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Top Questions From New Groups
We have compiled a list of frequently asked questions to help you navigate the world of small business health insurance and better understand the CaliforniaChoice private exchange.
Who is CaliforniaChoice? What does CaliforniaChoice do?
CaliforniaChoice is a third-party administrator that operates the only multi-carrier, private health insurance exchange focused on the needs of small businesses in California. We partner with eight of the state’s leading health plans to offer major Medical, Dental, Vision, Chiropractic and Acupuncture, and Life and AD&D Insurance, as well as other employee benefits. We serve nearly 20,000 California businesses (with 1-100 employees) and more than 335,000 members.
Is CaliforniaChoice a broker?
No, we are California’s longest-running, multi-carrier private health insurance exchange. Our organization works with independent brokers across the state to help employers find coverage that is affordable and offers more choice to employees.
Does the law require businesses to provide employee health insurance?
That depends on the size of the business. Under current federal law, the number of your full-time plus full-time-equivalent (FTE) employees determines whether your organization is an Applicable Large Employer (ALE). If that number is 50 or more, you’re subject to the Affordable Care Act (ACA) Employer Mandate, which requires you to offer health insurance that is “affordable” and provides “minimum value” to full-time employees (and their dependents). As of April 2019, a full-time employee under the ACA is one working 30 or more hours per week, or providing 130 hours of service each month.
If you want to learn more, you can find an ACA Calculator on the CaliforniaChoice website here. (Click on the link in the lower right.)
If your business is not an ALE, you are not required to offer employee health insurance to your full-time and FTE workers; however, many smaller businesses do offer health coverage because it can help you recruit and retain top talent in today’s competitive marketplace.
How many employees does a business need to have in order to be required to provide health insurance?
If your business has 50 or more full-time and FTE employees, you’re an Applicable Large Employer (ALE) subject to the Employer Mandate (also known as the Shared Responsibility Provision). That means you must offer minimum essential coverage that is affordable and provides “minimum value” to full-time employees (and their dependents). If you do not offer this coverage, you must, potentially, make an employer shared responsibility (penalty) payment to the IRS.
If you own a small business with very few employees, there are group insurers that will write groups with as few as two workers – in most cases, the owner and a non-spouse employee. A few carriers write coverage for husband and wife groups; however, these groups cannot be written through CaliforniaChoice.
How does the cost of Group Health Insurance compare to Individual coverage?
When it comes to cost, it’s tough to compare Group and Individual & Family (IFP) health insurance coverage. That’s because an employer’s cost for coverage is not just for personal coverage, but also the cost for all of your eligible employees’ coverage, too.
For a very small business, it is possible that purchasing IFP coverage could be less expensive than a group plan. However, there are competitively priced plans for Small Groups in California, so IFP coverage is not necessarily going to be less expensive.
The best way to learn the potential cost for health coverage for you and your employees is to talk with your health insurance or employee benefits agent. If you don’t have an agent, visit our website here to look for one in your area.
How can I get an estimated cost of health insurance for my employees?
The easiest way is to request a quote from your agent. Your health insurance agent is a great resource when you’re looking for information on plans and the cost of coverage for you and your employees. If you are not already working with an agent, it’s easy to find one on the CaliforniaChoice website.
Why should I consider health insurance for my employees?
1) It’s tax deductible. Generally speaking, you can deduct 100% of the cost of employee and dependent health insurance as an ordinary business expense on your state and federal income taxes.
2)It’s good business. Offering health insurance to employees of your small business can help you set your organization apart from others when it comes to employee recruitment and retention.
3)It makes employees happy and can improve productivity. The 2019 MetLife Employee Benefits Trends study found that employees who are happy are more productive. Furthermore, happy employees tend to be more satisfied with their jobs, more engaged, more impactful, and more successful.
If I choose CaliforniaChoice for my employees’ health insurance, can each select a different health plan?
Absolutely. That’s part of the appeal of CaliforniaChoice. Each of your enrolling employees has the freedom to choose the health insurer and coverage that best meet his or her individual or family needs. It is important to note, though, that all enrolling family members must select the same plan, although each can have a different Primary Care Physician (if required by the plan).
Do plans offered through CaliforniaChoice include coverage for prescription drugs?
Yes. All benefit plans available through CaliforniaChoice include coverage for generic and brand name medications.
What if an employee does not want health care coverage?
Any of your employees can decline to enroll. However, it’s important to note that if an employee does not enroll, his or her dependents will be unable to enroll.
If an employee wants to decline (or waive) coverage, he or she must complete a written Medical/Dental Waiver form.
Can any of my employees be denied health coverage?
No. With CaliforniaChoice, as with all Small Group health coverage, each employee’s acceptance is guaranteed. That means your employees and their dependents cannot be turned down due to their prior medical history or current health status. They may be denied if they do not meet eligibility guidelines. For example, a child may be declined if he or she is outside of the age range for eligible dependents (i.e., beyond age 26 unless disabled).