Medical costs in the U.S. are high, which is why a lot of employees look for a job that offers health insurance. Over 88% of people consider health insurance benefits when choosing a job. For companies, providing group insurance to
employees costs a lot of money, so some companies opt out of providing insurance. But are they required to? Yes, and no.
Affordable Healthcare Act
There is no specific law that requires employers to provide health insurance coverage to their employees. However, in January of 2015, the Affordable Care Act, ACA, required that employers who have 50 or more full-time employees provide health insurance. If they do not, they will face a tax penalty.
According to the ACA, full-time employees are employees who work an average of 50 hours a week.
Group Insurance Penalties
If a larger company with 50 or more full-time employees does not offer health insurance, they are subject to IRS penalties.
The IRS will penalize the company if one or more of their full-time employees gets a premium tax credit for getting their own health insurance coverage from the Marketplace. The company can owe up to $2,500 for each employee.
The company must offer insurance to 95% of their employees to avoid a penalty, and it must be year round. If the business offers healthcare for some months, and not others, then they will face a portion of the annual penalty.
Small Businesses
Small businesses are not required to offer healthcare coverage to their employees. Since they have less than 50 full-time employees, they will not face penalties. If a small business does not offer health insurance, then a person can seek their own health insurance plan from the Marketplace or a private company.
While there is no longer a penalty for going without healthcare coverage, it is important to seek out information on different plans. There are plans within your budget that will meet your needs and lifestyle. If you need help searching and comparing all the group insurance plans around, EZ.Insure can help. We offer local specialized insurance agents that can do all the comparisons for you, and just provide you the quotes. All for free! It’s that simple. To begin, enter your zip code in the bar above, or to speak to an agent, email [email protected], or call 888-998-2027. There is no hassle involved, and no obligation to buy, and no headaches. Just easy, fast, and free quotes!
Small business owners know the value of covering their employees. After all, everyone gets sick at some point. If you support your team’s wellness, you make a stronger team.
You might also see the value in comparing and then choosing the best option. Two of these are either QSERHA or group health insurance, but which one has the most value for your business? For the answer to that question, we’ll need to break each one down first.
QSERHA
This choice was unavailable until now. The ACA has now widened the usefulness of HRAs. Previously, you couldn’t set up an account unless it was tied to a policy. For more info on this, read about 2020 HRA changes here. Thankfully, this puts a Qualified Small Employer Health Reimbursement Arrangement or QSERHA on the menu.
So, what does it offer for your business?
This option skips the sometimes expensive group health insurance plans. While you’re missing out on the robust coverage insurers provide, the cost-saving benefits might be redistributed amongst your employees.
With this HRA, you must follow the requirements: employees must already have minimum health insurance, and you have to set-up your HRA properly. Afterward, you simply make contributions to the account, and later, the funds will be available to help pay for your employee’s medical expenses, tax-free.
Group Health
It comes down to which is better for your business. To help guide your decisions, see what your answers to these questions are:
Do my employees need healthcare assistance?
Is everyone on staff covered by an HRA already?
Does my budget include funds for a robust insurance option?
After answering these, you should have a better idea of which option to go for. If not, then consider the following:
QSERHA
Group Health
Cost
You can choose how much you contribute to the account.
Premiums vary by provider but are generally more expensive.
Participation
All employees must be offered coverage, but they do not have to accept.
Generally, around 60% of your staff must be enrolled to qualify.
Coverage
Can’t be in tandem with group health.
Employers can choose to reimburse medical expenses or premiums.
Primarily covers medical, dental, and vision
Eligibility
1-49 full-time employees
2-50 employees
Note: some states requirements go up to 100
Hopefully, this chart helps guide your decision. No matter which you choose, remember that the health of your employees is important to your continued business. A healthy team is a happy team. However, if your budget allows, consider choosing the group health option. You’ll have an agent to help you with the tough questions plus the bonuses offered are well worth the price tag.
If you are looking to get more coverage for your company, EZ.Insure offers solutions. Your personalized agent will answer any questions you have, compare the plans available to you, and even sign you up when you are ready, free of charge. To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected], or calling 888-998-2027. EZ.Insure makes the entire process simple, easy, and quick.
Do you know about Health Savings Accounts (HSAs)? According to surveys, about half of Americans have no idea what they are, or what to use them for. This situation isn’t good considering how present medical expenses have a crippling effect on the average person. If your employees are hospitalized from a serious injury, the resulting bill can equal the cost of a family sedan. Help them understand what these are, so they’ll opt into your group health plan.
HSAs are a great solution for these high payments, but not if people don’t know how to use them.
What is an HSA?
HSAs were created to help pay for medical expenses that your health insurance plan doesn’t cover. These savings accounts are only compatible with high deductible health plans that are specifically tagged “HSA-eligible.”HSAs are tax-advantaged, giving you more of a reason to use them. On this note, if you make a withdrawal from the account to pay for a qualified expense, then the amount will not be taxed.
If their deductible is $1500, and your medical expense is $4500, then you will be expected to pay the $1500 deductible, and your insurance company will take care of the rest. For some, $1500 is still a lot of money. With an HSA in place, you can cover that as well.
