Compare Group Health Insurance for Small Business

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Compare Group Health Insurance for Small Business

Companies of various sizes co-exist in the market - both big and small. For the sake of regulations and implementation of different laws, the companies are classified into categories based on number of employees, turnover, amount of investment and many other factors. Out of these, number of employees, is a significant determinant whether a company will be classified as big, mid-size or small.

The focus here, is on how small companies can find the most suitable health insurance for their employees and what are the impediments to that. Small businesses are those that generally have between two and two hundred employees and are privately owned by members of a family.For big companies, employee health insurance benefits are not a big issue as they have all kinds of resources required to purchase and execute the plans. For small companies, resources are limited- but offering health insurance coverage is very important as that helps to attract good workforce.

However, small companies face a few issues when it comes to providing health insurance benefits to their employees. As said earlier, limited financial resources restrict the choices of health insurance for small companies. Small companies usually lack the administrative decision-making skills since they are operated by members of the family who are not necessarily trained professionals. There exists a planning mismanagement which results in wrong choices or strategies. Also, the smaller the number of employees, the narrower are the options of health insurance plans. Insurance companies offer very few plans for companies with ten or twenty-five employees. Small companies are usually localized so they cannot take advantage of health plans which do not have any network in their area.Due to lack of proper personnel to take care of health insurance issues, employees are left in the dark regarding the plan options and benefits. This makes the whole exercise ineffective. Health insurance is a complicated issue and without efficient guidance employees may not be able to take the right decisions.

Factors Which Determine Health Insurance Benefits for Small Companies

While formulating health insurance benefits for the employees, small companies need to consider some points before reaching a decision.

  • Assess and determine the target of the company in the near future - how the company plans to grow, what culture does the company want to promote among its employees etc. Government regulation on health insurance varies depending on the number of employee a company has. So, the health plans have to be designed in a way which serves smooth transition from one stage to another.
  • Take professional help from knowledgeable advisors on this issue so that the correct decisions can be taken. Small business owners are run by members of the family or close friends who do not have the expertise to handle complex subjects like health insurance. So,Small companies should arrange for professional advisors or agents who canlead them in the right way keeping in mind all the factors to benefit the company and the employees.
  • What is the standard of work force that the company wants to attract. Highly-paid employees look for high-quality health insurance with good standard of benefits. Employees with lower salaries would not too particular about expensive health insurance.
  • The rise in the number of employees and the rate of this increase. The number of employees determines many related things regarding health insurance. There are state and federal laws which govern how small companies provide health insurance. The policy makers of the company need to take into account the present and the projected number of employees to design the health insurance policies effectively.
  • What are the health insurance plan options available for that particular size of the company. Insurance plans differ widely between insurance companies depending on the size of the company. A plan could be meant for a large group only with a certain number of employees. Insurance companies can design special plans for companies with very few employees.
  • Consider starting with smaller more important benefits first and gradually expanding them. If the company is just starting, it is natural that resources will be tight. In this case, they can offer the most important type of health insurance plans with limited coverage. Later, as the company grows in size and turnover, it can offer better plans with better benefits to its employees.
  • Take advantage of the discounts and deals that are offered by the health insurance companies. Insurance companies in a bid to maximize their sales, often offer various or discounts for group plans. Small company owners can work out a beneficial deal with the insurance company or get them to include some additional benefits into the existing plan.
  • State and federal regulations regarding health insurance have to be kept in mind. Healthcare laws and regulations keep changing from time to time. While making the health insurance policies for the employees, the small business owners have to remain within the laws.
  • In the same regard, small companies need to go through proper verification to establish their identity and the genuine nature of their hired employees. Laws take into account the salaries of the employees, the status of the employees etc.
  • Last but not the least, come up with a very clear and solid plan on providing health insurance.

Health Insurance Plan Options for Small Companies

Small companies have to design their health insurance benefits after keeping all the parameters in consideration. Due to their size and other factors, sometimes the plan options get narrowed.Following are the basic types of -

  • PPO Plans - These plans allow the most amount of flexibility as far as the choice of providers is concerned. Members do not have to go through any primary care physician or get referrals for seeing specialists.
  • HMO Plans - These plans have a very restricted provider network within which the member has to remain in order to get coverage.All visits to specialist doctors have to be approved by the primary care physician. There are variations of these plans which allow a little more flexibility. These plans are most reasonably priced.
  • POS Plans - These are in-between PPO and HMO plans. It has the provider network restrictions of a HMO plan but allows members to visit out-of-network providers also. Members need to have their care coordinated by a primary care physician but they don't need referrals to visit specialists. Carriers may offer open-access or direct-access plans.

