Health Care Benefits

Along with time-off benefits, health care benefits are one of the most important and popular benefits to employees. While that's not enough of a reason to get them in and of itself, if you're vying for employees with particularly rare or valuable skills, it could play into your decision to offer them. Another good reason to offer them is because you can then take advantage of them yourself and get cheaper health insurance and some nice tax breaks for the contributions made by the business.

Do you have to offer a health plan? Unless you are an employer in Hawaii or Massachusetts, you are not required by law to offer your employees health insurance benefits. If, however, you decide to offer health insurance benefits, you call into play a whole series of laws that will tell you what coverage you have to offer and how you have to offer it.

Hawaii is the first state to require employers to provide health insurance to employees. The law, the Prepaid Health Care Act, requires employers to provide health insurance to full-time employees, either through an indemnity plan or an HMO. Massachusetts employers with more than ten employees are required to offer pre-tax health plans to employees.

Health care reform. The enactment of the Patient Protection and Affordable Care Act and related legislation requires employers with 50 or more full-time employees to offer health coverage or be subject to an assessment. This mandate is in effect beginning in 2014. Small businesses with no more than 25 employees may be eligible for a tax credit for purchasing health insurance for their employees.

For more information on the Affordable Care Act and small business, visit the government's website.

Should you offer a health plan? The first decision to make is whether to offer health insurance at all. To investigate further, consider the following issues:

• pros and cons to offering health insurance
• which benefits you should offer
• how to find and choose benefit providers
• how to negotiate health plan contracts
• what administration of health benefits entails