Either you, or your employee, or both, will put money into the account. While HSAs can be opened by yourself, starting one with an employer will help it grow faster with you both making contributions. These are saved up to pay for things like dental work or prescription drugs to make you feel better.
How Do You Start One?
Before starting an account, your employees have to meet the requirements. This is easier if you have a high-deductible health plan (HDHP). With the HDHP, they often are bundled with an HSA, or at least give you the option.
Besides the basic stuff, you won’t qualify if you:
Have other health coverage
Are considered a dependent
Are enrolled in Medicare
How Do You Use It?
Let’s say an employee started their HSA, saved money with it, but now an urgent medical need arises.
We’ll say this urgent need is the medicine to help their recovery. Thankfully, the IRS approves this for HSA spending. Make sure to double-check though. No one wants to pay a 20% surprise tax when you file your taxes later.
That being said, they have options with spending your HSA. They can either get a debit card for it from your bank or insurance company, or you can ask for a reimbursement.
No matter which place they go to, they will have experts to help explain everything. After they use these accounts to save money, they can withdraw from it to pay for qualified medical expenses. In the long run, these expenses will cost less because the HSAs are tax-advantaged.
HSAs seem fairly easy, but most people have no idea how to use them. Many insurance providers will not give HSAs the time of day, just throwing them in like a less useful option. As savings accounts go, they are specific to medical expenses, and those are restricted even more by the IRS.
We can only assume that their extreme restrictions and mystery are a cause for people not using HSAs properly, if at all. Don’t miss out on the opportunity to help your employees pay for hefty medical expenses without going bankrupt. Do some research and ask your insurance company or bank about these benefits.
If you are stuck, don’t know where to start, or have issues, don’t worry. EZ.Insure offers solutions. Your agent will answer any questions you have, compare the plans available to you, and even sign you up when you are ready, free of charge. To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected], or calling 888-998-2027. EZ.Insure makes the entire process simple, easy, and quick.
Not convinced small business coverage is worth it? Find out why we think it is.
1. It’s Cake.
As a business owner, your greatest currency is time. So the last thing you want is to waste that on looking for the right group plan.
When you hire an agent, you hire a full-time tour guide committed to navigating you through the selection process. With demographics, health concerns, and company size to consider, there are plenty of factors that must be included in your final decision. An agent can explain the nitty-gritty details of selecting a plan that fits your company’s needs, instead of you spending an unbelievable amount of time trying to digest the vast sea of information. Consider them
your “sparknotes” of insurance plans.
This connection is 1-to-1, because trust us – we hate spam calls as much as you do.
Connect With a Personal Agent Now
2. Less Money (From You), Less Problems.
One of the biggest misconceptions about purchasing insurance is the hefty price tag that comes along with it. And that can be true, if you go about the process in the wrong way. So we’re here to dispel that myth.
Compared to individual health insurance, high costs of one insured person have a smaller effect in a larger pool – in other words, more people are paying to support the few who use the benefits of being covered to their full extent.
With comparison shopping, you avoid that. You are guaranteed to find the right plan at an affordable price. You can contribute nothing to a plan – and it will still be beneficial for your employees. No risk is necessary.
It is important to keep in mind that you are not only the owner of your company; you are the owner of the plan selection.
Checking out your options is a great place to start.
3. “I Want YOU To Buy Health Insurance!”
If you still don’t believe in the affordability of group health coverage, consider this – it’s on Uncle Sam. Two words for you: Tax. Benefits.
Here are the tax savings you get by offering group health insurance:
Employer contributions are tax-deductible
Employer payroll taxes are reduced by 7.65% of employee contributions
Employer workers compensation premiums are reduced
No payroll taxes and workers compensation premiums on money used towards health benefits.
And here are the tax savings your employees get by receiving group health insurance:
When employees buy health insurance on their own, they have to use post-tax dollars to buy it. They make money, the government taxes that money, and then they take the remaining amount to buy what they need.
When employees buy health insurance through a group plan, they pay for the insurance with pre-tax dollars. That can save them up to 30 to 45% on their health insurance premiums.
4. Healthy Employees = Happy Employees
You might not be able to buy the Beatles’ love, but youcan buy your employees’.
Studies show that small business health insurance plans increase employee loyalty and decrease turnover. There’s scientific proofthat purchasing insurance for your employees can increase retention and aid in recruitment. Mic drop.
In all seriousness, health insurance is a big deal for both employees and job seekers. For some, it’s even the deciding
factor between job offers.
Providing health insurance, despite not being a large corporate powerhouse, shows how much you value your potential and current employees. Which – if you’re a good boss – is a lot.
5. And Happy Employees = Happy Boss
You can imagine that an employee with a burst appendix or an inflamed wisdom tooth might be a little distracted when calculating the day’s revenue. But only a little.
Employees who aren’t provided health insurance have an increased likelihood of avoiding doctor appointments or hospital visits. In short, they have an increased likelihood of being unhealthy.
Additionally, healthy employees means less visits, less appointments, and less sick days. If you focus on “saving money” at the cost of your employees’ health, we’re tellin’ ya, it’s just going to come back and bite you in the bottom.
