If you’re a small business owner, you may be considering offering your employees health insurance. The good news is that a group health plan can be a valuable employee benefit. Not only do they offer lower premiums, but they can help provide medical care for your employees and their dependents. A group health plan is also a lot more flexible on where it is provided.
Group health plans are distinct legal entities, and they are governed by HIPAA. These rules have been put in place to protect your information and your employees’ health. It’s important to understand what you’re getting into before you sign on the dotted line.
Generally, group health plans are self-insured, but they can be administered by a third party administrator. Self-insured group health plans do not pay premiums to insurance companies, and they have a special trust fund to pay claims. Typically, the premiums are paid out of the company’s payroll department.
A group health plan may be offered through a professional association, trade organization, or membership organization. Some of these groups share the cost of the insurance and the benefits, and others can be used as supplemental plans to enhance the coverage offered to the entire group.
You can find out more about these types of plans through an account representative. In general, a group health plan includes medical, dental, and vision plans, as well as health insurance for your employees and their dependents. For more details, you may want to contact an account representative or a trained staff member.
A small group plan is one that has less than 50 employees. This is a very important number as it helps to ensure that you’re in compliance with the Affordable Care Act. However, it’s not mandatory for all small businesses. There are also government-backed options, such as Medicaid. Even so, many small businesses are eager to provide affordable health insurance to their employees.
As a group health plan owner, you must ensure that your plan meets federal regulations. You must also make sure that it complies with the Employee Retirement Income Security Act of 1974. Among the laws that apply to these plans is the tax-free employer contribution, which is held by the employer until the claim is due. Depending on the amount of money the employer pays toward the monthly premiums, it can be tax-deductible.
Group health plans are an important business tool, but you need to make sure you’re using it wisely. It’s easy to get wrapped up in the hype and confusion of choosing a plan, and a little research can go a long way. One thing you should look for in a group health plan is the best possible combination of benefits and cost. While this might seem like a lot of information, it can be easier to understand when you break it down by the type of plan you’re considering.
You’ll also want to be careful about the limits of the plan’s health insurance. For example, a group health plan can’t be the sole provider of certain benefits, including long-term care.