Medicare: Group Benefits, Coverage, and Eligibility

As a business owner, you may be wondering if Medicare can help cover your employees. The answer is yes! Medicare is a government-sponsored health insurance program that provides coverage for…

April 16, 2022

Written by Trey Bongiovanni

As a business owner, you may be wondering if Medicare can help cover your employees. The answer is yes! Medicare is a government-sponsored health insurance program that provides coverage for people who are 65 or older and those with certain disabilities.

Medicare is not just for individuals; it’s also for businesses. Businesses that provide health insurance must comply with several laws and pay monthly premiums to the government. In this post, we’ll cover everything you need to know about Medicare’s group benefits. 

What Is Medicare? 

Medicare is a federally-funded health insurance program that provides coverage for people 65 and over and those with certain disabilities. It is the largest health insurance program in the United States, covering more than 55 million people.

Businesses can offer group Medicare plans to their employees as a way to provide them with health insurance coverage. Group Medicare plans are usually offered through an employer-sponsored health insurance plan.

Employer Group Waiver Plans

If you are an employer with 20 or more employees, you may be able to offer a Medicare Advantage plan instead of Original Medicare. This is called an Employer Group Waiver Plan (EGWP). An EGWP offers the same coverage as Medicare Part A and Part B, but usually at a lower cost to both the employer and employees. In addition, EGWPs often include prescription drug coverage and other benefits not available through Original Medicare.

Eligibility

To be eligible for an EGWP, your company must:

  • Employ 20 or more full-time equivalent employees
  • Be headquartered in a state that permits employers to offer EGWPs
  • Have been in business for at least two years
  • Not have any current or past affiliation with a labor union

Medicare Advantage 

Medicare group coverage falls under Medicare Advantage plans. These plans are Part C programs, and they cover all of the same things as Original Medicare: Part A (hospital coverage) and Part B (medical coverage). They may also include extra features not available through Original Medicare, such as prescription drug (Part D) insurance and wellness extras.

Medicare Advantage Plans

There are different types of Medicare Advantage Plans, each one with its own set of benefits:

PPO

A Preferred Provider Organization (PPO) is a health plan that works with medical providers, such as hospitals and specialists to establish a network of participating providers. PPO plans typically require you to pay less if you use a provider that participates in the plan’s network.

HMO

An HMO is a kind of health insurance plan that restricts coverage to services provided by doctors employed by or contracted with the HMO.  In most cases, it will not cover out-of-network treatment in an emergency. To be eligible for HMO coverage, you must live or work in the organization’s service area.

POS

A Point-of-Service (POS) plan is a type of managed care plan that gives you more choices about where to get your health care. You can go outside of the plan’s network with a POS plan, but you’ll pay more for using non-network providers.

Medicare Group Coverage

If you’re a business owner, you should know a few things about Medicare. First, it’s important to understand the difference between group and individual coverage. Group coverage is available to businesses with 20 or more full-time equivalent employees, while individual coverage is available to anyone who meets the eligibility requirements. 

You’ll need to know that you have to make sure that at least 50% of your employees are enrolled in Medicare Part A and Part B before you can qualify for group coverage. Finally, some important benefits come with group Medicare coverage. 

Group Medicare Benefits For Employees

There are several benefits that Medicare Advantage can provide for your employees. It’s important to know how acquiring these plans can benefit your workers for the better. 

Out-Of-Network Care

Health and Benefits that your employees will be able to receive include care from any doctor or hospital in the country that accepts Medicare. This is a big advantage over individual coverage, which only allows your employees to see doctors and hospitals within their plan’s network.

Prescription Drug Coverage

The second benefit is that group coverage includes prescription drug coverage. This is a huge help for employers who have a lot of older employees, as it can be very expensive to cover the cost of prescription drugs out-of-pocket.

Wellness Extras

Finally, group Medicare coverage also includes dental and vision insurance. This can be a great perk for your employees, especially if they don’t have access to these benefits through their individual coverage.

