Small-business owners face seemingly endless responsibilities. That makes it even more important to prioritize. Research from the National Federation of Independent Business strongly suggests that finding affordable health insurance for your employees should be near the top of your list.
You’d be right to expect full transparency from your health insurance broker when discussing all the possible options and prices. But how can you be assured your broker is showing you the whole picture?
Here are three things your broker might not be telling you:
1. 'You have more options than I’m showing you.'
Small-group health plans, the individual marketplace and the Small Business Health Options Program (SHOP) exchange combine to give companies more choices than some brokers present. This might be because some brokers may not have access to all carriers in their market or operate in a single market (group or individual). And it's realistic to assume some agents simply have a personal preference for certain plans over others.
Many brokers focus solely on traditional group plans. They may be unable to offer SHOP exchange plans including subsidies or individual-market solutions, which offer even greater subsidies through the Affordable Care Act exchanges. Also, brokers may be limited to selling plans from only a few insurance companies, possibly leaving out dozens of plan choices for you to consider.
It’s important to keep yourself educated about healthcare choices, even if you have a broker or agent. You need to be aware of the respective benefits of both group insurance and enrolling your employees in individual plans. Push your broker to show you all of the options -- or find an agent who will.
2. 'My services may be limited.'
When was the last time you heard from your broker? That long? Practitioners of the “write and run” approach -- selling the business but not providing the appropriate follow-up and support -- exist in nearly every industry. Health insurance is no different. Judge your broker the same way you would any other service provider.
Your broker should be a strategic partner who helps you determine the intersection of health benefits, talent acquisition and retention, cost and coverage. Find a broker who focuses on smaller businesses, understands your needs for continued service and is willing to invest in assisting your employees, too. You and your employees deserve open, candid communication. You also should be able to count on your agent for support in understanding what’s available and how to make the best decisions.
3. 'You could be at risk for large fines.'
Make a wrong move, and you could be exposed to fines of $100 per employee per day. Seriously. If you don’t offer a group policy but instead provide some funding to help employees pay for individual health insurance, you might be in trouble due to a recent IRS ruling.
Moreover, if you exceed 50 full-time equivalents (FTEs), be careful. You could be exposed to penalties under the Affordable Care Act (ACA) if you don’t provide qualifying group coverage. The ACA employer mandate requires applicable large employers -- small-business owners with 50 or more FTE employees -- to offer health insurance to at least 95 percent of FTEs and their dependents.
There are a few other requirements, too. Coverage must be affordable, which means a plan cannot exceed 9.5 percent of the employee’s income. It also must meet a key minimum value: equivalent to the minimum essential-coverage and cost-sharing amount for a bronze plan (60 percent). There’s a lot to keep track of, so make sure your broker educates you on all the pitfalls and steers you clear of penalties.
What should you do now?
Small-business owners deserve a knowledgeable, communicative broker. Remember, your broker works for you and should provide you with the level of guidance needed for your business. If you're experiencing something less, don’t hesitate to shop for a new broker.
Ask a few key questions to help you evaluate potential agents and determine if they're a good fit for you and your company.
- How long have you been selling health insurance?
- What locations and marketplaces do you specialize in?
- What carriers do you have access to?
- How frequently do you communicate with your customers?
- What kind of support will I have when it comes to compliance paperwork to steer clear of penalties?
- Are there plans available to me beyond what you're presenting?
Ask your broker about his or her experience and level of knowledge in the various marketplaces. You might be surprised by what you're missing or what your current broker isn’t telling you. Employers -- and employees -- deserve better.