Besides the regular health insurance plans, some employers can also offer supplementary health insurance to their employees. The premiums for these can also be deducted from the salary if the employee wants. A supplementary health insurance adds more security and protection beyond what an employee gets from the primary health insurance policy. The benefits are disbursed in times of critical medical conditions but there are no restrictions on how the money should be used. It can be used for non-medical needs as well. This insurance can also be used to cover some out-of-pocket expenses of the primary health insurance policy. When the small business owner arranges this kind of health insurance, employees can benefit from the assistance given by the insurance professionals from the carrier.

Some Significant Factors to Consider Before Deciding the Company Health Plans

Small companies do not have the high-profile of a big company, so it is difficult to attract talented personnel. Once acquired, it is also important to retain the personnel. A good health insurance plan serves as an effective incentive to procure talent. When a small company or start-up company tries to lure experienced personnel from its established competitor, it has to offer more high-quality health plans to match the benefits that the employee enjoyed at his or her last job. In this case, the company may have to offer PPO plans because HMO plans will not be appreciated by the employees.

A small company may go for the less expensive HMO plan when the majority of the workforce is young and have no major health problems. This can help to save money for the company. As the company gets older and the employees age or their families grow, the company can upgrade the plans.

A small company can also offer less expensive plans when the average of the workforce is not very high salaried. Low earning workers would like to have plans with less out-of-pocket expenses.

The decision-makers for small companies should have complete knowledge of the health plans available in the local area. They should compare all plans before finalizing one plan. If a POS plan is slightly more expensive than a HMO plan, the company should go for the POS plan. POS plans offer less restrictive than HMO plans so employees have a wider choice of providers. A direct-access POS plan may be cheaper than a PPO plan which will again help to keep the health insurance budget under control. Depending on the availability and budget, some small companies can consider offering two types of plans -one more expensive option and one less expensive option.

Even though the decision of buying health insurance ultimately rests with the owners, they should try to involve the employees as much as possible in the decision-making process. This will increase understanding between the owners and employees and help to formulate an effective policy.

Level of Employee Contribution Towards Health Insurance through a Small Company

The financial resources of small companies are limited which affects their health insurance budget also. Small companies are always under the pressure to compete with large organizations in terms of employee compensation. Since unable to match the higher salaries, small companies try to match other perks to employ experienced or talented workers. Health insurance being an important benefit for employees, small companies may go out of their way to match the benefits with bigger companies.

In this regard, trying to pay the health insurance premiums fully may not be the right strategy. Even if the company does not employ many employees, they should always make the employees pay a part of the premiums, however small. The reasons for accepting employee contributions for health insurance has some advantages.

When the company is relatively small with less than ten employees, it is easier to set the company policy of contributory health insurance. It can be difficult to implement that when the company has grown to many more employees. The employees who join later won't question the already existing health insurance policies.

By asking employees to contribute a part of the health insurance premiums, a small company may avoid some risks involved. If an employee does not take the fully insured plan offered by the company and does not buy any alternative insurance, the company may be approached by providers and hospitals when that employee takes some medical services. The company will be asked to meet the medical bills of the employee.

When employees are asked to pay and they do not like the kind of insurance, they are free to get their own plans as per their choice. If the plans are fully paid for by the company, the employee may remain on the plan but not use it. Thus, the company would have to pay uselessly for his coverage.

Health insurance plans provide coverage for the employee and his or her dependents. If the company has to pay for all the coverage, for the employee as well as the dependents, it would become very expensive and take away essential reserves.

Most employees who are a part of the general work force may have paid for health insurance at other jobs. It is better to let them continue with the practice and not get them used to fully paid health insurance at the cost of the company.

Why Small Companies Find It Difficult to Implement High-Deductible Health Plans

What are High-Deductible Health Plans

Larger companies are found to offer high-deductible health plans to its employees. However, for several reasons these plans don't work in the favor of small companies. High-deductible health plans or HDHPs are health insurance plans which have lower premiums and high deductibles. HDHPs have to be combined with a health savings account(HSA), health reimbursement account (HRA) or flexible savings account (FSA). The following reasons will clarify why these kinds of plans are not beneficial for small companies.

