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Choosing Small Business Health Insurance

Jan 10, 2019 | Healthcare, Monitor

Small businesses employ nearly 60 million people in our economy. We know that small businesses care about their employees and want to offer coverage. Some 82 percent of employers in a recent Metlife study reported that employers have a responsibility for the health and wellbeing of their employees. Small business owners want to attract and keep the best employees, and offering benefits is a great way to do that. But many small business owners are unsure about how to begin or if they can afford any plans. In addition, those who do offer insurance to their employees already have to suffer through a lengthy back and forth processes. Here are five steps on how to choose the best health insurance plan for your small business.

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July 2019

July 2019

Getting Started

The auto insurance industry has benefited from online auto insurance marketplaces like Progressive and Liberty Mutual, which are modernizing the auto insurance shopping process. Similarly, health insurance has profited enormously from online health insurance marketplaces, which are transforming and streamlining the health insurance shopping process as we know it.

Online health insurance marketplaces are useful tools to shop and compare plans and generate unlimited quotes in no time at all. These marketplaces exist to make things easier for small business owners and they are a smart way to begin the search for a health insurance plan that fits your team. Start your search and see what carriers, products, and premiums are available, in an instant, whenever you want. You will be able to see quotes, side-by-side, so you can compare and make an informed decision on which plan is best for your team. Choose one or two or three plans (depending on how many employees you have and their needs) from the same medical carrier to offer to your small business. The price of insurance varies for every employee based on their age, carrier and plan.

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How to Find an Accurate Estimate

For an accurate estimate of your employees’ health insurance options, while using an online health insurance marketplace, you’ll need to be equipped with a specific set of information. Be sure to have the following information on-hand as you begin your search.

Zip Code—Enter the zip code of your company’s headquarters to see which carriers are offering plans in your company’s location.

Number of employees—How many employees are you looking to cover?

Employee (+families)—Are your employees looking to cover their families as well as themselves?

Dates of birth or age of the employees

Understanding Plan Options

You’ve found some plan options but what does it all mean? Here are simple terms to help you understand what you’re actually shopping for:

What is a premium? A premium is defined as the amount of money you pay per month for health insurance coverage. (This varies by age and smoking status of each individual employee covered.)

What is a high or low deductible? A deductible is defined as the amount of money you’re responsible for paying before your insurance starts paying for health services. The lower your deductible, the earlier your plan starts paying its share.

Copay and Coinsurance: A copay is defined as the flat fee you pay for medical services. Copays can occur before or after a deductible depending on the type of plan you have chosen.

A coinsurance percentage reflects how much of the bill you pay for medical services.

What do bronze, silver, gold, and platinum mean? Bronze plans have the highest employee costs at the point of care, but the lowest monthly premiums and typically high deductibles.

Silver plans have moderate employee costs at the point of care, moderate level monthly premiums, and lower deductibles than bronze plans.

Gold plans have low employee costs at the point of care, but high monthly premiums and typically low deductibles.

Platinum plans have the lowest employee cost at the point of care, but the highest monthly premiums and very low deductibles.

Are my and my employees’ doctors in-network? A Health Maintenance Organization (HMO) is a plan that limits coverage to care from doctors who work for or contract with the HMO, meaning they generally do not cover out-of-network care, but consumers save money when accessing these providers.  

A Preferred Provider Organization (PPO) is a type of plan that contracts with medical providers to create a network with a broad choice of providers. Benefits are available both in and out of network, but you pay less to use the contracted in-network providers.

How much will this cost me (and my employees)? We know you may be on a tight budget and getting the most for your money is important. Employers usually cover 50 percent to 100 percent of the cost of benefits for their employees. You decide how much to contribute, and your employees pay the rest. According to KFF’s 2018 Employer Benefits Survey, small firm employers contributed an annual average of $5,681 to their employees’ premiums for single coverage, while their employees contributed an annual average of $1,133. For family coverage, small firm employers contributed an annual average of $11,957 to their employees’ premiums while their employees contributed an annual average of $6,781.

Finalizing Your Options and Getting Enrolled

Once you have settled on a plan you like, how do you close the loop and finalize the health insurance shopping process? At this point, you need to find a licensed broker you can trust so you can get your company and employees enrolled.

Online health insurance marketplaces that offer a seamless transition from the shopping, comparing and quoting platform to a licensed broker via live chat, email, or phone are ideal. Rather than suffer through disorganized call centers and waiting on a broker to return your call, it’s helpful to get connected to an insurance expert instantly who will answer any questions you might have and help you enroll in health coverage as quickly and efficiently as possible.

Leveraging online health insurance marketplaces to shop, search and compare plan options simplifies the process, provides transparency and choice in products, while still offering access to live expert help from licensed brokers to help you make this important decision for your employees.

Sally Poblete
Sally Poblete
Sally Poblete has been a leader and innovator in the health insurance industry for more than twenty years. As a broker and former industry executive herself, she founded Wellthie out of a deep passion for making health insurance more simple and approachable for consumers and small businesses. She had a successful career leading product development at Anthem Blue Cross Blue Shield, one of the nation’s largest health insurance companies.
Alaska Business Magazine June 2019

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