Coverage Scope

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Early on, you should decide upon a general approach: whether you’ll be shopping for limited or broad coverage.

Generally speaking, for plans at the more basic or “catastrophic” end of the spectrum, employees must pay potentially high costs at the time of service. Routine preventive care, such as an annual physical exam, may or may not be covered, but ongoing care for a chronic health condition will be entirely paid for by the employee, up to the plan deductible amount. Because of the significant out-of-pocket costs, these plans are sometimes termed “high-deductible” or “high-cost-sharing” plans. For additional benefits or for less cost-sharing, you may need to look at plans with broader coverage, sometimes called “comprehensive” plans.

Comprehensive plans cover a relatively wide range of services and benefits, such as preventive care, prescription drug coverage and mental health services. The most comprehensive plans also may cover alternative services such as acupuncture or chiropractic. The more comprehensive the plan, the more the premium tends to cost. On the other hand, employees may have to bear less cost-sharing responsibilities with more comprehensive plans. Finally, keep in mind that dental and vision benefits are almost always separate from the medical plan.

It’s a good idea to check in with your employees to find out what they most need or want in a medical plan. You may not be able to give them everything they want, but you may be surprised by their preferences.