It is tough to build a great business. Finding the perfect small business health insurance shouldn’t be. Small businesses and self-employed individuals face particular challenges when shopping for insurance. Through education, you can find the best coverage for you, your family and employees.
Small Business vs. Self-Employed
There is a distinction between small businesses and self-employed individuals when talking about small business health insurance. Those self-employed find the primary benefit of coverage is reducing any risks as they grow their business. Individuals owning small businesses quickly realize that hiring the best talent isn’t possible without employer-sponsored health coverage.
Why Small Business Health Insurance is Important
Purchasing small business health insurance minimizes your overall risk significantly, but there are many other reasons why this coverage is so vital. While these reasons may seem obvious, some individuals struggle to realize the ramifications of not having a full policy.
Here are a few reasons coverage is vital to your business:
Your finances can be ruined without the proper coverage. Medical costs are surging and without a great policy, you could be on the hook for medical bills you could never afford to pay alone. Insurance has helped many families avoid bankruptcy after an injury or hospitalization. Along different lines, your coverage entitles you to lower medical rates that have been negotiated by the insurance company. For example, fees charged for a regular office visit will usually be twice as high without insurance.
Medical care is expensive. If you don\’t have coverage, it can be difficult to afford the costs of quality care, even for minimal injuries and issues. Health insurance ensures you have access to great care. As well, preventative care and checkups included within your medical plan often lead to a healthier lifestyle. Lastly, insurance ensures you get necessary treatments for life-threatening chronic conditions. If you don\’t have coverage, you may not qualify for these treatments until you make an up-front payment.
Small business health insurance also allows you to protect your business from your personal medical expenses. Unexpected medical expenses can hinder your business significantly, but limiting any personal liability will ensure your business can stay above water while you get healthy. As well, your business will hire and retain much better employees if you have group health insurance coverage. This ensures the company continues to prosper.
Individual, Family & Small Group Coverage
Small business health insurance as it relates to individuals, families and small businesses is relatively self-explanatory. Individuals and families can apply for coverage if they do not receive it from a group plan, or they do not like a group plan they qualify for. As expected, these policies and premiums can be costly because there are no economies of scale to benefit from for individuals or one family. Small business health insurance plans can be called group health insurance, too. These plans offer coverage that is subsidized due to the number of individuals in the plan. As well, the employer and the employee tend to share the costs of coverage. Usually, this provided coverage will extend to dependents of the employee, too.
Types of Group Health Insurance Plans
There are a variety of different small business insurance plans available. Many are created to provide numerous options to people when selecting hospitals and doctors. Other plans keep costs low by only allowing you to visit a select group of physicians and hospitals. The best plan for you, your family or company will come down to the level of protection you desire and the costs you\’re willing to incur. Here are the four most popular types of group health insurance plans:
Certainly one of the most popular plans on the market, a PPO or a Preferred Provider Organization, are plans that require people covered to get medical from certain doctors or hospitals. If you get services out of network, the plan may only cover a little bit or none at all. PPO coverage is ideal for people looking to save money, those whom their favorite doctor is part of the plan, and other who like the freedom of finding their own health care, but don\’t mind only working with certain providers.
HMO, or (Health Maintenance Organization), is a plan that offers a variety of health care services from a limited network of providers. HMO plans are typically based on selecting a primary care physician that provides the majority of services for the patient. If this physician refers them to another provider, it is often in the HMO network. Services outside the system are not covered in most cases. Persons who value preventative care, checkups, immunizations, and more often find benefit in HMO coverage.
Often, these plans are a PPO with a Health Savings Account (HSA) attached. These HSA accounts are flexible spending accounts that allow users to save pre-tax dollars for medical expenses. Many of these plans have high deductibles and lower premiums. Young and healthy individuals who don\’t go to the doctor often find benefit in these plans.
Indemnity plans offer members the ultimate control over their health care. You can visit almost any provider you choose with these plans. The insurance company then pays a portion of any medical services. Usually, members of these plans pay upfront and then have to submit claims to an insurance company. The freedom of these plans is the greatest benefit, but the premiums are usually high because of that.
Tax Credits For Small Businesses
While offering employees insurance coverage can be costly, there is another benefit to the practice. Small businesses that provide group health coverage for their employees receive significant tax credits due to The Affordable Care Act. One of the best ways to reduce your tax burden is through offering coverage.
The Importance of Providing Health Insurance to Employees
There are a plethora reasons that providing health insurance to your employees is important. First, the pricing obtained with your group of employees will almost always be better than searching for individual or family plans. Second, businesses often struggle to hire or retain top-tier talent without offering health insurance. If your company requires highly skilled employees, you\’ll have to provide coverage.
Small Business Health Insurance & You
If small business health insurance is of interest to you, your family or employees, it\’s vital to speak with an insurance specialist before making a rash decision from something you read online. Health insurance is always complex, and it’s best to find all the options available before making a choice.