Recently we were featured in an article found in the Indianapolis Business Journal. The article mentions the migration of small group health insurance to the individual market, which really just scratches the surface of what small employers in Indiana are faced with when it comes to the group health under the ACA. Small Indiana employers have always felt an obligation to provide health insurance to their employees. With the ACA and tax credits, employers are starting to look at group health insurance differently.Under the ACA, guaranteed issue has changed the value of a group health plan. In the past a group health plan offered guaranteed issue. With the passing of the ACA, now individual health plans offer that huge benefit.
Tax credits are playing a huge factor for employers. If the employees qualify for tax credits on the marketplace, these tax credits could be higher than what the employer can afford to give. If you have a company where half of the employees qualify for tax credits, the employees can end up with a health plan that cost far less vs the group premium.
The other benefit for employees, is they can choose the health plan that best fits their families needs. This way, the family is in complete control of their health insurance.
We are starting to see the health insurance companies develop new small group health options. Most of these options are for companies over 10 employees. There has been an emergence of self funded plans for small groups. These look and feel like a fully insured option.
Association plans may be making a come back and PEO plans may get a second look.
These new group options all include one very important feature: UNDERWRITING
With the ACA, fully insured small group plans cannot be underwritten. Underwriting has been a key component for getting lower rates.
If you take a healthy group of 25 employees, these options could potentially work.