What to Consider When Getting Group Health Insurance
As an employer, you can help your employees save money on health insurance costs while still getting quality coverage. Group health insurance plans provide lots of options for small businesses, giving you more flexibility with the type of benefits you offer. Knowing your options and what type of insurance you qualify for can help you get the right plans.
If you are unsure where to begin to enroll your employees, you may want to consult a health insurance broker. An insurance professional can assess your company’s needs, compare providers and plans, and guide you through the enrollment process. They can also adjust your plan as your team expands. Below are some basics to consider when getting health insurance for your employees.
The Number of Employees
To qualify for small business group health insurance, your company must have between one and 50 employees. If you have more than 50 employees, your company must apply for large group or corporate health insurance. Regardless of how large your company is or the number of employees, your company must meet all group coverage reporting requirements and group health insurance standards.
All requirements and standards differ depending on whether you are a small business or a larger corporation. If you are unsure about the standards, make sure you discuss them with your broker. They can address any issues and answer your questions. They can also inform you of any updates or changes in health insurance regulations.
At the basic level, there needs to be a clear distinction between an employer and an employee. For instance, to qualify for group health insurance, there must be at least one other employee who is not the owner of the company. Furthermore, the employee must fall under the following guidelines:
- Not an owner or employer
- Not the spouse of an owner or employer
- Not a family member of the owner or employer
- Not a partner of the owner or employer
- Not a seasonal worker, even if the person works full-time during that period
- Not an independent contractor of the owner or employer
Who Is Eligible for group health insurance? A qualified full-time employee is one who works at least 30 hours per work directly for your company. If your company offers group health coverage to any full-time employees, you must offer coverage to all full-time employees.
Your employees must also pass the common-law test. According to the IRS, a person who works for you would pass the common-law test if you as the owner has control over what the employee does and the way they do it. A worker is considered your employee if you direct both the work process and the finished product.
How Much Your Company Pays for Health Insurance
On average, larger corporations pay 80 to 100 percent of a health insurance plan for a single employee. Smaller businesses contribute between 50 and 60 percent. How much your company pays and contributes for group coverage depends on several factors such as
- Type of plan
- Insurance provider
- Employee census
- Business location
- Type of work/industry
As a small business with less than 50 full-time equivalent employees, you are not required to offer group health insurance. If your company does decide to offer health coverage to your employees, then you are typically required to pay for at least 50 percent of employee premiums as a small employer. Keep in mind that your business can also decide to contribute a larger amount to your workers’ premiums.
Look Beyond the Monthly Premiums
Group health insurance consists of a variety of factors, such as premiums, copayments, deductibles and coinsurance. These elements contribute to the type of plan you choose and how much you and your employees will pay for coverage. A higher premium generally means a lower deductible, or the amount an employee must pay toward medical costs before insurance kicks in.
Just like individual health insurance, co-payments for group insurance go along with medical visits. Consequently, they can add up if you have employees that see a doctor frequently. Your health insurance broker can estimate what you will pay and what your employees might pay with each plan choice based on all factors involved, not just the premiums at face value.
Low Deductible or High Deductible?
There is almost always a debate (and some confusion) between a high deductible health plan (HDHP) and a low deductible health plan (LDHP). HDHPs almost always have a lower premium than LDHPs, because the policyholder (your employee) is taking on much more risk. However, there are other issues to consider outside of the risk.
For instance, if your workforce is primarily young and healthy, you can save a lot of money on premiums by opting for an HDHP. You can always supplement your plan with a group coverage HRA or an HSA. If you are an employer with a large per-employee health care budget and want to make sure your employees pay little to nothing out of pocket, your organization should consider offering an LDHP.
How to Buy Group Health Insurance
Whether you are self-employed or have a workforce of up to 50 employees, you may qualify for group health insurance in most states.
Self-Employed Group Health Insurance
Group health insurance for self-employed business owners is available in some states. Therefore, if you may be eligible to get group health insurance with no employees. States that allow you to get group insurance for a small group of 1 do so on a guaranteed-issue basis. Therefore, you do not have to worry whether you qualify for coverage.
Group Health Insurance with Employees
If you hire at least one employee who is not a spouse, co-owner, business partner, or independent contractor, you can buy group health insurance through your Insurance Enterprise agent. There are a variety of insurance plans available for all types of small businesses and larger corporations with 50 or less employees.
Contact Insurance Enterprise for Group Health Insurance
If you have questions about group health insurance plans for small business and need to enroll your employees, contact Insurance Enterprise at 888-350-6605. Speak to a licensed agent and find out more about how you can get affordable health insurance quotes.