Small Group Employers

small-business-owner

Beginning on January 1, 2014, small employer (under 50 employees) insurance is available through two different channels: Direct through an insurance company that meets the guidelines set forth by Colorado’s legislature, or through Colorado’s health insurance exchange (marketplace), Connect for for Health Colorado.

Colorado’s health insurance exchange, called Connect for Health Colorado is a government-run entity opening in October where individuals, families and businesses with fewer than 50 employees can shop for health care plans. Health insurance exchanges are part of the Patient Protection and Affordable Care Act (PPACA) that President Obama signed the into law on March 23rd, 2010 and upheld by the US Supreme Court ruling on June 28th, 2012.

The Affordable Care Act is also know as “Obamacare” or “ACA”.

  • An Eligible Employee is anyone that is reasonably expected to work at least 30 hours per week. This does not include employees who work on a temporary basis or partners without a W2.
  • Owners and partners are not considered Eligible Employees and may not participate in a small group plan unless they have at least one employee.
  • Small employers are NOT required to offer dependent coverage.
  • For plan years beginning on or after January 1, 2014, employers may not set a waiting period that exceeds 90 days.
  • If you have 25 of fewer employees, a small business tax credit may be available to you. There are certain restrictions that apply. Give us a call to find out more.

 

What should I look for when choosing a group plan?

The plan you choose must accept all employees within a certain employee class, and employee family members if you offer dependent coverage – even employees and family members with health problems. However, health insurance companies cannot deny your application because of the health status of your employees or their family members. In addition, the health insurance coverage you choose will come with “guaranteed renewal” – meaning that it cannot be canceled because someone in your group becomes ill.

What are open enrollment periods?

Small employers can purchase a group health plan at any point during the year. For most of the year, insurance companies can decline coverage if the employer is unable to comply with contribution and participation rules.. However, between November 15 and December 15 of each year, insurance companies must accept every application – even those that don’t comply with contribution and participation rules.

What if I currently offer Health Insurance?

Was your group plan in effect on March 23, 2010? If your insurance company allowed, the plan may be “grandfathered” – which means that is it considered qualified coverage. You will not loose grandfather status if you continue to add employees and dependents to the policy. However, if your employer has allowed the coverage to be reduced, or your portion of the premium has increased, it may have lost it’s grandfathered status. At that point, your employer would be required to select a new health care plan.

What if my business has less than 50 employees?

Then you might be able to purchase group insurance through the Small Business Health Options Program (SHOP). Unfortunately, the cost for purchasing health insurance is usually much higher for small businesses than for big businesses. SHOP allows small businesses to pool their risk and gain increased purchasing power. This might make it possible for you to offer your employees high-quality coverage for less. Not every small business will qualify for SHOP. Give us a call to find out more.

What if I would rather help pay for my employees individual health care plans rather than purchasing a group plan?

This is not allowed under new Health Care Reform laws, both the IRS & Department of Labor have issued bulletins and regulations coming out against use of employer funds to pay for any portion of individual premiums. You probably have better options anyway. Give us a call to find out what they are.

Due to the complexity of the group insurance we recommend a one-on-one conversation to insure that all options have been explored. Please call 303.667.7123

Your Rights as a Small Employer:

The following is an outline of your rights as defined by Colorado law.

1. Guarantee Issue»
2. Small Group Rates»
3. Other Key Protections»

 

  1. Normally a health insurer must sell you coverage. You, as the small employer or business group of one must meet all their underwriting requirements.
  2. Must accept all eligible employees and dependents regardless of their health.
  3. Cannot exclude coverage of certain medical conditions.
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  1. Insurers are limited in the factors that they may use in setting premiums for your group.
  2. Insurers must explain in their sales and solicitation material how they determine the prices
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  1. Insurer must provide you with a Health Benefit Plan Description form for any plan you are interested in purchasing. (We always provide these forms with any quotes we give you.)
  2. In most cases, insurers are required to renew your coverage, if you so desire.
  3. When changing insurers, the new insurance company must cover everyone within the eligible employee class.
  4. Small employers and health insurers may be required to allow terminated employees and their dependents to continue coverage at their own expense for up to 18 months or until they are eligible under another group policy.
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