What is Group Health Insurance?

Group Health Insurance, also known as Corporate Health Insurance, is a comprehensive policy that covers a specific group of people, usually employees of a company. This plan can also be extended to cover the family of the insured employees, including their spouse, dependent children and sometimes dependent parents. It benefits both the employees and the employers, providing financial security during medical emergencies.

What is IRDAI’s Definition of a “Group” in Group Health Insurance?

IRDAI defines a group as a collection of individuals who come together to partake in a shared economic activity, rather than being formed primarily for obtaining insurance coverage.

The IRDAI states that certain entities are considered part of a group like -

A group consisting of employers and employees working together in a professional setting.
Group of individuals who are not operating under an employer-employee relationship.
Associations and trusts.
Groups that share a common interest and have officially signed up or joined together.
Societies and registered clubs
Social and cultural associations.

Why is Group Health Insurance Required?

Retaining great talent and keeping them motivated can feel like a never-ending task, especially when you realize you could have addressed their concerns differently. One way to boost employee morale and improve organizational culture is by providing adequate paid-off time, flexible work-life balance and a comprehensive group health insurance plan. Losing a team member after investing so much effort can be truly disheartening.

Group Health Insurance is a strategic solution that helps address various challenges faced by companies. It not only boosts employee satisfaction and retention but also provides financial security during health crises. This comprehensive coverage makes companies more attractive to top talent, creating a positive work environment.

Who Needs Group Health Insurance?

Group health insurance is a form of health coverage that is offered to a group of people, often through an employer or membership organization. It can be a beneficial option for many individuals and families depending on their specific situations. Let us take a closer look at who may find group health insurance advantageous.

Businesses and Startups (as few as 5 employees): It offers an important benefit for small businesses and startups with a limited number of employees. It helps these businesses attract and retain talented staff, especially when competing with larger companies. Additionally, it provides employees with financial protection from expensive medical expenses.
Established Organizations: It is a common benefit provided by established organizations, which has proven to enhance employee morale, increase productivity and draw in high-caliber professionals.
Those without access to individual plans: Consider opting for group plans through associations or unions if you are self-employed or your employer does not provide health insurance. These plans can be a beneficial alternative for individuals without access to individual plans.
People who want affordable coverage: Group plans typically have lower premiums compared to individual plans because the risk for the insurer is spread across a larger pool of insured individuals. This can make group plans a more affordable option for people looking for coverage. You can find more information on the benefits group health insurance on this page.
Those with pre-existing conditions: These plans are more beneficial for individuals with pre-existing conditions because they cannot be denied coverage or charged higher premiums due to their health status. Unlike individual plans, group plans offer more inclusive and affordable options for those with existing medical conditions. Therefore, individuals with pre-existing conditions are better off opting for group health plans over individual ones to ensure they receive the coverage they need without facing discrimination based on their health.

Benefits of Group Health Insurance for Employees

Group health insurance is cheaper than individual or family health insurance because the premium is shared with other employees.
Group health insurance motivates and values employees, leading to higher productivity and engagement.
Group health insurance includes the family under one plan, providing coverage for medicines, daycare, maternity, etc. It offers financial support to employees and their families.
It offers a hassle-free claim settlement process. Individual health insurance requires time-consuming document production and upfront transactions, while group medical insurance only requires submission of hospital bills for reimbursement.
Group health insurance includes coverage for maternity benefits, OPD benefits and preventive care. It also covers pre-existing illnesses and offers health and wellness sessions.
Individual health insurance has waiting periods for pre-existing conditions, while group health insurance minimizes this disadvantage.

Benefits of Group Health Insurance for Employers

Maintaining a healthy lifestyle is challenging in today’s stressful world. Medical insurance can help employees and their families in medical emergencies, contributing to a happier workplace.
Employers can receive tax benefits by offering group health insurance to employees as per Indian tax regulations. This helps organizations save on tax returns and care for their employees.
Benefits are becoming an important factor in employees’ decision-making, alongside CTC and company culture. Providing a good health insurance plan gives organizations an advantage in attracting talent.
Companies must have a strong reputation internally and externally. Good company culture, growth rate and corporate health benefits improve overall goodwill.
Group health insurance shares risk and cost among employees, making it more affordable than individual.

