Private group health insurance is coverage provided by an insurance company that is not funded by the government, like Medicare or Medicaid.
Private insurance is also called commercial insurance, and is available through companies like Blue Cross, United Healthcare, and Cigna.
This kind of health insurance can be purchased on a group basis through one's employer, or individually, where the insured is the policy holder.
Private group health insurance is far more affordable since the large number of people who will be insured provides that the majority of healthy members will exceed the bad insurance risks.
Most employers that purchase group health insurance for their members can choose from several plan types, that basically outline how the cost of premiums are shared between employer and employee.
The most comprehensive and most expensive plan type is "indemnity coverage", wherein there is complete coverage, and the insured is not limited to in-network healthcare providers.
A more popular option is "managed care" plans, which means the insurance company plays a bigger role in "managing" the healthcare services for the members, including selecting premium providers, coordinating referrals and claim submissions, and other value-added services like educating their members on various medical services.
Private group health insurance firms usually offer three types of managed care plans: Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), and Point of Service (POS) plans.
Managed care plans are more cost-effective but also more limited, while Indemnity plans provide maximum flexibility with higher premiums.
All things considered, managed care plans are a better choice for most people.