Small Business Health Insurance

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Every business owner wants to attract the highest-quality employees as possible. Offering a comprehensive range of employee benefits is one of the best ways to improve your applicant pool. Most job applicants look for employers who offer health insurance — and if your business wants to remain competitive for talent, you’ll need to invest in your employees as well. Thankfully, there are plenty of affordable options when it comes to getting the best small business health insurance. 

What is Small Business Health Insurance?

Small business health insurance is a type of corporate health insurance. Corporate health insurance is health insurance coverage that is offered to employees of a business through an employer-sponsored health insurance plan. Generally referred to as a “group plan,” this insurance provides benefits to both employees and the employer. Group plans can be customized to fit the needs of the company, no matter how many employees the company has on its payroll. 

How Group Plan Health Insurance Works

In a group plan, the employer usually shares the cost of the premium paid by each employee to maintain their coverage. The employer chooses the overall plan, but sometimes the employee has a few options within the plan to choose from. These options allow each employee to balance their coverage and their healthcare expenses. 

Contributions to the premium that the employee pays can be made with pre-tax dollars, which can lower their taxable income. Providing health insurance coverage to employees is an attractive incentive for possible employees when hiring, which makes it especially important for small business owners to explore their plan options. 

Businesses are federally required to offer insurance coverage to their employees if they have 50 or more employees. Therefore, small businesses with 50 employees or fewer are not obligated to offer health insurance to their employees. Some states may have more guidelines for small businesses and may require businesses with fewer employees to offer health insurance coverage. 

Businesses that have fewer than 50 full-time equivalent employees (FTEs) are eligible for the Small Business Health Options Program (SHOP). SHOP is for small employers who wish to provide affordable health insurance to their employees. This insurance is offered by private insurance companies, and there are minimum participation requirements which may differ from state to state. 

If a small business does not meet the required employee threshold and has fewer than 25 employees, they may still be eligible for the Small Business Health Care Tax Credit. This tax credit credits 50% of paid premiums on the company’s tax returns. This tax credit is based on the company’s income baseline. The business’s full-time employees income must meet an average of less than 2x the maximum credit in order to receive the maximum credit. These guidelines are set forth by the IRS and the amounts are changed annually according to the IRS.     

SHOP offers four categories of plans to choose from, which is a choice made at the employer’s discretion. The categories include Bronze, Silver, Gold and Platinum. The plans differ in the amount the insurance companies pay for care compared to the amount the employees pay.  Bronze, being the lowest category, has the lowest monthly premiums, but the highest costs of care when needed. Platinum is the highest category with the highest monthly premium, but the lowest cost of care.    

Can One Person Have Corporate Health Insurance?

One person can have small business health insurance when they are self-employed and a sole proprietor. You are considered self-employed if you have a business that earns income but does not have any employees other than yourself. If you are self-employed, you can find small business health insurance options for yourself. 

Before getting insurance for yourself as a sole proprietor, you need to confirm that you do not have any employees. Some people think that a spouse counts as an employee, but this is often not the case. According to the IRS, an employee is considered an employee if the employer controls the work they do, in addition to the way they do it. The individual is a small business employee as long as the employer somehow controls the worker’s production operation and the finished work.  

Once determined that you legally do not have any employees, in order to get business insurance as a self-employed person, you need to prove to the insurance company that your business is a legitimate business. Documents such as a current business license, articles of incorporation or a recent business tax return can be used to show company legitimacy. Don’t be afraid to reach out to a few corporate insurance providers to learn more about specific options in your state. 

Is Small Business Health Insurance Worth it?

The benefits of offering health insurance as a small business insurance generally outweigh the disadvantages. Here are some ways having group health insurance for your employees is advantageous for you.

  1. Attract more skilled employees
  2. Show your employees your business cares for their well-being
  3. Increase worker productivity while reducing your own risk
  4. Save on your individual health insurance costs
  5. Get tax benefits and advantages

Attract more skilled employees

One of the biggest benefits of small business insurance is the ability to attract more skilled employees. If your small business does not offer health insurance, then someone looking for a job may bypass your company only because you don’t offer your employees insurance. 

Healthcare is costly even with a personal independent insurance plan. Naturally, this means that the most skilled employees will be attracted to employers offering comprehensive health insurance plans. 

