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As a small business owner or HR manager, when you’re considering health insurance and benefits for your employees, you want to be sure whatever plan you offer includes health care facilities you and your employees want.

That makes CaliforniaChoice an easy decision, because it includes options from seven of California’s premier health insurers from across the state, dozens of health plan options, and access to thousands of providers, including doctors and leading hospitals, medical centers, and medical groups from across San Diego.

 

CaliforniaChoice gives small businesses in the San Diego area health insurance coverage from:

Plus, if you have employees in Northern California, you get the added option of health care from Sutter Health Plus and Western Health Advantage.

Click to see a list of plans, provider networks and medical groups in the San Diego area

 

Plus, if you’re interested in Kaiser Permanente coverage, you have access to hundreds of doctors and all of Kaiser Permanente’s San Diego-area hospitals, medical centers, and clinics.

Since Kaiser Permanente is its own health care system, they manage their locations differently. To find locations in your area, click here.

Only CaliforniaChoice offers you and your employees access to so many health care providers across the San Diego region.

And it doesn’t stop there, with CaliforniaChoice, you and your employees also get access to our Business Solution Suite, which includes the following at no cost:

*Initial case set-up is covered; fee applies after first year

Ask your broker for more information about CaliforniaChoice, our diverse provider networks, and the no-cost benefits offered through our Business Solutions Suite. If you don’t already have an employee benefits broker, we can help you find a CaliforniaChoice broker to speak with about getting a quote for your employees.

Note: The table listing Network and Medical Group affiliations by carrier is accurate as of December 2017; participating providers are subject to change. Ask your health care professional or check the carrier’s website for the latest provider information. You can also find providers on the CaliforniaChoice website.

Highlights/Key Takeaways

  • Affordable Care Act (ACA) individual mandate still applies in 2018; it won’t go away until 2019.
  • ACA employer mandate remains in force, unless Congress decides to take further action.
  • End of individual mandate won’t affect most Americans since a majority of people get their health coverage through their employer, Medicare, Medicaid, or the military.
  • Association health plans could reappear – and shake up the marketplace – in late 2018 or 2019.
  • Single-payer health care in California is still being discussed.

The White House said within hours of President Donald Trump signing the tax reform bill in December that ObamaCare was “essentially” repealed. The reality is something different.

While the recently approved tax law did include a provision to eliminate the Affordable Care Act (ACA) individual mandate, the ACA remains the law of the land for 2018 and other provision of ObamaCare are still in force. (The individual mandate, which requires most individuals to have insurance or pay a penalty, remains in force for 2018 and is eliminated in 2019.)

So, you may be asking, what is – and what is not – changing this year? Here’s a quick overview:

Federal and State Exchanges

The online marketplaces established under the ACA will continue to operate. The Covered California exchange continues to accept enrollment for 2018 through the end of January, and all exchanges will continue to accept applications from those experiencing a qualifying event during the year. Subsidies for coverage will remain available to those individuals making less than 400 percent of the federal poverty level (about $98,000 for a family of four).

Employer Mandate

The back-door elimination of the ACA individual mandate (through tax legislation) does not eliminate the employer mandate; it remains in force for 2018 – and the foreseeable future unless there’s further action by Congress. That means, most employers with 50 or more full-time or full-time equivalent employees will continue to be required to offer health plans that comply with the ACA to their employees. Link here to read more on the Employer Shared Responsibility provisions on the Internal Revenue Service (IRS) website.

Association Plans

Association health plans (AHPs) are likely to make a big splash later this year (or early next year). The 60-day comment period on the Trump administration proposal to update the rules for these plans is now underway. As proposed, AHPs would allow small business owners, their employees, sole proprietorships, and other self-employed individuals to band together as a single group to purchase health insurance in the large group market. (As larger employers, the consolidated group would be exempt from some of the current requirements of the ACA. For example, AHPs would not have to include the ACA’s “essential health benefits” such as mental health, emergency services, maternity and newborn benefits, and prescription drugs.

Critics of association health plans, including consumer groups, public health advocates, and many insurers (including Blue Cross and Blue Shield plans) say new association plans will drive up health care costs for older Americans and those with pre-existing health conditions as younger, healthier workers leave their current health plans and move to less comprehensive, less expensive plans developed as a result of the AHP proposal.

“Those with serious health conditions like cancer would be left paying ever-increasing premiums for comprehensive coverage,” said Chris Hansen, the president of the American Cancer Society Cancer Action Network told the New York Times. “The rule proposed today will almost certainly result in more people facing financial distress when an unexpected health crisis happens.”

