Your startup wouldn’t be the same without your employees’ hard work and dedication. Even companies with only a few team members should give back to them so they stick around long-term. Providing great benefits is an excellent way to do that, but navigating those benefits may seem intimidating. Check out these healthcare tips for early-stage startups to make the process more manageable.
If your business just opened its doors, you may only have a handful of employees. According to the Patient Protection and Affordable Care Act (PPACA), employers with fewer than 50 employees don’t have to provide healthcare. Employees who work at companies without healthcare benefits typically get plans on the marketplace.
You can always return to the healthcare provision issue after your company grows beyond that number. For now, use the saved funds to reinvest in your business and help it blow past quarterly revenue expectations. Once it has a bigger budget, you can bring on more team members and provide their health insurance.
Anyone can compare employer-provided health insurance options by researching plans online. Compare the payment plans with your current budget to determine which option will be the most sustainable. If you’re worried about misunderstanding plans, working with a professional could be the next best step.
There are two resources for business owners who need help navigating the health insurance industry: brokers and professional employer organizations (PEOs). Brokers work with an insurance company as the go-between between startups and insurance plans.
PEOs are whole companies that provide health insurance directly to employers and provide guidance for compliance and HR questions that might arise along the way. Reach out to both if you’re unsure who could resolve your questions.
Many startup owners don’t realize that group insurance is a lesser-known option they could use for their business. It’s a good option for companies with people who may not purchase individual plans because they currently get coverage through a spouse, family member, or private insurance.
Before comparing group coverage costs, there are a few things to note. A fully funded plan is where the health insurance company sponsors the coverage. Employers only pay a fixed monthly fee, although it’s often more costly than traditional plans.
Group insurance also has self-funded plans, which are more affordable because they don’t have as many applicable taxes and fees. However, they come with more risk. Employers would have to pay for claims, which are detailed statements of service from doctor’s offices that become more expensive for people with long-term or specialized health conditions.
You could also get a traditional health insurance plan through a major provider that allows employees to pick from individual coverage options. Although this may be more costly than group insurance, it can provide better insurance for employees and reduce turnover rates due to people seeking better benefits elsewhere.
There are three types of health insurance plans that give employees more flexibility to cover their various health needs. Compare prices for plans that include coverage like:
- Preferred Provider Organization (PPO) Plans: Employees can visit any doctor or specialist without a primary care physician.
- Health Maintenance Organization (HMO) Plans: Employees can visit their primary care physician for reduced fees and coverage at a more budget-friendly cost.
- Point of Service (POS) Plans: Employees can combine PPO and HMO benefits to coordinate coverage for more complex treatment plans.
The best health insurance for your startup may include one or more of these options. It depends on the health of your employees, their age range, and what they need for their medical conditions. Younger, healthier people often choose HMO plans because they don’t need to visit the doctor more than once a year, while older individuals may prefer POS plans because they have frequent healthcare appointments.
Once you decide which type of insurance you’ll provide, your job isn’t over. You’ll still have to walk your team members through the signup process. They may have to mail paperwork or finish the process online. Working alongside them will put them at ease and build an essential foundation of trust because they’ll know you have their back.
After your health insurance plans begin, you’ll need to keep up to date with your coverage. New laws or company policies could make plans better or worse than when they started. If significant changes occur, you’ll want to make appropriate adjustments to your provided insurance according to the needs of your employees and the company budget.
These are a few healthcare tips for early-stage startups that make it easier to find the right health insurance coverage for employees. Think about what your employees could want from their coverage and what your startup can currently afford to find the best plan that meets everyone’s needs.