The one thing almost every employee wants and needs is health insurance. The most common plans are health maintenance organizations (HMOs), preferred provider organizations (PPOs), point of service (POS), and indemnity plans. Another option for businesses that want to provide employees with health insurance coverage is to offer them access to a health savings account (HSA), which is a tax-free medical savings account that must be paired with a high deductible health insurance plan (HDHP).
Choosing the right plan for you and your employees is a complicated decision. The Patient Protection and Affordable Care Act, which was signed into law in March 2010, made significant changes to the health insurance industry. Many provisions are complex and not yet clearly defined by the federal government. Many more are subject to both state and federal rules and regulations that are still to be determined. Because of the changing requirements that employers must follow, many to be phased in from now until 2018, it makes sense to consult with a benefits manager who can guide you through the process.
Life Insurance Group life insurance is a relatively inexpensive benefit to offer employees. Many employers provide a life insurance benefit equal to one or two times the employee’s base salary, paying either all or most of the premium cost. In addition, employers may allow those wishing more coverage to increase the death benefit or add coverage for family members through the purchase of supplemental life insurance. Although not required under current law, employers can provide up to $50,000 as an income tax-free benefit to employees.ᵃ
Companies that do not feel they can afford to provide an employer-paid benefit can still deliver a valuable service to their employees by offering life insurance as a voluntary benefit. While employees pay the full cost of coverage, there are several advantages to buying this way. Generally, employees can get coverage more easily than if they were to purchase an individual life insurance policy on their own outside of the workplace, and the premiums can be less expensive because of efficiencies in enrollment and billing procedures.
A well-conceived employee benefits program is a necessary tool for attracting new employees and retaining current ones, regardless of the size of your company. A benefits program can be important to the success of your business and to the financial security of your employees, but it also can be costly. That’s why employers typically share the costs with their employees. A benefits specialist can help you select the right mix of benefits and guide you through the various plan options. It’s also a good idea to consult with your accountant and attorney before establishing or expanding an employee benefits program.
Diversified Employer Benefits is here to help you navigate these confusing waters. Contact us today.