The majority of large businesses across the United States offer health coverage benefits to their employees. By offering attractive benefits packages, they are often better able to attract and keep highly qualified employees. Small businesses are less likely to offer health insurance to their employees, which can put them at a disadvantage when it comes to hiring talented individuals. However, whereas small businesses are estimated to spend 20 percent more than large businesses for their health insurance policies, they still have plenty of choices.
If you own a small business or are responsible for choosing an insurance plan for a small business, you will first need to determine what is most important to your employees and their dependents. Federal law prohibits business owners from asking about employees' personal medical histories, yet you can discuss their preferred benefits. Some plans may provide coverage for routine care as well as major medical, while other policies may provide only major medical and can be combined with health savings accounts. Still other policies may include coverage for prescription drugs, dental care and vision care. The ideal group policy will provide coverage for the different needs and preferences of your employees and their family members.
Cost will likely be another consideration, if not one of your most important considerations. You will need to determine whether your employees would prefer lower monthly premiums and higher annual deductibles or higher payments and lower deductibles. You will also need to determine how much cost sharing your business can afford. Keep in mind that most states require that employers must cover at least 50 percent of the cost of their employees' health insurance payments.
In order to make sure you have the best plan both for your small business and your employees, avoid those that offer costly extras that neither you nor your employees want or need. Include extras such as vision or dental with your group medical policy instead of getting them separately in order to keep coverage affordable. Finally, before purchasing any plan, check the industry ratings of your preferred brand or carrier to make sure the company is reliable and trustworthy.
One final way you can manage your small business' costs for health insurance is to take advantage of tax credits. You may be eligible for a tax credit of up to 35 percent. In 2014, this credit will be raised to 50 percent. This credit is designed to offset the cost of your share of your employees' health coverage payments and is refundable, so that even if you owed no taxes, you may still be eligible for a refund. You can learn more about this credit by talking with a tax professional.
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