Turning the Page on 2020 (Thankfully!) Means Planning for 2021 with Employee Health Insurance Options
In uncertain times like these, it’s never too early for small businesses to start looking into employee health insurance options for the coming year. 2020 may seem like it’s lasted forever, but the end of the year is rapidly approaching. Companies looking to start a group health insurance program or modify their existing plans have options that were previously unavailable.
At Preferred Insurance, our skilled independent Colorado insurance brokers work with small business owners to help them understand the often complicated but vital task of employee health insurance planning. We know the Colorado healthcare plans, we know the providers, and we know how to get coverage for local companies that keep their workforce healthy while also doing the same for their bottom line.
While the federal health insurance laws only require companies with 50 or more employees to offer health insurance coverage to their employees, plenty of smaller businesses do so as well because of the numerous tax and intangible benefits that offering health coverage provides.
As you consider, employee health insurance options for 2021, keep these three tips in mind:
Employee Health Insurance Options Tip One: Understand the Basics of Group Coverage
Group plans are the primary way employers provide employees with health insurance. Health insurance companies such as Anthem, UnitedHealthcare, Humana, Aetna, Kaiser Permanente, and several others offer multiple plans specifically tailored to the needs and budgets of small businesses.
Here’s how group plans work. A company signs up and purchases the insurance from a carrier for the “group,” which consists of employees and their dependents. Plans can cover full-time employees only, or they can provide coverage to part-time employees as well.
A company that enrolls in a group plan will typically pay the full fee for the plan to the health insurance company while also deducting contributions from the paychecks of employees who participate in the program.
Tip Two: Understand Your Needs
One of the many benefits of working with an experienced Colorado health insurance broker applies when they can help you figure out your company’s needs when looking at employee health insurance options. The size of your workforce, the nature of your industry, and the specific demographic characteristics of your employees will all play a role in determining what benefits your company truly needs. All of these factors will also play a role in how much your group coverage will cost.
Knowing what you need before you start looking at all the group coverage options available to you will help ensure that you offer your employees a program that works for them while also providing the best value for your business.
Tip Three: Understand the New Alternative to Group Coverage
Starting January 1, 2020, employers that want to offer their workforce health benefits without administering a group health insurance program have a new option that allows them to reimburse workers for their healthcare-related expenses: the individual coverage health reimbursement account (ICHRA).
As defined in final rules issued in 2019, an ICHRA is “a type of account-based group health plan funded solely by employer contributions.” Through an ICHRA, employers can pay their employees directly for their health insurance coverage and medical care expenses, without any reductions in their salary or other employee contributions.
Employer payments reimburse participating employees solely for medical care expenses incurred by the employee, or their spouse, dependents, and children under age 27, up to a maximum dollar amount for a coverage period.
These reimbursements are excluded from the employee’s income and wages for federal income tax and employment tax purposes. ICHRAs are attractive to employers and employees alike, helping companies control costs while expanding employee choice.
Tip Four: Understand that You Don’t Need to Do Your Employee Health Insurance Planning Alone
Even the smartest and most business-savvy individuals can find themselves lost when it comes to deciphering employee health insurance options. Choosing the right health coverage in Colorado can be a confusing and time-consuming process, especially when you don’t know where to look, what to look for, and what will result in the best coverage at the lowest price. Good news!Those charged with selecting and enrolling in a group health insurance plan don’t have to go at it alone.
Finding the right combination of medical benefits and pricing for employers and employees is what we do best at Preferred Insurance, a skillful Colorado Springs business health insurance broker.
Small businesses not only get the benefit of our extensive group health insurance expertise but also receive the information they need in plain English so they can make informed and knowledgeable decisions. We are a locally owned and operated Colorado group health insurance broker that offers free quotes in less than 48 hours.
Call Preferred Insurance today to schedule a free consultation about your small business health insurance needs.