Small Business Health Plans

The Affordable Care Act (ACA) does not require employers with fewer than 50 full-time equivalent employees to provide health insurance for their employees. There are no penalties for not offering coverage.

Of course, many small employers do invest in employee health benefits as way to attract top talent and move the business forward. And now they are feeling the impact of many ACA provisions in the form of higher premiums as health plans implement new coverage requirements:

Patient’s Bill of Rights including Essential Health Benefits

Underwriting changes

60-day maximum waiting period

The good news is that state or federal officials now review any rate increases of 10 percent or more. In California, the Department of Managed Care reviews health plan rates and the Department of Insurance reviews other plan increases. Insurers also must justify those increases by providing consumers with information about the reasons.

Also balancing out the premium impact is the small business tax credit available to qualified businesses that purchase coverage through the Small Business Health Options Program.