A deal on health insurance for small businesses

This is the time of year when almost everyone needs to make decisions about their health care coverage.

Seniors make decisions about prescription drug and all-in-one advantage plans during Medicare’s open enrollment. Individuals and families seek coverage under the Affordable Care Act at Healthcare.gov, with new higher subsidies and lower income limits to get the best individual plans.

I’d like to discuss the Small Business Special Enrollment period, which runs Nov. 15 through Dec. 15. This is a little-understood opportunity for businesses with as few as two employees — and only one plan participant — to purchase a top-rated group plan with no employer contribution required. And the employees can pay the premiums on a pretax (salary deduction) basis.

At a time when there are so many “help wanted” signs, the chance to offer the best health insurance plan to prospective employees — at no cost to the employer — is a powerful recruitment tool. So, if you’re a small business owner who thought offering a health care benefit was too expensive or complex, read on. (And if you work for a small business that doesn’t offer group health insurance, show this column to the owner!)

The Affordable Care Act mandated that insurers must offer their best group health insurance plans to small businesses during a once-a-year special enrollment period. These plans must offer the same comprehensive coverage as the generous coverage plans negotiated by large businesses in your state. During this period, all insurance companies that are selling plans in your state must agree to accept all small businesses that apply for coverage.

Not surprisingly, few insurance agents are pushing these plans because they are a nuisance to the insurers and don’t generate big commissions for the agent. So it’s up to you — the small business owner — to ask for this coverage.

Here’s how this small business insurance deal works:

Dates: Small businesses (2-50 employees) must apply between Nov. 15 and Dec. 15. The plan becomes effective Jan. 1, 2022.

Qualifications: Businesses can set up a plan even if only one full-time employee joins. So if some employees are covered by a spousal plan, a less expensive ACA plan or Medicare, and only one person wants this coverage, the plan is qualified. For example, a business owner who is older and covered by Medicare does not have to join the plan but can offer the insurance to employees.

Coverage: The plan must offer equally comprehensive coverage and premiums as group plans for other businesses in the state that typically require a 70% employee participation rate and employers to contribute as much as 50% of the cost.

Premiums: The monthly premiums must be comparable to those offered to traditional small group plans.

The employer is NOT required to contribute for the employee. And an employee can pay premiums on a pretax, salary-deduction basis.

Preexisting conditions: There are no limitations because of ACA provisions.

If you’re competing to get employees, health insurance benefits are a big attraction. But you must act quickly. Ask your insurance agent or go to specialists to get guidance, such as Vesta Benefits Group (vestabenefitsgroup.com) and eHealth (ehealthinsurance.com).

Allen Wishner, CEO of Vesta, says this program was started for small businesses that couldn’t afford to provide health insurance. Now, Wishner says, “employees believe that good jobs come with benefits. And these are good benefits, with large networks of providers, and they can even include dental and vision coverage. Plus, it’s all on a tax-free basis to the employee paying the premiums, or as a deduction to the owner if paying the premiums. It’s worth checking out this unique opportunity.”

He urges small businesses to fill out the “employee census” at his website to see if they can qualify and to find the costs — and to begin the paperwork so applications can be submitted before the Dec. 15 deadline.

I know this is the one deal that sounds too good to be true. But it is true! And that’s the Savage Truth.