A Guide to The Best Small Business Health Insurance Options
As 155 million people get their health insurance through an employer-sponsored plan, employers are pressured to choose a good plan.
No matter what industry you’re in, you can’t bank on having a young and healthy workforce forever. Even if you’re a young tech outfit, eventually, people will get sick, have kids, and need access to the best small business health insurance.
Choosing the cheapest plan isn’t always the most cost-effective plan. Offering a poor benefits package will keep you from getting ahold of the best talent and keeping them around.
It will mean that your employees will foot the bill for a high deductible and might opt for their own plans, driving low enrollment that costs you more.
If you’re interested in finding your team’s best small business health insurance plan, get to know some of the basics.
Do You Want Group Health Insurance?
There are two main categories of health insurance that an employer can offer.
When you offer your employees a group health insurance plan, you’re offering to split the cost with your employee. You must contribute a minimum percentage of the price to maintain the program.
Potential employees are attracted to group health insurance plans because it often extends to dependents. That means even employees with kids in college might be able to cover them while in school.
You can contact a broker or buy your insurance online for your small business.
Look into the Small Business Health Options Program or SHOP plans offered by the ACA marketplace near you. You might be able to get a good deal that serves all of the needs of your employees.
Your employees will appreciate this option because the most basic health insurance plans cost hundreds of dollars a month. Even if you don’t buy the best small business health insurance plan, they’ll pay less and get a better strategy than they would on their own.
Be sure your HR department is well trained in whatever plan you choose so they can answer basic questions to your employees.
Would You Prefer To Subsidize Individual Plans?
The other category of health insurance plans is the individual one.
This is a policy that allows more freedom of choice. If you’re a small business that can’t afford to help pay for anything but the most basic plan, this will enable employees to get the needed services.
While your employees might pay slightly more out of pocket, they won’t be confined by a limited plan.
Since the Affordable Care Act began, there have been no restrictions on current health status. People with more severe issues might need a more comprehensive plan than younger employees in stable health.
Through this program, you can have premiums reimbursed to employees for their individual plans. This will be similar to how you contribute to a group plan but leave your employees to choose their schedule.
Because individual plans vary by employee, it could be just a couple hundred dollars a month before premium tax credits or into the thousands. When employees must cover their children and dependents, the prices will increase.
Since most people are eligible for tax credits, many pay less than $100 monthly for their health insurance plans.
Check out the guides available to learn more about the kinds of plans available.
Once you’ve chosen the coverage category, it’s time to select the type of plan to offer. There are 4 significant types of group and individual plans. They each have their pros and cons.
1. PPO Insurance plans
PPO stands for Preferred Provider Plan and is the most commonly purchased plan.
Under this plan, the insurance company chooses a set number of providers when you opt into the program. You’ll need to select your provider from this list or pay a higher premium to see them.
Seeing the approved providers allows claims to be paid at the highest level possible, sometimes requiring nothing from your pocket. Providers similarly opt into working with these insurance companies for the promise of a steady stream of patients and services paid for.
While providers might make less from the insured patients, the access to the number of patients is why they choose this path.
2. HMO Plans
Health Maintenance Organization plans to offer a more limited number of providers, but they often will work exclusively with the insurance you get.
You start off by choosing a primary care physician. This is who you’ll visit for all of your general health needs. If you think you need to see a chiropractor, urologist, or any kind of specialist, you’ll have to visit your primary care doctor first.
They will then refer you to the specialist who will likely be on the same network and covered by your insurance. You could pay a high bill out of pocket if they’re not.
3. HSA Plans
A Health Savings Account is a type of bank account where your employer will automatically dump a portion of your paycheck tax-free.
These funds are to be used specifically for medical expenses. This means that you’ll have money ready for emergencies and medical procedures.
These are usually connected to a PPO plan that works with an HSA provider.
4. Indemnity Plans
Under these plans, you can see any doctor or visit any hospital. Your insurance company will pay a fixed amount in response to the charges. You may have to pay some upfront and then apply for reimbursement.
The Best Small Business Health Insurance Plans Offer What Employees Need
Ask around your company to choose the best health insurance for small business owners.
If you’ve got a small enough office, you should be able to assemble a list of essential services your employees need. Rather than guess or overpay for services employees don’t need, check with them.
Rather than skimping on health insurance, check out our guide for how to cut business costs this year.