Open Enrollment Tips for Small Businesses

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As a small business owner, you’re probably your own HR Department. It’s up to you to decide the kind of health insurance you offer your employees.

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As a small business owner, you’re probably your own Human Resources Department.  That means it’s up to you to decide the kind of health insurance you offer your employees, how much you’ll contribute toward their premiums or whether you offer health insurance at all.

To help you make these decisions, we’ve put together these helpful tips.

Tip #1- Know the Law

The Affordable Care Act (ACA) requires all businesses with 50 or more full-time employees to offer said full-time employees health insurance.  In addition, the health insurance you offer must meet the ACA minimum requirements and can’t be too expensive for your employees or else you could incur fines of up to $3,000 per year per employee. If your company has fewer than 50 full-time employees but is part of a larger ownership organization that employees 50 or more people full-time, you are subject to the same requirements as a larger company.

Even if you have fewer than 50 employees, if you decide to offer health insurance, the plans must comply with ACA regulations.

Tip #2- Know Your Options

If you offered a plan last year, contact your insurance and ask the following questions:

  • Is my current plan scheduled to auto renew?
  • Has the provider made any changes to my current plan for the following year?
  • What other ACA-compliant plans are available in my price range?

If you’ll be offering health insurance for the first time, contact an insurance broker and ask about your options for the coming year.  If you have fewer than 25 full-time employees and you cover at least 50% of the premiums for those full-time employees, you’re eligible for a tax credit.  So it might be worth discussing this with your accountant.

Another option for businesses with fewer than 100 employees is purchasing a health plan through the Small Business Health Options Program (SHOP).  This marketplace is maintained on a state-by-state basis, so it might not be available everywhere, but if it is available in your state, it could be a way to find affordable, ACA-compliant health plans for your employees.

Tip #3- Come up with Creative Alternatives

If you have fewer than 50 full-time employees and can’t afford to offer a health plan, you can still contribute to their health care costs by offering a stipend for employees to purchase their own plans.

Tip #4- Communicate with Your Employees

You should communicate all changes to your health insurance offerings with your employees at least a month before open enrollment starts.  Even if you’ve decided to keep the current health plan, that plan provider has made no changes to coverage levels and employees’ costs will remain the same, you should communicate this to your workforce.

If you’re making any changes to your plan offerings or contribution levels, make sure you educate your employees as to their options and how these options will affect them.

Choosing the right health care plan for your business can feel daunting, but by doing so, you’re more likely to keep good workers.  You’re also more likely to have a healthier workforce, which means increased productivity and less turnover due to illness.  So follow our tips and when in doubt, reach out to an insurance broker who can help guide you through your options.

Disclaimer: the content presented in this article are for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, including fund prospectuses, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.