State “Single Payer” Proposal

While the White House and GOP members of Congress continue their efforts in Washington, DC, to undermine the ACA, California lawmakers are continuing to explore the expansion of health care through a single payer measure. As outlined, Senate Bill 562 would establish a program to deliver health care to all Californians.

However, Assembly Speaker Anthony Rendon (D-Paramount) said last year the bill was “woefully incomplete” and he shelved it. The measure is likely to come back into view this year, as some of the leading candidates for governor support single payer. Costs remains a big issue, though, as it’s estimated single payer could run a $400 billion tab over a decade. Stay tuned for further updates.

If you’re considering health insurance for your employees for the first time, or you’re considering a change to your current employee benefits, you’ll want to talk with your broker about CaliforniaChoice. It is the only place where you and your employees can select coverage from seven of California’s leading health plans in one program. If you don’t already have an employee benefits brokers, we can help you find a CaliforniaChoice broker to answer all of your questions and provide you with a custom quote.

 

Finding the right health insurance for your small business employees isn’t always easy. In fact, it can be a very bumpy road. But CaliforniaChoice offers you options from seven of California’s leading health plans: Anthem Blue Cross, Health Net, Kaiser Permanente, Sharp Health Plan, Sutter Health Plus, UnitedHealthcare, and Western Advantage. And you also get tools to match your employees’ health care needs to a plan that includes their preferred doctors and hospitals as well as coverage for prescriptions.

Take a look at how CaliforniaChoice has you covered, whether you have employees in just one location or throughout California.

 





Key Takeaways

  • A private exchange offers you and your employees access to multiple health plans in a single program.
  • Employee benefits are important to helping you attract and retain employees.
  • 78% of workers say they base acceptance or rejection of a job offer in part on benefits.
  • Using a broker in your hunt for employee benefits costs you nothing – and can actually save you money and streamline your search.

 

When you are considering health insurance options for employees at your small business, a “private exchange” may not be the first thing that comes to mind. However, it is something you might want to consider because it offers advantages for you, your business, and your employees.

So, you may be wondering, “What is a private exchange?” At its core, a private exchange is sort of like a health insurance shopping mall that offers your business coverage from multiple health insurers. It may also offer other related products, like Dental and Vision insurance.

In California, the most-successful private exchange is the CaliforniaChoice multi-carrier exchange, which has been offering employee benefits to small businesses in the Golden State since 1996. With CaliforniaChoice, employees can choose from seven different health plans and dozens of coverage options, including PPO, HMO, EPO, and Health Saving Account (HSA) compatible plans. CaliforniaChoice also offers optional benefits like Dental and Vision insurance as well as Chiropractic and Acupuncture benefits.

 

Why offer employee benefits – and a private exchange?

Offering employee benefits can help you attract and retain employees. Benefits are a key factor in recruitment and job satisfaction. Not offering benefits (or offering lesser benefits) could put you at a disadvantage in attracting and retaining top talent. In fact, according to a survey by Benefitfocus, 78% of workers base their acceptance or rejection of a job offer in part on the employer’s benefits package.

When it comes to Health Insurance, a report by the Society for Human Resource Management (SHRM), 2016 Strategic Benefits—Leveraging Benefits to Retain and Recruit Employees, found 95% of employees rank health care benefits as among the most important. The report suggests that to appeal to the widest range of employee demographics, businesses need to position themselves as an “employer of choice” by offering benefits employees want.

A private exchange can help you do that. It gives your business and your employees access to multiple health insurers and plans, instead of just one carrier and one plan type for everyone. With a private exchange, you and your employees have the flexibility to shop and compare health coverage and find the plan that best suits your individual and family health care needs.

With the CaliforniaChoice multi-carrier, employee-choice program, one of your employees might choose PPO coverage from Anthem Blue Cross because it includes his or her preferred doctor or a specific hospital in its network. Another employee who visits the doctor less frequently might select a Kaiser Permanente HMO plan. A third might select HSA-compatible HMO coverage from UnitedHealthcare or another carrier. It is their choice with CaliforniaChoice.

Another reason to offer employee benefits is you can deduct the cost of your employees’ health benefits as a routine business expense. Offering employee benefits can also help you improve your employees’ health (by giving them access to health care); that can help lower employee absenteeism at your company.

You are in charge. With a private exchange, you determine what you want to spend on the premium for your employees’ health benefits. (A broker can help you with this, if you like.)

