What Is Commercial Health Insurance?

Everything you need to need to know about Commercial Health Insurance: what it is, how to get it, what are its types - and so much more!

Most of the businesses get their employers insured to enhance their package and to stay ahead of insurance issues. This minimizes the jeopardy that  might affect their business, but what if you plan on getting insurance for your business and you can not figure out if you should get commercial health insurance or otherwise?

This guide is what you need!

Learn about Commercial Health Insurance. What is Commercial Health Insurance, and how does it work? This ultimate guide has all the answers to your possible questions about Commercial Health insurance,

Stay with us, because this guide is what you need to stay ahead of the game.

So without further ado, let’s dive in!

What does being insured mean?

First of all, let’s talk about what is Commercial Health Insurance and what does being insured mean: a health insurance coverage plan of any kind that is not maintained and run by the government can be considered as a type of commercial insurance. If one is commercially insured, then that means they have been provided and administered with health insurance by one of the non-governmental organisations. It covers the medical expenses and disability income, if applicable.

What are commercial health insurance companies?

There are a multitude of private health insurance companies in the United States.

According to the reports published in 2018 by National Association of Insurance Commissioners (NAIC), the direct written premiums of tragedy and health insurance hit 1.1 trillion dollars, an increment of about 57.3 percent from 2009, with a whopping 51.8% of collective share of ten largest insurance organisations.

Following the data collected by NAIC, ranked below are the five most successful commercial insurance groups:

UnitedHealth:

With its direct written premiums as 156.9 billion dollars and a market share of 14.2%, United Health is an American diversified for-profit healthcare service based in Minnetonka, Minnesota.

The network of clients of UnitedHealth are not just limited to United States but extends to more than 130 other countries.

Kaiser Foundation:

With its direct written premiums as 93.2 billion dollars and a market share of 8.5%, Kaiser Family Foundation is a private non-profit organization that operates with the main focus on the trivial health care issues that the United States is facing, in addition to its role in global health policy.

Anthem, Inc.:

With its direct written premiums as 67.2 billion dollars and a market share of 6.1%, Anthem, Incorporation is one of the largest for-profit health-care organizations which provides health insurance across the United States in the Blue Cross Blue Shield Association (BCBS).

They offer a number of basic and comprehensive to individuals, as well as to the groups of employers in order to meet their certain needs.

Humana:

With its direct written premiums as 56 billion dollars and a market share of 5.1%, Humana Incorporation is an American for-profit insurance company based in Louisville, Kentucky. It provides service and help to the members achieve the best of their health.

It offers a range of customised healthcare experiences to different groups of people.and aim to innovate solutions and resources to help each person to continue to evolve and live their healthiest lives.

CVS:

With its direct written premiums as 55.4 billion dollars and a market share of 5.0%, CVS Health is an American healthcare company with a motive to pioneer a fresh approach in order to help people get on the path to a healthy life, using its innovative plans, services and community pharmacies.

Is United Healthcare commercial insurance?

When the word “commercial” is added before insurance, then that indicates the provision and administration of health insurance plans by private health insurance companies, instead of the government. These plans can either be purchased by the individuals or acquired by businesses for a mass coverage of employees. Therefore, the types of plans from insurance that are laid out by a public or government program such as Medicaid, Medicare, or State Children’s Health Insurance Program (CHIP) can not be considered as commercial health insurance plans.

This brings us to our main question: Is United Healthcare commercial insurance?

Well, yes!

Using the above explanation, it is clear that the insurance that would be purchased from UnitedHealthcare can easily be considered as a commercial health insurance.

Is Cigna a commercial insurance?

Cigna Health Corporation is a global health-care service organization, with direct written premiums as 29.3 billion dollars and market share of 2.7%. Its insurance services and plans involve health insurance for individuals and families, orthodontic insurance, medicare basic and premium plans and international health insurance.

