Current Options for Small Businesses Seeking Group Health Coverage:
Right now, there are many different options available for small business owners who wish to obtain a group health policy for their employees. There are many ways that you can now save on your group health premiums, while increase the amount of coverage that you have.
Here are some of the current available options for small businesses:
Association Health Plans - If your business is the member of a trade organization or a credit union, you may be able to obtain a group health insurance policy for much less than you would normally have to pay. An association gives its members greater purchasing power by banding them together into one large group. Small group health insurance policies can be expensive and may not have the amount of coverage that a large group health plan can offer.
In addition, if you are self-employed and do not have enough employees to be eligible for small group health coverage, an association health plan can assist you in signing up for a group health plan through the association.
If you are not aware of any association health plans that are available to your business, you can contact your state's insurance regulation board for more information. As these plans grow in popularity, more of them are forming each year.
State High Risk Pools - As health insurance costs go up, many states are now offering high risk pools. If you are having difficulty finding a group health insurance policy, this may be an alternative for you and your employees. There are typically waiting lists for high risk pools, and limited available slots.
As with association health plans, if you need more information on high risk pools in your state, you can contact your state's insurance regulation board for more information. This is a great new way that employers and employees can find the coverage that they need for much less than they would normally have to pay.
Health Savings Accounts - HSA's first came into existence in 2004. They offer small businesses a way to make tax-free contributions to a health savings account for employees. This money is then allowed to earn interest, tax-free and can be used for qualified medical expenses, again, tax-free.
Qualified medical expenses include payments on monthly insurance premiums, payments for health care services, prescription drug payments and much more. If you have not heard about health savings accounts, now is a great time to discuss your options with your health insurance representative.
You will need to have a group health plan that is HSA eligible to take advantage of health savings accounts. This means that the annual deductible will need to be higher than $1000. There are other restrictions such as no co-pays that will need to be considered as well.
You can discuss these new HSA's with your employees to see if they would like to take advantage of these benefits. They can save money on their taxes and you can save money by deducting the contributions you make to these accounts from your taxes.
As health savings accounts change, more benefits for employees and small businesses will be added. Make sure you stay on top of all of the latest legislation and news affecting health savings accounts for more information.