Gap plan strategies for group medical savings
Utilize innovative Gap plan strategies for savings
There’s only a few certainties in the life of a benefits agent. Death, taxes, and the ever increasing cost of health insurance. Due to a number of contributing factors including the Affordable Care Act, medical costs continue to rise, and there’s no foreseeable end in sight. Fortunately there are some strategies to help reduce insurance premium increases, and medical Gap plans are one of the best. Let’s take a look at some of the benefits of a Medical Gap strategy.
Minimize health insurance costs with a high deductible PPO plan
The first step of a successful Gap plan strategy is to find the right major medical plan to work with. Typically it’s best to find a medical plan with a higher deductible and out of pocket threshold in order to get the lowest possible rates.
Most Gap plans will work with any fully insured, level funded, or even self funded plan and carrier. Usually a major medical plan with a deductible of $5000 or higher can be a good base plan to build on. Then it’s on to the next step of the process.
Implement a secondary supplemental Gap plan to lower deductible exposure
Once you’ve identified the right alternate major medical plan, then you can select the best Gap plan benefits to lower the net deductible and out of pocket expenses. Gap benefits can lower exposure on both the deductible and out of pocket side if needed.
One common example would be to lower a $5000 deductible to a $2000 deductible, assuming 100% coinsurance after the deductible. This can be easily accomplished with a $3000 Gap benefit that would give an “end result” $2000 deductible to the member.
Fortunately with most Gap plan options, you can create a variety of “end result” benefit options to suit a clients’ needs. Gap plans like the Premium Saver plan can offer a comprehensive benefit that is the same for both inpatient and outpatient services.
Create a net annual savings to reduce medical premiums
However the main purpose of a successful Gap plan strategy is premium savings. When comparing the combined costs of a higher deductible medical plan and Gap plan premiums to a lower deductible medical plan, you will typically find a good net savings. Many times groups can save 10-20% or more on their medical costs by implementing a Gap strategy.
Plus with flexible Gap benefits, you can tweak the benefit options to achieve the level of savings that you’re targeting. Generally a savings of one to two months of medical premiums can entice a group to implement a Gap strategy.
Explore Gap plan options for your clients
At MWGroupTX, we’re Gap plan specialists. We’ve been working with agents and brokers for over a decade to implement successful Gap plan strategies for their clients. Contact us today to learn more about Gap strategies for your clients. While we may not be able to beat death or taxes, we sure can fight the increasing costs of healthcare.
