Summary of the April 4, 2012 Presentation to the Tenafly NJ Chamber of Commerce
Health plans for small groups (2-50 people) in NJ are priced at the same rates for an equal plan with the same insurance company, no matter the size or demographic of the group (community-based pricing). Joining an association’s health plan may make sense for a sole proprietor unable to form a group or for a business that currently insures one family as a group to meet the minimum of two members.
If an association can get enough members to buy into the health plan to get to a larger group category (50+ people), non-standard plans/pricing can be developed. It is possible, based on the specific demographics of the larger group that the pricing will be better for the group over the community-based pricing of the 2-50 person group. To pursue this option several local Chambers would probably wish to work together.
Work would be required to administer the plan. If a larger group plan were proposed each business would need to pay a month in advance and understand that the business would be immediately dropped if the payment were not made on time.
Insurance agents and brokers evaluate plans and advise businesses at no extra cost to the business. It would be an insurance broker’s job to evaluate how good a deal a proposed association plan would be for each business based on specific demographic information from the business (age, sex, current health patterns).
Joining an association’s health insurance plan would not mean that everyone would be covered completely from day one of a plan. NJ insurance companies are permitted to not cover pre-existing conditions for one year if the condition has not been covered by insurance in the six months proceeding the start of the plan.