Employer group health insurance is health insurance purchased by an employer. It is offered to the employees of a company or corporation to help cover personal medical costs and needs. Often, such plans also cover the children and family members of company employees.
The major differences in employer group health insurance depend upon the size of the company purchasing the insurance. Most Americans work for small businesses (those that employ fewer than 50 people), and they are covered by small business health insurance plans. Federal law states that no insurance company can refuse to cover a small business and its employees because of preexisting health conditions.
Large businesses, on the other hand, are not protected in the same way by federal laws, but most large companies do offer health benefits. In fact, benefits packages are one way in which companies attract talented employees. Furthermore, individual employees may not be excluded due to preexisting conditions. Rates paid by the employer are based on the history of insurance claims of the entire group filed in previous years.
In the event that you change or lose a job, you may still be eligible for health insurance. Most individuals who are able to maintain health care coverage through such transitions do so through the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) health insurance law.
COBRA essentially allows you to keep your health benefits for a certain period of time after you separate from an employer, though it is usually up to you to pay to maintain your health care coverage (sometimes as much as 102 percent of the premium). Although it's always preferable to have health care coverage, it's especially wise when your plan covers additional members of your family, especially young children or those with chronic illness.