It is important to note that the vast majority of its business is private, and hence commercial. However, it does offer a Medicare or Medicaid category of services with the help of its branch, Cigna HealthSpring. This makes about 15 percent of its clients getting medicare amenities while up to 85 percent of its employers are those that insure privately and about 15 percent is fully insured, where Cigna assumes the risk.

So is Cigna a commercial insurance? The answer to that question is somewhat of a grey area, but primarily Cigna is still considered to be a commercial insurance, infact, one of the top ones to be accounted for.

What are examples of Commercial Health Insurance?

The insurance companies are constantly coming up with inventive and unprecedented plans, ideas and products, expanding the array of commercial health insurance. However, below examples are some of the ones that we have known for a while now:

i) Health Maintenance Organization (HMO)

Such an organisation provides all the health services using a system that includes healthcare professionals and facilities. By acquiring the services of an HMO, you will have the most reduced liberty to pick a healthcare provider of your own choice. It also requires the least amount of paperwork and documentation as compared to other plans and a doctor for your primary care to take charge of your care and, if need be, direct you to a specialist which in turn, is effectively covered by the HMO plan. In order to check in with a specialist for your care, HMO usually asks for a referral.

Let’s now talk about which and if you can choose any doctor for yourself. Well, the answer is that you can choose any doctor to see you as long as they are included in your network, otherwise, you will probably have to pay the full bill yourself, with no involvement whatsoever from HMO. Although emergency facilities at an external hospital (not in HMO) must be covered at the HMO rates, the doctors who are not willing to participate have the full right over the bill and hence, can charge you as per their liking.

HMO has different schemes which include: Premium, Deductible, Copays and/or co-insurance.

Premium  is the cost you pay each month for insurance, deductible is when your plan requires you to pay the amount before it provides its services. This excludes preventive care. Copays and/or co-insurance a fixed fee for example 18 dollars, that is supposed to be paid when you get the services whereas coinsurance is the fee that is paid as a percent of the charges for the services, such as 15%. Coinsurance depends exclusively on the plan that you are following and are counted toward your deductible. As for the involvement of paperwork, there are little to no claim forms that are to be filled out.

ii) Preferred Provider Organization (PPO)

Such an organization provides a moderate amount of freedom to choose your health care providers – at least more than that with an HMO – since with PPO, you are neither required to have a referral from a primary care doctor to see a specialist, neither you are asked to.

Though it does come with a little heavy to the pocket. This is because if you wish to see an external doctor, it would probably cost you an out-of-pocket price, as compared to seeing an in-network practitioner, along with an additional amount of documentation and paperwork.

Moving on to the choice of doctors you can see; you can opt for any one of the doctors from the PPO network; and even an external one, you would just have to pay more in that case.

PPO again has different schemes which include: Premium, Deductible, Copays and/or co-insurance.

Premium  is the cost you pay each month for insurance. Deductible is dependent on the policies of each PPO; some include it, while others do not. An external doctor would cost a higher deductible. Copays and/or co-insurance a fixed fee for example 18 dollars, that is supposed to be paid when you get the services whereas coinsurance is the fee that is paid as a percent of the charges for the services, such as 15%.

Additional cost might include the extra cost that the out-of-network doctor might charge you. This extra cost can possibly be greater than the one that the other doctors in your area charge. In that case, you will have to pay the balance after your insurance pays its part of the bill.

The paperwork involved is extremely minimal in the case of an in-network doctor with a PPO. But if you choose to see an out-of-network doctor, the process gets a little longer since after your payment to the provider, a claim has to be filed by you in order to get your cash back from the PPO.

iii) Exclusive Provider Organization (EPO)

Such an organization provides a moderate amount of freedom to choose your health care providers – at least more than that with an HMO – since with EPO, you are neither required to have a referral from a primary care doctor to see a specialist, neither you are asked to.

