By James Eckardt
As a business owner, there is a lot you can do for your employees. It can be scheduling vacations, bonuses, or pension plans. But do you know what makes the employees happiest is health insurance?
If you are a small business owner with a bunch of employees, the least you can do for your employees is to take care of their health and wellbeing.
Although small businesses are not legally bound to cover their employees through group plans, it is good for their team and should be considered.
Why should you opt for a group plan?
First and foremost, it is easy. You can find a good agent who will recommend a good small business health insurance based on the number of people working for you and the type of your business.
Moreover, the agent sets up everything and explains everything to your employees as well.
A big reason to go for group insurance is it saves you money on taxes.
For employees, if they buy health insurance personally, they have to pay for it after the tax deduction.
But, if employees buy small business health insurance as a group, they have to pay for it from the pre-tax money, which helps them save 30 to 40 percent on their health insurance.
As an employer, if you provide health benefits, your contributions are tax-deductible, and payroll taxes are reduced by 7.65% of employee reductions.
Moreover, paying for health benefits, instead of raising salaries saves you money, because you don’t have to pay payroll taxes and other compensations.
Group insurance also gives you access to more doctors and hospitals as they have a larger network than individual insurances.
There are certain doctors and hospitals which don’t accept or charge highly for individual insurances.
And most importantly, it keeps your employees happy. Employees consider health benefit as the most important benefit, they can ever get; therefore, it should be your top priority.
Moreover, it increases the productivity of your employees. More than 60 percent of the employees believe that benefaction of health insurance has increased them increase their productivity.
And as a business owner, all you need is a happy and productive team.
How to get small business health insurance?
Small business owners may have to hassle a bit to find the ideal health insurance for their employees. You can get group health insurance from the following:
* Individual marketplace: If you want to buy an individual plan from healthcare.gov, you can choose this option. Your eligibility for premium tax credits depends upon your location and income.
* Private individual plan: You can directly buy insurance plans from individual health insurance carriers. You will not be eligible for premium health subsidies with this plan.
* Trade association plan: There are various professional trade associations which provide group health insurance plans. Going for a trade association plan is cheaper than the private individual plan.
* Medicare: This plan is especially for seniors. Your Medicare tax contribution record and age determine your qualification for the plan.
How much does a group Plan cost?
The cost of obtaining a small business health insurance depends on the location, workforce size, and the age of employees.
If you have made any premium cost-sharing arrangements with your employees, it also affects the cost.
On average, if you own a small business with less than 200 employees, the annual cost will be approximately $6500 for single coverage premiums, per employee and approximately $17,000 for family coverage premium, per employee.
Annual administrative costs of around $13,000 should be considered as well.
Hiring a plan administrator is critical because handling price negotiation, plan selection, and compliance, plan enrollment, is a time-consuming task.
About Author: James Eckardt is the founder of Peak Advisors Inc., a boutique insurance brokerage on Long Island, NY. The firm has a stellar record of service with three decades of experience in health insurance coverage and hundreds of clients including small businesses, commercial enterprises, sole proprietor-ships and seniors.