For example, with an employee benefits program like CaliforniaChoice, you can set up your health care budget in a way that makes sense for your business. You can decide to contribute either a fixed dollar amount or a fixed percentage of a specific plan’s premium. The minimum you can pay is always 50% of the lowest-cost health plan, so you have a lot of flexibility in deciding what you want to spend.

Once you define how much you can contribute to your employees’ benefits, they use those funds to find the health insurance carrier and plan design (HMO, PPO, HSA) they like best. If an employee likes an option that costs more than what you’ve decided to contribute, he or she simply pays the difference.  

Once coverage begins (on your selected effective date), your employees are responsible for all of the medical expenses they incur, like costs for doctor office visits and prescriptions.

And, the amount you decide to pay is locked-in for 12 months. When it is time to renew your benefits, you have the flexibility to change what you are paying for employees’ benefits and your employees can either stay with the carrier and benefit plan they have or change to something new.

 

How you can get started

The best way to get coverage for your employees through a private exchange is by working with a broker. An experienced broker will have the expertise to help you sort out all of your options, get a quote, and guide your employees through the enrollment process. And, of course, he or she can help you after your group is enrolled if you hire new employees, want to make changes to your coverage, or have a claims or administration question.

Contrary to what you might think, using a broker does not cost you anything. In fact, a broker could save you money because he or she has the knowledge and technology to help you find the most competitive benefits for your company, while ensuring you and your employees have access to the health care providers you want.

If you would like to learn more about how a multi-carrier exchange like CaliforniaChoice can help you attract and retain employees, deliver more choice, and still allow you to control your benefits costs, contact your broker. If you do not already have one, we can help you find a CaliforniaChoice broker to speak with about a quote for employee benefits for your business.

If you’re a small business owner, and you’re interested in offering health insurance and other benefits to your employees – whether you’re doing so for the first time or because you want to find out whether you can save by moving to a different health insurance plan – your first step should be to talk with a broker.

There are many benefits to using a health insurance and employee benefits broker in your review of options for your employees. The primary benefit is that using a broker can save you and your business money. Contrary to what you might think, the services of a broker don’t cost you anything. (Your broker earns a commission from the insurance company for each of the products sold.)

An experienced broker has the insurance and health care expertise – and the technology – to help you find an affordable employee benefits program for your business, while ensuring you and your employees have access to the doctors, hospitals, and other health care providers you want.

 

What can you expect to pay?

The good news is that it’s up to you. Working with your broker, you decide what amount you want to spend on your employees’ benefits – and the amount you select is locked-in for 12 months. (The only variable is if you hire new employees or someone drops coverage.) You can choose a fixed dollar amount or a fixed percentage of the costs of employees’ benefits.

For example, if you choose 50% of the lowest-cost health plan and the price for that coverage is $150 per month, your contribution would be $75 per month per employee. At renewal, you can adjust your premium contribution – up or down – so you continue to have full control over your company’s benefits budget for another 12 months.

If you choose a multi-carrier, employee-choice health insurance program like CaliforniaChoice and one of your employees selects a health plan that costs more than your contribution, he or she simply pays the difference. It’s that simple.

 

The process all starts with a census

To provide the most-accurate quote for you and your employees, your broker will ask you for information about everyone to be insured. (It’s up to you if you offer coverage for dependents. Some organizations offer insurance to all full-time employees and eligible spouses and/or dependent children. Others offer employee-only coverage.)

A Group Health Census form includes:

  1. Each employee’s name
  2. Date of birth
  3. Gender
  4. Home ZIP Code
  5. Date of birth for spouse (if he or she is to be covered)
  6. Date of birth for each child (if he or she is to be covered)

Age and ZIP Code affect the cost of each employee’s coverage, so accuracy in the entry of information is critical. Effective this month, separate rates for children begin at age 15, although the cost for child’s coverage is limited to the first three children. (If an employee has five children, he or she only pays a separate premium for the first three children.)

 

Reasons to offer health coverage

There are many reasons small businesses choose to offer health insurance to employees. One is that it helps you compete more effectively in a tightening employment marketplace. (After all, you’re not just competing for talent with other small businesses; you’re recruiting against employers of every size, who may offer a diverse range of employee benefits.)

Another is that the premiums you pay toward your employees’ health insurance benefits are exempt from your company’s federal income tax and payroll taxes. Plus, it can reduce payroll taxes for your employees.

An added advantage of offering CaliforniaChoice is that it gives your employees the ability to choose from seven of the state’s leading health plans – and find coverage to match their individual or family health care needs. One employee might pick a PPO from Anthem Blue Cross because it includes his or her preferred doctor or hospital in the provider network. Another employee, who rarely visits the doctor, might choose an HMO from Kaiser Permanente or another insurance company. A third employee might choose an HSA-compatible plan from UnitedHealthcare because of its cost and tax advantages.