Group health insurance plans benefit both employees and employers by providing financial protection in medical emergencies, increasing healthcare accessibility and reducing the cost of health insurance. Employers also gain advantages such as improved competitiveness, higher employee morale and productivity and tax benefits. These benefits make group health insurance crucial for ensuring healthcare access and financial stability for many individuals.

Qualifying Criteria to Purchase Group Health Insurance

Group health insurance provides coverage to a set of individuals, usually provided by employers or associations. To be eligible, individuals must belong to a qualifying group and meet specific requirements set by the insurer.

Group Eligibility:

Group Size: In India, the minimum group size required for a traditional group health insurance plan is usually 20 members or employees, as determined by the IRDAI. However, there may be certain exceptions to this rule.
- Micro-insurance plans: Certain insurance providers offer micro-insurance plans tailored for small groups, requiring only a minimum of 5 members to qualify.
- Including Dependents: IRDAI permits groups with fewer than 20 employees to include family members of the employees to fulfil the minimum requirement of coverage.
Group Type: There are two primary categories of groups that are eligible for group health insurance coverage.
- Employer-Sponsored: This is the most prevalent form of group health insurance, with many employers providing it as a benefit to their workers. This type of insurance often offers a range of coverage options and may be more affordable due to group rates negotiated by the employer.
- Voluntary Associations: Professional associations and alumni groups can brainstorm health insurance for their members when they share a common interest. This allows these voluntary associations to provide health coverage for their members, ensuring they have access to necessary medical services and treatments. By pooling together, these associations can negotiate better insurance rates and coverage options, benefiting their members and enhancing their overall well-being.

Individual Eligibility:

Additional eligibility criteria for individual group members may vary by insurer and can include specific requirements beyond the group’s overall eligibility. It is important to carefully review the insurer’s criteria to ensure that each member meets the necessary qualifications for coverage.

Employment Status: Eligibility for employer-sponsored plans may be restricted to full-time or part-time employees who fulfil specific hourly requirements. This means that not all employees may qualify for these benefits, depending on their employment status and the criteria set by the employer.
Pre-existing Conditions: Insurers often impose restrictions or exclusions on coverage for pre-existing conditions, which can impact the extent of coverage available to policyholders.

Key Features of Group Health Insurance

Group health insurance policies typically provide coverage for a group of people, such as employees of a company and often offer more comprehensive coverage than individual plans. Employees need to understand the details of the group health insurance policy offered by their company to make informed decisions about their healthcare coverage.

Insurance covers employees, spouses, kids, parents and parents-in-law for a fee or free, depending on the chosen plan.
Pre-hospitalization and post-hospitalization expenses including medical tests, physiotherapy etc. Pre-hospitalization expenses are usually covered for 30 days and post-hospitalization for 60 days, but it can vary.
No waiting period for group health insurance, including pre-existing illnesses and specific diseases.
Under group health insurance, there is no waiting period for pre-existing conditions, allowing for instant claims.
No pre-medical check-up is needed for group health plans.
Group health insurance includes maternity coverage at an extra cost. It covers delivery expenses and some insurers offer newborn coverage too.
Group health insurance companies have tie-ups with hospitals for cashless claims. No lengthy paperwork or payment at the time of hospitalization. You just have to show your health card for settlement.
Group health plans offer extra benefits such as teleconsultation, pharmacy, discounts and diagnostic discounts.

What Does a Group Health Insurance Policy Cover?

Room charges
Nursing care
Surgeon fees
Anesthesia
Medications administered during hospitalization
Other hospital-related costs (may have sub-limits)
Doctor consultations
Diagnostic tests
Treatments that don't require hospitalization
Medical expenses incurred before admission and after discharge, for a certain period
Maternity care
Ambulance services
Pre-existing conditions (after a waiting period in some cases)
Dependent coverage (spouse, children, parents)

What Does a Group Health Insurance Policy Does Not Cover?

