Park City, Utah (PRWEB) June 02, 2013
Today, Zane Benefits, Inc. published new information on small business health benefits. Zane Benefits, which provides comprehensive and flexible alternatives to traditional employer sponsored health benefits, is the leader in defined contribution and health reimbursement arrangements.
According to Zane Benefits’ website, a big milestone for any small businesses is offering small business health insurance for the first time. Zane Benefits offers five quick tips for small businesses starting to offering health benefits for the first time.
#1: Understand the advantages (and value) of offering employee health benefits
According to Zane Benefits’ website, many small business owners are familiar with the reasoning: Offer the right health benefits, and jump-start the business's growth. When small businesses give employees health benefits they value, they'll be more satisfied, miss fewer workdays, be less likely to quit, and have higher commitment to helping the business grow. There are three key advantages of offering health benefits to employees.
- Recruitment & Retention of Key Employees: Employee health benefits are a valuable tool in recruiting key employees and retaining top talent. While the importance of this for the small business may depend on industry competition in the area and the age and demographics of the workforce, it will be an important factor in the overall compensation package.
- Tax advantages: By offering a traditional group health plan or an alternative solution such as a defined contribution health plan, small businesses can offer employees a tax-advantaged health benefit. These tax advantages increases the small business’s overall compensation package and allows an income tax deduction for the contribution. In other words, the business expense is less than the value of the health care benefit to the employee.
- Employee wellness: Insurance coverage keeps employees healthy and working. Preventative care and more affordable access to health care prevents employees from taking extended periods of sick leave, allowing the small business to be more productive and profitable.
#2: Analyze the risks (and costs) of offering employee health benefits
According to Zane Benefits’ website, all small businesses must assess costs and risk of any new expenditure. Likewise, it is important to understand the risks and costs of offering employee health benefits.
- Cost: The cost will vary depending on the type of employee health benefits the small business chooses. For example, health insurance premiums rise every year. The uncertainty of rate renewals with a group health insurance plan makes financial planning difficult. Small businesses can have more control over costs with a defined contribution health plan.
- Administrative Commitment: Budget for the administrative time of offering employee health benefits. With a traditional group health insurance plan, the small business will spend time choosing the coverage and then spend regular time filling out forms, remitting premiums, and acting as intermediary between employee and insurer. With a defined contribution health plan, administrative time is reduced. For example, the small business will spend time at the front-end of setting up the defined contribution health plan and then spend 5-10 minutes each month adding reimbursements to payroll.
#3: Research employee health benefits options
According to Zane Benefits’ website, there are new options for small business health benefits. The two main types are a traditional group health insurance plan and a defined contribution health plan.
Group Health Insurance Plan: Also called "employer-sponsored" health insurance, a group health insurance plan covers all employees and their family members. These plans are generally uniform in nature, offering the same benefits to all employees or members of the group. Unlike individual health insurance, group health insurance is purchased by an individual (or family member) indirectly through the individual's (or family member's) employer. Group health insurance is dependent on an individual's (or family member's) employment.
Defined Contribution Health Plan: Rather than paying the costs to provide a specific group health insurance plan (a "defined benefit"), employers can fix their costs on a monthly basis by establishing a defined contribution health plan. Defined contribution health plans are an affordable alternative to employer-sponsored group health insurance plans. Defined contribution health plans by themselves are not health insurance plans, rather the small business offer employees a tax-free allowance to spend on their own personal policies and other medical expenses. A defined contribution health plan is like a business expense account for health care.
About Zane Benefits
Zane Benefits was founded in 2006 to provide a revolutionized SaaS (Software-as-a-Service) administration platform ("ZaneHRA") for Health Reimbursement Arrangements (HRAs) and defined contribution health care. The flagship software provides a 100% paperless administration experience to employers and insurance professionals that want to offer better health benefits without a traditional group health insurance plan at lower costs. For more information about ZaneHRA, visit http://www.zanebenefits.com.