You can start the process for a new quote for your employees’ heatlh care by contacting your broker. Or, you can link here to begin the process. We’ll put you in touch with a CaliforniaChoice broker who can answer all of your questions about finding the right health care coverage for your employees.

Among your responsibilities as an employer is ensuring the reporting of employee and independent contractor income information to the Internal Revenue Service (IRS) each year.

In addition to IRS reporting, employers are required to provide employees and independent contractors with a summary of their earned income for the previous year. (They use the supplied information when filing their individual annual tax returns.)

Employee information is reported using IRS Form W-2, while Form 1099-MISC is used to report contract worker income. Although the reporting of contractor earnings is required only for those who earn more than $600 annually, some employers choose to report income for all 1099 employees. Be sure to ask each of your contractors (whether you call them a freelancer, independent contractor, or consultant) to fill out a W-9, Request for Taxpayer Identification Number and Certification , so you have the information needed to complete their 1099-MISC forms.

Due Dates

W-2s for employees’ 2017 income are due to the IRS along with a summary report by January 31, 2018; the same deadline applies for 1099-MISC forms (and Form 1096 , the Annual Summary and Transmittal of Information Returns ).

The January 31, 2018, deadline also applies to providing employees and contractors with income information for 2017.

For verification purposes, employers must file copies with the Social Security Administration (using Form W-3) by the end of January.

If you have more than 250 employee and/or contractor forms to submit, you must submit them electronically.

If you’re using QuickBooks® (or other tax software) for your firm’s book-keeping, you can likely access the required forms online. Otherwise, you can get forms at most office supply stores and online, at the IRS website.

 

Penalties for Non-Compliance

California employers must provide employees with a federal W-2, Wage and Tax Statement , by January 31, as required under Section 13050 of the California Unemployment Insurance Code (CUIC). Failure to do so (or for furnishing false or fraudulent statements) is subject to a state penalty of $50 for each such failure under Section 13052 of the CUIC.

California State Senate Bill 542 requires businesses and government entities (defined as a “service-recipient”) to report specified information to the Employment Development Department on independent contractors (defined as a “service-provider”).

If you hire an independent contractor and he or she is an individual or sole proprietor earning or entering into a service contract for $600 or more, you are required to report independent contractor information using Form 1099-MISC.

Employers are subject to a penalty of $24 for each failure to report a 1099-MISC worker’s income within the required timeframes, unless the failure is due to good cause. If the failure to report is an intentional agreement between the service-recipient and service-provider to not supply the required information to the state or to supply a false or incomplete report, a penalty of $490 may apply.

Federal penalties start at $50 per return, up to a maximum of $536,000, if forms are not more than 30 days late. The “per return penalty” increases to $100 (and a maximum of $1,609,000) if the form is 31 or more days late but filed by August 1. If the form is filed after August 1 or not at all, the penalty increases to $260 per return (up to a maximum of $3,218,500). Employers who intentionally disregard the filing deadlines are subject to a penalty of $530 for each return (with no maximum limitation).

Small businesses (which are defined as those with gross annual receipts of $5 million or less) are subject to the same per return penalties noted above, although the maximum penalty amounts are different – $187,500 if forms are not more than 30 days late, $536,000 if 31 or more days late (but filed by August 1), and $1,072,500 if not filed by August 1 or not filed at all.

The same penalty structure applies to W-2 and 1099-MISC income reporting and filing.

For additional information on W-2 reporting requirements or instructions, visit the IRS website and refer to the IRS Employer’s Tax Guide (Publication 15, Circular E) and Instructions for Forms W-2 and W-3 , respectively.

For additional guidance on completing state information on Form W-2, refer to the California Employer’s Guide, DE 44. For information on state reporting of independent contractor income, refer to Report of Independent Contractor(s), DE 542. If an employee or contractor performs services in more than one state, contact the other state(s) for guidance.

 

Employees vs. Contractors

Be sure you pay people based on the work they do and how they are categorized – as an employee or a contractor. Then make sure you file the correct income information (using Form W-2 or 1099-MISC) with federal and state authorities.

Filing is required by law – and your failure to comply could result in substantial penalties for each late return. Don’t risk a fine – at both the state and federal level; comply with the guidelines and make sure you act by the January 31 due date.

