How your business can get started with healthcare

Congratulations, you founded a company and formed a rock star team. While you may have stock options, a cool work environment and a great culture on your list of benefits, don’t forget about health insurance.

In addition to keeping employees motivated and productive, health insurance helps to keep your company competitive in a tight labor market.  According to the 2014 National Small Business Survey, 75 percent of companies with six to nine employees offer health benefits to their team.

Although it is not a requirement by the ACA (Affordable Care Act), companies with less than 50 employees have the option to offer health benefits. Larger companies with 100 or more employees are required to offer health benefits or risk paying a penalty.

So, what are your options and considerations in making this decision? There are two ways to provide insurance for your employees: offering an insurance program through your company or providing additional money to subsidize the employee’s individual coverage.

By offering a group plan, you can deduct the cost of the insurance coverage from your business taxes.  When deciding what type of insurance to offer, some considerations include the level of coverage (represented by metallic tiers, including Bronze, Silver, Gold and Platinum), the level of access to health care providers, and other value added services offered by the insurance company affects the range of  premiums (monthly cost per employee) charged for group insurance for small businesses.

When you are ready to buy a group plan, there are several different purchasing options. You can seek the support of local insurance brokers who will guide you through your personalized options and provide step-by-step assistance (they are compensated by insurance companies).

You can also purchase benefits from companies who also provide your payroll services, other HR benefit solutions, or new online marketplaces called private exchanges. These companies are beneficial because they may provide other valuable services related HR services.

Lastly, as part of the Affordable Care Act, there is a new online marketplace called Small Business Health Options Program (SHOP) where the entrepreneur can define the amount they wish to contribute but give employees the option of choosing their own plans. The other benefit of using the SHOP is that you may be eligible for Small Business Tax Credits to help offset the cost of insurance.

The other option is to encourage your employees to purchase insurance as individuals through online marketplaces such as or your state’s insurance marketplace.  You may offer additional compensation to your employees to help pay for coverage, if you choose. Premiums for individual coverage across the country can be found via here.

While the process of offering insurance may seem daunting at first, there are a lot of companies and services that are geared to help entrepreneurs find the best coverage for their employees. Small businesses have many options available, and this season is the perfect time to research your options and make a decision.

Interested in workspace? Get in touch.