Employers with 25 or fewer employees with average annual wages of less than $50,000, may be eligible for a special tax credit of up to 50% of the amount the employer contributes (at least 50%) toward employee insurance premiums.
Whether you offer small business health insurance arizona to employees or not, it is absolutely critical that you make your employees aware of their obligation to seek health coverage under the Affordable Care Act. And, you have to let your employees know that they have access to guaranteed coverage in the individual market, and that they may be eligible for government subsidies if the coverage you provide them is not deemed to be affordable under the law.
Beginning in 2016, businesses with the equivalent of 50 or more full-time employees must provide “affordable” health insurance or pay a tax penalty. Health plans offered through the Small Business Health Options Program (SHOP) exchanges allow payers to provide the nation’s smallest businesses with affordable plan options that offer critical health benefits.
SHOP health plans operate under separate exchanges from the individual health plan marketplace.
The SHOP market has undergone some significant administrative changes in recent months. Federal agencies have redesigned how small businesses can purchase and enroll in SHOP plans.
Small businesses that can find the right SHOP plan can receive a comprehensive health benefits package with cost alleviation options like state and federal subsidies.
With 27.7 million small businesses operating in the US, payers that can connect small business owners with SHOP coverage may have an opportunity to capture a lucrative segment of the employer-sponsored insurance market.
The cost of obtaining healthcare insurance for yourself and any employees depends on the age, location, and size of the workforce. It also depends on what, if any, premium cost-sharing arrangement you made with your employees to reduce your costs.
, small businesses with fewer than 200 employees annually paid roughly $6,480 per employee for single coverage premiums and $17,616 per employee for family coverage premiums in 2017. They spent another $13,000 annually in plan administrative costs.
You’ll also have to factor in the cost of hiring a part- or full-time benefits administrator, if you choose to hire one, to handle plan selection, price negotiation, plan enrollment and compliance. If you decide to oversee the plan yourself, factor in how much time it would take you to manage the plan throughout the year and translate that into opportunity cost.
The rising costs of health care aren’t just a problem for individuals– they’ve also impacted businesses that make health benefits a priority for their employees.
Small businesses have been particularly vulnerable. Over the last 15 years, the cost to cover one employee under group health insurance rose nearly 200 percent– from $2,196 to $6,435.
These unsustainable costs, coupled with the hassle and one-size-fits-all nature of traditional group benefits, have caused many small businesses to drop health benefits. As we’ve covered previously, this is a losing strategy for 2019. In 2019 and beyond, small businesses will face a competitive war for talent in which health benefits are vital if these businesses are going to succeed.
Fortunately, there are more small business health benefits options today than ever before