Frequently Asked Questions - Texas Health Insurance 101

What are the various ways that individuals receive Texas health insurance protection?

Besides participating in group insurance plans, individuals may also be covered under federal and state government-sponsored programs such as Medicare and Medicaid, service-type plans such as Blue Cross/Blue Shield or so-called alternative health care systems such as insurance may also be purchased privately on an individual basis, or through mass purchasing groups such as credit unions and professional or trade associations.

For information about public programs if you cannot afford or qualify for health insurance:

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What are the advantages of Texas group insurance over Texas individual insurance?

For an employer that intends to provide insurance protection to its employees, the group approach ensures that all employees, regardless of health can be covered. Those with known health problems, who might otherwise be unable to obtain Texas individual insurance, can be covered automatically upon employment without evidence of insurability.  Although some limits may be imposed on new hires for certain conditions that predate their enrollment in the plan, most employees can receive coverage as soon as they are eligible.  Group insurance offers a lower cost per unit of protection than a Texas  individual health plan, because the economies of scale resulting from selling, installing and servicing one plan covering many individuals. In addition, group plans are typically more flexible and tend to provide more liberal benefits than individual coverage.

Can an employer work directly with an insurance company?

It is possible for an employer to deal directly with an insurer through a group sales representative to purchase group insurance. Premium rates and underwriting practices vary considerably from one insurer to another.  In addition, the coverages provided are rarely identical. This means that comparison shopping is often difficult.

An employer group needs a Texas health insurance agent to act as intermediary because they lack the resources and expertise to handle their group insurance needs.  The Texas health insurance agents at My Texas Health can help define your needs and objectives and deign a plan to meet your criteria and select the proper purchasing and funding vehicle, obtain competitive quotes from insurers and service the plan. Call us at 1-281-394-0234 or email us your contact information and will get back to you in one business day.

What are the minimum and maximum number of employees allowed by state law to participate in a group health insurance plan?

Most states require that an employer enroll a minimum number of employees (a minimum of 2 full time employees working 35 hours a week) for coverage in order to purchase and maintain a group health insurance plan. This minimum size requirement reduces the potential for adverse selection. There is no legal limit to the number of employees that may be covered under a group health insurance plan.

What is a deductible?

It is a specific dollar amount that an individual mus pay (or "satisfy") before reimbursement for expenses begins. The higher the deductible, the lower the cost of the health insurance plan.

For insured employees with dependent coverage, does the deductible for each person have to be satisfied before reimbursement begins?

Each person covered under a group health insurance plan must meet a deductible before expenses will be covered. However, plans usually include some type of family deductible in order to limit a family's exposure for health care expenses. The family deductible is usually some multiple of the individual deductible, generally two or three.  For the family deductible to be satisfied, the combined expenses of covered family members are accumulated. Some plans require, however; that at least one family member satisfy the full individual deductible before the family deductible can be met.

What is coinsurance?

Coinsurance is a feature found in most group health insurance plans. It sets forth the percentage of covered expenses that the employees and the health insurance plan will pay. The most common coinsurance level is one in which the employee pays 20 percent of the expenses and the insurer pays 80 percent. This is called 80 percent coinsurance and usually happens after the insuree has met his/her deductible.