Many small businesses in America are looking to compete with larger corporations by offering employee health insurance and other benefits as a way to recruit and retain talent. Thanks to the Affordable Healthcare Act and other related laws and regulations, many small businesses with fewer than 50 employees are not required to offer health benefits to their employees. However, doing so is good a way for them to attract employees to their companies and encourage good attendance and work ethic.
If you decide to offer your employees health benefits, you need to be aware that there are federal laws in place to protect their rights and yours. Although it may not be your intention, running afoul of these laws could have bad implications for you and your business. Business owners should work to develop a deep understanding of health insurance and benefits and how it affects their rights. Here are some ways small business owners can overcome some of the challenges they experience.
Research Your Options
Thanks to the rising costs of healthcare, many small businesses are unable to afford traditional group health insurance. If you are a business owner who is having trouble finding affordable group health insurance, there are options available that can make the task of providing your employees with insurance a more cost-effective one. The following are resources that you can use to find affordable coverage:
- Small Business Health Options Program (SHOP)
- Individual Health Insurance Reimbursement
- Private Health Exchange
Each option carries its own set of stipulations and requirements. Research them carefully to identify the one that is most capable of meeting your business needs.
Maintain Compliance With the Law
Once your organization offers health insurance benefits, it must do so in a manner that complies with the law, without affecting employee rights. This means your organization cannot deny coverage or limit its health insurance and benefits to exclude anyone based on their religion, race, gender, age, nationality or disability. Many states also prohibit the use of gender identity and sexual orientation as criteria for health benefits. Other distinctions you cannot make include:
- Provide less coverage to anyone who is sick, older or pregnant.
- Classify pregnancy-related conditions, such as abortion, birth recovery, and postpartum issues as separate health conditions.
- Deny coverage to an employee or their dependents because of a disability, perceived disability or genetics.COBRA Insurance and Employee Rights.
Under federal law, employers with 20 or more employees who offer health insurance must offer a continuation of health insurance benefits for anyone who leaves the company due to termination or layoff, except in cases of gross misconduct. However, your organization is not required to continue to subsidize or pay the cost. The Consolidated Omnibus Budget Reconciliation Act (COBRA) mandates that former employees can stay on your organization’s health plan for no longer than 18 months, 36 months if they have dependents.
By offering health insurance to your employees, you must ensure that your health plan is in compliance with the Employee Retirement Income Security Act (ERISA). This federal law is designed to protect the rights and interests of employees, their dependents and health plan beneficiaries. According to this law, employers must do the following:
- Notify all plan participants (employees) of plan availability, eligibility, claims procedures and any changes or adjustments to the plan and their rights.
- Manage plan funds and invest them accordingly for the best interest of employees.
Due to rising healthcare costs and other considerations, you may not feel your organization is in a position to offer many health insurance options for its employees, or you may be seeking to do so in a manner that enables you to minimize the expenditure of resources. It doesn’t matter if you’ve got five employees or 50, employer sponsored health insurance can be a valuable asset for your organization. If you decide to offer health insurance to your employees, take the time to learn what your rights and legal obligations are beforehand.
The content on our website is only meant to provide general information and is not legal advice. We make our best efforts to make sure the information is accurate, but we cannot guarantee it. Do not rely on the content as legal advice. For assistance with legal problems or for a legal inquiry please contact you attorney.