Group health plans are a great way to protect your employees. As a small business owner, sometimes, it’s hard to find the right plan. However, you don’t need to spend hours looking online. Here are some ways you can hasten the process.
Check the Affordable Care Act (ACA) Requirements
In ACA, businesses with 50 or more employees are required to offer health insurance. The health insurance must cover at least 95% of FTE employees.
FTE means full-time equivalent. This number includes part-time employees who are working less than 130 hours a month or less than 30 hours a week. Computing for the FTE is straightforward and simple.
For example, you have 40 employees working regularly and full-time with you. Your part-time employees are around 20 people who are working 20 hours a week.
First, you need to get the equivalent full-time number of your part-time employees, which is 20 multiplied by 20. Divide the result by 30, and you will get 13. Add the 13 to 40, and you will get 53, which means you are required to offer health insurance to your employees.
Below the 50-employee requirement, you don’t need to get group insurance for your employees. However, you might still want to get health insurance for some reason.
If you plan on buying health insurance for your employees, here are the other requirements to think of:
- Affordability of the premiums (9.78% or less based on employee’s income)
- At least 60% shared provision, shouldered by your business
- Must cover 10 health benefits as mandated by the federal or state government
Conduct a Survey
Get the opinion of your employees by conducting an anonymous survey. You can send through their email to ask the most important things when they are given a chance to buy a LA Group Health Insurance.
What topics should you include in your survey? You can use the list below to construct a survey that will answer all you need when you’re ready to contact an insurance provider.
- An option to join the group insurance or to find their provider
- Dependents, whether they’re going to add their spouse or their children.
- Type of Plan (more of this in the latter part of this article)
- How much they’re willing to pay in term of premiums and protection coverage
- Comprehensive coverage that includes an extensive network of hospitals and clinics
Never ask about medical history because asking about it is prohibited in HIPAA (Health Insurance Portability and Accountability Act).
Prepare Your Business Information
After the survey, you will have a better idea of how many employees are willing to purchase a group health plans and how much they are willing to spend. Your next step is to prepare all necessary documents.
The exact requirements may vary from one provider to another. However, here is a standard list of information and documents you might need to prepare.
- Business information such as an address, registered name, employer identification number (EIN), date established, among others
- Standard Industry Classification (SIC)
- Employees list including beneficiaries (spouse and/or dependents)
Give Options to Your Employees
Choose group health plans based on your employees’ needs. Also, provide lots of options for them. Group health insurance has 4 major categories:
- Health Maintenance Organizations (lower premiums, lesser flexibility, needs primary care doctor and referral, no out-of-network coverage except emergency)
- Preferred provider organization (high premiums, greater flexibility, doesn’t need primary care doctor and referral, out-of-network coverage with a corresponding premium fee)
- Exclusive provider organization (medium-level premium, high flexibility, primary care, and referral depends on plans, no out-of-network coverage except emergency)
- Point-of-service plan (medium level premiums and flexibility, needs primary care doctor and referral, out-of-network coverage with the corresponding premium)
The great thing about health insurance is mixing the different plans based on needs and budget. However, you will need an expert’s opinion to create the best plan for your employees.
Lastly, request a list of benefits and coverage for each plan. Give copies to your employees, so they can peruse the plans and decide which option suits their needs.
Consider Your Budget
Employers with less than 50 employees who opted for health insurance are exempted from shared premium payments. However, you can still pay if you want and if the business can afford to pay.
You can pay a portion of the premium or let your employee pay the full amount through payroll deductible. Some businesses choose to split the payment. The employee will pay half, and you pay the other half.
Whatever decisions you come up with, always be transparent with your employees. After all, their money is also involved. Most importantly, consult an expert to avoid making the wrong decisions.
About Arroyo Insurance Services
Arroyo Insurance Services was officially established in 1986, but we have roots dating back to before 1950. One of California’s leading client-oriented and independently owned agencies, we have over 140 employees with a combined experience of over 450 years, spread across 11 locations. We are committed to providing the best insurance and risk management services at the most competitive premiums, and backing it with hands-on service tailored to our customers’ needs. For more information on how we can mitigate your risks, contact us today at (877) 220-4769.