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FAQ's - Employer-sponsored Health Insurance

What is Employer-Sponsored Health Insurance?

Of Americans who have health coverage, nearly 60 percent secure that coverage through an employer sponsored plan, often called group health insurance. Millions take advantage of the coverage for reasons as obvious as employer responsibility for a significant portion of the health care expenses. Group health plans are also guaranteed issue, meaning that a carrier must cover all applicants whose employment qualifies them for coverage. In addition, employer-sponsored plans typically are able to include a range of plan options from HMO and PPO to additional coverage such as dental, life, short and long term disability.

Health insurance is a type of protection that helps people afford the costs of health care, preventive medicine and prescription medications. Employer-sponsored health insurance is one type of health insurance available to some individuals.

Who is Eligible?

Sometimes called group health insurance, an employer-sponsored health insurance plan is a type of insurance made available to employees of a particular company as well as their families. Generally you need to be a full-time employee to be eligible.

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Who Pays the Costs?

For employer-sponsored health insurance plans, companies and businesses pay for at least a portion of the premiums or fees for coverage, while the employee is responsible for the remainder. The specific cost to the employee varies depending upon the type of coverage and the amount of an employer’s contribution.

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How is Coverage Offered?

Employer-sponsored health insurance plans carry eligibility requirements, such as a minimum amount of years of service, or hours worked per year. Employers also typically offer insurance one time each year when employees have the option to sign up for coverage, known as open enrollment.

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What are Some of the Benefits?

Generally you cannot receive a denial for an employer-sponsored health insurance plan for a pre-existing condition, provided you enroll during open enrollment. Employer-sponsored health insurance plans are typically less expensive than health insurance plans purchased directly by individuals or families, according to the Insurance Information Institute.

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What Types of Group Protection do Most Employers Provide?

Although there are many variations of each, the four major types of insurance coverage provided by employers to their employees are life, accidental death and dismemberment (AD&D), disability, and health or medical. Some employers also provide additional coverage, including group legal, travel accident, vision, and dental care.

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