Business health insurance is a major cost of doing business, especially for small companies. There are ways, though, for small business to help give employees the kind of coverage they want at an affordable rate.
With health insurance premiums soaring, many small business owners are asking their employees to shoulder more of the financial burden for their benefits or are cutting benefits entirely. Small business health insurance may take a huge chunk out of an employers’ revenue, but the benefits of offering insurance to employees are great. Offering health insurance often attracts better employees and helps retain existing workers. In addition, satisfied, healthy employees are more likely to help your business grow.
When considering purchasing a group health insurance plan for their small business, employers should consider the health care needs of their employees. Employers may wish to consider conducting an employee survey to find out what kind of coverage their employees want and what kinds of service are most important to them. In doing so, employers can ensure that they are searching for the type of coverage their employees will value.
Once employers have determined what kind of coverage their employees desire, they must then determine a way to provide this coverage without breaking the bank. Reducing the amount of coverage offered to employees or requiring them to pay more for their health care expenses are both logical and easy ways to save money on health insurance premiums; however, this option is likely to be unpopular with employees. Employers will need to consider their employees’ needs and come up with a solution that best fits their budget. Employees may be more willing to contribute more to the premium if the coverage they require is provided.
A Health Savings Account (HSA) may be another type of affordable health insurance employers could offer their employees. This type of account works with a qualifying high-deductible health plan to provide coverage. The HSA is used to pay for routine health care expenses, and the high-deductible plan is used to pay for more significant health care expenses. The high-deductible plan can be through an HMO, PPO or through traditional insurance. An HSA is funded with pre-tax dollars to pay eligible health care expenses including insurance policy deductibles, copayments and out-of-pocket medical expenses. These tax-exempt accounts could reduce small business health insurance costs while giving employees tax breaks.
Offering group health insurance is beneficial for employers and employees. It can help a small business hire and retain the best workers, and the amount the employer pays toward employee premiums may be tax-deductible. Also, since no one can be turned down based on medical history, group coverage can protect workers or family members who might otherwise go uninsured.
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