What to Consider when Choosing Health Insurance for Your Small Business Employees

Whether you run a business with one employee or a couple dozen, picking a health insurance plan can be overwhelming. You want your employees to have access to the best coverage, while also making sure your business expenses are something your revenue can cover.

A healthy group of employees makes for a healthy business. Whether there’s a global pandemic in our midst or not, we know that the physical, mental, and emotional well-being of a team can make a difference in how customers are treated, how good ideas are shared, and how productive people can be.

But like many of the hundreds of decisions that business owners must consider, there’s no limit to the options out there. So how do you make a decision about health coverage that works for your staff and your business? Here are a few options you have.

Qualified Small Group Plans (SHOP)

Employers with one to fifty employees may qualify for a group plan. You can decide how much of the insurance premiums your business will cover, what types of dependents you might include (such as children or parents), what types of health care to incorporate (like dental), and when employees may be covered after they begin working for your business.

Check to see if your business can qualify for a small business health care tax credit, which could help cover some of these costs.

Health Reimbursement Arrangement

If your business has less than 50 employees, you might consider a Qualified Small Employer Health Reimbursement Arrangement. In this health care arrangement, an employer could help reimburse costs like premiums or coinsurance for their employees who have at least some health insurance coverage, without providing a full group health care plan. Reimbursing these health costs is tax free.

Any employer, regardless of how many employees they have, can offer an individual coverage Health Reimbursement Arrangement (HRA), to help reimburse certain medical expenses.

Self employed

Do you run your own business or work as a freelancer? If you don’t have any employees other than yourself or a spouse, you won’t qualify for group coverage. But you can still get health insurance for yourself and your family, and pick the coverage that works best for you, whether that’s a higher deductible with lower costs each month, or higher premiums with lower out-of-pocket payments at the time you need service.


For questions about your business’s health insurance needs, contact a Sea Mountain Health Insurance Specialist.