Looking for the best health insurance options for your small business in California?
This guide has everything you need to know to make a well-informed and educated decision.
Learn about the best providers, cost-saving tips, and how Group-Health-Quotes.com makes the process easier with free quotes and professional expert advice.
Let’s take a look!
Health Insurance Options for California Small Businesses
Private Group Health Insurance Plans
Private group health insurance plans are bought directly from insurance companies or brokers. They provide customizable coverage options to match the specific demands of your company. These plans usually include:
- Comprehensive coverage which includes access to medical, dental, and vision coverage.
- Add-on services like employee wellness programs, mental health support, smoking cessation programs and more.
- Access to a broad network of health providers throughout the state of California.
Employers usually split the cost of premiums with employees, making this a cost-effective approach that provides excellent benefit.
Covered California for Small Business (SHOP Marketplace)
The Covered California for Small Business SHOP Marketplace is an online marketplace tailored to small businesses with up to 100 employees. It offers:
- Plan Variety: There are four tiers to choose from: bronze, silver, gold, and platinum, each with its own coverage level and cost.
- Tax Credits: Eligible companies may obtain tax credits of up to 50% of their premium costs.
- Employer Flexibility: Provide multiple plan options to your employees and control your contributions to premium costs.
In order to qualify to use the Covered Californian SHOP Marketplace, your business must:
- Have at least one full-time equivalent employee, but not more than 100.
- Have at least one employee who receives a W-2.
- The majority of eligible employees must live in California.
Health Reimbursement Arrangements (HRAs)
HRAs which include Individual Coverage HRAs (ICHRA) and Qualified Small Employee HRAs (QSEHRA) enable employers to reimburse employees tax-free for health insurance premiums and medical expenses.
Employers allocate a specific amount of money each month that employees can use to pay for qualified medical expenses like premiums or out-of-pocket costs. Employees have flexibility to choose the plan that best suits their needs. HRAs are entirely funded by employers, and in most cases unused funds can roll over into the following year.
There are two main types of HRAs depending on the size of your business:
- Individual Coverage HRAs (ICHRA): Created for businesses of any size to reimburse employees for their own health insurance premiums or medical costs.
- QSEHRA, or Qualified Small Employer HRA: This option is intended for companies with fewer than 50 employees and offers tax-free reimbursements for approved medical expenses or individual health insurance.
Other Alternatives to Traditional Health Coverage in California
- Health Sharing Programs: These programs pool together member contributions to cover medical expenses. While not regulated as insurance under the Affordable Care Act (ACA), they offer a less expensive option for employers looking for basic coverage.
- Short-Term Health Insurance: Offers basic benefits for up to 12 months and is ideal for employees who require temporary protection. These plans usually only offer limited protection and are not ACA-compliant.
- Association Health Plans (AHPs): Small businesses can obtain group insurance at discounted prices by becoming a member of an association tailored to their industry. AHPs combine resources to provide more cost-effective plans for related professions or sectors.
Feeling overwhelmed by the options? Group-Health-Quotes simplifies the process by letting you compare private group health plans from top providers instantly. Learn more here.
Types of Small Business Health Insurance Plans
There are a variety of small business health insurance plan options to meet their needs of any business owner in California:
Health Maintenance Organizations (HMOs)
Offer lower rates and predictable costs. Employees must use in-network doctors and obtain referrals from a primary care physician (PCP) to see specialists. HMOs are suitable for companies that want to cut costs while still offering complete coverage within a defined network.
Preferred Provider Organizations (PPOs)
Allow employees to see out-of-network providers at an additional expense. Referrals are not necessary for specialist visits, making PPOs an excellent choice for employees who value the ability to choose their healthcare providers.
Exclusive Provider Organizations (EPOs)
Combine aspects of HMOs and PPOs. They do not require referrals for specialists, but employees must remain within the plan’s network unless there is an emergency. These programs are ideal for businesses wishing to reduce costs without compromising flexibility.
