Choosing A Better Insurance Plan

Can Small Employers Benefit From Group Health Insurance?

by Isabella Torres

Group health insurance is a broad topic covering a wide range of organization-focused health insurance policies. Many people associate group health insurance with large corporations, but small employers can also benefit from these policies. In some states, independent contractors with no employees can even buy into group healthcare.

Of course, choosing the right group health plan for your small business isn't necessarily an easy process. This article will help you familiarize yourself with the benefits and potential challenges of choosing a group health plan for your business, even if you only have a handful of employees.

Why Should You Provide a Group Health Policy?

If you have less than 50 employees, you are not legally obligated to provide health coverage for your workers. However, providing a group health policy can offer many potential benefits for your employees and your business. Tax credits are also available for certain small businesses that choose to provide employee benefits.

Additionally, providing healthcare for your workers can have added benefits such as reducing absenteeism and improving hiring prospects. Health coverage is routinely near the top of employee benefits surveys, so offering this perk can lead to greater job satisfaction for existing employees and more qualified hiring prospects.

How Can You Choose the Best Group Plan for Your Business?

Choosing a group health plan for a relatively small business typically means looking at small group policies, most of which are fully-funded plans. With a fully-funded group plan, you maintain a single policy for your business but pay premiums individually for your employees who choose to opt-in. Unlike a self-funded plan, you have no responsibility for claims coverage.

One option for comparing small group health plans is the Small Business Health Options Program (SHOP). This exchange is similar to the individual healthcare marketplace and will allow you to compare group providers and select one that works for your company. You'll need to choose a group plan from the SHOP exchange to qualify for the small business health care tax credit.

You should also consider discussing options with your employees, especially if you have only a few. Determine how much your employees are willing to pay and how many will opt-in. These pieces of information can be helpful when deciding what percentage of the premiums you'll cover. Note that most states require employers to contribute at least half when offering a group health plan.

Ultimately, providing healthcare for your employees can offer many tangible and long-term benefits for your business. By taking the time to select a plan that works for your budget and the needs of your employees, you can help improve the health of your workers in a way that's sustainable and affordable.