Small businesses are big business, and they employ a huge percentage of the workforce. In fact, according to the Small Business Administration, these smaller businesses employed almost 60 million people in 2015 alone. That means these businesses have a huge impact not only on the economy but also on the majority of the workforce.
This is all good and well until it comes to insurance. In the United States, employers with fewer than 50 full-time employees aren’t required to offer health insurance. As you know, insurance is expensive, and health care costs are on the rise.
Employers who fail to offer options for their workers leave people struggling to make ends meet in order to maintain their health. As a small business, you need to prioritize health insurance. Here are the top 5 small business health insurance options in 2019.
1. Health Reimbursement
If you’re unsure whether your business can afford the structure of a group or private plan, an alternative to traditional insurance is offering a Health Reimbursement Account (HRA). An HRA is a program where employers give a monthly allowance to employees which can be used towards healthcare. Workers can purchase their own health plan with these funds or just pay for health services.
Thanks to the 2016 Qualified Small Employer Health Reimbursement Arrangement (QSEHRA), there are a lot of benefits to offering HRAs such as tax reductions. Businesses need to meet some criteria in order to be eligible, including having under 50 full-time employees and not offering any other health insurance options.
2. The SHOP Marketplace
Another popular choice that’s developed thanks to the Affordable Care Act is the SHOP Marketplace. The name stands for the Small Business Health Options Program, and it’s designed to make health insurance more affordable for businesses with fewer employees.
While some states offer their own SHOP marketplace, you can use the federal SHOP system to check your own eligibility requirements. Enrolling in a SHOP plan through the marketplace qualifies your business for the Small Business Health Care Tax Credit if you meet several criteria.
3. Private Group Plan
While many business owners think group plans are only for big businesses, this is just a misconception. Any business of any size can purchase a group plan from a private insurance provider. These plans can be purchased through a local insurance broker or even on their own.
Some providers offer what’s known as a self-funded plan for businesses. This means these plans have access to risk-limiting features like stop-loss insurance and funding arrangements. Don’t overlook a group plan just because you think your business is too small.
4. Multiple Employer Welfare Arrangement
A Multiple Employer Welfare Arrangement (MEWA) is when multiple small employers join together to create a larger pool of insured employees. This brings costs down for everyone and lessens the risk that comes with a smaller group plan. Under the Affordable Care Act, MEWAs are treated as regular group plans, and they need to adhere to similar rules.
Sole proprietors and self-employed individuals can even join a MEWA under what’s known as an association health plan (AHP). These are usually formed with members in the same industry, though these restrictions were recently lifted.
5. Hospital Indemnity Insurance
Finally, don’t forget about supplemental insurance. Supplemental plans fill in the gaps of traditional health insurance which doesn’t cover all types of treatment. One important supplemental plan is hospital indemnity insurance. What is a hospital indemnity insurance plan?
If you’re confined to the hospital for scheduled or emergency treatment, you’re usually out that income for however long it takes. With hospital indemnity insurance, your insurance provider pays you benefits when you’re in the hospital and unable to work. This means you and your employees don’t suffer any lost income. It’s a huge relief for those who worry about missing work for medical treatments.
Despite the many myths about healthcare today, it’s easier than you think to find an insurance plan for a small business. You care about your employees, and you want them to be healthy. It’s no secret that healthy employees are more productive.
Provide the right insurance today with the ideas above. Your employees will thank you, and it’ll be a weight off everyone’s shoulders.