As a small business owner or manager, you are a jack-of-all trades. With so many demands on your time, managing health benefits can not, and should not be a full time job. That's why when it comes to assessing the small business health benefit options, it is not just about the line item expense. The delivery time is also an important factor to consider.
In this practical guide, we will discuss management options for health benefits of small businesses and what these options mean for your health care and personal budgets.
Benefits Small Business Health Administration
Benefits Small Business Health Administration How a small company administers health benefits depends largely the type of services offered. There are two main approaches to the administration of health benefits.
1. Policy group health insurance
Health insurance is a type of policy purchased by an employer and offered eligible employees of the corporation and eligible dependents of employees.
The cost of the premium is usually shared between the employer and the employee, and there is a minimum percentage rate, the employer must contribute to the premiums.
Small businesses can purchase a group health insurance through a broker, online or via the new ACA Small Business Health Options Program (SHOP). Market
the cost of group health insurance
In 2014, the average cost to cover one employed with the group health insurance was $ 502 / month or $ 6,025 / year. For family coverage, group health insurance costs $ 1,403 / month or $ 16,834 / year. These costs are generally shared between the company and the employee
Related :. The Simple Guide to Health Insurance for Small Enterprises
How to Administer
With most fonts 'insurance in small groups, a good amount of administration is supported by the insurance company, broker, or insurance organization is (eg a commercial organization). The small company, however, still some administrative functions to fulfill, including:
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selection and font purchase
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employee education
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education of employees and termination
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health plan reviews the distribution
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the annual renewal
for many small businesses, running a health insurance policy, and relations with unpredictable annual rate increases, creates too much of an administrative burden. So there is a second option for small businesses.
2. Health Individual Insurance Reimbursement
The second option for small businesses to provide and administer health benefits is with no reimbursement from health insurance.
With individual health insurance reimbursement (also called "premium rebate" or "defined contribution"), the company sets up a formal repayment plan to give employees a health care allowance. Employees choose (or keep) the plan of their choice and are reimbursed by the company up to the amount available to them.
The cost of individual health insurance Money
With a rebate program, the company may set an amount to contribute to the health of employees; there is no minimum or maximum amount.
The cost of individual health insurance will vary by the employee. On average in 2014, individual health insurance costs $ 346 / month or $ 4,152 / year before the tax credit reductions on premiums. In 2014, 87% received tax credits and paid, on average, only $ 82 / month for all types of plans -. Or $ 984 / year
How to give
person with reimbursement of health insurance, the company simply manages the repayment plan and employees choose and manage their own health insurance. The administrative tasks of the company needs to fulfill the following:
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The establishment of a formal repayment plan
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employee education
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employee enrollment and termination
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Health distribution opinions on plans
Conclusion
when considering health benefits administration time, the type of health benefits offered is an important consideration. With a group health insurance policy, small business is involved in the purchase and selection of the health insurance. Therefore, the administration time is higher. With individual reimbursement health insurance, small business has less of an administrative burden. With good health reimbursement software, companies can expect to spend five to 10 minutes per month administration of health benefits.
What questions do you have on how to administer health benefits for small businesses? Leave a question or comment below.
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