OVERSEAS GROUP HEALTH INSURANCE AND POOLED GROUPS

GROUP HEALTH INSURANCE WITH “POOLED” RATES

It is always better to get your group health insurance with companies that “pool” their small groups. Some companies put all of their small groups into a “common pool.” This pool may consist of 30-40 small organizations. The advantage is that if one of the small groups has a major medical problem, e.g. a cancer, the medical cost for that cancer is spread throughout all the organizations in the “pool.” Thus the medical increases at renewal time are much more minimal.

If a small group of say 10 employees is insured outside a “pool” and one of the employees has a cancer surgery that costs $200,000, the insurance company will need to make up that loss by raising the rate on the small group. That rate increase could be 100% or more. Thus if insurance was costing $400 a month for a family, at renewal time it could end up being $800. If the organization was insured by a company that “pooled” small groups the rate increase might be 20% or an $80 increase in the monthly premium.

When looking at group health insurance it is wise to ask, “Will my organization be included in a pool with other small organizations?” For information on companies that “pool” small group email us.