The modern health insurance market has faced countless changes in recent years. While some people found themselves with great coverage, other people found themselves steeped in insurance coverage nightmares. Small business owners found themselves increasingly confused over whether they needed to provide coverage or not and how to manage the financial nightmare.
Included here are a few things every small business owner should know about health insurance.
Employee Count
New laws implemented under the Affordable Care Act (ACA) dictated that companies with 50 or more employees be providing health insurance. Unfortunately, 96% of businesses in the country have fewer than 50 employees, so what are they supposed to do? In 2013, only 59% of those small businesses offered health care to their employees.
While you, as a small business owner, are not required to supply healthcare to your fewer than 50 employees, you do have better options should you choose to offer health insurance. New legislature by the ACA dictated that small business owners have access to better insurance for themselves and their workers, without being penalized for staying small.
Use SHOP
The Small Business Health Options Program (SHOP) was implemented to create a health insurance exchange for small business owners. This electronic marketplace can help you compare benefits, costs, networks and providers all online and within the small business sphere.
Before 2016, states were individually determining the number of employees you had to have to qualify as a small business. After 2016, any business owner with fewer than 100 employees will be eligible to shop in the market.
Hire Agents
While SHOP may offer you options you didn’t know you had, you are still faced with a large chunk of time invested in finding those plans. Fortunately, you can hire an agent or licensed broker to help you find plans that suit you and your business’ needs, at no extra cost to you! As long as the broker has signed an agreement with the marketplace in your area you should be good to go!
No Cost To You
For small business owners with fewer than 49 employees, you are not required to pay any part of the insurance coverage your employees receive. You can choose a plan on the SHOP system and offer it to your employees, with the knowledge that they will be paying their own premiums. In 2016, these laws may change when businesses up to 100 employees are allowed in.
Tax Credits
With the new ACA requirements, businesses with fewer than 25 employees who make less than $50,000 a year may qualify for tax credits to cover at least half of their premiums. Employers can qualify for a benefit from the Small Business Tax Credit to half of their contribution to their employees premium. Plus, you can still deduct the half you do pay.
