The Best Small Businesses Health Insurance Options

December 6, 2016

Category: Benefits

Deciding which small business health insurance plan is right for your small business can be complicated and time consuming — but it doesn’t have to be.  Zenefits helps small businesses and entrepreneurs navigate the process.

While health care markets vary from state to state, some are facing the same challenge seen across the country: insurers leaving individual marketplaces, and as a result, health care costs increasing.

As we approach 2017 and await what the new leadership will bring, it’s clear that health care costs and the direction of health care is in a state of uncertainty. As such, small businesses are feeling the pressure to move the benefits discussion higher on the priority list.

To help, let’s take a look at the current healthcare landscape and how small businesses are getting their organizations squared away with health coverage in 2017.

Where Can Small Businesses Shop for Health Insurance?

Most small businesses and their employees have three primary places where they can shop for health insurance:

  • Commercial small group plans
  • The Small Business Health Options Program (SHOP) marketplace; and
  • The individual healthcare exchanges

Commercial Small Group Market

The Commercial Small Group Market is increasingly attractive to small businesses. Moreover, small business employees are requesting their employers to provide this option. Many carriers are pouring resources into this segment, particularly in markets where individual insurance is performing poorly.  

The flux of technology solutions, benefits integration and compliance tools have made it even more attractive for small business to partner with a good solution and execute. Visibility into pricing, wider variety of products, administration and compliance automation and increasing employee engagement all in affordable range are a few aspects that a small business can look forward to with the right partner in today’s commercial group market.  It’s easy to see why insurers, small business, and vendors are migrating closer together in this market.

Need helping finding the right health insurance benefits for your company? Zenefits can help.

In addition, new legislation has made hints to expand and invest in the abilities for small business to further excel in our economy.  Anyone for “making entrepreneurship easier and more accessible for everyone?”   

Small Business Health Options Program (SHOP)

SHOP is available to businesses who typically fall under “small group” definitions by market, and provide tax credits for businesses of certain sizes whose payroll meets certain salary criteria. These offerings are more limited, but may be a good fit for your business. Again, there are state and federally facilitated SHOP exchanges that vary amongst markets.  If you meet the requirements, determine if you qualify for the small business healthcare tax credit in a federal SHOP exchange (for example) here.   

Reports have stated that SHOP is stronger in certain markets and weaker in others, sometimes with more value on the insurance products and design than on availability of small business healthcare tax credit, contrary to the individual exchanges.  As mentioned, be certain you research tax credit availability, plan coverage, price, and access to care.

Individuals and Families

Some states have their own individual marketplace, others have shared efforts with federal exchange and the majority use the federal health insurance marketplace,  Open enrollment is underway and will run until December 15, 2016. Access your appropriate marketplace, coverage will kick in on January 1, 2017, so get informed to ensure you don’t miss the deadline.  

Most of the tools and technologies have improved since inception just a short time ago, and now follow a more intuitive and simple… “apply, shop, and enroll” walkthrough.  The heavy attraction to the individual marketplace is often attributed to a higher rate of premium subsidy eligible members, in other words, credit towards your premium depending on income.  When assessing small business health insurance options, be certain you research the subsidy availability, plan coverage, price, and access to care.

Looking for assistance in navigating life and disability insurance? Zenefits can help.


Tim Cerimele is co-founder of the Zenefits Insurance Advisory Board. He has 10 years of experience as a benefits consultant, manager, and director of operations at a national benefit firm. Recently, Tim has been focused on the ACA's impact, access to care behind new and unique health plan contracting and benefits technology.

Category: Benefits

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