Four Ways Small Business Owners Can Approach Health Benefits

Small business ownership can be a daunting endeavor no matter how you cut it, but throw in health benefits and the new Affordable Care Act and you may be feeling a bit overwhelmed. Though small business-provided health insurance is not required by the new law, it is a highly sought after benefit that draws a greater labor pool and should be seriously considered. To simplify things a bit, let’s take a look at how you can approach offering these benefits.

The SHOP Marketplace

Small businesses with fewer than 50 full-time equivalent workers are exempt from the Employer Shared Responsibility portion of the Act. This means that as of October 1, 2013 you can purchase quality medical, life and federal disability insurance for your employees through the Small Business Health Options Program (SHOP). This marketplace lays out insurance plans in clear, easy-to-compare terms, giving you the ability to choose the right plan for you, your employees and your expense account.

Tax Incentives

What better incentive to offer health care benefits than the government helping your business do so financially? Currently, the Small Business Health Care Tax Credit offers qualifying entities assistance of up to 35% of the cost you pay in premiums for low- to moderate-paid workers. In 2014, that will increase up to 50%, but at that time your business must obtain insurance coverage through SHOP in order to be eligible.

Buying Power

Just like your consumers, small businesses can create buying power if they group together. Risks are reduced and administrative duties are spread out over the group, lessening costs and allowing small businesses better deals in acquiring insurance for their employees. This option can be done through the SHOP Marketplace.

Wellness Programs

A healthy employee is a more productive employee, right? It is also a more fiscally beneficial one, with those small businesses who offer a workplace wellness program an additional tax credit increase of up to 20% in 2014. Add another 10% onto that credit if your program actively discourages smoking. Along with encouraging preventive care the Act will cover alternative medical treatments, a possible factor in your wellness program design.

These four approaches to providing health care benefits offer the small business owner light at the end of the Affordable Care Act tunnel. They make it both feasible and realistic to offer potential hires one of the most coveted of employee benefits, thus benefiting your business with the best person for the job.