How to Choose a Health Insurance Plan for your Small Business
The Affordable Care Act (ACA) “employer mandate” says organizations with 50+ full-time equivalent employees must provide coverage to at least 95% of full-time employees and their dependents up to age 26. Larger employers must pay a fee for not offering health coverage. However, there’s no requirement that smaller businesses provide health insurance for employees. Nevertheless, many employers do offer health insurance because they know they’re competing for employee talent with others who include such coverage in their employee benefits program.
So, you may be wondering, how do you choose the best health insurance plan for your business? What should you consider in choosing a small business health plan? Below are some things to think about.
It’s important to find a health insurance solution that is flexible enough to work with your budget. A private health insurance exchange, like CaliforniaChoice, puts you in charge of what you spend with Defined Contribution. You decide what amount you want to put toward your employees’ coverage. You can choose a fixed dollar amount per employee or a fixed percentage toward the cost of coverage. You may qualify for an employer tax credit if you purchase group health coverage through the Covered California marketplace (the state’s public health insurance exchange). Or, when you buy coverage directly from a carrier or through a private health exchange, your contributions to the costs of employee and dependent health coverage are, generally speaking, 100% tax-deductible as business expenses on your state and federal taxes. Best of all, your premium costs are limited to the amount you choose. Your employees apply your generous contribution to the cost of the plan they prefer. If they select a plan that costs more than your contribution, they pay the difference. It’s that simple.
Coverage Options and Networks
Most important to your employees is probably that they can access their preferred health care providers – doctors, specialists, and hospitals – and prescription drugs, if they have ongoing health concerns like high blood pressure, diabetes, or similar conditions. A multi-carrier private exchange offers more employee choice than a single-carrier solution. For example, with CaliforniaChoice, one of your employees might choose a PPO from Anthem Blue Cross because of a particular doctor or hospital in their network, while another employee who rarely visits the doctor might choose an HMO from Kaiser Permanente. A third employee might choose an HSA-compatible HMO from UnitedHealthcare because of its cost and tax advantages. Whatever your employees’ needs may be, it’s their choice!
You want a program that’s easy to manage. A private exchange gives your employees access to multiple health plans but offers a single point of contact for answers to questions, a single website to manage your benefits online, and just one bill for all of your employees’ coverage each month. It doesn’t matter how many different health plans your employees enroll in, your one monthly bill shows all coverage, your contribution, and each employee’s contribution to the cost.
Help When You Need It
A group health insurance broker – who doesn’t charge you anything for his or her services – can make it easier for you to find the right health insurance solution for your small business. A broker can explain the benefits of each plan you’re considering, help you determine your monthly contribution to coverage, schedule enrollment meetings to help employees select their benefits, and answer any questions once your group coverage begins.
If you don’t already have a broker, we’ll help you find a local CaliforniaChoice broker to speak with about your employees’ health insurance needs.
Three Reasons Employers Love the CaliforniaChoice Private Exchange
A small business private health insurance exchange offers advantages to employers and employees alike. But more and more employers are turning to CaliforniaChoice for three primary reasons: 1- budget control, 2- multiple health insurance carriers, and 3- the availability of Affordable Care Act (ACA) compliant plans.
1. Budget Control
Controlling health care costs is easy with Defined Contribution. You choose the amount you want to contribute toward your employee’s health care benefits. You can select a Fixed Percentage (50% to 100%) of a specific health plan and/or benefit, or you can contribute a Fixed Dollar Amount for each employee.
Your employees then apply your generous contribution to whichever health plan and benefits they prefer. If an employee selects a plan that costs more than your contribution, he or she pays the difference. It’s that simple.
When you renew with CaliforniaChoice, you have the option to adjust your contribution – up or down – giving you complete control over what you spend on employee benefits, year after year.
2. Multiple Health Insurance Carriers
Unlike purchasing health insurance from a health insurance carrier directly, you and your employees have a selection of eight different, top-rated carriers with CaliforniaChoice. For example, one of your employees might choose a PPO from Anthem Blue Cross because of a particular doctor or hospital in the Anthem network, while another employee who rarely visits the doctor might choose an HMO from Kaiser Permanente. A third employee might choose an HSA-compatible HMO from UnitedHealthcare because of cost and tax considerations. CaliforniaChoice includes choices from eight of the state’s leading health care plans.