You will have to pay the full cost of an out-of-network doctor, unless it is an emergency.The premium is lower than that of a PPO. You can choose any in-network doctor. The paperwork involved is extremely minimal in the case of an in-network doctor with a PPO.

iv) Point-of-Service Plan (POS)

A POS is a blend of an HMO and a PPO. It gives you greater freedom to choose your health care providers than you would in an HMO.

Paperwork is moderate in amount if you choose to see out-of-network providers.

If you need a specialist,  the primary care doctor will coordinate your care and refer you to them.

In case you opt for an out-of-network doctor, it would cost you a lot more than the internal one which consequently increases the paperwork too since after your payment to the provider, a claim has to be filed by you in order to get your cash back from the PPO.

It is interesting to note that most of the commercial health insurance plans are designed to follow either a preferred provider organization (PPO) or health maintenance organization (HMO), with the main difference between these two types of plans being that an HMO requires patients to opt for a single primary care practitioner, who serves as the central connection and coordinates the care that other specialists and healthcare providers have to offer.

Types of commercial health insurance:

Having the right commercial insurance coverage that suits the needs of your financial plan is a critical part for small businesses to protect their work, employees and resources.

Among the many types of commercial health insurance that the small business owners should consider, let’s take a closer look at the most prominent ones:

General Liability

When a customer gets injured at the workplace of business due to the fault of employees, it calls for General Liability to cover all the potential costs that might have incurred as a result  of the accident. It has been designed to cover the medical, as well as the associated legal fees. This coverage can also cover the “advertising injury,” which can be described as the summary offenses for example copyright infringement or defamation.

Property Insurance

This kind of insurance is responsible to cover the damage to your building and its contents, and extends to the resulting impact to your business income. Property Insurance is particularly in the event of damage caused due to the victim in fire, theft or a natural disaster. There are three types of property coverages, namely, “named-peril,” “open-peril” or “special.”

Workers’ compensation insurance

Workers’ compensation is responsible to provide financial coverage to the employees of the organization and provide them with wage replacement and medical benefits for their injuries in the course of employment. This is a compensation – an exchange of sorts – for the employee’s mandatory relinquishment of the employee’s right to register a complaint or sue the employer for their negligence.

Commercial Auto Insurance

Now you must be wondering why would small businesses even need commercial auto insurance? Well, simply put, small businesses have way more expenses than it might seem. They have to employ workers with fair/market competitive wages, excellent benefits, and stability, which count as expensive. However, to ensure that your workers and equipment are insured (read: protected) financially, as well as medically, is actually a smart way to do business.

This policy is responsible for the financial coverage of any physical damage and liabilities for amounts, situations, and usage that is not covered by a personal auto insurance policy.

It is understandable that nobody even wants to anticipate such accidents and tragedies, but the truth stands: future can be unpredictable.

Conclusion

Commercial Health Insurance is a health insurance coverage plan of any kind that is not maintained and run by the government. Anyone who has been provided and administered with health insurance by one of the non-governmental organisations is commercially insured. United Healthcare, Kaiser Foundation, Humana, Anthem Inc. and CVS are few of the commercial health insurance. If any insurance is not associated with, monitored or provided by the government, then it is considered as commercial, therefore United HealthCare and Cigna, both are considered as commercial insurance companies, though Cigna does have an element associated with Medicare. A few types of Commercial Health Insurance are General Liability, Property Insurance, Workers’ Compensation Insurance and Commercial Auto Insurance.

Charles Bains

Charles Bains

Charles Bains started his insurance career as a marketing intern before pounding the pavement as a commercial lines agent in Orlando, FL. As an industry journalist, his articles have appeared in a variety of trade publications. His insurance television career, short-lived but glorious, once saw him serve as the expert adviser on an insurance-themed infomercial (yes, you read that correctly). Having recently worked for various organizations, coupled with his broader insurance knowledge, Charles is able to understand our client’s needs and guide them accordingly. He is a gem for Insurance Noon as his wide area of expertise and experience have been beneficial in conducting further researches to come up with solutions and writing them in a manner which is easy for everyone including beginners to comprehend.

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