Rising healthcare costs impact all of us including businesses that offer health benefits to their employees. Small business owners are especially vulnerable to these costs and many feel the need to drop their traditional health benefits. However, not offering health benefits costs more in the long run because employees most likely will look elsewhere for jobs with better benefit packages.
Better employee benefit packages usually make for happier employees. Whether a business is looking to recruit new talent, retain existing talent or just ensure that employees are satisfied and feel like they’re being taken care of. Also, the healthier your employees stay, the better it is for your small business and your workplace in general.
There are four main elements you, as a small business owner, should be aware of concerning small business health insurance: insurance coverage, number of employees, employee premiums and shopping for coverage.
- Insurance coverage – If you are eligible for a small business health insurance plan, your coverage is generally guaranteed to be issued by the insurance company. This means that you, your employees and your dependents cannot be denied coverage based on pre-existing medical conditions, and that all eligible employees and their dependents can enroll in the new plan regardless of their medical condition(s).
- Number of employees – To qualify for small business health insurance coverage, you must have at least one employee on your payroll. However, some states allow you to count yourself as both the business owner and an employee. If your small business has 50 or more employees, it is required to offer health care coverage to all full-time employees, according to the Affordable Care Act.
- Employee premiums – You must pay at least 50% of the monthly health insurance premiums for your employees. The minimum percentage may vary depending on your state or insurance company. But, you could receive a tax credit. The health care tax credit is available to many employers who offer health insurance coverage to their employees. The smaller the business is and the lower the average wages paid, the bigger this tax credit may be.
- Shopping for coverage – As a small business owner, you can shop around for health insurance coverage at any time, without needing to wait for your current plan to expire or for a special open enrollment period. However, once you buy a plan, you are typically locked in for at least a year, during which you can add new employees and dependents or drop coverage for former employees. Once your contract is up, you have the option to renew or shop for a new plan.
It may seem confusing for small businesses to find affordable benefits, but luckily, several health insurance options are designed for small employers. Whether you offer a small group health insurance policy, HRA, or ancillary products, understanding your options is the first step to finding the right policy for you and your employees.
At Ohio Health Benefits, our independent, licensed, small business health insurance brokers, work for you. We advocate for your company, not insurance carriers. If you have questions, call us toll free at 330-633-3837 or click here to email us your name and phone number for us to call you.