Advantages Of Providing Group Coverage

When considering employment opportunities, health advantages such as retiree benefits are taken into account. Even after retirement, having a group Medicare plan in place distinguishes your organization as one that cares for its people. For many years, businesses have been able to offer Medicare supplemental insurance plans as a benefit for their retirees.

Other advantages include: 

Employee Morale And Retention

There are some big advantages to offering Medicare group plans to your employees. First, it shows that you care about their health and well-being. This can go a long way in terms of employee morale and retention. 

Attract Talent

Second, offering Medicare group coverage can help you attract and retain top talent. This is because more and more people are becoming interested in working for companies that offer good benefits packages.

Save Money

And finally, offering Medicare group coverage can help you save money in the long run. This is because healthy employees are less likely to call in sick or need expensive medical care.

Contribution Level

Employers must pay a portion of commercial group plan premiums, which is usually around 50%. However, you do not have to contribute to Medicare coverage for your employees. This flexibility allows you to provide high-quality healthcare insurance at no cost to yourself or at a price that is right for you.

You may sleep well at night knowing that you won’t have to worry about leaving your retirees with a hefty premium payment. The federal government covers the majority of the premium on behalf of members. The member’s share is significantly lower than for a commercial health plan.

Individual Medicare Plans VS EGWPs 

It’s important to know the differences between individual and EGWP medicare in order to make the best decision for you and your family.

EGWPs are only available to those who are employed by a company with 20 or more full-time equivalent employees. If you are self-employed, you are not eligible for an EGWP.

Individual Medicare plans are offered by insurance companies that contract with Medicare. 

These plans are sometimes called “Medicare Part C” or “MA plans.” If you join a Medicare Advantage Plan, you will give up your Original Medicare coverage, and you will get your Part A, and Part B benefits through the Medicare Advantage Plan.

Things To Consider When Choosing Your Plan

Here are some things to consider when deciding between an individual Medicare plan and an EGWP:

Network: With an EGWP, you will have access to a larger network of doctors and hospitals. You may have to pay more with an individual Medicare plan if you see an out-of-network provider. 

Cost: An EGWP may have a lower monthly premium than an individual Medicare plan, but you may have to pay more out-of-pocket costs when you receive care.

Extra benefits: An EGWP may offer extra benefits that an individual Medicare plan does not, such as dental or vision coverage.

Coverage: All Medicare Advantage Plans must offer at least the same coverage as Original Medicare. Some plans may offer additional coverage, such as dental and vision.

Prescription drugs: Most Medicare Advantage Plans include prescription drug coverage. If your plan doesn’t include this coverage, you can join a stand-alone Prescription Drug Plan.

EGWP High-Level Considerations & Requirements

There are several high-level factors to consider due to the complexities of successful EGWPs.

Enrollment Periods: EGWPs typically have shorter enrollment periods than those for individual Medicare plans. This means it’s important to know when your enrollment period is so you can sign up for coverage.

Waiting Periods: Some EGWPs have waiting periods before coverage starts. This means you may have to wait a certain amount of time after enrolling in the plan before your coverage begins.

Deductibles & Copayments: EGWPs usually have higher deductibles and copayments than individual Medicare plans. This means you will likely have to pay more out-of-pocket costs when receiving care.

Network Restrictions: EGWPs are set up with a network of third-party suppliers and may be customized to eliminate the distinction between in-and out-of-network benefits.

Start Offering Group Medicare

Figuring out where to start with EGWP might be a daunting task. That’s why our Nesso Benefits experts are here to help provide all the necessary information to get you started. We’ll ensure all your needs are covered and that your plan provides your workers with everything they need in their Group Medicare coverage. 

At Nesso Group, we work hard to provide you with a service catered to your specific needs. We take on administrative tasks that help you devote more time to your company’s mission. Your team will enjoy the same attention and support as you do, so they will be able to get in touch with our responsive team if they have any queries.

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