The logistical and administrative processes involved for implementing a high-deductible health plan can become expensive for small companies. Employees who take this plan have to maintain a medical reimbursement plan alongside this plan. This requires more coordination with the insurance provider and additional processes during claim settlements. These plans give the option of investing the unused part of the account which again may become difficult for the small company to manage with its limited resources.

The logistical and administrative processes involved for implementing a high-deductible health plan can become expensive for small companies. Employees who take this plan have to maintain a medical reimbursement plan alongside this plan. This requires more coordination with the insurance provider and additional processes during claim settlements. These plans give the option of investing the unused part of the account which again may become difficult for the small company to manage with its limited resources.

High-deductible health plans are different from the regular plans in terms of out-of-pocket expenses payment and claim settlements. If a small company adopts this type of health plans for its employees, the company has to make the employees fully understand the pros and cons and various regulations of these plans. With limited trained HR personnel, small companies may find it difficult to clearly explain these plans to the employees.They have to have a medical reimbursement account or flexible savings account with the HDHP. The employees should know how to pay the out-of-pocket expenses and how to claim the benefits. The insurance carrier has to issue an explanation of benefits (EOB) and the healthcare provider has to submit the invoice. With FSA, there are IRS restrictions which limits their use for certain medical services. So, in many cases the preferred medical reimbursement account is in the form of health savings account (HSA). However, this too has its drawbacks.The funds in the FSAs are more accessible than HSA funds.

An employee can use the entire amount of his FSA annual election amount at any time of the year. The funds are usable right after the year starts even if the employee has not yet contributed his whole portion yet. The employee can receive the funds of FSA up front and use them to get medical services. There is no up-front access to HSA funds so the employee has to wait till his account has enough funds from his payroll deductions to pay the providers. However, employees have the option of adding funds to his health savings account apart from what is being deducted from his salary. When employee adds funds to his HSA account on his own he does so after deducting taxes on his salary. If funds are added to the HSA account directly by the company through payroll deduction that amount is pretax. So, employees can gain an advantage when they add funds to their HSA directly. At the end of the year, employees are supposed to submit proofs of their medical expenses during the year for which they have used the FSA funds. If there are some unused funds in the account, it does not get rolled-over into the next year. Here is another big disadvantage of FSA accounts. But left-over HSA funds can be continued to be used in the next year. All these regulations make HDHPs a complicated issue for which the employees need expert advice and guidance. Small companies are generally not equipped to provide employees with this administrative infrastructure.

HDHPs have large out-of-pocket expenses which most small companies may not be able to help the employees with. The savings that the companies make through reduced premiums by taking HDHPs, may not necessarily be shared with the employees. In this case, the employees are left to grapple with the increased out-of-pocket expenses. Employees may feel dissatisfied when they have to pay large deductibles and copayments even though their share of the premiums may come down.

Another negative situation is created when employers try to take advantage of deals and discounts offered by insurance companies for giving them bigger out-of-pocket amounts. Small companies would not want to pressurize employees into shelling out huge amounts of deductibles and copayments. Unhappy and disgruntled employees is not a good thing for any company, much less for small companies, where the number of employees is as it is low.

HDHPs with its complicated regulations and processes is a deterrent for employees of small companies. Ideally, policyholders want to understand the working that goes on throughout the health insurance claim disbursement process, the billing process etc. This kind of clarity is still not existent with high deductible health plans.

Reformation of Healthcare Insurance Laws

Healthcare insurance and related laws have been burning issues with every government over the years. In an effort to revamp the healthcare policies, various governments have introduced new laws and regulations.

The Patient Protection and Affordable Care Act, popularly referred to as Obamacare has perhaps brought the most significant changes in the healthcare system in the US. Health insurance mainly along with the ways to fund health insurance like health savings account or health reimbursement accounts are covered under this law. The reformed law, since its introduction in 2010, has attracted a huge amount of criticism, debate and apprehension. Attempts have been made to repeal or replace the law. As of now, the new law continues to be implemented. Patient Protection and Affordable Care Act has several provisions for which apply to small companies.

Insurance companies have redesigned their plan offerings so that they can include the options and provisions as prescribed by the healthcare law for small companies. Some significant changes include the exemption of preventive care services from co-pays, expanded emergency care for patients and limitations on the maximum amount that can be spent on out-of-pocket costs.

