As an employer, you know that providing group health insurance benefits can keep your workers happy, healthy, and productive. And because health insurance is a highly sought-after benefit, providing a group plan helps you remain competitive with regard to employee recruitment and retention. But beyond that, health insurance rules and regulations can seem confusing. What’s the difference between a small group and a large group health insurance plan? And which one are you supposed to offer to your employees?
The names “large” and “small” refer to the amount of people insured by the plan. A small group health insurance plan covers fewer than 100 employees, and a large group plan covers more than 100 employees. That’s the simplest way to sum it up.
However, for the purposes of counting employees, it’s the full-time employees we’re talking about. According to health insurance rules, a full-time employee is one that works 30 or more hours per week, or 120 or more hours per month. Part-time employees work fewer hours than those limits. You’re only required to insure full-time employees, under the Affordable Care Act and California law, and only if you have 100 or more full-time employees.
Another difference between small group and large group insurance plans is the premium. Typically, large group plans have slightly lower premiums, because they spread the risk across a larger pool of participants. In order to qualify for large group health insurance, you must have 100 or more full-time employees, and your organization must meet minimum participation requirements (the number of employees who enroll).
Group health insurance does not require an enrollment period, so you can sign up at any time. You can compare rates and enroll through an insurance broker, or by contacting insurance companies directly. However, an independent broker can offer you the assistance of comparing plans and explaining the benefits and limitations of each one. Your premiums are locked for one year, during which time you can add or remove participants and dependents.
The nature of work performed by your company, the length of the plan you choose, and the average age of covered individuals all impact premiums as well. To learn more about both small group and large group health insurance plans, contact one of our agents and we can demonstrate your options.