What Will Health Insurance Cost Your Small Business in 2015?

As a small business owner, this is the time of year when you need to start thinking about next year's budget.

Staying on track to meet all your fiscal responsibilities is always a main concern.

One of the largest liabilities on your income statement is health insurance for your employees.

Planning Ahead

As the following article shows, requirements for group health insurance plans by company size are changing next year.

Beginning in 2015, employers with 100 or more full-time employees must provide health insurance or face an assessment penalty. The definition of full-time under this new law is 30 hours or more, per week.

Employers with between 50 and 100 full-time employees will be transitioned into the law beginning in 2016. If you already offer health insurance benefits to your employees, you'll be wondering if you can expect to pay more for that same coverage in 2015.

According to the experts, small business owners can expect to pay moderately higher insurance premiums in 2015. The amount of the increase is anticipated to be around 4% overall.

To offset this increase, and to keep a lid on rising insurance costs, businesses will be reviewing their current plan offerings.

Ways to Keep Finances in Order

One way that many business owners are keeping their insurance financial responsibility in check is to increase the out-of-pocket expense provision for employees. Another way that some small business owners are considering is higher deductibles.

However you stand personally on the recent laws surrounding healthcare, it is true that insurance coverage helps businesses in a broad sense.

By increasing coverage for such preventive care as routine medical checkups, health club memberships and dental and vision supplemental plans, employees can be healthier.

Business owners reap the benefits with fewer sick days and more productive employees who are enjoying better health.

Avoid Losing Valuable Workers

As a small business owner, you should understand that employees with families often make employment decisions based on the insurance plan that is made available to them.

So even though you will want to defray the cost of insurance in a way that doesn't directly hurt your bottom line, you need to weigh that choice against the cost of losing valuable employees to a company with a better insurance plan.

A better angle might be to plan ahead to pay for continued health care without passing on the 4% increase to your employees in an offhanded way by raising their deductibles and out of pocket expense.

Look at other ways to cut financial liabilities and improve profits. Be the small business owner that employees are keen to work for because of your generous insurance benefits.

In the end, your insurance decisions must be based on financially sound principles. But realize that insurance costs are unlikely to ever go down.

At some point, you as a small business owner will need to find a way to fund an insurance plan for your employees that is attractive, yet affordable for everyone involved.

About the author

Kate Supino writes about best business practices for small to medium sized businesses.

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