The new healthcare law also gave some tax advantages to small companies. Small business owners can claim tax benefits if they employ twenty-five or less full-time equivalent employees whose average salary per year if $50,000 and they pay at least half of the employees'health insurance premiums.

Small business employee health insurance falls under the category of group plans, so, many regulations for small groups apply to these employees as well. The employees of small businesses have to given a summary of the benefits and an explanation of the coverage as per the rules of the health law.

The introduction of the health exchange marketplace helped small business owners get good plans for their employees at very reasonable rates.Three tiers of plans with varying benefits and rates were available in the health exchanges. All these plans confirmed to the regulations of the new law, so small business owners need not worry about compliance when they buy through health exchanges.

However, the Patient Protection and Affordable Care Act created some complications for small business owners as well.The small companies with more than fifty employees were supposed to pay a penalty per full-time equivalent employee if they did not provide health insurance. This was in accordance with the mandate of the healthcare law of every individual having health insurance, either on his own or through his employer.

Small companies while designing their health insurance policies have to go through a tough situation which requires prudence and adequate knowledge. They have to comply with the healthcare regulations as prescribed by the state or federal government on one hand, and on the other, see to the welfare and interests of the employees.Small business need to keep themselves updated with all the information regarding the current or future laws, the various options offered by insurance companies and the requirements of their employees. Since purchasing and implementing the health insurance benefits for the employees is a continuous process, small business owners should always treat it with importance and get help from consultants. Health insurance benefits can help to retain talented employees and can ultimately contribute to the overall growth of the company.

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OVERWHELMING STATISTICS

OVERWHELMING STATISTICS

  • Number of persons under age 65 uninsured at the time of interview: 28.2 million
  • Percent of persons under age 65 uninsured at the time of interview: 10.4%
  • Percent of children under age 18 uninsured at the time of interview: 5.1%
  • Percent of adults aged 18-64 uninsured at the time of interview: 12.4%

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Group Health Insurance

Group Health Insurance

Compare Group Health Insurance for Small Business

Companies of various sizes co-exist in the market - both big and small. For the sake of regulations and implementation of different laws, the companies are classified into categories based on number of employees, turnover, amount of investment and many other factors. Out of these, number of employees, is a significant determinant whether a company will be classified as big, mid-size or small.

The focus here, is on how small companies can find the most suitable health insurance for their employees and what are the impediments to that. Small businesses are those that generally have between two and two hundred employees and are privately owned by members of a family.For big companies, employee health insurance benefits are not a big issue as they have all kinds of resources required to purchase and execute the plans. For small companies, resources are limited- but offering health insurance coverage is very important as that helps to attract good workforce.

However, small companies face a few issues when it comes to providing health insurance benefits to their employees. As said earlier, limited financial resources restrict the choices of health insurance for small companies. Small companies usually lack the administrative decision-making skills since they are operated by members of the family who are not necessarily trained professionals. There exists a planning mismanagement which results in wrong choices or strategies. Also, the smaller the number of employees, the narrower are the options of health insurance plans. Insurance companies offer very few plans for companies with ten or twenty-five employees. Small companies are usually localized so they cannot take advantage of health plans which do not have any network in their area.Due to lack of proper personnel to take care of health insurance issues, employees are left in the dark regarding the plan options and benefits. This makes the whole exercise ineffective. Health insurance is a complicated issue and without efficient guidance employees may not be able to take the right decisions.

Factors Which Determine Health Insurance Benefits for Small Companies

While formulating health insurance benefits for the employees, small companies need to consider some points before reaching a decision.

