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When you become an entrepreneur, one of the first orders of business you must deal with is health insurance. Whether you have employees or not, health insurance is a necessity in the U.S., but it can be challenging to find a good plan. Here are some tips to help you locate health insurance for your business.[soros]
Health Insurance Marketplace
If you qualify for a subsidy, the first thing you should do is check the Health Insurance Marketplace at Healthcare.gov. It’s also worth a check if you’re not sure whether you qualify for a subsidy. If you’re buying insurance for your business and employees will be on the plan, then the Health Insurance Marketplace isn’t an option.
However, for solopreneurs and anyone who must buy their insurance separate from their workplace, the Health Insurance Marketplace is a good option, especially for those who qualify for a subsidy. If you don’t qualify for a subsidy, there are undoubtedly better insurance plans available outside the Marketplace. Thus, if you apply and find out that you don’t qualify, you might want to look elsewhere.
Some associations offer health insurance as a benefit of signing up. For example, the National Association for the Self-Employed or NASE offers health insurance to members. However, you should do your research to determine if the benefits offered are truly worth the fee paid for membership because not all of them are.
Association health plans are group insurance plans in which multiple employers, including people who are self-employed, unite to offer medical benefits. Joining together increases the number of participants on a plan, making the association qualify as a “large group” health plan.
Large group plans are eligible for less expensive health plans with a lower percentage of premiums spent on profits for the insurer and administrative costs. They also allow associations to design plan benefits based on best practices used by large businesses. Additionally, large group plans can negotiate better rates from healthcare insurers and providers, and self-insuring can lower your plan administration costs more and avoid a health insurance tax.
Associations could be a good option for solopreneurs or small business owners who want to offer health insurance but don’t have a lot of employees.
Professional Employer Organizations
Professional Employer Organizations (PEOs) are firms that outsource accounting, payroll and other management tasks, including health insurance. Small business owners who sign up with a PEO can buy into group health insurance for a small monthly fee.
Like associations, PEOs combine multiple employers into one large group of employees for a health insurance plan. This enables workers to access insurance plans similar to those they would receive if they worked at a big company. Unlike associations, PEOs also come with other services like payroll processing.
However, one potential problem with PEOs is the fact that many have minimal options in insurers, which means small business owners might not have access to the best plans. PEOs also require administrative fees to support their services, and these fees come out as a monthly fee per employee or a percentage of the total payroll.
Health networks are another option for small business owners who want to provide health insurance for themselves or their employees. Some examples of health networks include New Health and Liberty Healthshare.
However, these health cost-sharing networks are not an option for those with pre-existing conditions, as you must be in good health to sign up for the plan. They’re also not a choice for small business owners who want to provide health insurance for their employees. On the other hand, solopreneurs in good health might be interested in health networks.
An Easier Way to Find Health Insurance
It can be a daunting task to find health insurance for you, your family, and your employees, but one other option can make the process easier. A comparison platform like the HealthMarkets marketplace enables you to compare multiple plans and receive the best recommendations from hundreds of different insurers.
To use such platforms, you just answer some questions about your needs and your current health insurance plan. They can even help you save money on health insurance.
Whether you’re a solopreneur or a small business owner with several employees, there are multiple options for seeking health insurance. You just have to know where to look.