For small businesses, extending group health insurance coverage to employees can have a huge and beneficial impact. But is your business eligible for a group health plan? Read on to find out!
Why Purchase Group Health Coverage?
What are the benefits of group health insurance coverage for small businesses?
Well, for one thing, a recent report found that small group health insurance is far more affordable on a per-person basis than individual plans. Even better, group health plans tend to be more insulated from premium increases than other types of plans in the insurance marketplace, with costs rising much more slowly than for individual plans.
Even better, small businesses that choose to offer insurance coverage may be eligible for major tax benefits.
- Increased loyalty and decreased turnover
- Helped with new employee recruitment
- Reduced absenteeism and increased productivity
Can My Small Business Enroll in a Group Plan?
Getting started with a group insurance plan for yourself and your employees may just be easier than you think! Broadly speaking, all it takes to qualify for a group health plan is to meet three simple requirements:
- You must be able to provide information that proves that you really are a business (such as articles of incorporation, or a current business license)
- You must have at least one common-law employee who opts to enroll in the plan (this employee cannot yourself or a spouse)
- As an employer, you must contribute to your covered employees’ monthly premiums
For the most part, that’s it!
Under the law, small businesses are guaranteed group coverage if they choose to purchase it; the health histories of individual employees will not affect your group’s ability to secure coverage.
You may also purchase a group insurance plan at any time. No need to wait for the hectic open enrollment period to get started!
Some Things to Keep in Mind
Let’s dive into those requirements in a little more depth:
Under current health insurance laws, a “small business” is broadly defined as a legitimate business that has 2–50 employees. Owners are included in this employee count, which means that your business may be eligible even if it is just you and one employee, or a partnership without any additional employees.
In certain cases, your business may be eligible even if your employees are 1099 contractors.
For businesses with more than 50 full-time-equivalent employees, you are required to provide group coverage or face a penalty. Under the Affordable Care Act, small businesses with fewer than 50 employees do not have to provide coverage.
There are certain other stipulations to keep in mind when it comes to who counts as an employee. For example, a spouse does not count as a “common-law employee,” meaning that businesses that are just a partnership between spouses may not be eligible. However, family businesses that include employees in addition to a spouse may be eligible.
One more important thing to keep in mind: Generally speaking, if you wish to offer coverage to one full-time employee, then you must offer coverage to all full-time employees. Similarly, if you choose to offer coverage to part-time workers, then you must be willing to offer the same coverage to all of your part-time employees. Employees may choose not to opt in, but you cannot pick and choose who gets the option to enroll.
What Will Employers Have to Pay?
Under the current laws, employers must pay a portion of their employees’ monthly premiums—generally, at least 50 percent. Many employers will pay more than 50 percent, and may even choose to cover the full amount of the premium.
Broadly speaking, employers are not required to cover the monthly premiums of employees’ dependents, although rules vary from state-to-state on this. And employers are not typically required to purchase vision or dental insurance, though plenty choose to do so.
There are a few other factors you may want to keep in mind when considering how much of your employees’ costs you’re willing to cover. Most importantly, remember that employers who offer group coverage may be eligible for certain tax credits and advantages, on both the state and federal levels.
How to Started with Group Health Insurance
Interested in exploring all of the group health insurance options available for your business? Looking to do some comparison shopping before you decide on the right coverage for you? Have any more pressing questions?
We’re here to help!
Led by our owner and principal consultant Matt Peebles, the Enrollment Specialists have helped countless small businesses find the group plan that’s the right fit for their unique needs.
We’ll make the process as simple as can be, at every step of the way:
- Get in touch with the Enrollment Specialists, and be ready to tell Matt about your company and employees.
- Once we know what makes your business special, we’ll be able to design and customize the right group health plan for you.
- We’ll highlight the value of your potential plan, and help you understand every piece of the puzzle, including rates and benefits. And we encourage you to ask as many questions as you want to, too! This way, you can rest assured that you’ll be making the best decision for your employees’ needs. We’ll make sure your costs are minimized, and your coverage is at its peak!
- You’ll enroll in the group health plan that’s right for you!
- Whenever you have any questions or concerns about your coverage, for the life of your plan, Matt will be there to help! He’ll be your main point of contact and do all the heavy lifting, so that you’ll never have to sweat the small stuff!
Ready to see how much of a difference it can make having a health and life insurance superhero on your side? Ready to say, “I Got A Guy!” for all things health insurance? Drop us a line today to get the conversation started!