Small Business Owners: Even if You Don’t Provide Health Insurance, You Can Help Your Employees Get the Coverage They Need
Under the Affordable Care Act, small business owners have more purchasing power and can access lower cost health plans through deals brokered by the state’s health care exchange, Covered California, and its small business marketplace, Covered California for Small Business (formerly known as SHOP). Through SHOP, small businesses can get tax credits and other support for providing health care coverage to your employees.
Still, it may be a better choice for some small business owners and your employees to get health insurance through Covered California’s individual marketplace. There, you and your employees may qualify for tax credits or subsidies on individual or family plans that make health insurance even more affordable for everyone on your team.
What Covered California Can Offer
For small businesses, Covered California for Small Business offers the following benefits:
• Expanded and affordable options: Health plans offered in the SHOP will be standardized so employers can make side-by-side comparisons of health plan benefits, premiums and quality, allowing employers to make the best decision for their business and budget. Qualified businesses may be eligible for a tax credit by purchasing health insurance through the SHOP.
• Employer control, employee choice: The SHOP will offer employers the option of deciding the level of coverage to provide and how much to contribute toward premiums. Employers decide which level of health plan is right for their budget, and their employees decide which plans meet their needs and lifestyle.
• In-person and online enrollment tools and support: Employers can receive in-person enrollment assistance at no cost from certified insurance agents. Employers and employees will be able to manage their accounts online or by telephone. Covered California will handle billing and administration.
• Simple Administration: Employers make one payment to Covered California, which is then distributed accordingly to the health insurance companies that cover employees.
• Eligibility for Small Business Health Care Tax Credit: Beginning in 2014, employers eligible for a tax credit to help defray the cost of providing coverage must enroll through SHOP to receive the credit.
For employees who don’t get health insurance through work, Cover California offers health insurance plans for individuals and families. An employee who doesn’t get coverage at work may qualify for a discount on their individual premiums in the form of a federal tax credit, may qualify for a subsidy, or may find they can get low or no cost health care coverage through Medi-Cal. As in SHOP, the Covered California individual marketplace allows individuals and families to make side-by-side comparisons of health plans and choose the one that is right for them.
Encouraging Enrollment Helps Your Bottom Line
Businesses that have 49 or fewer full-time equivalent employees do not have to provide health insurance to employees and face no penalty if your employees receive coverage from Covered California. (For information on how to calculate a full-time equivalent employee, click here.)
However, encouraging your employees to get health care coverage will not only improve their overall wellbeing, but will benefit your business by:
• Reducing employee sick days
• Increasing employee productivity
• Increasing employee morale
• Improving quality of life for employees at home and in the workplace
• Improving your standing with your employees, your customers and your community.
Get Yourself and Your Employees Covered
Under the Affordable Care Act, all U.S. citizens are to have health care coverage by Jan. 1, 2014.
To review your options as a small business owner:
• Talk to your broker, or find a Covered California Certified broker here.
• Talk to your CPA or tax preparer to see if your business qualifies for a small business tax credit
• Visit the Covered California SHOP website.
If you decide not of offer health insurance to your employees, help them get the coverage they need by encouraging them to:
• Log on to http://www.coveredca.com/ to learn more about Covered California and begin comparing their health insurance options.
• Call Covered California at (888) 975-1142 for assistance comparing and enrolling in a health plan.
• Include information about Covered California in regular communications with your employees, such as in companywide emails and during staff meetings.
• Invite a Covered California Certified Enrollment Counselor to visit your workplace and speak with employees about how to find the plan that’s right for them and their families.
• Provide a laptop or computer that employees who do not have access to the internet at home can use to compare their health insurance options and enroll in coverage.