Coverage for pre-existing conditions may have waiting periods or exclusions in some plans.
Checkups and vaccinations may not be covered by all plans
Dental and vision care is usually covered separately, although some accident-related dental procedures may be covered under your health plan
Cosmetic procedures like elective surgeries are typically not covered
Limited coverage for behavioural health services may exclude additional treatment and certain mental health services
Unproven treatments are not covered without scientific backing
Self-harm injuries are not covered
Hospital room phone charges, internet access and travel costs for medical treatment are non-medical expenses

Group Health Insurance Add-ons

Add-ons are additional features that can be purchased alongside your Group Medical Coverage or GMC. These extras can provide you with added benefits for a small increase in your premium when incorporated into your base plan.

The age of the beneficiary, policy type, coverage amount and policy terms determine the premium cost.

Top-up Cover : It is an additional health insurance that employees can buy, to provide themselves extra coverage beyond the base plan sum insured. It is beneficial for family members and offers cost savings and tax exemptions.

Hospicash (Daily Allowance Benefit) Cover : It covers loss of income during hospitalization by providing a daily cash allowance. It does not cover maternity and pre-existing conditions. It can be used by employees, spouses and dependent children.

Group Personal Accident Policy : It provides compensation for insured individuals in case of death, disability or accident. The payee pays 100% of the insured amount for accidental death or permanent or partial disability. In the case of temporary total disability, compensation is provided based on policy terms. Additional benefits include coverage for children’s education and repatriation of mortal remains. The coverage is global but the claim payments are limited to India and Indian Rupees. The coverage amount varies among insurers based on policy terms.

Room Rent Waiver : It covers the cost of exceeding the room rent limit at a nominal fee. It applies only to the base policy and can be used by all covered members.

Out-Patient Department (OPD) Cover : A group health insurance policy covers hospitalization for more than 24 hours but an OPD add-on covers medical costs requiring OPD visits. It includes doctor consultations, check-ups and diagnostics, with no limit on consultations or medical tests. It is valid for employees, spouses and children.

Consumables Cover : It is essential for covering items like cotton, wool, masks, gloves, bandages, oxygen masks etc. The cost of these items can be 15 to 20% of the total hospitalization bill. This cover is particularly helpful during a pandemic like COVID-19. It also includes coverage for employees, spouses and children’s hospitalization.

COVID-19 Home Quarantine Plan : It is a smart choice for COVID-19 treatment at home. The COVID-19 home quarantine plan covers costs for doctor consultations, diagnostic tests, oximeter, nebulization, medicines and RT-PCR tests. Need a positive RT-PCR report from an ICMR-approved lab. It covers family members.

Parental Cover : Parents are not covered by the base Corporate Health Insurance policy. An add-on cover allows you to include your parents in your insurance policy. This cover benefits employees with dependent parents who need adequate health insurance.

How is a Group Health Insurance Plan Different from Individual Health Insurance?

Feature	Individual Insurance	Group Insurance
Coverage	Covers only the policyholder	Covers a group of people
Purchased by	Policyholder themself	Employer or main family member
Insured	Policyholder only	Policyholder and chosen members
Control	Full control for the policyholder	Limited control for the policyholder
Eligibility	Must be 18 or older	Must be part of a group
Add-ons	Can choose from available add-ons	Limited options
Claims Process	Filed directly with the insurance company	Usually filed through a third party
Medical Checkup	May be required for older applicants	Not required
Sum Insured	Typically higher	Typically lower
Coverage Ends	At age 65 (may vary)	When leaving the employer
Tax Benefits	Tax benefits available	No tax benefits
Critical Illness Coverage	Coverage available as an add-on	No coverage unless chosen as an add-on

Group Health Insurance Claim Process

There are 2 ways insured employees can avail claim settlements under a group health insurance policy -

1. Cashless Claim Settlement

Insured employees can request cashless claim settlement under group health insurance at network hospitals, where the expenses are directly settled by the insurance companies. TPAs approve cashless claims within 4 hours. There is no need to pay from your pocket.