Show your employees your business cares about them

In addition to providing your employees with a tangible benefit, offering health insurance also humanizes your operation. The prospective employee may see comprehensive insurance offerings as a sign that the employer cares about them and their well-being. In light of the current COVID-19 pandemic, offering health insurance as a small business can be a major deciding factor when it comes to your applicant pool. 

Increase productivity and decrease risks

A prospective employee could also need coverage for their family. An employer offering health insurance coverage is a huge plus and will play a factor in the ability to attract employees and gain an employee’s trust overall. In addition, if your employees have health insurance, then you will subsequently have healthier employees, which can lead to more production and fewer days off. 

With a group health insurance plan, you are able to get coverage that matches the risks that are particular to your line of business. This ensures coverage for anything that may occur to you or your employees while on the job.   

Save on your own health insurance costs

As an employer, enrolling in a group health insurance plan can be more affordable than individual insurance for yourself as well. Group health insurance plans generally cost less due to having a larger risk pool. This means that the risk is spread out across a number of people and therefore it costs less per person. Additionally, premium prices for group coverage are generally more stable than individual coverage. 

Even if you are a sole proprietor, have no other employees and wish to get insurance for only yourself, getting small business insurance is still oftentimes more affordable than getting an individual health insurance plan. If you sign up for a group plan, insurance companies will offer you lower premiums and deductibles.   

Get tax advantages

There are major tax advantages to small businesses that provide health insurance, as well. Employers are usually able to deduct the cost of monthly premiums they contribute on behalf of their employees from their federal business taxes in its entirety. This is only possible if they pay on qualifying health plans. If your employees have health insurance coverage, they could possibly benefit from lower payroll taxes.     

Find Health Insurance For Your Employees

The current global pandemic has made it more important than ever before for business owners to offer health insurance to their employees. While you might assume that you cannot afford to offer health insurance as a small business owner, coverage might be more affordable than you think. 

If your business doesn’t currently offer health coverage to its employees, we recommend exploring your options now to attract the highest quality talent when you hire again — and to retain the excellent employees you already have.  

get started Call Now securely through Blue Cross Blue Shield’s website
# of Healthcare Providers
28k+
Online Application?
Yes
1 Minute Review

Blue Cross Blue Shield consists of 35 separate companies that provide health insurance for roughly one-third of Americans. The company serves all 50 states, Washington D.C., Puerto Rico, and many international areas.

While you look into the BCBS affiliates near you, understand what health plans are available as well as the health insurance cost. It offers extensive coverage that gives just about every American the opportunity to purchase a BCBS-affiliated health plan. However, be sure to read up on the company because the premiums and deductibles may not suit you and your circumstances. 

Best For
  • Desire for a new doctor with plenty of options
  • No cap on annual maximum limits
  • Comprehensive coverage with exclusive discounts and partnerships
Pros
  • Coverage in all 50 states and outside the country
  • Covers both generic and brand-name drugs
  • Wide network of doctors, hospitals and specialists
Cons
  • Plans offered through regional companies, meaning you must look to your regional company for specific policies
  • Main customer service helpline may be difficult to reach
Get Started securely through Sidecar Health Access Plan’s website
Disclosure: Plans referred to above are excepted benefit fixed indemnity insurance products marketed and administered by Sidecar Health Insurance Solutions, LLC and underwritten by Sirius America Insurance Company or United States Fire Insurance Company, depending on the state. As an excepted benefit plan, it does not provide comprehensive/major medical expenses coverage, minimum essential coverage, or essential health benefits. You cannot receive a subsidy (premium tax credit and/or cost-sharing reduction) under the ACA in connection with your purchase of such an excepted benefit fixed indemnity insurance plan. Also, the termination or loss of this policy does not entitle you to a special enrollment period to purchase a health benefit plan that qualifies as minimum essential coverage outside of an open enrollment period. Coverage and plan options may vary or may not be available in all states.
# of Healthcare Providers
See any doctor
Online Application?
Yes
1 Minute Review

Sidecar Health Access Plan is another approach to traditional health insurance. Instead of your health care providers billing your insurance, you pay upfront using the Sidecar Health payment card. This results in savings of up to 40% on healthcare costs for its customers. 

Established in 2018, Sidecar Health Access Plan is based in El Segundo, California. Its plan options are easy-to-understand and allow you to shop upfront for affordable health care rather than receiving care and finding out what it costs later. 

