While the number of small businesses offering health benefits to employees has steadily declined over the past decade, the fact remains that health insurance is perceived as one of the best benefits a company can offer its workers.
And of course, for businesses with 50 or more full-time employees, the Affordable Care Act requires health insurance plans to be offered.
Not only do employees appreciate health benefits for themselves and their families, but companies themselves can enjoy a number of significant advantages when they offer health insurance to their employees.
Attract and Retain Qualified Employees
Experienced, hard-working employees know they have options when it comes to their employment. Because of their expertise and credentials, they will likely have an easy time receiving multiple job offers.
If you truly want these workers on your team, then you're going to need to make them an offer they can't refuse.
While a higher salary or a nice retirement package might help, going above and beyond to offer excellent health insurance benefits will truly sweeten the deal. This same concept applies to your existing employees, who may be persuaded to seek employment elsewhere if they're not getting the insurance benefits to which they feel entitled.
By offering health insurance, your company can not only attract but retain the best workers. In fact, one recent study found that workers ranked health insurance as the single most important job benefit, outranking even vacation time and retirement plans.
Achieve Healthier, More Productive Employees
When your employees have access to the healthcare they need to stay healthy, your company also benefits from having happier, healthier, and more productive workers. When your employees are able to easily seek preventative care such as routine physicals and checkups in order to avoid illness or are able to diagnose and treat illnesses early on, it has a significant impact on workplace performance.
Furthermore, insured workers will spend less time worrying about finding ways to pay for their own insurance out-of-pocket, so they'll be less likely to pick up a second job in order to pay for healthcare expenses.
Enjoy Numerous Financial Incentives
Typically, when a business offers a health insurance plan for its employees, these costs can be written off as a business tax deduction. This applies to payments made for:
- group health insurance premiums
- health savings account (HSA) contributions
- medical reimbursement plans
For businesses that employ fewer than 25 employees and meet some other basic criteria, it may even be possible to collect a tax credit that covers up to 50% of a company's health insurance premium costs. In this sense, offering health insurance to employees doesn't just afford productivity benefits, but potential financial advantages as well.
Pass Lower Healthcare Costs to Employees
In many ways, offering a quality health insurance plan to employees can also boost morale and loyalty to the company. This is especially true in long-term scenarios where a company is eventually able to pass on lower healthcare costs directly to workers.
Over time, as employees have access to and utilize their health benefits, their overall health and wellness improve. This results in a decrease in health care costs for the company.
Businesses that make the decision to pass on some of these health care savings may be rewarded with even greater employee satisfaction, morale, and loyalty—and you can't put a price on that.
Avoid Penalties Under the Affordable Care Act
Finally, it's worth mentioning that for businesses of certain sizes, not offering health care benefits to employees can be a violation of the Affordable Care Act and lead to major fines and penalties.
In this sense, offering health insurance isn't much of a choice, though doing so will help to avoid the costly penalties and the negative press/reputation that comes along with not offering health insurance benefits when you're required to do so by law.
Specific fines can vary depending on the size of the business and other factors, but most penalties are assessed on a monthly basis, with the monthly amount also being multiplied by the number of employees without coverage. This means that companies could easily pay tens of thousands of dollars or more in penalties over the course of a year.
There are so many reasons for businesses of all sizes to offer health insurance benefits to their employees, though these are just a few of the most compelling. There seems to be a misconception that health insurance isn't within the budget for many small- and mid-sized businesses, but this often isn't the case.
By taking the time to explore options and consider the potential tax incentives that come along with employer-sponsored health insurance, businesses of all sizes can begin offering workers the coverage they deserve.