Choosing Health Insurance For Your Small Business

With small businesses employing the majority of the workforce, the health benefits they offer is vitally important to millions of workers. When evaluating which health insurance plan is best for your employees, make sure you shop around. The large variety of plans and coverage options available can be difficult to navigate, but these options allow small businesses to tailor plans that best fit the needs of their employees.

When considering a health insurance plan for your small business, it’s important to note that insurance carriers calculate rates according to the following case characteristics:

Age of employees – Older employees are assumed to have more expensive and more frequent health-related claims, so generally speaking, an older workforce means steeper health plan costs.

Gender – Women typically incur more medical costs than men at younger ages, while males incur higher costs as they age. If your small business has a young, predominately female workforce, or one that is older and mostly male, expect to pay higher premiums.

Number of plan participants – As the amount of plan participants increases, the administrative cost for each individual decreases.

Industry – Certain factors, like unsafe working conditions, subject small businesses to higher costs. And even high employee turnover can result in a more expensive plan due to higher administrative costs for the insurer.

Geographic area – Health care costs vary by region due to differences in cost of living, medical practices and the amount of medical competition in the area.

Since the above factors affect health insurance rates, you can expect premiums, deductibles, coinsurance percentages and copayments to vary drastically from plan to plan. Shop around and do your research to ensure that you get the best plan at the best price for your small business.

Planning A Company Health Insurance Policy

Whether you’re a small business or a large multinational, attracting the best employees in your sector is a crucial determinant of future commercial success. That’s why so many companies offer their workforce a range of benefits, from generous holiday allowances to discounted gym membership or season ticket loans. Such incentives are believed to help attract bright candidates for job openings, as well as increasing overall employee satisfaction.

However, one benefit that employees in the UK are increasingly seeking is a company health insurance policy. The extent of the cover offered by one of these policies may vary from basic dental and everyday health costs to a comprehensive package that covers family members too. If you’re a business owner and you’re considering offering your employees private health insurance, here’s a few tips to bear in mind.

Get Advice From An Insurance Broker

If you’ve come across an insurance company that offers company health insurance, approaching them for a quote may seem like the logical next step. But while this may be the easiest course of action, it’s not usually the most cost effective. Instead, turn to an independent insurance broker or health insurance comparison website for an overview of the most competitive quotes in the marketplace.

Consider The Size Of Your Workforce

With the help of a broker, you should be able to find a well-priced company health insurance policy that meets the needs of your business. However, if you run a very small business with fewer than five employees, it may make more sense to take out individual cover for each person. That’s because the cost of health insurance is based on risk – the higher the risk posed to the insurance company, the more expensive the policy will be.

In larger companies, risk is spread across the workforce thus ensuring that you’ll get a better deal on the cost of a health insurance policy per employee. Some insurers may also offer a group discount for companies with more than five employees, and a good insurance broker should be able to advise you on the best course of action.

Geographic Factors

Another factor that may affect the cost of your company health insurance is your postcode. Businesses in London, for instance, are likely to find it more expensive to insure their employees than companies in Edinburgh or Manchester. So if you have offices in several locations around the UK, the cost of insuring all your employees may vary significantly.

The Reach Of Your Company Health Insurance Policy

Finally, it’s important to decide exactly what you want to offer – for example, a cash plan covering basic health costs like dental or physiotherapy treatments, or a more detailed policy that covers health check-ups and hospital stays. You may also wish to consider covering each employee’s spouse or live-in partner and children as an added benefit, or at least give them the option of extending their cover themselves.

Your Workforce And Your HSA Program

The idea behind the HSA Account is a pretty simple one … it goes like this: If consumers have to pay more of their own medical expenses out-of-pocket, they’ll make more cost-effective choices.

The point being that the Health Savings Accounts might be able to put the lid on out of control health care costs while protecting your workforce from the dangers of catastrophic medical problems. More importantly, to qualify, your employees will have to be under the age of 65 (and therefore not yet eligible for Medicare Benefits) and participating in a high deductible health insurance plan–meaning an insurance policy with a minimum deductible of $1,000.00 for singles, and $2,000.00 for families.

Will your employees be able to take advantage of your company’s Health Savings Account Program? Good question. Because the plans are cost effective and flexible tools for controlling health care related expenses, HSA’s are playing a major role in changing the way workforce managers every deploy corporate health care dollars.

However, I am sorry to say, Health Savings Accounts aren’t exactly simple.

Introducing an HSA Plan to your workforce will require you to provide a new set of key HR services that will make it easier for them capitalize on the full potential of health savings accounts. New account welcome kits detailing program highlights, deposit confirmation notices, and regular account balance statements, will all be necessary to keep your workforce properly informed.

Unlike their MSA predecessors, (Archer Medical Savings Accounts) which were only for the self-employed and small business owners, HSA Accounts are available to just about anyone–without regard to employment status; or to any employer without regard to size. There are limits however. For instance, Health Savings Accounts can only be established for employees who are:

· Currently covered by a High Deductible Health Plan. The definition of a HDHP for use with an HSA is: a plan with an annual deductible of at least $1,000.00/$2,000.00 (for individuals/families) and annual out-of-pocket maximums of $5,000.00/$10,000.00 for the same.

· Not currently covered by any other health insurance plan,

· Cannot be claimed as a dependent on anyone’s tax return, and

· Not yet entitled to receive Medicare benefits.

Remember, when managed properly Health Savings Accounts can be a boon to both employer and employees.