As some of the Obama administration’s health care reform legislation goes into effect in 2014, many businesses are left wondering what they should do about their employee’s health insurance coverage.
One major law that will be enacted in 2014 is that small businesses (under 50 people) will no longer be required to provide coverage for their employees. These employees will now have the option of buying into state-based insurance exchanges.
If your business is larger than 50 people, it’s mandatory to provide or pay a $2,000 per employee fine. Some small businesses may be tempted to drop insurance coverage and perhaps bump their employees’ salaries. But should they? Here’s why you should keep your employees insured.
You’ll have a healthier, more productive workforce.
Having un- or under-insured employees means that your workforce will likely forego routine checkups and needed medical care for all but the most dire medical problems. Sicknesses are a major loss of productivity for any business, and in particular small business. Keeping your employees covered means fewer absences from illness.
You won’t have as much of an attrition rate.
There’s more than just salary that employees value in their jobs. A good benefits package is perhaps one of the main reasons that talented employees stay with a particular company for awhile. So many businesses don’t offer health insurance benefits that employees are willing to stick with a company that does. By providing health insurance coverage, you’ll be sure to retain your most talented employees.
If your company has more than 50 people, you’ll lose money if you drop coverage.
No matter the size of your company, by 2014 you really don’t have to offer health insurance. But if you don’t and your company has more than 50 employees, you’ll pay $2,000 per worker, which can add up quickly.
If you’re considering raising salaries and dropping insurance, you’re not looking at hidden costs.
If you have less than 50 employees, and you’re considering dropping coverage, you’ll still be slapped with hidden costs. After raising salaries so that your workers can get their own insurance, you’ll have to pay more in payroll and other related taxes because of the increase in salaries.
Of course, as a business, you’re mostly concerned with the bottom line. But providing good benefits for your hard-working employees is also, needless to say, the right thing to do. If you can afford to keep the benefits, keep them. You won’t regret it.
About The Guest Author: Susan Wells is a freelance blogger for InsuranceQuotes.org who enjoys writing about automotive and health news, technology, lifestyle and personal finance.
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