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Who Is Buying Group Gap Medical Coverage?

Posted on: March 27, 2015 by Aegis General

As employers continue to search for ways to lower healthcare costs while still complying with the Affordable Care Act (ACA), many are also looking to provide the best coverage to their employees. As such, some employers are turning to group gap plans to help their workers finance the higher co-pays, deductibles and premiums that can result from changes to their healthcare benefits. For insurers, it is important to understand who is buying Group Gap Medical coverage and why, in order to engage and advise your clients.

As a result of the ACA, many employers have reduced their healthcare benefit offerings, leaving employees facing out-of-pocket health care costs and deductibles that can go as high as $10,000. But when employers are forced to cut healthcare costs, they often lose out on attracting and retaining quality workers. Group Gap Healthcare coverage is a strong solution for many employers, especially small businesses. According to industry data from BenefitsPro, a typical individual gap insurance plan can be written for $3,500 or $5,000, which offers enough coverage to cover the majority of healthcare claims. Research shows that 86 percent of all healthcare claims total less than $5,000 per year, which can be easily reimbursed through the right gap policy. The Aegis GAP Plan covers the same expenses as the major medical plan, with the exception of charges for professional fees in a doctor’s office or medical clinic, outpatient prescription drugs, vision, dental and plan co-payments.

While gap coverage is traditionally sold through the workplace as a voluntary benefit with employees absorbing the full cost of these policies, some small businesses are finding it more cost effective to foot the bill for gap coverage. However, small and medium businesses that offer low-cost, high-deductible standard healthcare plans that comply with the ACA requirements to keep their costs low are choosing to absorb the full cost of their employees’ gap coverage as well. Instead of offering employees low-deductible healthcare plans, which can be expensive, many employers have found that coupling their gap coverage plan with lower-priced, high-deductible health care plans is actually more cost efficient in the long run. This strategy allows employers to offer their employees the healthcare insurance they need to comply with the ACA, while keeping both employee and employer out-of-pocket expenses low. According to industry experts, much of the growing interest in gap insurance comes from businesses that are not large enough to self-insure, but strive to offer the most complete healthcare benefits they can.

At Aegis General Insurance Agency, we offer solutions designed to help reduce the cost of group medical coverage. Our Supplemental GAP Group Medical coverage is designed to help ensure that employers can offer their workers quality health insurance coverage without breaking the bank. To learn more about the benefits of our Group Gap Medical coverage and to find out more about our operation, contact us today at (866) 662-5752.

Posted in: blog Healthcare