The Affordable Care Act (ACA) requires applicable large employers (ALE) to offer affordable, minimum value health coverage to their full time employees (and dependents) or pay a penalty. An ALE is an employer with, on average, at least 50 full-time employees, including full-time equivalent employees (FTE’s) during the proceeding calendar year
All group medical benefit plans fall into one of two categories: self-funded or fully insured. The choice of one over the other should not be made arbitrarily. Each type carries its own set of administrative rules and legal constraints. Under a fully insured health benefit plan, an insurance company assumes the financial and legal risk of loss in exchange for a fixed premium paid to the carrier by the employer. The fixed premium amount is typically set for a period of 12 months. A common misconception is that employers are tied to a contract for a year when electing fully insured medical plans and premiums. However, all health insurance contracts are month to month; only the premium is set for the 12 month period. Traditionally, employer groups with less than 200 employees have offered fully insured medical plans as the core of their employee benefits package. As a direct result of the ACA, the market has seen a drastic shift towards smaller employers electing to self-fund their medical benefits.
Making decisions about your company health insurance probably isn’t at the top of your list of favorite things to do. However, health insurance is an important part of not only the corporate finances but that of your employees as well. The medial care decision that you make has a direct impact on the health and financial well being of your current employees in addition to those future employees that you hope to attract and retain. Group health plans are employer sponsored plans that offer coverage to a pool of employees. Because a group plan covers multiple people, the risk is spread out over what is likely a fairly healthy group of participants. This helps keep the premium rates lower than plans in the individual market, which are based on individual risk.
At LaPorte, our objective is to help employers make educated decisions about their employee benefits based on open communication and understanding of goals combined with complete market access. We believe that hiring our dedicated team of benefits advocates will help you attract and retain the highest quality employees by offering the most competitive benefits package, without compromising the task of controlling costs over the long term.