Why are small businesses still provides group health insurance?

Why are small businesses still provides group health insurance? -

Many small businesses offer their employees health insurance through a group plan. It is the way things have been is carried out for a long time in the United States. But lately, more and more employers are switching to individual plans for themselves and their employees.

Here's a look at what industry experts say about the transition to the individual health insurance.

most employers offering health insurance stop in the next decade

Dr. Ezekiel J. Emanuel, in his recent book "Reinventing American Healthcare" predicts that b y 2025 "less than 20% of private sector workers receive traditional employer-sponsored health insurance." [1945009[

S & P Capital IQ, come a division of McGraw-Hill, to a similar conclusion. They predict that b y 2020, 0% of American employees who currently receive health insurance could be shifted by their employer to the individual health insurance and government markets.

In a recent white paper, we discuss how the shift initially start with small businesses, predicting that 60% of small businesses is traditionally employer-sponsored health insurance in favor of defined contribution arrangements and individual health plans of 2017 to eliminate with the defined contribution plan, the employer reimburse employees for their individual health insurance premiums. There are to make premium expenses before tax and post-tax options for employers and employees.

Why are small and medium enterprises, switching to individual health insurance?

One of the main reasons why small businesses are canceling group health insurance is in favor of individual health insurance and defined contribution that the individual health insurance costs up to 60% less. S ee this state by state comparison of tariffs.

comes addition, most employees are to reduce for a premium tax credit into account what they pay for individual health insurance. A recent analysis found that those who pay eligible for a tax credit on average only $ 82 / month for a health plan market.

Finally, individual health insurance is now better for the employees, because they get more choice, the coverage is portable, and all employees (regardless of their health) are capable of an individual health insurance to purchase that as an existing group health insurance options is equal to or better for them.

Why even small businesses offer group health insurance?

How many industry leaders are final, no longer is a good reason for small businesses to offer traditional group health insurance.

The cost of group health insurance is on an unsustainable trajectory and individual health insurance plans offer greater value to employees. Individual health insurance costs up to 60% less than group health insurance and defined contribution arrangements allow employers employees for individual health insurance to reimburse the cost.

So why are small companies still offer health insurance group?

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