Like many small business owners, you may wonder how to get affordable employers group insurance and health coverage for your employees when you don’t have enough employees to fill out the insurance forms. If this sounds like your business, you’re not alone. Small businesses account for 50% of all new jobs, and 48% of all small businesses are family-owned and operated, according to the US Chamber of Commerce Foundation’s research and polling about small business owners’ attitudes toward health care reform and the Affordable Care Act.
No Matter What State You Live in, You Still Need to Follow the Affordable Care Act (ACA)
The ACA requires employers with 50 or more full-time equivalent employees to provide health insurance to at least 95% of their full-time employees and their dependents up to age 26. If an employer does not comply, they may be subject to a penalty of $2,320 per full-time employee, excluding the first 30 employees. The good news is that there are many options for employers group insurance and employer group benefits that can help you meet these requirements and provide your employees with quality coverage.
With Whom Can Employers with Fewer than 50 Employees Buy Group Insurance?
Most employers with fewer than 50 employees are small businesses. To buy group insurance from an insurance company, the employer must have a minimum number of employees, usually two or more. Most small businesses do not have enough employees to meet this requirement. However, there are a few exceptions.
Types of Benefits You May Want as Part of Your Employer’s Group Policy
- Health insurance is employers’ most common type of benefit. It can be offered as part of a group policy or as a standalone policy.
- Dental and vision insurance are also common types of benefits that employers offer. These can be offered as part of a group or as standalone policies.
- Life insurance is another type of benefit. It can be offered as part of a group policy or as a standalone policy.
- Disability insurance is another type of benefit. It can be offered as part of a group policy or as a standalone policy.
- Long-term care insurance is another benefit that employers often offer. This coverage is an expensive option, but it may be worth considering if you’re at high risk for chronic health conditions such as Alzheimer’s.
- In addition to these benefits, some employers offer short-term disability insurance and paid time off (PTO). Short-term disability provides income when employees cannot work due to illness or injury. Paid time off provides employees with paid days off for vacation and sick days (paid leave).
- Some employer groups have in-house dental plans in which the employee pays a monthly fee for service at any dentist within their network–rather than paying for each visit out of pocket like traditional dental plans would require.
Making Sense of All These Requirements
Business owners and HR professionals need to know about coverage requirements for employer group insurance. With all of the Affordable Care Act’s changes, it can be challenging to keep up with what is required for your business. Here are a few key things you need to know:
- First, all businesses with 50 or more full-time equivalent employees must offer health insurance to their employees or pay a penalty.
- If you offer insurance, it must meet specific minimum essential coverage requirements defined by the ACA.
- Your coverage must also be affordable. Your employees cannot pay more than 9.5% of their household income. It also needs to cover at least 60% of the expenses related to healthcare services. The total out-of-pocket expenses should not exceed $6,350 per year for an individual plan. For family plans, this cap is $13,700 per year.
Obviously, there are many things to think about regarding employers’ group insurance, but hopefully, this guide has helped clear up some confusion. If you’re still unsure about what coverage is right for your business, Kirby Employee Benefits is here to help. We specialize in tailor-made plans that will give you peace of mind knowing that your employees are taken care of. Give us a call today or visit our website to learn more.