  • Assess and determine the target of the company in the near future - how the company plans to grow, what culture does the company want to promote among its employees etc. Government regulation on health insurance varies depending on the number of employee a company has. So, the health plans have to be designed in a way which serves smooth transition from one stage to another.
  • Take professional help from knowledgeable advisors on this issue so that the correct decisions can be taken. Small business owners are run by members of the family or close friends who do not have the expertise to handle complex subjects like health insurance. So,Small companies should arrange for professional advisors or agents who canlead them in the right way keeping in mind all the factors to benefit the company and the employees.
  • What is the standard of work force that the company wants to attract. Highly-paid employees look for high-quality health insurance with good standard of benefits. Employees with lower salaries would not too particular about expensive health insurance.
  • The rise in the number of employees and the rate of this increase. The number of employees determines many related things regarding health insurance. There are state and federal laws which govern how small companies provide health insurance. The policy makers of the company need to take into account the present and the projected number of employees to design the health insurance policies effectively.
  • What are the health insurance plan options available for that particular size of the company. Insurance plans differ widely between insurance companies depending on the size of the company. A plan could be meant for a large group only with a certain number of employees. Insurance companies can design special plans for companies with very few employees.
  • Consider starting with smaller more important benefits first and gradually expanding them. If the company is just starting, it is natural that resources will be tight. In this case, they can offer the most important type of health insurance plans with limited coverage. Later, as the company grows in size and turnover, it can offer better plans with better benefits to its employees.
  • Take advantage of the discounts and deals that are offered by the health insurance companies. Insurance companies in a bid to maximize their sales, often offer various or discounts for group plans. Small company owners can work out a beneficial deal with the insurance company or get them to include some additional benefits into the existing plan.
  • State and federal regulations regarding health insurance have to be kept in mind. Healthcare laws and regulations keep changing from time to time. While making the health insurance policies for the employees, the small business owners have to remain within the laws.
  • In the same regard, small companies need to go through proper verification to establish their identity and the genuine nature of their hired employees. Laws take into account the salaries of the employees, the status of the employees etc.
  • Last but not the least, come up with a very clear and solid plan on providing health insurance.

Health Insurance Plan Options for Small Companies

Small companies have to design their health insurance benefits after keeping all the parameters in consideration. Due to their size and other factors, sometimes the plan options get narrowed.Following are the basic types of -

  • PPO Plans - These plans allow the most amount of flexibility as far as the choice of providers is concerned. Members do not have to go through any primary care physician or get referrals for seeing specialists.
  • HMO Plans - These plans have a very restricted provider network within which the member has to remain in order to get coverage.All visits to specialist doctors have to be approved by the primary care physician. There are variations of these plans which allow a little more flexibility. These plans are most reasonably priced.
  • POS Plans - These are in-between PPO and HMO plans. It has the provider network restrictions of a HMO plan but allows members to visit out-of-network providers also. Members need to have their care coordinated by a primary care physician but they don't need referrals to visit specialists. Carriers may offer open-access or direct-access plans.

Besides the regular health insurance plans, some employers can also offer supplementary health insurance to their employees. The premiums for these can also be deducted from the salary if the employee wants. A supplementary health insurance adds more security and protection beyond what an employee gets from the primary health insurance policy. The benefits are disbursed in times of critical medical conditions but there are no restrictions on how the money should be used. It can be used for non-medical needs as well. This insurance can also be used to cover some out-of-pocket expenses of the primary health insurance policy. When the small business owner arranges this kind of health insurance, employees can benefit from the assistance given by the insurance professionals from the carrier.

Some Significant Factors to Consider Before Deciding the Company Health Plans

Small companies do not have the high-profile of a big company, so it is difficult to attract talented personnel. Once acquired, it is also important to retain the personnel. A good health insurance plan serves as an effective incentive to procure talent. When a small company or start-up company tries to lure experienced personnel from its established competitor, it has to offer more high-quality health plans to match the benefits that the employee enjoyed at his or her last job. In this case, the company may have to offer PPO plans because HMO plans will not be appreciated by the employees.

A small company may go for the less expensive HMO plan when the majority of the workforce is young and have no major health problems. This can help to save money for the company. As the company gets older and the employees age or their families grow, the company can upgrade the plans.

A small company can also offer less expensive plans when the average of the workforce is not very high salaried. Low earning workers would like to have plans with less out-of-pocket expenses.

The decision-makers for small companies should have complete knowledge of the health plans available in the local area. They should compare all plans before finalizing one plan. If a POS plan is slightly more expensive than a HMO plan, the company should go for the POS plan. POS plans offer less restrictive than HMO plans so employees have a wider choice of providers. A direct-access POS plan may be cheaper than a PPO plan which will again help to keep the health insurance budget under control. Depending on the availability and budget, some small companies can consider offering two types of plans -one more expensive option and one less expensive option.

Even though the decision of buying health insurance ultimately rests with the owners, they should try to involve the employees as much as possible in the decision-making process. This will increase understanding between the owners and employees and help to formulate an effective policy.

