Group Health Insurance

Employers with 49 employees or less are considered Small Group Employers. Small businesses also can use an exchange to find insurance for their employees. These are called Small Business Health Options Programs, or SHOPs, for short.

3 Options for Health Insurance 2014 forward
  1. Offer a fully insured plan that is ACA compliant through the SHOP or traditional marketplace.
  2. Offer an ASO plan, if allowed by state law, where essential health benefits and metal level requirements don’t exist.
  3. Stop offering coverage and let employees buy an individual plan on or off the exchange.

Subsidies for small employers

Tax credits will increase for employers with 25 or fewer employees (with an average wage of less than $50,000 a year) who offer coverage through an exchange.

  • The credit will cover up to 50% of the employer’s cost (35% for small nonprofit organizations).
  • Employers will be eligible for credits in the first two years they offer coverage through an exchange.
  • Credits decrease on a sliding scale as group size and employee wages increase.

Another option may be to offer defined contributions or adjusting contributions by employee. This means employers give each employee a certain amount to spend on health insurance they find themselves.