We say this all the time around our offices: your people are your greatest asset.
It’s true! Your employees make all your business’ success possible. Investing in their wellbeing is part of continuing the success of your business.
If you’re a business owner with 2 – 50 employees (even a husband and wife duo) this guide to small group health plans is for you. We’re going to cover how a group health plan works, and some of the most common concerns employers have when they’re considering implementing a benefits plan for their employees.
How Does a Group Health Plan Work?
Of course health insurance comes with some rules and regulations. Here’s what you need to know.
If you provide health insurance, you must offer it to all your employees who work 30 hours or more each week. You must also offer coverage for their dependents. Business owners can enroll in their small-employer health plan if at least one of their employees also enrolls. However, both do not need to enroll, as long as the second employee has creditable coverage elsewhere (i.e. on their spouse’s plan).
The largest cost involved is paying your health plan’s premium. You are not required by law to pay an employee’s health plan premium, but many insurance carriers will require the employer to cover at least 50%.
It’s Too Expensive to Offer Health Insurance to My Employees
Many employers are actually surprised to find out insurance doesn’t cost what they first expected. It all depends on the group of employees you want health coverage for.
Health plan premiums are based on several factors:
- Age of employees (older employees are typically more expensive)
- Geographic area
- Type of health plan (greater provider choices typically means higher premiums)
If you feel like you’re paying more than is reasonable for health insurance, it never hurts to talk to an independent brokerage firm like Advanced Benefit Solutions. Perhaps you have the best plan for your company, perhaps not. Shopping different carriers every year could save you hundreds or thousands of dollars! Sometimes it’s just having the knowledge or experience to make a small change to your health insurance plan options that will bring costs down.
Another aspect is paying attention to your claims. Are your employees visiting the ER when they should go to urgent care? What about telehealth benefits? Are they utilized?
By analyzing your claims you might discover your employees simply need more education to partner with you and help control costs for everyone. Telehealth visits alone for things like sinus infections or flu can cost thousands less.
Traditional Health Plans Are Not Your Only Option
Deductibles, premiums, coinsurance … you’re probably familiar with how a traditional health plan works.
Many employers are taking the opportunity to look at something called a Level Funded Health Plan. These plans can be a less expensive option for small employers and offer a fixed price each month. Level Funded Plans are a form of self-funded insurance, but not as risky as being completely self-insured. In these policies, employers will pay a fixed dollar amount to an insurance carrier to cover medical claim payments and stop-loss insurance premiums.
There is typically an annual threshold per person, and if you accurately estimate your medical claims, you may receive a refund at the end of the plan year. There is definitely a bit of a learning curve when it comes to Level-Funded plans, so you’ll want to have a partner well-versed in using them appropriately to avoid a hefty renewal if you under-estimate your claims.
Dealing with rate increases? Check out our blog about how to lower your group insurance rates and implement these four cost control methods in your business.
I Don’t Have the Time to Manage Benefits
You’re not alone. As a business owner your time is stretched to the limit! You can manage benefits on paper or even try to do it yourself, but insurance companies are relying on digital documents more and more.
You can easily enroll employees with many different software programs today. We utilize one at our firm and can assist with connecting it to your payroll vendor so it is seamless (i.e., no extra work for you!) Software handles everything: enrollment, benefits comparisons, repository of important information an employee needs throughout the year (things like where to log in to the insurance company, getting ID cards, benefits summaries, etc.), terminations, new hires, and more!
Be sure to ask your current provider what options you have to utilize online benefits enrollment. The next question to ask is does it connect with your payroll vendor. If your payroll vendor offers benefits software, please be a little wary. Many of the payroll-based options are just not as robust as one dedicated to benefits alone.
When you are a client of Advanced Benefit Solutions, you get the benefit of all of our technology at no charge. And we’ll manage it too, taking the time investment completely off of your plate. We’ve seen too many mistakes and our goal is to reduce the “human” element of changes throughout the year so your records and benefits are well-managed and aligned without taking hours of your valuable time.
My Employees Can’t Cover Dependents and I Can’t Afford to Either
Enter the Family Glitch Law
Basically, the “family glitch” was a rule in the Affordable Care Act (ACA) that prevented eligible family members from receiving premium tax credits (PTCs) for an ACA marketplace plan if the employee’s self-only coverage was affordable.
What does that mean? Let’s say it’s 2021 and you’re a man who has a wife and three children at home, but you work full time and your employer offers healthcare coverage and charges you 50% of the premium. So your health coverage is only $150 each paycheck. However, if you added your spouse and children, your health coverage goes up to $850 per paycheck.
Ok, you go to healthcare.gov to find a plan, but you discover that you aren’t eligible for any tax credits because they see you have access to healthcare through your employer. You’re forced to choose between self-only coverage or expensive family plan without marketplace subsidies.
Not anymore!
The IRS finalized new rules in 2023 to fix the family glitch, making it easier for families to qualify for tax credits and gain access to affordable health insurance.
What does this have to do with you as an employer? If you are partnered with Advanced Benefit Solutions, we’ll help your employee’s spouse and dependents find affordable coverage. You have one more way to level-up the support you offer your employees and their families.
Getting Small Group Health Insurance Can Be Easy
If you have a small business here in Texas, it’s worth a call to talk about your options. We’ll look at your current health plan if you have one, and if everything is working for you there is no pressure or obligation to change a thing!
If, on the other hand, you’re struggling with managing paperwork, a lackluster experience with your payroll provider handling benefits, or just wondering if you’re paying too much, let us help. Never even looked into benefits? We can help with that too.
Give us call today at (800) 291-2009 or contact us.