Or your bottom line.
6. The Gift That Keeps on Giving
Cobra isn’t just a snake.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a health insurance program that allows an eligible employee and his or her dependents the continued benefits of health insurance coverage in the case that employee loses his or her job or experiences a reduction of work hours.
The time has come. You made it to 26 with health insurance coverage through your parents. But now your birthday is approaching and are getting kicked off your parent’s health insurance plan. You may be wondering if you can stay on your parents’ health insurance longer. The answer to this is, unfortunately, no. You will get kicked off the plan at
either the end of the month that you turn 26, or at the end of the year. Its inevitable, but where do you start?
The Options
If you are employed, then you can join your company’s health insurance plan if they have one. Another option is to hop on your spouse’s health plan if you are married. If none of these options apply to you, then your only choice is to get your own health insurance plan. Those options are:
Long-term Plans
When you turn 26, you qualify for a special enrollment period for Obamacare, also known as the Affordable Care Act (ACA). You also have the option of getting private insurance in which licensed health insurance agents are able to create a policy that is unique to your specific needs using a full spectrum of different insurance companies. It is important to shop around because these plans are sometimes cheaper than the marketplace insurance plans. Long-term plans offer more comprehensive coverage. These plans help manage day to day expenses and are convenient for those that require routine medical work, such as medication, lab work, and inpatient/outpatient services. Major medical health insurance complies with the ACA requirements which means it provides the ten essential health benefits.
Essentially, when you are over 26 years old and are no longer on your parent’s plan, then a major medical plan is best if you are looking for coverage of pre-existing conditions, and need routine medical work , such as medication,
lab work, and inpatient and outpatient services. Major medical health insurance complies with the ACA requirements which means it provides the ten essential health benefits. These ten essential benefits are: ambulatory patient services, prescription drugs, emergency care, mental health services, hospitalization, rehabilitative services, preventative and wellness services, laboratory services, pediatric care, and maternity and newborn care.
Short-Term Plans
Unlike long-term plans, their short-term counterparts do not need a qualifying life event to enroll. Short term health insurance provides fast, flexible insurance with many benefits. These plans can be extended up to 3 years, and you can pick your deductible amount from many options. You are also able to drop coverage without a penalty if you want to change to a long term insurance option. Premiums are lower than ACA health insurance plans, and you get coverage as soon as a day after applying.
It is important to understand that short-term insurance is temporary and not ideal for those who require more comprehensive coverage or have health conditions. Short term plans are not guaranteed issue, meaning they do not cover pre-existing conditions. They only cover the basics.
When you consider purchasing health insurance, you have to think about how much you want to pay, the coverage provided, and which term length is best for you. It can be quite overwhelming when you embark on this new journey. EZ.Insure can help. We will provide you with a highly trained agent within your area that can provide you quotes and plans from all the different health insurance companies in your region. To get started, enter your zip code in the bar above. Or to speak to an agent call 888-350-1890, or email [email protected]. We will go over everything with you and help you decide if this plan best suits your needs. If it does not, then we will direct you to other plans.
In 2014, the Affordable Care Act established the premium tax credit so that individuals or families with low or moderate income can be able to pay for health insurance through the Health Insurance Marketplace. Premium tax credits help you pay for a portion of your monthly cost of insurance premiums. Individuals and families must meet an income requirement to enroll in a health insurance plan through a state-operated insurance marketplace, or a federally-operated marketplace.
Qualifications
You must prove you do not have access to an affordable employer-sponsored program. This plan must meet minimum essential coverage meaning the employee contribution does not exceed 9.5% of the employee’s income.
You must prove you are not eligible for Medicare, Medicaid, or TRICARE
You cannot be claimed as a dependent by another taxpayer.
In the same month, you or a family member must have health coverage through a Health Insurance Marketplace.
You file a joint federal income tax return if you are married; you cannot file married filing separately tax return (unless a victim of domestic abuse or spousal abandonment).
Have a household income that falls within a certain amount.
Income Requirements
In order to be eligible for the premium tax credit, you and your family size must be at minimum 100 percent below the poverty line, but no more than 400 percent. This means the income must be between $12,060 and $48,240 for an individual and between $24,600 and $98,400 for a family of 4 in 2018.
The amount of tax credit is based on a sliding scale. This means the lower your income, then the larger credits you receive. If your income changes, then the amount of assistance you qualify for will change as well.
It is important to keep an eye on your household income and how much tax credit you receive. If the advance credit payments are more than the allowed credit, then you will have to repay some or all of the extra earnings. If your household income is more than 400% of the federal poverty line for your family size, then you are not allowed a premium tax credit. You will have to repay all of the advance credit payments.
Advance Tax Credits
A taxpayer can either choose to receive advanced payments, which is paid to the insurance company to lower monthly premium costs, or the taxpayer can wait to get all of the credit when they file their tax return. Eligibility for the advanced payments is determined when purchasing coverage through the marketplace. There is a difference between advance payments to your insurance company and your allowable premium tax credit amount. Form 8962 calculates your tax credit amount that is allowed when you file your tax return.