Why Small Businesses Should Drop Group Insurance in 2014
Fort Wayne, IN (PRWEB) July 31, 2013
America’s Health Insurance announces that it is in the best interest for small businesses to drop group insurance in 2014 to avoid new taxes and increasing premiums. It is advantageous for small businesses to instead enroll employees into the individual health market with defined contributions from the employer.
According to a news article written this week by Kaiser Health News, WellPoint foresees small group employers dropping group coverage. At the same time, they foresee an increase in the individual market. WellPoint CEO Joseph Swedish stated, “Our current expectation is that fully insured, employer-based coverage will likely see membership declines in ’14, with growth skewed to individual coverage offered through the exchanges.”
There are few reasons why WellPoint foresees this happening. “…small employers have hesitated to buy coverage for next year because of uncertainties surrounding the online exchanges offering individual and small-group plans,” the company said. Also, according to the article, “some smaller companies are shifting to self-insurance for health benefits to avoid taxes and benefit requirements associated with the Affordable Care Act.”
According to an article written by Zane Benefits (Employer Health Insurance vs. Individual Plans – Which is Better?), there is an alternative to group insurance that is appealing for small group employers and employees. “The emergence of HRAs and defined contribution health plans allow employers to reimburse employees for individual health insurance premiums, as an alternative to the traditional employer health insurance,” writes Christina Merhar from Zane Benefits.
America’s Health Insurance shares the same opinion as WellPoint and Zane Benefits- it will be advantageous for small group employers to drop group coverage and enroll their employees into the individual health insurance market with a defined contribution. This will allow the employer to avoid the new taxes and benefit requirements of small group insurance coverage mentioned in the Kaiser article. The section 105 (HRA) and the section 125 (HSA) of the Internal Revenue Code allow for these contributions and allow eligible employees to take advantage of the subsidies offered in the individual exchange.
America’s Health Insurance has the carriers, the products, the paperwork in streamlined form, and the enrollment procedures down to an easily manageable package guaranteed to make both small employers and their employees ecstatic about the decision to enroll into the individual market. Contact America’s Health Insurance at 1-888-589-3000 for any questions.