Small Business Health Plans - 4 Things You Need To Know
For small business owners, offering health insurance to their employees seems like it would be a paperwork nightmare and many are reluctant to offer it. However, having insurance benefits makes it much easier to retain employees who expect to get more than a paycheck from their employers. Offering health insurance isn't quite the nightmare you'd think and finding the right small business health plans may be one of the best decisions you can make for your business.
1. Can Offer Several Plans
Even though you are a small business, you don't have to offer only one type of plan. Instead, you can sign up to let each employee choose the best type of plan, whether that is an HMO, PPO or HSA plan. This makes health insurance for small businesses more flexible and gives the employees perks they might only expect from a larger business. Employers who want to offer just one type of plan can do that, of course, but many find that having multiple types is a major perk for employees.
2. Multiple Funding Options
As a small business owner, you don't necessarily have to go for the typical funding option with a set monthly premium. Instead, you can opt to have a self-funded plan in which the amount you pay depends on the claims made by people insured through your small business. This can significantly reduce the cost of the insurance, especially if people in your business are healthy. You can also choose from shared-funding plans that combine the best aspects of full funding and self-funding for a balanced cost.
3. Potential Tax Credit
Some small businesses are eligible to claim a tax credit for paying at least half of the costs of health insurance for their employees. This tax credit is available to small business with no more than 25 workers who pay an average wage of no more than $50,000. The credit is for 35 percent of the premiums, which can dramatically reduce the cost of health insurance for small businesses. Plus, the remaining 65 percent of the premiums can still be claimed as tax deduction.
4. Flex Plan Option
Even employees on small business health plans deserve to set up their own flexible spending accounts to use pre-tax dollars for out-of-pocket health care costs. You can add flex plans to any type of health insurance, which allows employees to set aside a specific dollar amount out of each paycheck and submit bills for reimbursement from the flexible spending plan. Just remind employees that they can't carry over their flex dollars to the next year!
About the Author
For all his employees to have better coverage, Royce Vangoff researched group health plans that were very affordable. With individual, family, small business group health insurance and more, Rocky Mountain Health Plans (RMHP) can get everyone covered. Visit http://www.rmhp.org/employer-groups/over-fifty/ for more information.
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