According to the Kaiser Family Foundation, less than one third of US businesses with fewer than 50 employees offer health insurance to their employees. In contrast, nearly 97% of companies with greater than 50 employees do provide health insurance. That’s a huge discrepancy!
You might be wondering what the benefits of offering health insurance plans to your small business employees may be. There are a few. For starters, it can help you beat out the competition when it comes to recruiting top talent. Those looking for new jobs are attracted to places that offer comprehensive benefits packages that include health insurance. Another awesome benefit is that offering health insurance comes with some pretty excellent tax benefits for small business owners.
Let’s dive into those benefits with just a bit more detail…
Offering health insurance to your employees can be a plus for you and your employees. When employers provide health insurance, employees don’t have to stress about how a medical emergency could impact them financially. Just one emergency can send a family into a financial downward spiral that can be incredibly difficult to recover from. The peace of mind that comes with insurance coverage is often an unspoken benefit.
As we mentioned earlier, offering health coverage also gives companies a competitive advantage around attracting and retaining talent. A recent study by the TransAmerica Center for Health Studies reported that healthcare coverage influences job decisions for half of Americans. Yep, that’s right. As much as 50% of Americans are making decisions about staying in a job, changing jobs, or seeking out new positions based on health insurance options.
As a small business owner, hiring and retaining great employees is important for the bottom line. Whether or not you offer health insurance can impact your entire business and who is interested in working for you. Something to consider!
Health insurance small business offerings also come with tax benefits. For starters, employer-provided premiums on group health plans are tax-exempt. That means you don’t pay taxes on those premiums. When you contribute to employees’ premiums, you can deduct those amounts from taxable income. This lowers the amount of taxes you are liable for.There is another option referred to as “Section 125 premium-only plans” (aka cafeteria plans) that allow employees to pay their portion of premiums with pre-tax dollars. Not only does that reduce payroll taxes for you, but for your employees, too!
If you’re a small business that has 24 or fewer full-time equivalent employees, you have even more options. The small business health care tax credit is an additional tax perk that is available to businesses of this size. It helps make insurance more affordable by offering qualifying businesses a tax credit for up to half of their contributions toward employee premiums.
We understand the pressures that small businesses — and their employees — face. We know that even one unplanned medical issue can lead to significant financial strain for people who aren’t covered by health insurance. The ability to offer health insurance to your employees helps them, but it can also safeguard the future of your small business for years to come. Content, stress-free employees perform better and are more satisfied with their jobs.
Decent offers plans that are ideal for small businesses by enabling small business owners and entrepreneurs to band together to purchase healthcare. In this way, small businesses can achieve some of the same advantages previously only available to large corporations. Decent groups small businesses of similar categories, starting with technology. If you run a technology company or a company that services technology companies, we have plans for you. It gets better! Decent plans are up to 40 percent lower than currently available options. Get your free quote today!