When running a business, the last thing you want to worry about is your employees’ medical insurance. If you have more than 50 full-time employees, this will be required by law. However, if you do not meet this requirement, it does not mean that you should ignore the need for coverage. Damon Becnel discusses how to set up medical insurance for your employees and what options are available to make sure they get all of the care they need while staying in compliance with federal regulations.
Decide who to cover and what type of coverage you want.
The first step is to decide who the coverage goes too. If your company does not have 50 full-time employees, you will want to limit this group of people to include only the essential positions in the business. For example, if you have 20 full-time workers and 30 part-timers, then there should be no reason why all 60 cannot get medical insurance through work. However, since part-timers do not usually need health care benefits as urgently because they are often covered under their spouse’s plan or another program like Medicare, it may make more sense from a cost perspective to exclude them.
On the other hand, if your organization has over 250 employees total (full time and part-time), but less than 50 hold full-time positions, you might consider including all of them in your plan. This may seem counterintuitive, as there is a higher risk of claims from the larger group. But if your business does not have a large enough part-timer population to keep premiums at an affordable level for those working 40 hours or more per week, then offering insurance to everyone may be helpful.
Next, you must decide what type of coverage you want to offer by choosing between two options: self-only and family plans. A self-only policy will include medical care for yourself and any dependents that live with you (if they do not work). In addition, this option does not require employers’ contributions towards the cost since it only covers employees – not their families. However, if you go with a family plan, your company will need to pay insurance premiums. This includes medical benefits for more than just those who work at the business – spouses and children are also included as eligible dependents.
Choose an insurance provider that covers your needs.
The next thing to decide is where you want your employees to get their medical care. This also affects what type of insurance plan they will have access to – a health maintenance organization (HMO) or a preferred provider organization (PPO). An HMO requires members to use the doctors and hospitals provided by one specific network for coverage to kick in. For this reason, it may be less expensive because those who work at your company do not need as many separate policies from different providers. On the other hand, a PPO gives workers more freedom since they can visit any doctor without prior approval from an insurer first.
However, higher premiums are usually charged with a PPO, so if cost is a concern, then going with an HMO may be the way to go.
Another thing to consider is whether your employees will have access to prescription drug coverage or if they need it. If you select an insurance plan that does not include this type of medical care, then there are options for making it with a separate policy through another provider like Express Scripts.
Once you choose how much money you want your company to contribute towards premiums and what providers can offer coverage, finding the right package should be easier than ever! Now all that’s left is enrolling new hires into their benefits packages so everyone can get back to work quickly while enjoying peace of mind knowing they are covered in case anything happens.
Create a process for enrolling in benefits, including deadlines and penalties for not enrolling on time.
Many companies have a routine for their employees to enroll in benefits. In the first month of working, they are given paperwork and told to fill it out as soon as possible so coverage can begin on day one. The employer may also provide an open enrollment period, which is usually about once per year. Anyone who wants or needs new insurance plans must sign up before a certain deadline, with exceptions allowed within that time frame.
For example, suppose someone gets married during this allotted timeframe. In that case, they will still be able to apply for family medical care – even though that type of plan has stricter deadlines than self-only coverage does. However, there might not be much flexibility when it comes to losing other health policies like vision or dental because the specific enrollment period for those benefits has already passed.
If employees miss deadlines, they may not get new coverage until the next open enrollment period. Some companies charge a penalty fee if this happens.
Follow up on enrollment periodically to ensure employees are still enrolled or have updated their coverage if needed.
This is another area where employers can be proactive in making sure their workers are covered. If you have a system set up for employees to enroll, it may not get checked again until the next open enrollment period. However, if your company takes care of this step, then managers will need follow-up procedures that include at least one reminder call or email message before deadlines pass.
You should also check on coverage periodically during non-enrollment timeframes too because life changes happen all the time. For instance, an employee’s insurance plan could change because they start working fewer hours. Hence, their salary qualifies them for subsidies under Obamacare – which means they now require more affordable medical plans than what was available previously. Or maybe someone got married, and their spouse’s insurance becomes available to cover them too – so they can drop their separate policy and save money.
Setting up medical insurance is a complicated process. But with careful planning and a little extra effort, your employees can be covered in no time. Take your time so you can make the best decisions for your business.