Offering this level of choice — without increasing your costs, as compared to a single health plan solution — gives you a recruiting advantage and a powerful tool to retain your current employees.
3. ACA Compliant Plans
CaliforniaChoice ensures your health insurance benefits are compliant with the requirements of the Affordable Care Act (ACA). You can choose from a variety of full and limited health care networks – giving you and your employees access to the doctors, specialists, and hospitals you want at the best-possible price point. Plus, you can choose one ACA metal tier or two. You can select a Platinum, Gold, Silver, or Bronze plan or Tiered Choice, which gives employees access to two metal tiers (Platinum/Gold, Gold/Silver, or Silver/Bronze) rather than just one. This can significantly increase the number of plans and doctors your employees can use.
To learn more about CaliforniaChoice, contact your employee benefits broker. If your current broker doesn’t represent CaliforniaChoice or you don’t have a broker, we’ll help you find a broker.
What’s Likely to Stay – and Go – as Part of Proposed ACA Repeal
While we don’t know with certainty the timetable for any repeal (or repeal and replacement) of the Affordable Care Act (ACA), there are some parts of the current law expected to remain in place, and others that could likely go away under President Trump and a Republican-led Congress.
Let’s take a look at a few of these.
What’s likely to stay?
Guaranteed coverage: a big part of the ACA – some would argue the most important part. The ACA allows individuals to get health coverage even if they’re sick. The downside is members know sicker people have a greater need for care, and members have to spread the risks among all the people members. That makes premiums higher for those who may not use the doctor or a hospital very often. Under one proposed replacement plan, while those with a pre-existing condition will still be able to get coverage, they may pay more. Currently the ACA limits the premiums that can be charged to the oldest enrollees to three times the amount charged to the youngest members. Republicans would change that, so members could charge the oldest member five times as much as the youngest member. Allowing parents to cover their children up to age 26 is one of the most popular provisions of Obamacare. President-elect Trump and congressional leaders say they want to maintain this provision, although it was not part of the Senate discussion on January 11.
What’s likely to go away?
The mandate that most Americans have health insurance or pay a tax penalty is likely to be eliminated. Republicans have been consistent critics of the so-called individual mandate since the ACA became law. It’s uncertain what alternative might be implemented to keep premiums in check by attracting a mix of healthy and sick participants, and to discourage people from going on and off of insurance as their needs and health change. One proposal would allow members to charge sick people more if they don’t maintain “consistent coverage. Taxes are a big part of the ACA. Two examples are the 3.8 percent investment income tax for those over a certain threshold and added payroll taxes on high-income earners. Both are targets for the GOP-led Congress. Meanwhile, those earning less could actually see their taxes go up, according to the non-partisan Tax Policy Center. Insurance marketplaces – also known as exchanges – could be on the chopping block, too. Republicans want to eliminate these online marketplaces and the income-driven subsidies that go with them.
Consumer advocacy groups warn that without the exchanges and the subsidies, millions who have coverage currently through the exchanges could be left without vital health insurance. It’s not known yet whether any state running its own public health insurance exchanges might consider maintaining its program. In California, the new state budget proposed by Governor Brown makes no allowance for it – or maintaining the expansion of Medicare – without ongoing federal assistance. Keeping up: If you’d like to learn more about possible changes to the ACA as Congress debates the matter, your CaliforniaChoice employee benefits broker can help. If you don’t have a current broker, we’ll help you find a broker to speak with about your employees’ health insurance and related needs.
Enrolling in a Private Health Exchange a Good Idea for 2017
It could be a while before there’s any agreement in Washington, DC, on the proposed repeal and replacement of the Affordable Care Act (ACA). While we wait, you may be wondering about whether now is the time to make a change to your employee benefits program for 2017.
More and more employers are moving to private health insurance exchanges. Growth was up by more than one-third (35 percent) in 2016, as compared to the prior year. At CaliforniaChoice, membership is also increasing – with 2016 service to more than 17,700 employers and nearly 320,000 employees and dependents.
