medical sharing program (SCORE, 2002, p. 4). Under this proposal, members are supposed to contribute towards meeting the healthcare costs of an uncovered member (and his or her dependents). The payments are often made monthly but unlike conventional health insurance, the payments made are not regular throughout the year. Here, a membership fee may be required and an annual maintenance fee may also be sought from the members (SCORE, 2002, p. 4).

Another alternative that can be pursued if conventional health insurance is not an option is the consumer health alliance program. This program was launched in the early 2000s with the aim of helping uncovered employees to access healthcare services without the assistance of their employers (Hill, 2012, p. 2). In the scheme, members are issued discounted membership cards which are supposed to guarantee them free access to healthcare services. The main difference between this health insurance option and others is the lack of exclusionary policies. In fact, it is reported that the consumer health alliance program does not care much about a patient’s health history and other parameters that are used to exclude people from accessing healthcare services (Hill, 2012, p. 2). These are the possible alternatives to conventional health insurance.

References

Berkowitz, E. (2010). Essentials of Health Care Marketing. Mississsauga: Jones & Bartlett Learning.

GFIQ. (2012). Selecting Employee Benefits. Web.

Hill, S. (2012). Personal Insurance. Web.

SCORE. (2002). Health Insurance Alternatives for Small Business Owners. Web.

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