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As you consider offering employer-sponsored health insurance, it is important to assess the
amount your business can invest in workforce benefts.
If your business already ofers employer-sponsored benefts:
You most likely have a good idea of how much your business can afford to pay. Take into
consideration projected increases in health care costs, and your potential eligibility to take
advantage of exchanges in 2014. If your business is mid-to-large sized and rising costs are
a concern, consider a private exchange that offers fxed contribution options to help control
costs.
If you are considering ofering these benefts for the frst time:
Discuss your options with your benefts consultant or broker to help weigh the costs. For
instance, in 2013, health care costs are expected to increase per employee by 5.3 percent
(0.6 percent lower than in 2012).
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You can use cost estimates to determine approximately how
much it will cost per-employee, as well as potential penalties for not providing employee health
coverage. Additionally, you can estimate your eligibility for small business tax credits to help
defray the costs associated with health care coverage through a public exchange.
Employee benefts are a key indicator of employee satisfaction, retention and productivity.
In fact, the 2012 Afac WorkForces Report revealed that workers who are extremely or very
satisfed with their benefts program are six times more likely to stay with their employer
than those workers who are dissatisfed with
their benefts program.
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With many options to
choose from, including traditional insurance, self-
insurance, HMO, PPO, affordable coverage, or a
combination of options, take time to determine
your business strategy. A few strategies to
consider include:
Adjust current health plan:
Talk with your broker or benefts consultant to understand how your current benefts work
within new ACA standards. You may fnd that your benefts already meet or exceed federal
standards, and can actually capitalize on going above and beyond to help protect workforce
health and wellbeing. As you assess your current plan, keep in mind that employees may be
eligible for tax subsidies through the public exchange if their required contribution to employer-
sponsored health insurance exceeds 9.5 percent of the employee’s annual gross income or
the plan pays less than 60 percent of covered health expenses.
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Public Exchange:
Exchanges are expected to offer competitive benefts options to small businesses and
individuals. Additionally, small businesses participating in public exchange may be eligible for
a tax credit of up to 50 percent of their premium payments if they have 25 or fewer full-time
employees whose average annual wages are no more than $50,000.
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Essential Question 2:
How much can
my business
aford to spend?
Essential Question 3:
Which strategy
will I choose?
In
2013
,
health care costs are
expected to increase
per employee by 5.3%
(0.6% lower than in 2012).
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