The CaliforniaChoice private exchange offers advantages to employers and employees alike:
More Health Insurance Options
You no longer have to pick one plan for all employees; you can give them a choice of HMOs, PPOs, and other plans from eight carriers: Aetna, Anthem Blue Cross, Health Net, Kaiser Permanente, Sharp Health Plan, Sutter Health Plus, UnitedHealthcare, and Western Health Advantage.
Cost Control for Your Business
Defined Contribution lets you decide how much you can afford to contribute toward your employees’ benefits.
Options for Other Coverage
Like Dental, Vision, Chiropractic, and Life – plus value-added, no-cost extras like a Premium Only Plan, online HR support, and more.
Easy, Consolidated Administration
Just one monthly bill for all of your employees’ coverage, one website to manage your benefits, and one toll-free number for answers to questions.
During the past 20 years, CaliforniaChoice has become an authority on employee-choice health care and the Golden State’s leading multi-carrier health program for businesses with up to 100 employees.
If you’d like to learn more about CaliforniaChoice, contact your employee benefits broker. If you don’t have a current broker, we’ll help you find a broker to speak with about your employees’ health insurance and related needs.
What Small Business Can Expect Under Obamacare Repeal
There is some uncertainty regarding the timetable for the “full repeal and replacement” of the Affordable Care Act (ACA) by President-elect Trump and the Republican-controlled Congress. However, no matter how long it may take, there are changes small business owners can expect as part of any 2017 (or later) effort to change the health care law.
New HHS Secretary
Rep. Tom Price (R-Georgia) has been named as the planned new Secretary of the U.S. Department of Health & Human Services, which is responsible for implementation of the ACA and oversight of the Centers for Medicare & Medicaid Services (CMS). While there is some opposition to the Price nomination, Congressman Price has been an outspoken critic of the ACA. He introduced legislation to cut off funding for the health care law in 2015. His reconciliation bill would have eliminated the funding of premium tax credits and cost-sharing subsidies, which make ACA premiums more affordable for low- and middle-income Americans. (While both the House and Senate passed the Price bill in 2015, President Obama vetoed it in January 2016, after which Congress failed to override the veto with the required two-thirds vote in each chamber.)
The President-elect has voiced support for increased use of Health Savings Accounts (HSAs), which offer tax-advantages to those enrolled in high-deductible health plans. There is no federal tax on contributions to HSAs and interest accrues tax free. There is no tax due when funds are withdrawn to pay for qualified health care expenses. Critics of HSAs say they are very helpful to high-income people, but offer fewer benefits to lower-income individuals who may not have the ability to contribution.
Insurance Sales Across State Lines
While the ACA already allows for states to reach agreements with other states to allow cross-border insurance sales, it’s not been appealing to most insurers. (Health insurance has traditionally been sold and regulated at the state level, with each state setting its own standards for plans sold in the state.) The Trump administration says allowing insurers in one state to offer policies in another state would give buyers more options and drive down the cost of coverage. Critics says it will become a “race to the bottom” as insurers flock to operate in states with fewer regulations (and fewer consumer protections). They point to the changes in the credit card industry that occurred after 1978, when the Supreme Court ruled that credit card regulations could be exported by banks located in one state to customers elsewhere, which led issuing banks to set up shop in places like South Dakota and Delaware, which had virtually no usury laws, nullifying other states’ limits on credit card fees and interest rates.
Continued Dependent Coverage
President-elect Trump told CBS in a November interview that one of the things he likes about the ACA – and there aren’t many things – is the provision that allows parents to keep their children on their health plan until age 26. If there’s a way to continue it in a post-ACA world, dependent child coverage is likely to continue.
What’s Not Yet Known
Something else that the future president agrees is beneficial to consumers is the pre-existing condition exclusion that is a bedrock of the ACA. However, it’s not yet known whether any ACA replacement plan could be crafted that would keep that benefit in place. As of 2014, the ACA made it illegal for health insurance companies to deny coverage to anyone with a pre-existing condition, something that was common for individual insurers previously. Conditions that historically triggered an automatic denial were cancer, diabetes, heart disease, epilepsy, and pregnancy. According to an analysis by the Kaiser Family Foundation, about one in four people have a pre-existing condition that will make it difficult for them to get health insurance if the pre-existing condition prohibition is eliminated as part of the ACA repeal.