For many companies and organizations, group health insurance provides operational savings and great coverage options for employees. In order to use these plans, however, you need a certain number of people working for the business. If your business is very small, you may not think that you have enough people to take advantage of these plans with potentially lower rates. After you know the facts, you might be pleasantly surprised.
Small Business Definitions
Two main determinations matter when you consider if your small business is eligible for group health services or not. First, how many employees do you have? Second, are they related to you? The answers to these questions determine whether you can get group health insurance and if you qualify for small or large group versions.
If you have less than 50 workers employed full-time at your company, you qualify as a small business when it comes to purchasing and providing health insurance benefits. However, if you have only a few and they are all family members, will have to use a family insurance plan instead. This also applies if the other employees own part of the business along with you.
Any company with 50 or more employees can definitely choose group health insurance. However, they will not get the small business version as long as all other criteria are met.
Employee Qualifications for Group Coverage
Besides not being direct family members of the owner of the business, there are other rules about who constitutes an employee for group health insurance allowances. In general, any full-time employee counts. Part-time employees do not count on their own. However, the IRS has developed a guideline that allows you to add together multiple part-time employees to create what is called a full-time equipment one. If you have two workers who both work 20 hours per week, they will add up to one full-time employee.
The cut off for full-time work is considered 30 hours per week. If you want to offer group health insurance at your company, it makes sense to pay attention to how much work is being done by the majority of the people employed there.
There are a wide variety of different types of group health insurance you can get on the market today. Besides for traditional HMOs and similar, there are also alternatives like MEWA, VEBA, and more. It may be difficult to navigate the complex issues surrounding the healthcare industry today. Since you have to pay attention to the rules still in place under the Affordable Care Act, it may help to get some group health consulting services to better navigate your options.
ClaimLinx can help you do just that. We offer qualified and services about a wide variety of different health plan options. We will help you determine if your employees qualify and whether you can get small business group health plans or larger group coverage. Let us help you make the best choice for your company.