Small Business And Health Insurance : As if it is not clear now, the smaller the business, the greater the challenges employers face in providing quality health insurance to their employees. While this is not headline news, the depressed economic environment and rising health insurance premiums have exacerbated the problems of small business and health insurance.
A recent Small Business Administration (SBA) report showed that only a third of national companies with fewer than ten employees had health insurance benefits offered to employees in 2009. For companies with 1,000 or more workers, that figure skyrockets to 99 percent. . .
Some state businesses with fewer than ten workers are lower, with only 24 percent offering health insurance benefits. That figure jumps to 93 percent for companies employing 100 to 499 people.
One owner of an advertising agency that employs 35 people stated that the recession had taken a toll, commenting on the marketing cuts the company’s clients had to make to survive. Owners have taken steps to deal with tighter budgets and large increases in their small business and health insurance premiums to go in a different direction with corporate insurance providers. Part of their unique solution is to increase the reduction and opening of the company’s Health Savings Account (HSA) for their employees, which is funded by the company.
Health Savings Accounts, which are available to people enrolled in a deductible health plan, are transferable from job to job and are not subject to federal income tax at the time of deposit. At the end of each year, unused funds roll over to the following year, which makes small business health insurance coverage more viable.
A recent insurance industry report showed a nine percent increase in 2011 for family coverage premiums, with single coverage costs also increasing by eight percent – a significant upward trend from 2010, when increases for families were three percent and five percent for individuals.
The report data also shows that the average annual premium for families more than doubled from 2001 to 2011 – from $7,601 to $15,073. Just what everyone needs in a down economy!
Small business health insurance coverage, while important, can be difficult to understand for some. In my particular line of business, which is a one-stop shop with gas and car wash, the tendency of independent owners is to rarely extend insurance coverage to employees, mainly because it is always too expensive. Most of the employees who work in c-stores other than the owners are generally students and part-time employees, so most don’t care about health insurance issues.
Most business owners, however, should be covered by quality health care coverage, as their businesses depend on their guidance and leadership nearly 24 hours per day, even though most owners are unable to let go of their business long enough to even take a sick day. ! Small business health insurance group coverage is optional, as long as your state’s insurance laws allow for a group of “people,” which some do.
Small business and health insurance are hot topics that will continue to be a problem for the next few years, especially until the US economy starts to moderate and recover! As a business owner myself, I know from direct experience that small business insurance is generally a very important aspect of your business that you should pay attention to, or you could suffer business-destroying losses in the blink of an eye!