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5 Insurance Coverage Changes Every Small Business Should be Aware of

insurance coverage

In 2014 the Affordable Care Act will bring about significant changes in health benefits for those who run or work in small businesses. Here we will talk about 5 insurance coverage changes you will need to know.

In an effort to make healthcare more affordable, this new legislation will include access to new tax benefits for small businesses and new freedoms for employees. There are, however, some potential drawbacks that small business employees and owners could face if not financially responsible.

Here are 5 of the most significant insurance coverage changes everyone in a smaller business should prepare for:

1. Tax Benefits.

Beginning in 2014, small business owners will have more options and control in health insurance spending with the Small Business Health Options Program. It also makes small business owners with low to medium-wage workers eligible for a tax credit that covers up to 50% of their contribution towards premium costs. This will make providing insurance to employees much cheaper and more manageable.

To qualify for this break you must employ at least 25 low-wage workers that are full-time employees. Other tax breaks will be offered as well such as the chance for small business owners and their employees to use pre-tax money to make their premium payments. This is one of many ways your small business can climb out of debt and into the green again.

2. Protections.

Older employees and those with high care costs or preexisting conditions will no longer have to pay a higher premium than those who are younger or have a healthier history. Employees will also no longer have an annual limit on the amount of insurance coverage they can receive. Those with more serious conditions such as cancer or some other potentially fatal disease will no longer have to be worried about being dropped or limited in insurance coverage if they decide to enter a clinical tri

3. More Options in the Insurance Market.

Technically the new law does not make it mandatory that a business must provide health insurance. As such, some employees will have the freedom (or burden) to seek out a health insurance plan that is more catered to their specific needs. This is being done to increase the Health Insurance Marketplace. Don’t worry too much though; insurance companies will be required to provide all of the benefits of a typical company plan that protect you from serious financial peril.

4. Eligibility for Medicaid.

If you earn less than $14,000 or live in a family of 4 that earns less than $29,000, you will be eligible for the benefits of Medicaid. This is based on those who bring in less than 133% of the national poverty level. Every state collects a tax for Medicaid but if you are not able to afford the insurance coverage you can qualify for an exemption while those who can still be required to pay a fee to help the costs of caring for those who are uninsured.

5. Enrollment Begins in October.

On October 1st enrollment begins for the health insurance marketplace. Do your homework and gather information on current and potential employees before then. Employers and employees of a small business should know that in most states children 18 or younger can qualify for Medicaid in families of 4 that have a total income of less than $46,000.

Keep this in mind when shopping around for insurance coverage plans because if you employ someone that is beneath that income level they may not want to jump on a group plan you offer to all of the workers. A lot of plans rates differ based on the number of people joining.

Keep these things in mind if you make a living off a lower wage or attempt to build a sustainable small business. These new laws are intended to make healthcare more affordable for the lower and middle class but financial responsibility is still a priority with this system. It will be interesting to see how effective these new laws will be.

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