Finding the best health insurance for small business owners in California can be an intimidating project. This short guide will help get you started.
Are You Researching Health Insurance for Small Business Owners?
Offering group health insurance to the employees of your small California business has many benefits. Good health care means more productive employees. Employees with health insurance are more loyal and engaged at work. Health insurance is very important to millennials, the largest demographic in the US workforce.
But before you start googling small business group health insurance, read this quick list of four questions you need to ask yourself before buying health insurance for your small business.
1. Does My Business Need to Offer Health Insurance?
If your California company has more than 50 full-time employees the Affordable Care Act mandates that you provide affordable health insurance.
Affordable means that the annual cost for an employee can’t be more than 9.86% of their annual income in 2019. If you don’t offer coverage, you are subject to a nasty penalty of $2,320 for every full-time employee after the first 30.
If you have less than 50 employees you are not required to provide health insurance. However, you may choose to offer health care benefits anyway because a good health insurance plan will help you find and retain great employees.
2. Can We Receive Tax Credits?
If you have less than 25 full-time employees, you may qualify for tax credits if you offer health insurance and pay at least 50% of the premium cost.
How big of a tax credit you get will vary based on a variety of criteria, but you may get as much as 50% of your premium contributions.
The tax benefits to your business let you provide your California employees with health care but at a more manageable cost to you.
3. Low Deductibles or Low Premiums?
Before you start researching health insurance for small business owners, you should think about what is best for your employees.
Would they prefer to have low deductibles or low premiums? Health plans usually offer one or the other. It’s a tradeoff.
To make sure your employees are happy with the health plan you ultimately select, it’s vital to understand what they value more. You might even consider asking employees by sending an anonymous survey asking this question.
Also, consider that you can reduce costs for your California employees by having them pay an initial amount which will then cover some of the expense of premiums and deductions for the year.
4. Should We Hire a Group Insurance Broker?
Finding group health insurance for small businesses can be time-consuming and difficult. You may decide that working with a licensed California group insurance broker is your best bet.
A group health insurance broker can streamline the paperwork you have to fill out. The broker will also ensure your organization is compliant with relevant laws that you probably don’t even know exist.
An experienced small business health insurance broker in California will also help with implementation and renewals. Brokers work on commission. But they don’t get their cut until you find a plan that suits your needs and you sign up for it.
Unlike health insurance agents, health insurance brokers are independent of a parent company and act on behalf of clients (like yourself) and represent insurance products from many companies.
That means that group health brokers are invested in helping you find a plan you’ll be happy with rather than typecasting you into their products.
Bottom Line on Health Insurance for Small Business Owners
There you have it, four questions California business owners need to consider before they start shopping for health insurance for small business owners.
At Preferred Insurance of California, we use a large database of health insurance plans from all California providers to quote you the best plans for your needs. We will lay out the health insurance plan designs and rates in a simple manner.
Preferred Insurance of California is an independent group health insurance broker that specializes in small business health insurance for companies in San Diego County. We service what we sell, which means we are personally there to help your employees with their health insurance needs.
Call (760) 385-8239 to schedule a conversation