More than 25 million working-age Americans are still uninsured, with millions working for small businesses that do not offer access to job-based coverage.
Between cost and participation requirements, most small businesses (businesses with 1 to 50 employees) struggle to offer group health insurance. In fact, 50% of small businesses in America DO NOT offer benefits to their employees.
But things are changing. There is a demanding need to increase access to job-based coverage as employees seek out those businesses that do offer it. Small business not currently offering access to job-based coverage should learn how they can, why they should and how it can affect their businesses.
The Affordable Care Act
The Affordable Care Act (ACA) has been engineered to expand job-based coverage by designing a system that can efficiently serve the vast majority of these working Americans in the mainstream of economic life. The ACA provides the facility for small businesses struggling to offer job-based coverage to do so.
Here is how it works.
Every year the ACA provides for a Special Enrollment Period (SEP) to encourage and enable small businesses to establish job-based plans. The SEP – which occurs every year from November 15th through December 15th for a January 1st coverage effective date – allows small businesses to offer and for their employees to enroll in plans of group health insurance. This gives them access to all the financial instruments available to help mitigate the high cost of premiums and out-of-pocket expenses and offers the ability to use providers of their choice.
Remarkable and Unprecedented:
- No employer contribution is required.
- There is no employee participation requirement, so just one employee can elect to have coverage.
- Those better served in the exchange marketplace because of eligibility for subsidies can do so with no employer penalty.
- ALL INSURANCE COMPANIES OFFERING COVERAGE ON OR OFF THE MARKETPLACE AGREE TO ACCEPT ALL SMALL BUSINESSES THAT APPLY FOR COVERAGE DURING THE SEP.
- Employees can elect to pay premium and out-of-pocket expenses on a pre-tax basis.
If the biggest suppressor of middle class wage growth is the high cost of health care, then providing job-based plans should be compelling because these plans have the tools and efficiencies to increase access and affordability for their employees.