What Are the Advantages of Group Health Care Plans?


Quick Answer

Advantages of group health care insurance plans include the contributions that employers usually make to the plans and the tax breaks for contributions, reports the National Association of Health Underwriters. Additionally, the law stipulates that eligible employees must receive health coverage regardless of their medical histories as of 2015. The Department of Labor regulates the plans under the Employee Retirement Income Security Act, and the Consolidated Omnibus Budget Reconciliation Act protects employees who might otherwise lose coverage.

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Full Answer

Employers often contribute half or more of monthly group health plan premiums, and the contributions do not count as taxable income for employees, points out the National Association of Health Underwriters. Many plans also allow employees to use pre-tax income to pay their share of the premiums. Employees generally do not have to fill out medical questionnaires before receiving group health coverage, although they may have to answer some limited health questions depending on their employer's claims history.

The Employee Retirement Income Security Act requires insurance companies to disclose vital information about the plan to participating employees and delineates financial responsibilities for plan administrators, explains the U.S. Department of Labor. It also gives plan participants the right to appeal plan decisions and sue to obtain benefits that the plan owes them. The Consolidated Omnibus Budget Reconciliation Act stipulates that participants must be offered continued health care coverage through group health plans for a limited time after events such as termination of employment or divorce.

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