While group health insurance may seem like an expensive investment for employers, it is important to understand the value of a Group Health Insurance plan. Many employees value health insurance second only to monetary compensation. Offering a group health insurance plan can be the difference between attracting average employees and attracting the best talent available. Quality employees are an integral part of the success and growth of any business.
So how do you know if you can qualify for a small business plan? Typically you will have to satisfy three requirements.
- You have at least 2 full-time officers, partners, owners, or employees.
- You are a legitimate business entity.
- You meet the minimum employer contribution percentage set by your insurance company.
If you have less than 100 full-time employees, the Affordable Care Act states that you do not have to offer health insurance to your employees and there is no penalty if you choose not to. However, if you do choose to offer a group health insurance plan, there may be tax credits available. For tax years 2014 and later, if you employ 25 individuals or less with an average salary of less than $50,000, and pay at least 50% of your employees’ monthly health insurance premiums, you may be eligible for a special tax credit of up to 50% of the amount you contribute to employee premiums.
Premiums are also 100% tax deductible as business expenses by law. You may also be able to reduce payroll taxes by including group health insurance in employee compensation packages.
There are 4 major types of plans that you should review when considering a group health insurance plan for your business.
- PPO – Preferred Provider Organization (PPO) plans are the most common of the 4. PPO plans require employees to get their health care from doctors or hospitals on the insurance company’s list of preferred providers.
- HMO – Health Maintenance Organization (HMO) plans require you select a Primary Care Physician (PCP). The PCP will handle most of your heath care needs. If necessary they will provide you with a referral to see a specialist.
- HSA-Qualified Health Insurance Plans – Health Savings Accounts (HSA) allow you to save money in a special bank account to be used in conjunction with some PPO plans.
- Indemnity Health Insurance Plans – Indemnity plans allow more freedom and control over health care, typically allowing you to visit a doctor or hospital of your choice. The insurance company will then pay a set portion of the expenses incurred.
Managed Care Plans, which are PPO, HMO, and HSA-Qualified plans, typically have less out-of-pocket expenses while Indemnity Plans allow for access to a wider range of doctors and hospitals.
At Greenwald Berk Agency, we understand how difficult it can be for an employer to determine which group health insurance plan makes the most sense for them. We will evaluate your health insurance needs and your budget to select the plan that is most appropriate for you. Call us at 570-288-7890 with any questions you may have or feel free to use our Group Health Insurance Tool!
Greenwald Berk Agency specializes in the following insurance throughout the Kingston, Scranton, and Wilkes-Barre areas:
• Auto Insurance
• Homeowners Insurance
• Flood Insurance
• Business Insurance
• Group Health Insurance
• and more!