Employers with very few employees sometimes make the mistake of assuming that they don’t qualify for small group health insurance—an incorrect assumption, in most cases. Federal law mandates that small business owners with 2 to 50 full-time employees are guaranteed group coverage should they choose to purchase it, regardless of the health status of their employees.
Since owners are typically counted as employees, an employer with just one employee may qualify for group coverage. Partnerships without any employees may also qualify. Some states, including California, define self-employed individuals who file a W-2 form as “groups of one,” and these individuals are guaranteed coverage in the small group market. However, it should be noted that many carriers will not allow the employee in a “group of one” to be the spouse of an owner/officer of the company.
SHOP Helps Small Business Employees Get Covered
In addition to the individual marketplace, the Affordable Care Act (ACA) established the Small Business Health Options Program (SHOP), a marketplace through which small business owners can purchase health insurance. Businesses with 50 or fewer employees are eligible to enroll in SHOP but are not required by law to provide employees with health insurance.
There is an incentive for small business owners with between 2 and 25 full-time equivalent employees earning an average of $50,000 annually to do so, however, as these businesses may qualify for tax credits. The credit is up to 50% of the employer’s contribution toward premium costs, and up to 35% for tax-exempt employers.
In California the online SHOP marketplace has been temporarily taken offline to fix technical glitches within the system. Business owners must enroll via a paper application until the online portal is restored. For assistance with enrolling and for answers to all your questions about group health coverage, contact the certified insurance agents at Benefit Packages today.