Healthcare Overview: Options and Resources
With healthcare changes looming on the horizon, providing employee health insurance poses a challenge for small businesses. In fact, many small businesses lack enough workers to qualify for the best rates, so they forego providing coverage altogether. However by joining groups and targeting plans designed for small companies, the business owner can find the most comprehensive plan at the right price.
Why Offer Healthcare?
Public health research has found many reasons small business owners should provide some kind of healthcare coverage. Just a few are:
- Employee attraction and retention, including delayed retirement of key employees.
- Tax incentives to both the business owner and
employees, such as a reduction in payroll taxes and the
employee's ability to contribute toward insurance premiums
with pre-tax dollars.
Under the Affordable Care Act, small businesses with fewer than 25 employees that provide health insurance now may qualify for a small business tax credit of up to 35 percent (up to 25 percent for nonprofits) to offset premium costs.
- Better worker morale, resulting in increased productivity, as well as lower rates of absenteeism and worker's compensation claims.
A Look at the Options
Given that so many healthcare plans now exist, small business owners may find choosing the right program for their companies an overwhelming task. A key element to take into account is the individual situations of staff persons.
Plans can vary greatly regarding doctors, hospitals and medical groups serving those covered. Some people, particularly families and older individuals, who've developed histories with particular physicians, may be unhappy if they must change. On the other hand, young persons who come into a job with no insurance will likely appreciate the most basic plan.
It's also important to remember that federal regulations regarding small business health care coverage are changing and will continue to be in flux for some time to come.
Though many healthcare options are available, most employers select a Small-Group Major Medical policy. These programs include:
- Traditional or Indemnity Health Plans
- Health Maintenance Organization (HMO)
- Preferred Provider Organization (PPO),
- Exclusive Provider Organization (EPO)
- Point of Service (POS)
- Consumer-Driven Healthcare (CDHC)
See Small Group Insurance for descriptions of each product.
How a Broker Can Help
A small business owner who's also an insurance expert is a rare animal, so a healthcare broker's assistance can be huge plus. Besides bringing a myriad of options to light, brokers can assist with legal and compliance issues.
Among these are the Health Insurance Portability and Accountability Act (HIPAA), the Consolidated Omnibus Budget Reconciliation Act (COBRA), the Employee Retirement Income Security Act (ERISA), and other regulations pertinent to specific areas. Brokers also can help employees and the self-insured process claims and resolve related problems.
To find a reliable broker, start the process by talking with friends, relatives and colleagues. Other reliable sources include the local chamber of commerce and the Better Business Bureau.
The state insurance commissioner's web site is an excellent resource for specific details such as the broker's licensing information and records of consumer complaints. The National Association of Health Underwriters' (http://www.nahu.org) Internet site lists members as well as their offerings.
As a rule of thumb, select a fully-credentialed broker with at least five to 10 years of experience in the field.