Group health insurance is a sought-after benefit for employees, but not all businesses must provide coverage. Whether your business is required to provide coverage is determined by the size of your organization and the number of employees you have.
Below, the insurance professionals at Unity Insurance discuss how to determine if your business needs group health insurance and why you may still want to consider providing the coverage even if it’s not a legal requirement.
What is Group Health Insurance?
Group health insurance is a type of health insurance policy that is offered to a group of people, typically employees of a company or members of an organization. These insurance policies usually cover medical expenses, such as hospitalization, physician visits, prescription drugs, and other treatments, and can also provide a way for self-employed individuals or small business owners to obtain health insurance coverage for themselves and their employees at a reasonable cost.
Employers often offer group health insurance as a benefit to attract and retain employees. Contributing towards the premium for their staff may make group coverage more affordable than individual policies. Group health coverage can also be paid for by employees through pre-tax payroll deductions, lowering payroll taxes for the employer and making it a win-win for both employer and employee.
Does My Business Need Group Health Insurance?
Group health insurance policies are regulated by law and must meet certain minimum requirements, such as providing coverage for pre-existing conditions and offering preventive care services without cost-sharing.
In Maryland, businesses must have a minimum of two full-time employees (not including the owner’s spouse) to obtain group health insurance coverage, although the availability of plans and pricing may vary depending on the size and demographics of the group. Additionally, some insurance companies may require a certain percentage of eligible employees to participate in the plan in order to qualify for coverage.
Meanwhile, whether your business must provide coverage is determined by the size of your business and the number of employees you have. The Affordable Care Act (ACA) requires employers with 50 or more full-time employees to offer health insurance coverage that meets certain minimum requirements or pay a penalty. This is known as the employer-shared responsibility provision or employer mandate. Employers with fewer than 50 full-time employees are not subject to the employer mandate, but may still choose to offer health insurance coverage as a benefit to their employees.
Should My Business Offer Group Health Insurance?
Employees today have more choices than in recent memory when it comes to choosing an employer. Often, the difference between choosing Company A or Company B, particularly post-covid, comes down to the benefits.
Whether you are legally required to offer group health benefits to your employees or not, choosing to offer health care coverage as an employer-sponsored benefit can have several advantages for both you and your employees, including:
- Helping to attract and retain employees: In a competitive job market, offering health insurance as part of your benefits package can help make your business more attractive to potential employees and retain your current workforce.
- Lower your business’s tax liability: The cost of providing health insurance coverage for your employees may be tax-deductible as a business expense.
- Promoting better employee health and productivity: When employees have access to preventive care and medical treatment, they are less likely to miss work due to illness, increasing attendance and productivity.
Overall, offering group health insurance coverage can be a valuable investment for small employers and large ones as well. It can help attract and retain employees, promote better employee health and productivity, and even comply with federal laws.
Speak to a Unity Insurance Agent For More Information About Group Health Insurance
At Unity Insurance, we know insurance plays a vital role in every stage of your business and we understand the specific challenges owners experience. Our professionals provide guidance and support to help you shop plans, compare coverage options, and ensure you make the right decisions regarding group health insurance coverage and other insurance options. We work with our clients to provide the best plan to suit business needs.
Call 410-539-6642 to learn how the experienced insurance agents at Unity Insurance can help you make the right decision for your business.