NU Online News Service, Nov. 27, 10:45 a.m. – American Medical Security Group Inc., Green Bay, Wis., says small employers that are interested in the new defined-contribution health coverage programs ought to consider adjustable health insurance instead.
The health insurance company reports it has had good results over the past 12 months with a small-group health insurance program that provides a core level of benefits, then gives employees the chance to pay for less coverage or more coverage than the core level supplies.
The program, which is available in 26 states, is comparable in some ways to a defined-contribution plan, which typically combines high-deductible, catastrophic health insurance with a personal care account for handling routine medical bills, American Medical says.
But the health insurance program also guarantees employees’ eligibility to enroll and prevents coverage lapses, American Medical says.
Organizers of the new defined-contribution plans emphasize the importance of sharing information with employees, but a properly designed traditional health insurance program can also give employees financial incentives to be good health care consumers by making sure that some of the money they spend on health care is their money, American Medical says.