Point of Service (POS)
These plans combine HMO and PPO elements. Employees must choose a primary care physician and get referrals to specialists, but they can also see out-of-network physicians for a greater out-of-pocket fee.
High Deductible Health Plan (HDHP) and Health Savings Account (HSA)
HDHPs offer cheaper monthly premiums but higher deductibles. They are generally paired with HSAs, which allow employees to save pre-tax funds for eligible medical expenses. These programs are particularly advantageous to small businesses and employees seeking tax-advantaged savings opportunities.
Top Providers for Small Business Health Insurance in California
Choosing the ideal insurance provider is key to providing comprehensive coverage while also keeping expenses under control. Here is our list of the top ranked small business health insurance Carriers in California:
Anthem Blue Cross
- Has a broad network of doctors and hospitals to choose from.
- Provides HMO, PPO, and EPO plans with customizable coverage options.
- Offers online tools for convenient access to claims and benefits.
Kaiser Permanente
- Provides an integrated care model that combines insurance and healthcare services.
- Highly rated when it comes to customer satisfaction.
- Most plans include preventative care and wellness programs.
Blue Shield of California
- Competitive pricing and customizable options.
- Telehealth and mental health support are included.
- Offers a vast network of providers statewide.
Health Net
- Specialize in affordable HMO plans designed for small businesses.
- Coverage options are designed and tailored specifically for California residents
UnitedHealthcare
- Comprehensive plans for all business sizes.
- Wellness benefits and access to national provider networks.
Cost Factors for Small Business Health Insurance in California
The cost of small business health insurance in California varies depending on numerous factors:
- Business Size: Larger organizations may benefit from lower per-person rates due to the pooling of risks among employees
- Employee Demographics: Businesses with younger, healthier employees typically have cheaper premiums.
- Plan Type: HMOs are often less expensive than PPOs, but provide less flexibility.
- Coverage Level: Plans with larger deductibles typically have cheaper monthly premiums.
The cost of insurance in California can vary greatly depending on the plan and provider. To gain a better understanding of how much your business might pay, visit Group-Health-Quotes.com to get your free quote today!
Tax Savings for Small Businesses in California
Small businesses in California can take advantage of numerous tax benefits to minimize the cost of providing health insurance to their employees:
The Small Business Healthcare Tax Credit
Small businesses with fewer than 25 full-time employees can receive up to 50% federal tax credit for employee premium payments. To be eligible, a business must:
- Have less than 25 full-time equivalent employees.
- Have an average employee salary of about $56,000 per year or less.
- Pay at least 50% of the full-time employees’ premium costs.
- Offer SHOP coverage to all full-time employees.
Health Savings Account (HSA) Contributions
Employers offering High Deductible Health Plans (HDHPs) can make tax-free contributions to employees’ Health Savings Accounts (HSAs). This lowers the company’s taxable income while also allowing employees to save for medical bills.
Tax-free reimbursements using HRAs
ICHRAs and QSEHRAs allow businesses to reimburse employees for tax-free health insurance premiums and certain medical expenses, providing employers and employees with flexible savings options.
Payroll Tax Deductions
Employer premium contributions can be tax-deductible, decreasing the tax burden on small businesses.
State-Level Incentives
California regularly provides state-specific healthcare subsidies or incentives for small businesses, particularly those enrolled in Covered California’s Small Business Health Options Program (SHOP).
Protect Your Business with the Right Coverage
Offering health insurance to your employees is more than simply a benefit; it is a business strategy. With a well-rounded plan, you can attract excellent people, keep your team healthy, and adhere to California regulations and requirements.
Ready to find the perfect health insurance plan for your small business? Group-Health-Quotes.com is here to make the process a breeze for you and your team.
We offer free instant quotes, plan comparison tools, and expert help from licensed health insurance agents.
To get started just enter your ZIP code on the right of the screen, or call us directly at (888)-571-0291.