Learn more about Sidecar Health Access Plan and how it works.

Prefer to talk to an agent on the phone? Call 866-794-1192 to speak to a representative now.

Best For
  • People who are younger than age 65
  • People in relatively good health
  • People who want to shop for affordable doctors, specialists or procedures
  • People who want transparency in healthcare costs
Pros
  • You can customize your plan
  • It may reduce healthcare costs by as much as 40%
  • It has a mobile app to access information on-the-go
  • No provider network, so you can see any doctor with no referrals needed
  • No enrollment period
Cons
  • Plans are not compliant with the Affordable Care Act (ACA)
  • Plans have an annual coverage limit
# of Healthcare Providers
150k+
Online Application?
Yes
1 Minute Review

Kaiser Permanente is a not-for-profit health plan. Kaiser Permanente offers both health insurance and health care, which has resulted in excellent reviews from customers and rating organizations. Kaiser Permanente does have limited service areas, and you typically need to stay in-network for services unless you’re experiencing an emergency.

Best For
  • People in Kaiser Permanente service areas
  • People who don’t mind managed care
  • People who like to manage their care online
Pros
  • Many services available in one location
  • Ability to make appointments online or using an app
  • Good customer service
Cons
  • Limited service area
  • Need to stay in the Kaiser Permanente network for most services
# of Healthcare Providers
855k+
Online Application?
Yes
1 Minute Review

UnitedHealthcare is an insurance company that is dedicated to making the health care system work better for everyone. Its plans can serve customers of all ages, starting in childhood and continuing all the way through the retirement years. The company partners with more than 1.3 million health care professionals and over 6,500 hospitals to give customers the freedom to access healthcare wherever they are. This insurance provider has a strong financial standing and good ratings, making it a reliable option for just about anybody.

Best For
  • People who want flexibility in their health care coverage
  • People who want supplemental insurance coverage
  • People who qualify for both Medicare and Medicaid
Pros
  • Offers a wide variety of plans
  • Strong financial and customer service ratings
  • ACA and non ACA plans available
Cons
  • Not all plans ACA-compliant
  • The website can make it difficult to get a quote
# of Healthcare Providers
875k+
Online Application?
Yes
1 Minute Review

Cigna Health Insurance offers low-cost private health insurance and Medicare Advantage and Supplement Plans for families and individuals. Founded in 1982 and based in Bloomfield, Connecticut, the company offers a wide array of health insurance plans including three Bronze plans, four Silver and one Gold. All Cigna plans are EPO plans, meaning they are all in-network. Free telehealth visits come with every plan and are available to customers 24/7.

The four-metal tier coverage plans include:

  • Bronze
  • Expanded bronze
  • Silver
  • Gold

Individual and family Cigna private insurance plans are all available on the Marketplace and through the Cigna website, as well as with licensed agents in each state. Because they are sold through the Marketplace, they can only be purchased during your state’s open enrollment period. Special enrollment periods apply for special circumstances.

Best For
  • Easy access to benefits
  • Pharmacy programs
  • Savings and spending accounts such as HSA and FSA
  • Supplemental plans
Pros
  • Home delivery for prescriptions
  • Health management mobile apps
  • Easy ID card replacement
Cons
  • Potentially high deductibles
  • Not available in all 50 states

Frequently Asked Questions

Q

Do small businesses have to offer health insurance?

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Do small businesses have to offer health insurance?
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In America, businesses with less than 50 employees are not required by law to offer health insurance or pay a no-offer penalty according to the Affordable Care Act.

But it’s typically considered best practices to offer employees some type of coverage, which is often advantageous for the business.

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Q

How do I get health insurance for my small business?

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How do I get health insurance for my small business?
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Working with an established group insurance plan provider offering policies in your area is the easiest way to offer coverage to your employees. Your insurance agent can help you explore coverage options and calculate your costs to choose the most effective insurance plan for your team. You can choose between multiple premiums, decide how much you’ll cover on behalf of your employees and set up an open enrollment period for your company.

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Q

How much is health insurance for small businesses?

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How much is health insurance for small businesses?
asked
A
1

The answer to this question will vary depending on a massive number of factors, ranging from the size of your company to the policy provider that you choose to work with and from the plan you select to the amount that you choose to pay on behalf of your employees. Working with an insurance agent who specializes in small business insurance options can help you balance benefits and costs for your employees. 

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