For information on the IRS extension of the filing deadline for employers to provide health coverage forms to individuals (using Forms 1095-B and 1095-C), link here. The paper-filer deadline, which was January 31, 2018, has been extended to February 28th, while electronic filers have until April 2, 2018.

 

Highlights/Key Takeaways

  • The Medical Expense deduction is being expanded, temporarily, for 2017 and 2018.
  • Employee awards – like gift cards, tickets, meals, and lodging – are now taxable.
  • Employers can no longer contribute to commuter benefits and take a tax deduction.
  • Unreimbursed moving expenses are no longer deductible for employees.
  • New rules apply to 401(k) loans when an employee leaves a job.

Just before Christmas, President Donald Trump signed the Tax Cuts and Jobs Act, which dramatically reduces the corporate tax rate (from 35 to 21 percent) and cuts the top individual tax rate to 37 percent. The legislation also doubles the standard deduction for individuals, while eliminating many personal exemptions and most itemized deductions. A single person’s standard deduction increases to $12,000 (from $6,300), and the standard deduction for married and joint filers increases to $24,000 (from $12,700). It’s forecast that more than 90 percent of taxpayers will take the standard deduction when filing taxes for 2018 (in 2019).

The tax legislation also repeals the individual mandate of the Affordable Care Act (ACA); however, the mandate does not go away until 2019. (At this time, individuals who are not exempt from the individual mandate are still required to have coverage in 2018, or face a penalty when filing their income taxes in 2019.) The employer mandate, which requires employers with 50 or more full-time or full-time equivalent employees to offer health coverage, has not been repealed… at least not yet; however, that could change during 2018 or 2019.

For employers, the new withholding rates should be ready by the end of January, so employee paychecks (under the new tax rates) are likely to change in March, or possibly sooner. Also changing in 2018 is the ability for employers to take a partial tax credit for employees’ short-term leave. The Family and Medical Leave Act guarantees employees at larger companies up to 12 weeks of leave annually, although there’s no requirement workers be compensated; the new tax law provides a partial credit to employers for wages paid during an employee’s leave.

  1. Medical expenses: Temporarily, for 2017 and 2018, the new tax rules expand the deduction for medical expenses. It allows individuals to deduct qualified medical expenses exceeding 7.5 percent of income. Under prior rules, the cutoff was 10 percent of income for those born after 1952. Nearly nine million people used the medical expense deduction in 2015.
  2.  

  3. Employee awards: Another change in the new tax law is an updated definition of what employers can offer as tax-free achievement awards. Cash or a cash equivalent (like gift cards, meals, tickets, and lodging) are taxable. Tangible property, like a t-shirt or coffee mug, is not taxable.
  4.  

  5. Commuter benefits: Employees can continue to use pre-tax dollars to pay for transit or parking expenses related to their commute. (Qualified expenses are allowed under Section 132 of the Internal Revenue Code.) Up to $260 monthly can be set aside by employees; however, employers are no longer permitted a tax deduction for contributions toward these expenses.
  6.  

  7. Relocation expenses: Unreimbursed moving expenses are no longer deductible for employees on their income taxes. If a business pays a worker’s moving expenses for a new job or relocation of an existing job, under prior tax law, the amount was not taxable to the employee. Now, through 2025, any such payments are considered income – and are taxable to the employee. The exception to this new rule is active-duty military. It remains to be seen whether employers will choose to offset the tax for employees by increasing their gross pay.
  8.  

  9. 401(k) loan repayment change: As a general rule, when an employee leaves a job, whether voluntary or otherwise, he or she has to repay any funds owed on a 401(k) loan. If it’s not repaid, the amount is deducted from the account when the balance is rolled over or paid out (which subjects it, potentially, to an early withdrawal fee, too). Now, under the new tax law, employees have until their tax-filing-due-date (usually April 15) in the year following their exit to roll over their account without it being treated as a distribution.

More health care options for your employees

Whether you’re an Applicable Large Employer who is required to offer health benefits, or you’re a small business that wants to compete more effectively by offering employee benefits for the first time, you’ll want to take a look at CaliforniaChoice. It is the only place where you and your employees can select coverage from seven of California’s leading health plans in one program, including HMOs, PPOs, EPOs, and HSA-qualified coverage.

And, CaliforniaChoice also offers valuable no-cost “extras” that you and your employees will appreciate – like discount Dental, Vision, and Hearing services, a Premium Only Plan (POP), COBRA billing, access to HRAnswerLink, Cal Perks employee discounts, and much more. For details, contact your broker. If you don’t already have an employee benefits brokers, we can help you find a CaliforniaChoice broker to answer all of your questions and provide you with a custom quote.