New Year Offers New Opportunities To Keep Your Workforce Healthy
At Southwest Health Insurance Experts, we pride ourselves in getting business owners the answers they need, including clear, helpful responses to group health insurance broker FAQs.
Even the savviest and smartest Phoenix area business owners can find themselves feeling confused and inadequate by the seemingly endless options and details for group health insurance for their employees. This is why so many Arizona businesses turn to our experienced brokers for the guidance and information that can empower them to make informed decisions about group health coverage for their workforce.
As we turn the page on a difficult 2020 and look ahead to a much better 2021, here are the top group health insurance broker FAQs in Arizona for the new year.
Is My Company Required To Provide Group Health Insurance For Employees?
The answer to this question depends on how many workers you employ. If your company has less than 50 full-time or full-time equivalent employees, it has no legal obligation under the Affordable Care Act (ACA) or any other law to offer or provide group health insurance to those employees.
For purposes of clarification, the ACA defines a full-time employee as one who works 30 hours or more each week or 130 hours each calendar month, including vacation and paid leave time.
Companies with less than 50 full-time employees may still need to provide coverage if they have 50 or more “full-time equivalent” (FTE) employees. The ACA further defines FTE as “a combination of employees, each of whom individually is not a full-time employee, but who, in combination, are equivalent to a full-time employee.”
If, on the other hand, your company has 50 or more full-time or FTE employees, the law considers it an “applicable large employer” (ALE) that must offer an ACA-compliant group health insurance plan to at least 95% of its full-time employees.
If The ACA Requires My Company To Offer Group Health Coverage, What Happens If We Don’t?
Arizona ALE’s with 50+ FTE employees that don’t offer ACA-compliant coverage should brace themselves for a tax penalty of $3,860 per employee for failing to do so. In other words, if your company has just 51 qualifying employees, you could face a hefty penalty of $196,680 per tax year. With a tax penalty that high, it makes sense to explore all available options for group health insurance, and this is where having a licensed group health insurance broker comes in handy.
What Types Of Group Health Can We Offer Our Employees?
There are plenty of options for group insurance in terms of the type of plan, scope of in-network providers, and the extent of coverage. Depending on your company’s needs, resources, and objectives, you may offer your workers one of these plans::
- Health Maintenance Organization (HMO)
- Preferred Provider Organization (PPO)an
- Exclusive Provider Organization (EPO)
- Point of Service (POS)
- Health Care Service Plan (HSP)
- High Deductible Health Plans (HDHP)
How Much Will It Cost My Company To Offer Group Health Insurance To Our Employees?
In today’s economy, this is one of the top group health insurance broker FAQs that Arizona employers ask time and again. Many factors play a role in how much group health coverage costs, such as the number of employees, their ages, whether the plan includes dependents, and the type of plan selected.
Most group health plans require an employer contribution of at least 50% of the cost of coverage, but it’s up to your company whether to contribute just that amount or more.
Can My Company Get Any Tax Breaks For Offering Group Coverage?
The short answer is, Yes. All health insurance-related expenses that your company pays are 100 percent tax-deductible as ordinary business expenses under both federal and state law. This is the case no matter what type of entity your company is, whether an S-corp, C-corp, LLC, or partnership.
Additionally, under the ACA, qualifying small businesses (typically those with 25 or fewer full-time employees) can receive tax credits of up to 50 percent of their premium expenses during any two-year period.
Arizona also provides state tax credits to small businesses that decide to offer health coverage to their employees if they did not do so previously. The Arizona Health Insurance Premium Tax Credit is actually a tax credit received by a health insurance company that enrolls a new, qualified small business in a group plan. But the enrolling insurer passes that credit on to the insured small business in the form of reduced premiums.
For More Information, Read: Group Health Insurance Tax Benefits For a Business in Arizona
Southwest Health Insurance Experts: Answering Group Health Insurance Broker FAQs From Arizona Companies For Over 30 Years
If you are considering obtaining group health insurance coverage for your employees, your first step should be to discuss your options with Southwest Health Insurance Experts, an experienced Arizona group and individual health insurance broker. We have over 30 years of experience servicing the health insurance needs of companies in Scottsdale and throughout Arizona. We are committed to answering your questions, addressing your concerns, and providing solutions that can keep you and your workforce safe and healthy during these challenging times.