2. Reimbursement Claims Settlement

If insured employees go to non-network hospitals, they cannot get cashless claim settlements. Instead, they have to pay for the expenses and then request reimbursement from the Group Health Insurance provider.

Cashless Claim Settlement Process	Reimbursement Claims Settlement Process
Find the nearest hospital covered by insurance Notify the group health insurer before 3-4 days for planned hospitalization and within 4-5 hours for emergencies Show TPA-issued Health Card at the hospital insurance desk Complete the hospital’s pre-authorization claim form The hospital will send the claim form to the insurance company for settlement The insurance company will review the claim details and notify the insured of approval or denial The hospital sends expenses and receipts for reimbursement after claim approval	Notify the insurer within 24 hours of hospital admission. TPA will provide a claim number for tracking the claim status Pay the hospital for medical expenses and keep original copies of all invoices Submit all the documents the the health insurance provider The insurance company will verify the claim details, may request more documents and then will approve or reject your claim Once the claim is approved, the designated amount will be credited directly to the insured’s bank account, providing a convenient and efficient process for receiving the necessary funds

Frequently Asked Questions (FAQs)

A: Eligibility coverage typically relies on the employer or association’s plan. Usually, employees meeting the required weekly hours are eligible, alongside dependents like spouses and children.

A: Group health insurance is usually unable to deny coverage due to pre-existing conditions, which is a great advantage compared to individual health plans. It is important to note that there might be waiting periods for coverage of certain conditions, so it is essential to carefully go through the plan details to understand all the specifics.

A: Employers can provide different plan options with varying coverage and costs, allowing you to select the most suitable plan based on your preferences and financial situation. It is important to note that the extent of customization offered is usually determined by the employer’s plan design.

A: The steps for filing a claim can differ from one insurance company to another. Normally, you will be required to fill out a claim form and provide documentation of your medical costs. Your employer or the insurance company should be able to offer detailed guidance on the claim filing process.

A: After your employment with the company ends, the group health insurance coverage provided by your employer also comes to an end. This is because the employer pays the premiums for his coverage and once you stop working there, the policy no longer remains active.

A: Yes, seeing a doctor outside of your insurance network will be more expensive. In-network doctors have agreed upon discounted rates with the insurance company, so going out-of-network means higher costs in terms of deductibles, co-pays and coinsurance.

A: Some group health insurance plans include disability insurance benefits to provide financial support in case you become unable to work because of a covered disability. These benefits aim to replace a portion of your income during your inability to work.

A: In general, you can include your spouse in your health insurance plan either during open enrollment or if a qualifying life event happens. It is important to note that there might be extra expenses involved in adding your spouse, so we recommend confirming with your plan administrator.

A: Group health insurance plans usually include coverage for expenses related to pregnancy and childbirth, although the specifics may vary. It is important to check the details of your plan to determine which services are included, your deductible and out-of-pocket costs, as well as any waiting periods for maternity care.

A: You should review your plan documents or the insurance company’s website for specific information on how to proceed with appeals if your claim is denied. The steps for appealing a decision can vary depending on the insurance company, so it is important to follow the guidelines provided. Understanding your rights and the process for appealing a denied claim can help you navigate this situation effectively.

A: Yes, typically children can remain on their parent’s group health insurance plan until they reach a specific age, often until they are 25 years old. This is a significant advantage of employer-provided group health insurance. However, it is important to consider the specific age limit and any eligibility criteria for continuation of coverage -

Age Limit: In India, the typical age limit for dependent coverage on a parent’s group health insurance policy is 25 years old, allowing children to remain insured under their parent’s plan until they reach this age.
Policy Variations: It is crucial to carefully review the terms and conditions of your group health insurance policy. Certain plans may impose varying age limits for dependent coverage, ranging from 23 to 26 years old.
Marital Status: Some group health insurance plans might stop providing coverage for children once they are married. This is important to consider when evaluating the coverage offered by different plans.

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