Open enrollment for individuals to get health insurance on the federal ACA marketplace (as well as most state ACA marketplaces) is right around the corner, from November 1 through January 15. But what about small-group health insurance plans?
The good news is that you can sign up for a group health insurance plan for your small business any time you want; you don’t need to wait for a certain open enrollment period.
Let’s take a look at some other things you should know about small business health insurance plans. Need assistance? Let Abbot Benefits Group help you find the perfect health, dental, vision, and life insurance plans for your small business. Contact us today for more information.
When to Enroll in Small Group Health Insurance
You can enroll in small group health insurance any time during the year, as long as your business qualifies. Although businesses with fewer than 50 employees are not required to provide health insurance, being able to offer health insurance plans may make it easier to hire and retain employees.
Does My Business Qualify for Small Group Health Insurance?
While each plan may have slightly different requirements, you generally need the following to qualify for a group health insurance plan:
- 2 or more full-time employees. One employee can be yourself, but your spouse typically does not count as a second full-time (or full-time equivalent) employee.
- Proof that you are a business, such as a business license or articles of incorporation
- The ability to pay at least half of each employee’s monthly premium
- At least one full-time employee who chooses to enroll in the plan
Not sure whether your small business qualifies? Contact Abbot Benefits Group, and we’ll help you figure it out.
What Does a Small Group Health Insurance Plan Cover?
Small business health insurance plans must comply with the Affordable Care Act by including these 10 essential health benefits:
- Emergency services
- Preventive services
- Prescription drugs
- Ambulatory services
- Lab tests
- Maternity and newborn care
- Rehabilitative services
- Pediatric services for kids, including vision and dental care
- Services to treat substance abuse problems and mental health disorders
How Much Does a Small Business Health Insurance Plan Cost?
Your cost as a small business owner will vary depending on the type of plan you choose and the state you live in, but you typically must pay at least 50% of your employees’ premiums. A 2021 survey found that annual premiums for employer-sponsored family health coverage averaged $22,221 and single coverage averaged $7,739.
Why Should Small Businesses Offer Health Insurance to Employees?
Although health insurance can be a significant cost for small business owners, small group health insurance plans also have many benefits, including:
- Employee retention. Health insurance is a popular benefit that can help potential employees want to work for your business – and stick around after you hire them.
- Reduced premiums. Compared to purchasing individual health insurance for yourself or your family, small group health insurance tends to have lower premiums since the risk is shared by a group.
- Easier enrollment. While you can only sign up for individual health insurance plans during the open enrollment period or after a life-changing event, you can get your small businesses started on a group plan any time you want.
- Tax advantages. Your company may qualify for a small business health insurance tax credit that can help pay the cost of your employees’ premiums.
- You may be able to lower your tax burden by deducting the employee premiums you paid from your taxes.
Am I Required to Provide Health Insurance to My Employees?
Businesses with 50 or fewer employees are not required to provide health insurance benefits. However, most employees value health insurance as a benefit, so offering it can make more people want to work for you.
What Types of Group Health Plans Are There?
There are many different types of small group health plans to choose from, each with its own pros and cons. Here are some of the most common types.
Preferred Provider Organization (PPO)
Unlike some other health plans, a PPO plan does not require members to have a primary care physician (PCP), and members can choose in- or out-of-network providers, although the plans provide less coverage for out-of-network providers. PPO plans typically have annual deductibles and coinsurance requirements in addition to copays.
Health Maintenance Organization (HMO)
HMO plans are more restrictive than PPO plans, which typically results in lower premiums. HMO plans only cover services received from in-network providers, and patients must get referrals from their PCP to get medical treatment from a specialist.
Fee for Service (FFS)
Also known as indemnity health insurance, FFS plans let members visit any healthcare provider they choose. However, this flexibility comes with increased out-of-pocket costs. FFS plans may include a PPO option to help reduce out-of-pocket costs.
Point of Service (POS)
A cross between a PPO and an HMO, a POS plan requires people to first see their PCP to get referrals, but they may then be able to receive some services from out-of-network providers. Members may be required to file all claim forms themselves.
High Deductible Health Plan (HDHP)
An HDHP plan has lower monthly premiums in exchange for higher deductibles. HDHP plans are often paired with a health savings account (HSA), which is funded through pre-tax dollars taken out of employees’ paychecks and used to help pay for out-of-pocket expenses.
How Do I Enroll in a Small Business Health Insurance Plan?
The easiest way to sign up for a small business health insurance plan is to enlist the help of a company like Abbot Benefits Group. We offer the personalized service of a small agency with the resources of a large agency to find – or even customize – the perfect benefits package for you to offer your employees. Contact us today to see how we can help you get enrolled.
Let Abbot Benefits Group Help You Pick the Perfect Plan
Abbot Benefits Group has been providing group health insurance benefits for small and medium businesses in the Houston area for 40 years. Let us help you find the perfect plan for your company. Contact us today to get started.