Running a small business requires building and maintaining a strong team, managing expenses and pursuing opportunities to grow. Add in navigating the complex world of health insurance, and the challenges can become daunting.
“Although the cost of health care continues to rise, it is still worth offering to employees. It creates value in attracting top talent and retaining employees,” says Michael Byrd, chief business development officer for Sharp Health Plan.
Without someone on payroll dedicated to learning and understanding health insurance, small business owners need to think strategically when buying health insurance for employees. These recommendations may help you in making this crucial and necessary decision:
- Understand your options. You need to educate yourself on pricing, availability of doctors and the richness of benefits in plans fitting within your budget.
“Many small businesses focus too narrowly on cost and then realize afterward what their benefit plans don’t offer,” says Byrd.
Often-overlooked items include prescription drug coverage, costs for the full range of services and whether value-added benefits come with the plan such as a nurse advice line. It’s best to come armed with a comprehensive list of your employees’ needs.
“You want a licensed insurance agent or carrier who will work with you on matching a plan design and network to the unique needs of your organization,” says Byrd.
- Look for wellness programs. In recent years, wellness programs grew because they help keep employees healthy all year long. You should look for options such as health coaching by certified professionals; online wellness portals with interactive resources such as health assessments, meal planners and exercise routines; and wellness challenges that inspire employees to focus on a particular health goal and use an online community to hold them accountable.
- Know where you can enroll. Under the Affordable Care Act, small businesses with more than 50 full-time equivalent employees will need to insure full-time staff and their dependent children by 2016 or pay a penalty. Because of this, small business owners may be purchasing group health insurance for the first time.
You have the option of purchasing from both public and private exchanges, which offer the ability to provide employees a choice of several benefit designs from multiple insurance carriers. For example, in California, the major private exchange for small businesses is CalChoice and the only public exchange is Covered California for Small Business. Small businesses can receive tax benefits if they meet certain thresholds by purchasing group health insurance through a public exchange.
Another option for many employers is to purchase health insurance direct from a carrier that often allows for additional choices in benefit designs and networks from that carrier.
Purchasing group health plans does not need to feel cumbersome when you come equipped with a little knowledge and research. Licensed insurance agents can also lend their professional assistance in this important decision and give you an overview of the marketplace.
Following these recommendations will help you make a thoughtful decision in purchasing insurance to protect one of your most important business assets: the health of your employees.