Providing Insurance for Employees
Many small business owners choose to provide insurance for their employees. Pennsylvania defines small businesses as those with 50 or fewer full-time employees. Some states may use different limits, but Pennsylvania law reflects the federal maximum of 50 full-time employees.
Many small employers seek coverage on their own or with the assistance of an agent or broker, but another way for small business owners to purchase insurance for their employees is through the Small Business Health Options (SHOP) Marketpace
at Healthcare.gov. When you apply to use the SHOP Marketplace, you will have to make a few decisions about the health insurance options you plan to offer, including:
- Whether you will offer one or multiple plans;
- How much of your employees' premiums you will pay;
- Whether you will cover dependents;
- Whether you will offer dental benefits in addition to medical benefits;
- When employees can begin receiving coverage;
- Whether you will offer coverage to part-time employees.
Whether purchasing insurance on your own or through SHOP, it is important that you consider how much you are able to contribute to your empoyees' premiums each month before selecting a plan or plans to offer. Like the individual marketplace, SHOP marketplace plans are broken into four categories – Bronze, Silver, Gold, and Platinum – that
represent a different level of cost-sharing between you, your employee, and the
insurance provider. Bronze plans will have a low monthly premium, but your
employee may have to meet a larger deductible before the insurance company pays
all costs. Gold and platinum plans will have a higher monthly premium, but the
deductible could be lower. Consider both the costs of a plan and the benefits covered so that you can choose the option that best suits the needs of you business.
Your business could qualify for the Small Business Health Care Tax Credit that is worth up to 50 percent of your contribution toward your employees' premiums for two consecutive tax years. In order to qualify, you must meet the following parameters:
- Have fewer than 25 full-time employees;
- The average employee salary for your business is roughly $50,000 per year or less;
- You offer health insurance coverage to full-time employees through the SHOP Marketplace;
- You pay at least 50 percent of your full-time employees' premium costs.
If you need help considering your options, there are many resources available
. Registered agents and brokers in your area can help you choose the best plan for you and your small business. For those looking on the SHOP Marketplace, marketplace navigators are available to help you understand your needs and options during the shopping process.
Every year, the Pennsylvania Insurance Department
reviews all proposed health insurance rates and changes to existing rates for
plans in the individual and small group markets. We have a number of resources
available to help consumers understand this process, and obtain information
about requested and approved changes to their rates. For more information on
the health insurance rate review process and to see a list of these resources,
You can always contact the Insurance Department to ask a question or file a complaint. You can call us at 1-877-881-6388 or file a complaint online.
Self-funded insurance plans are regulated by the United States Department of Labor and are subject to federal laws and regulations, including the Affordable Care Act. For more information on requirements for self-funded health insurance plans, visit the Department of Labor