Wise-up Wednesday from Zane Benefits: Health Insurance 101 – Do you know your options?
When it comes to running your dental practice, attracting and retaining the best dental staff should be top of mind. So should taking care of your loyal and hard-working employees. One way to accomplish these goals is to offer health benefits. But what coverage options are available for small dental practices and your staff? In this week’s Wise Up Wednesday, we’ll cover two basic health insurance options for dental staff.
Option 1 – Group health insurance, with employee contributions
The first health insurance coverage option is to purchase a small group health insurance policy for your dental practice. This is a traditional way of contributing to employees’ health care. Depending on your location, there are likely several carriers and types of plans available. A health insurance advisor can help your practice evaluate plan options.
How to contribute—This type of health insurance is selected and paid for by you, the employer. The premium cost is usually shared between the practice and the employees, and the employees pay for their portion of the premium through a pre-tax salary deduction.
Considerations—With this type of health insurance, your practice will need to meet certain eligibility requirements, such as paying a minimum contribution amount and having a certain percentage of employees enrolled. These factors make coverage unattainable for some small practices. But don’t worry, there is another option.
Option 2 – Individual health plans, with an employer contribution
The second way dental staff can attain health insurance coverage is by purchasing their own health plan on the individual market. They can purchase a policy online, through a broker, or through the Health Insurance Marketplace. When employees purchase their own health plan, they’re able to select any carrier, network of providers, and coverage level. Additionally, employees may be eligible for federal discounts, and an individual health plan is theirs to keep, regardless of employment.
How to contribute—The dental practice may set up a Section 105 Medical Reimbursement Plan to reimburse employees for their health plan premium. With this approach, employees pay for their health plan with their own money and are reimbursed by the practice up to the allowance amount set by the practice. Reimbursements are tax-free to employees and tax-deductible to the business.
Considerations—Your employees may already have health insurance coverage. By offering a Section 105 reimbursement plan, your staff can keep their current coverage or purchase a new health plan, and receive a contribution from the practice. Because the dental practice sets any contribution amount, this can be a cost-effective way to offer health benefits.
Conclusion
There are two main options for helping your dental staff gain health insurance coverage. The first option is to purchase a policy to cover eligible employees. The practice selects the plan and employees contribute to the premiums via payroll. The second option is to allow employees to purchase their own health plan. Employees select the plan of their choice and are reimbursed via payroll through the Section 105 Medical Reimbursement Plan.
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Wise-up Wednesday is presented bi-monthly from the experts at Zane Benefits. One Wednesday a month features Human Resource issues, and the other Wednesday discusses health benefits.For more information on health insurance reimbursement strategies, download Zane Benefits’ complimentary guide, “The Dental Practice's Guide to Individual Health Insurance Reimbursement.”
