If your business has employees, you may consider providing health insurance for your organization. However, there are several things you need to consider before offering health insurance to your team.
For instance, can you legally provide insurance, where do you find a good plan, what options are available, and, most importantly, how does it all work? Below we provide a quick guide of small group insurance to get you started. If you have any further questions, feel free to contact Insurance Enterprise. Our health insurance brokers can help you set up a solid health insurance plan.
How Does Small Group Health Insurance Work?
Group health insurance is a single plan that provides coverage for employees. There are different types of insurance plans, including
Preferred Provider Organization
PPOs are often seen as the most lenient type of plan since referrals aren’t mandatory, and the plan will at least partially pay for out-of-network services, but they also carry the most expensive premiums. Also, the most common group insurance plan.
Health Maintenance Organization (HMO)
HMOs tend to have lower monthly premiums, but employees will need to receive primary care physician (PCP) referrals for any special services.
Exclusive Provider Organization (EPO)
EPO plans only pay for services from a select list of providers.
Point of Service (POS)
POS plans are similar to HMOs in that you are required to get a referral for certain services, but a POS will still pay for certain out-of-network services.
Each plan will have a monthly premium, deductible, and copays.
Are You Legally Required to Provide Health Insurance for Employees?
If you have more than 50 full-time and part-time employees, you are legally required to provide group health insurance to 95% of your full-time employees who work more than 30 hours per week.
If you have less than 50 employees, you aren’t obligated to provide such benefits. However, a strong benefits package can attract and retain talent. The government also provides incentives to help make this easier to provide insurance to your employees.
How Much Does Group Health Insurance Cost?
Employers pay $5,700 per employee for single coverage plans and $14,000 per employee for family coverage plans per year. Health insurance benefits account for roughly 8% of employees’ total compensation across the U.S.
Employers aren’t required to pay 100% of the premiums for employees. However, employers with more than 50 full-time employees must offer affordable health coverage that provides a minimum level of coverage to their full-time employees and their dependents. A minimal level of coverage is 60% of the standard population’s healthcare costs.
You can claim however much you pay for your employees’ monthly premiums as business expenses. This means that the monthly premiums you pay are 100% tax-deductible at both the state and federal levels.
You may also qualify for the Small Business Health Care Tax Credit, which can allow for up to 50% of your health care expenses to be claimed as a credit. To qualify, your business must meet the following conditions:
- Have 25 or fewer full-time employees
- The average employee salary paid is $50,000 or less
- The business covers at least 50% of employees’ premiums
- All full-time employees are offered health care through SHOP
How to save on Employee Health Insurance
Paying for group insurance can be daunting, but there are a few ways you can creatively reduce those costs.
- Use a health insurance broker to manage your health insurance plan.
- Share the cost with employees.
- Create your health insurance group.
- Offer wellness programs in addition to health insurance.
Where to Find Health Insurance Plans
When looking for a health plan, first, assess what benefits your employees are looking for and need. If a high percentage of your employees want strong dental benefits, you’ll want a plan that emphasizes that. If your employees want affordable, minimal insurance that they’d only use for emergencies, that’s helpful to know as well.
After assessing their wants and needs, you can now enter the insurance market with a comprehensive list of the services you’d like covered and your budget, two of the most helpful initial filters.
Private Health Insurance Marketplace
You can also find health insurance through private health marketplaces. The quality and availability of plans will vary based on your location. But explore these as well to choose the best option for your employees.
With private insurance, you select a predefined contribution, which designates what plans employees have access to choose from. Employees then select the individual plan they’d like, and the employer receives a single comprehensive bill for every employee. The marketplace would typically provide administrative support services like call centers and online support.
Contact Insurance Enterprise for Premier Health Insurance
If you have questions about group or individual health insurance and need health insurance quotes, contact Insurance Enterprise at 888-350-6605. Speak to a licensed agent and find out more about how you can get an affordable health insurance plan.