Small businesses supply benefits to:
- Retain valued employees
- Lower lost work time due to illness
- Attract talented individuals looking for good coverage
- Supplement employees’ incomes
You can get health insurance rates now simply by entering your zip code!
There are many ways for small businesses to find affordable health insurance. Carefully studying all the factors that affect insurance premiums will help any business choose the best policy for their money. Comparison-shopping will also result in the most affordable rates. Small businesses should utilize all of the insurance resources available.
What should a small business do before looking for health insurance?
First, a small business should understand what kind of insurance would be the best for its employees. An anonymous survey or questionnaire will help to find out what options employees want the most.
If most of your employees are young, then coverage for maternity and well visits will be important. An older workforce might be more interested in full prescription benefits and coverage for specialists.
Small businesses should also discuss the amount of coverage the company can afford to pay; usually, a company pays a portion of the employees’ premiums every month. The company’s accountant or financial advisor should be consulted; keep in mind that 100% of insurance premiums paid by a business for its employees are tax-deductible.
Small businesses should also understand what factors affect the cost of health insurance premiums.
What factors affect health insurance premiums?
States set their own specific rules and laws for health insurance regulation. The National Association of Insurance Commissioners states that insurance companies use “community rating” to set insurance rates: everyone in a certain geographic area pays the same rates.
On the other hand, some states have laws that set insurance premiums based on at least the following factors:
- Age of employees
- Sex of employees
- The plans the employer is offering
- The location of the business
Small businesses should understand their state laws concerning health insurance.
What should a small business look for when comparing providers?
Just as you would compare and test drive multiple vehicles before buying one, a business seeking insurance should research and compare multiple insurance providers. Obviously, the costs will be the first comparison, but you will want to compare how premiums have increased with every provider in the last few years also.
Small businesses will also want to look into the reputation of an insurance provider they are considering. Speaking with fellow business owners about experiences with providing health coverage will provide valuable insights. Research can also be performed online at sites such as the Better Business Bureau and insurance rating companies such as A.M. Best.
One last area that should be looked into is whether a certain insurance provider is a legitimate business entity. Unfortunately, many scams include fake insurance companies. The NAIC has a phone number to verify an insurer’s license at 1-866-470-NAIC.
What are the different policy options available?
Health insurance policies have many factors that make them different. The coverage, providers, options, and money issues such as premiums, deductibles and copays all make policies different.
Indemnity plans include deductibles and the freedom to choose providers.
Managed care plans, such as HMOs, POSs, and PPOs require employees to utilize particular doctors and hospitals, but the premiums are generally lower.
Health Savings Accounts (HSA) paired with high deductible plans will save employees money at income tax time and provide insurance against expensive health events.
How can a small business keep costs down?
Companies can initially keep costs down by comparing companies to get the best rates and service. After that, employers can utilize a wellness program through the insurance company.
Wellness programs focus on education and preventative medicine. Employees are given free or inexpensive access to health screenings, exercise facilities, and informational seminars about personal health. Employees are encouraged or given incentives to improve their own health and thus submit fewer health claims.
What resources are available to small businesses?
The Affordable Care Act of 2010 had multiple health initiatives attached; one was to increase the affordability of health care for small businesses. Understanding the changes it has enacted, and those to come, will help small businesses wade through the health care process.
State departments of insurance are also valuable resources to learn about insurance laws in a particular state. Insurance companies can usually be looked up on a state’s department of insurance website. Research will result in better health options for any small business.
Explore your health options now by entering your zip code! You will instantly receive health insurance quotes tailored to your unique needs.