Group Health Insurance - Do you Really Need it

Have you found out that people can no longer afford to live or work independent of others? You possibly have and indeed it is nearly impossible for one to work and live without associating with other people. It doesn’t matter where you live or work, but it is undisputable that we all need each other hence the need for shared facilities, and or resources. Health insurance is no exception to this fact and we can therefore hear rightly of Group health insurance. But does everyone understand the meaning of group health insurance? Certainly not! So, let us have a look at it.

The Meaning of Group Health Insurance

Group health insurance is a term used to refer to the health insurance coverage secured for groups of people rather than individuals. Instead of getting individual health insurance coverage, all the health risks or needs or risks of all individuals are summed up and their health insurance covered as a single package. Group health insurance is usually acquired by organizations which employ several people working in groups. Such organizations include but are not limited to organizations/firms like building or construction firms, military or security force organizations, and professional or other associations.

When an employer gets group health insurance coverage for their employees, the organization then seeks to cover all the health needs or risks of its employees as a group, for example it may insure the group against health needs related to an epidemic, a fire outbreak and any other work related hazards. Associations would also insure against health needs or risks of common interest to that particular group.

Do we really Group Health Insurance?

To answer this question, we would need to look at the benefits group health insurance has over individual health insurance.

Group health insurance coverage tends to be cheaper than individual health insurance. With group health insurance, the unit cost of health insurance is often lower than it would have been in the case of individual health insurance. The premium and other insurance related costs an organization puts in if it acquires health insurance for each individual employee independently reduce by a sizeable amount when group health insurance is preferred. This means more savings for the organization and indeed more efficiency, and indeed which organization would not desire to cut down the expenditure it makes on health insurance?

More so, group health insurance is less inconveniencing and easy to administer on the part of the employer seeking health insurance coverage for their employees. Meeting employees’ health insurance needs can be hectic if each employee’s health risks and or, needs are covered independently. With group health insurance, there is no cause for alarm because premium and any other related costs are paid as single bulk. This greatly reduces the administrative costs and effort required to process insurance coverage for the employees.

Important still, Group health insurance is more desirable than individual health insurance because it enhances group cohesion and therefore promotes industrial peace. In the case of employers acquiring health insurance for their employees, employees tend to feel equally catered for if their health risks are covered together as a group. This promotes industrial peace, a sense of ownership on the part of the employees and creates cohesive work groups, which are all desired by all organizations. But if health insurance coverage is provided to employees as individuals, they may conceive that as segregation on the part of the employer and this may therefore result into unnecessary strikes hence destabilizing industrial peace.

However, it is also noteworthy that group health insurance may not adequately cover all the health insurance needs or risks of all individuals in the group. Some individuals may have health needs that are more specific to them. In this case, group health insurance would not be a welcome idea.

Admittedly, everything with an advantage has a disadvantage. What matters is the relative weight of each side. Thus, even when group health insurance has fallbacks, its benefits are more than enough to give it the benefit of doubt.