Level of Employee Contribution Towards Health Insurance through a Small Company

The financial resources of small companies are limited which affects their health insurance budget also. Small companies are always under the pressure to compete with large organizations in terms of employee compensation. Since unable to match the higher salaries, small companies try to match other perks to employ experienced or talented workers. Health insurance being an important benefit for employees, small companies may go out of their way to match the benefits with bigger companies.

In this regard, trying to pay the health insurance premiums fully may not be the right strategy. Even if the company does not employ many employees, they should always make the employees pay a part of the premiums, however small. The reasons for accepting employee contributions for health insurance has some advantages.

When the company is relatively small with less than ten employees, it is easier to set the company policy of contributory health insurance. It can be difficult to implement that when the company has grown to many more employees. The employees who join later won't question the already existing health insurance policies.

By asking employees to contribute a part of the health insurance premiums, a small company may avoid some risks involved. If an employee does not take the fully insured plan offered by the company and does not buy any alternative insurance, the company may be approached by providers and hospitals when that employee takes some medical services. The company will be asked to meet the medical bills of the employee.

When employees are asked to pay and they do not like the kind of insurance, they are free to get their own plans as per their choice. If the plans are fully paid for by the company, the employee may remain on the plan but not use it. Thus, the company would have to pay uselessly for his coverage.

Health insurance plans provide coverage for the employee and his or her dependents. If the company has to pay for all the coverage, for the employee as well as the dependents, it would become very expensive and take away essential reserves.

Most employees who are a part of the general work force may have paid for health insurance at other jobs. It is better to let them continue with the practice and not get them used to fully paid health insurance at the cost of the company.

Why Small Companies Find It Difficult to Implement High-Deductible Health Plans

What are High-Deductible Health Plans

Larger companies are found to offer high-deductible health plans to its employees. However, for several reasons these plans don't work in the favor of small companies. High-deductible health plans or HDHPs are health insurance plans which have lower premiums and high deductibles. HDHPs have to be combined with a health savings account(HSA), health reimbursement account (HRA) or flexible savings account (FSA). The following reasons will clarify why these kinds of plans are not beneficial for small companies.

The logistical and administrative processes involved for implementing a high-deductible health plan can become expensive for small companies. Employees who take this plan have to maintain a medical reimbursement plan alongside this plan. This requires more coordination with the insurance provider and additional processes during claim settlements. These plans give the option of investing the unused part of the account which again may become difficult for the small company to manage with its limited resources.

The logistical and administrative processes involved for implementing a high-deductible health plan can become expensive for small companies. Employees who take this plan have to maintain a medical reimbursement plan alongside this plan. This requires more coordination with the insurance provider and additional processes during claim settlements. These plans give the option of investing the unused part of the account which again may become difficult for the small company to manage with its limited resources.

High-deductible health plans are different from the regular plans in terms of out-of-pocket expenses payment and claim settlements. If a small company adopts this type of health plans for its employees, the company has to make the employees fully understand the pros and cons and various regulations of these plans. With limited trained HR personnel, small companies may find it difficult to clearly explain these plans to the employees.They have to have a medical reimbursement account or flexible savings account with the HDHP. The employees should know how to pay the out-of-pocket expenses and how to claim the benefits. The insurance carrier has to issue an explanation of benefits (EOB) and the healthcare provider has to submit the invoice. With FSA, there are IRS restrictions which limits their use for certain medical services. So, in many cases the preferred medical reimbursement account is in the form of health savings account (HSA). However, this too has its drawbacks.The funds in the FSAs are more accessible than HSA funds.

An employee can use the entire amount of his FSA annual election amount at any time of the year. The funds are usable right after the year starts even if the employee has not yet contributed his whole portion yet. The employee can receive the funds of FSA up front and use them to get medical services. There is no up-front access to HSA funds so the employee has to wait till his account has enough funds from his payroll deductions to pay the providers. However, employees have the option of adding funds to his health savings account apart from what is being deducted from his salary. When employee adds funds to his HSA account on his own he does so after deducting taxes on his salary. If funds are added to the HSA account directly by the company through payroll deduction that amount is pretax. So, employees can gain an advantage when they add funds to their HSA directly. At the end of the year, employees are supposed to submit proofs of their medical expenses during the year for which they have used the FSA funds. If there are some unused funds in the account, it does not get rolled-over into the next year. Here is another big disadvantage of FSA accounts. But left-over HSA funds can be continued to be used in the next year. All these regulations make HDHPs a complicated issue for which the employees need expert advice and guidance. Small companies are generally not equipped to provide employees with this administrative infrastructure.

