April 17, 2024


Health know-how

Choose the Right Group Health Insurance Policy for Your Small Business

Whether you’re in the planning stages of a startup, a new business, or an established company, a conversation about group health insurance for your small business is inevitable. But when should you consider obtaining group health insurance, what are the eligibility requirements, and what are the key factors for choosing the right insurance for your small business?

Group health insurance offers many benefits for both your company and your employees. Group health insurance increases your ability to retain high-performing employees while also attracting the best and brightest talent. Group health also enables your employees to quickly receive the medical attention they need, which keeps work disruption due to ailments at a minimum without affecting productivity. Since individual health insurance may leave employees with a monthly bill they are unable to afford, providing insurance allows them to avoid extra healthcare expenses and makes working for your small business the most desirable option. Also, many existing or potential employees might not be able to qualify for individual health insurance due to pre-existing conditions and therefore only look at employers that can offer them health coverage. In either scenario, employees get peace of mind and a boost in morale with the knowledge that your business genuinely cares about their health and well-being.

You are eligible for small group health insurance if you employ 2-50 people. When you apply for your group insurance, expect to fill out an application that lists your employees and, to some degree, medical information on those employees. There are two primary requirements for small business group health insurance:

1.      Employer contribution: Health insurance companies require that the employer contribute at least 50 percent of the employee only premium.

2.      Employee participation: Insurance companies require that at least 75 percent of the eligible employees actually enroll in the health insurance plan offered by the employer.

You will want to focus on three key factors when selecting the best group health insurance plan for your company:

Benefits: Look closely at the details of the various plans. What specifics are covered? What is left out? A few common things you’ll want to pay close attention to are co-payments for doctor’s office visits, hospital co-insurance percentages, prescription medicine coverage for both generic and brand name medications, and out-of-pocket maximums after which the insurance company pays 100 percent of the costs.

Price: On a monthly basis, how does the price for a plan compare to other plans with similar benefits? As your primary goal is to obtain the lowest priced plan with the most benefits, you will need to do some research to evaluate all of your options. Unlike individual insurance, in most cases you won’t be able to get free quotes online for group health insurance. You will want to speak with an insurance agent who specializes in small business group health insurance to discuss your specific needs and the options available to you.

Providers: The provider networks for the plans you are considering will be another important factor. You will want to review the types of doctors, number of doctors, and the specialties of the doctors in the network. Compare the networks for the various plans, and seek advice from other small business owners who have already acquired insurance.

Group Health Insurance is necessary to attract and keep good employees. While employers may not like the cost of group health, they should be aware of the benefits to the company and overall morale. There may be things you as an employer can do to alleviate some of this costly pain. Also, all Group Health companies and insurance agents that offer them are not created equal.

The cost of this health insurance versus the need for solid employees should be weighed. There a perception that many in this country that employees will take a cut in pay if they were to be guaranteed a group health plan. There is a simple explanation for this reasoning. People know they will have to go the doctor. Women need to have mammograms and pap smears, the children need their shots and physicals, and men need their prostrate examined, and people realize these services cost money. Employees often would prefer that you take money out their check for group health then for them to write a check each month for it.