It is always quite hard for small enterprises to get good health coverage with competitive rates, especially if compared with bigger companies. Some small companies, especially home-based ones, don’t have the minimum number of workers to be eligible for health group plans at all. And this means that there’s no other option for these small enterprises than having no group plans for their employees altogether. If you have a home-based business chances are that you are the single worker at it, or have only a couple of additional employees beside you, which makes it virtually impossible for obtaining adequate insurance plans from most insurance companies.
But don’t give up too soon, because there are ways you can get what you need. A great number of insurance providers offer competitive plans for self-employed individuals as well as group plans for small businesses.
These are some useful tips that will help you get adequate health insurance coverage for you and your workers in case you are the owner of a home-based enterprise:
• Join a purchasing pool or an alliance plan. It is quite hard for small business to negotiate competitive rates with the insurance companies as they will usually get billed with higher premiums than bigger enterprises. However, if small businesses group together it will be much easier to negotiate the rates because of the larger number of employees getting the benefits. The two options for such grouping are purchasing pools and association plans. Contact your state insurance department or local chamber of commerce to learn what are the options for your business regarding these two possibilities.
• Choose plans that are specifically tailored for small enterprises. The market of small business insurance and health insurance for smaller enterprises is growing rapidly and there are more and more companies competing for this market niche. So learn what insurance providers have specific small business offers and compare the rates. They should get even more competitive with more players entering this market.
• Cover your individual health insurance needs as well. As a business owner, no matter whether you’re the single worker or have more employees, the entire enterprise depends on your well-being. So make sure you’re properly covered and have enough insurance, because a single accident with costly medical bills to pay can be fatal to the entire business and some of your most valuable assets (house, car, etc.) Having no health coverage is not the smartest thing in your situation.
• Choose the right insurance coverage type. There is a very wide selection of insurance types with their pros and cons. Things like fee-for-service, PPOs and HMOs will surely get you confused at first so try to learn more about these plan types in order to know which one is right for you and your employees. The difference can be quite significant so take your time, ask your insurance agent to consult you on the matter.
• Consider having health savings account. HSAs have an important advantage over other types of insurance plans because the save your pre-tax money that can be quite sensitive for a small business. Being not a form of insurance technically, HSAs still have some of the group plan benefits and prove to be very helpful during the income tax period. So if the financial matters are vital for your business consider having such an option.
“Americans are playing by the rules, they’re working, they’re waking up every morning to go to their jobs and they have no health security. . . .”
That statement was Kathleen Stoll’s, director of health policy for the consumer health group Families USA*, in response to $10B in cuts to Medicaid in 2005. And it makes a point that many of the stories written about healthcare in the U.S. do not. That is, all this discourse about money- the billions cut in Medicaid health benefits to address a 7% increase in costs, the percent of costs covered by state and local government for the uninsured (which is about 85%, by the way), the $41B in costs that hospitals absorb for the uninsured – has an impact on real people. People like you and me, who play by the rules, pay their taxes, get up every morning to go to work, and come home everyday to their families.
Let’s consider an average family without health benefits today. John and Kate, for example. They have two children, Kate is a part-time teacher at a private pre-school where she can bring her two young children with her while she earns her teaching credential at night. She makes about ~$16K per year. John is a construction worker, which pays well (almost $5K per month), but it is seasonal work. He does well from spring to late fall. But from October to February, there isn’t much work. So John picks up work as a handyman when he can. And he grosses about $40K per year.
Neither of them get health benefits through their employer.
So John and Kate, like more and more Americans these days have to make a choice. No not between food on the table and clothing, but between paying for adequate healthcare for their family today and investing IN THEIR future. In other words, they cannot afford health benefits insurance AND tuition for Kate to get her teaching credential.
What would you do?
Well, John and Kate decide to roll the dice. They pay out-of-pocket to take their children to the pediatrician on a regular basis. But they decide that for them, since they are both young and strong and pretty healthy, they will skip insurance and regular medical check ups. They will only go to the doctor when it is absolutely necessary.
As chance would have it, John starts feeling pain in his side. He doesn’t think much about it at first. But as the days pass, it doesn’t get any better. In fact, it gets worse. But he says nothing to Kate because he doesn’t want to worry her (about the money it will cost for a doctor or about his health). Finally, the pain gets so bad that just touching the area causes excruciating pain. Until one day, he can’t bend down to put his pants on. He can’t go to work. Nothing.
Kate calls an ambulance, and they rush John to emergency. Kate follows in the car with both children in tow. When she gets there she finds out that John’s appendix has burst, and they are performing an emergency appendectomy.
Flash forward to the next day. Things are okay-relatively speaking. John is recovering. Kate is sitting by his bedside. The kids are with grandma. And John will go home soon enough. But they have incurred thousands of dollars in hospital costs. Some of those costs may be deferred by the hospital. But John and Kate WILL PAY a sizable amount deducted from their wages each month for a long while.
Kate’s degree? That will have to wait.
This is a sad story and not really true. But it is believable. Because that is the situation we’ve all been placed in, by employers who opt not to provide health plans and by our government that restricts access to subsidized health benefits.
Kate and John and others (like you and me) need to look for viable alternatives to employer-backed and government-subsidized health plans. One alternative is called Consumer Driven Health Benefits. It includes vision, dental, prescription, physician care AND hospital advocacy. Which means, had Kate and John had a Consumer Driven Health Benefits package, John would have been able to visit a doctor regularly. And whether John still had to have a scheduled appendectomy or an emergency appendectomy, he would have been covered.
*45.8 Million in U.S. Now Lack Health Insurance; Web Med Medical News; Todd Zwelich, Aug. 30, 2005