HDHPs have large out-of-pocket expenses which most small companies may not be able to help the employees with. The savings that the companies make through reduced premiums by taking HDHPs, may not necessarily be shared with the employees. In this case, the employees are left to grapple with the increased out-of-pocket expenses. Employees may feel dissatisfied when they have to pay large deductibles and copayments even though their share of the premiums may come down.

Another negative situation is created when employers try to take advantage of deals and discounts offered by insurance companies for giving them bigger out-of-pocket amounts. Small companies would not want to pressurize employees into shelling out huge amounts of deductibles and copayments. Unhappy and disgruntled employees is not a good thing for any company, much less for small companies, where the number of employees is as it is low.

HDHPs with its complicated regulations and processes is a deterrent for employees of small companies. Ideally, policyholders want to understand the working that goes on throughout the health insurance claim disbursement process, the billing process etc. This kind of clarity is still not existent with high deductible health plans.

Reformation of Healthcare Insurance Laws

Healthcare insurance and related laws have been burning issues with every government over the years. In an effort to revamp the healthcare policies, various governments have introduced new laws and regulations.

The Patient Protection and Affordable Care Act, popularly referred to as Obamacare has perhaps brought the most significant changes in the healthcare system in the US. Health insurance mainly along with the ways to fund health insurance like health savings account or health reimbursement accounts are covered under this law. The reformed law, since its introduction in 2010, has attracted a huge amount of criticism, debate and apprehension. Attempts have been made to repeal or replace the law. As of now, the new law continues to be implemented. Patient Protection and Affordable Care Act has several provisions for which apply to small companies.

Insurance companies have redesigned their plan offerings so that they can include the options and provisions as prescribed by the healthcare law for small companies. Some significant changes include the exemption of preventive care services from co-pays, expanded emergency care for patients and limitations on the maximum amount that can be spent on out-of-pocket costs.

The new healthcare law also gave some tax advantages to small companies. Small business owners can claim tax benefits if they employ twenty-five or less full-time equivalent employees whose average salary per year if $50,000 and they pay at least half of the employees'health insurance premiums.

Small business employee health insurance falls under the category of group plans, so, many regulations for small groups apply to these employees as well. The employees of small businesses have to given a summary of the benefits and an explanation of the coverage as per the rules of the health law.

The introduction of the health exchange marketplace helped small business owners get good plans for their employees at very reasonable rates.Three tiers of plans with varying benefits and rates were available in the health exchanges. All these plans confirmed to the regulations of the new law, so small business owners need not worry about compliance when they buy through health exchanges.

However, the Patient Protection and Affordable Care Act created some complications for small business owners as well.The small companies with more than fifty employees were supposed to pay a penalty per full-time equivalent employee if they did not provide health insurance. This was in accordance with the mandate of the healthcare law of every individual having health insurance, either on his own or through his employer.

Small companies while designing their health insurance policies have to go through a tough situation which requires prudence and adequate knowledge. They have to comply with the healthcare regulations as prescribed by the state or federal government on one hand, and on the other, see to the welfare and interests of the employees.Small business need to keep themselves updated with all the information regarding the current or future laws, the various options offered by insurance companies and the requirements of their employees. Since purchasing and implementing the health insurance benefits for the employees is a continuous process, small business owners should always treat it with importance and get help from consultants. Health insurance benefits can help to retain talented employees and can ultimately contribute to the overall growth of the company.

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ASSET PROTECTION

ASSET PROTECTION

Help protect your savings from the costs of care NOT COVERED
by traditional insurances or Government programs, like Medicare.

OVERWHELMING STATISTICS

OVERWHELMING STATISTICS

  • Number of persons under age 65 uninsured at the time of interview: 28.2 million
  • Percent of persons under age 65 uninsured at the time of interview: 10.4%
  • Percent of children under age 18 uninsured at the time of interview: 5.1%
  • Percent of adults aged 18-64 uninsured at the time of interview: 12.4%
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DISCOUNTS AVAILABLE

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Up to 15% Preferred Health Discount

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* Discounts are not cumulative and vary by state.