Employers
How small-group health insurance works
What a small-group plan is, who can enroll, and how to get coverage without a quote form on this site.
Small-group health insurance is coverage an employer sponsors for its employees. The company picks a plan (or a short menu of plans), pays a share of the premium, and employees enroll themselves and eligible dependents. This page is for employers. It is not a quote form.
What a small-group plan is
A small-group plan is a group medical policy written for a business, not for one person shopping on the individual Marketplace. The employer is the policyholder. Employees get ID cards through that group.
In most of the country, “small group” means a business with 1 to 50 employees. Some states set a higher small-group size. HealthCare.gov describes SHOP, the Small Business Health Options Program, as generally available to employers with 1 to 50 employees. If you are near that line, ask a broker which size band applies where you are based.
Small-group coverage is not an ICHRA (an employer allowance used to buy individual coverage). See ICHRA vs group medical if you are weighing those options.
Who can enroll
Eligible employees are the people who work full-time hours as the plan defines them. Many plans use 30 hours a week, which matches the Affordable Care Act idea of full-time work. Some plans use a different hours line. Owners and partners are sometimes treated differently from W-2 staff. Confirm the hours rule on the plan you are considering.
Dependents are usually a spouse or children, subject to the plan’s definition. You can offer employee-only coverage without covering dependents. Part-time staff are often excluded.
When coverage starts
Small-group coverage almost always becomes effective on the first day of a month. If you apply mid-month, the start date is usually the next first of the month, or the first of the month after the carrier’s cutoff.
Open enrollment is when eligible people join at the group’s start or renewal. New hires typically get a waiting period (for example, first of the month after 30 or 60 days). Marriage, birth, and similar life events can open a special enrollment window. The plan documents set those rules.
The census and where the group is based
Before anyone can compare plans, you need a census: a list of eligible employees. A useful census includes name or employee ID, date of birth, ZIP code, hours or full-time status, and who will cover a spouse or children. Ages and locations drive small-group rates.
Where the group is based matters as much as the headcount. Carriers file plans by state and often by rating area. Use the employer’s main location and ZIP. If you have people in several states, say so up front. Out-of-area employees can change which networks and carriers are workable.
SHOP vs working with a broker
SHOP is the official small-business Marketplace. HealthCare.gov explains that eligible employers can offer SHOP medical and dental coverage any time of year, and that you enroll through an insurance company or a SHOP-registered agent or broker — not by starting an individual-style application on HealthCare.gov.
SHOP is one path. Many small employers work with a licensed broker and compare plans both on and off SHOP. A broker can shop the market across carriers that file in your state, explain participation rules, and help you enroll. This directory is not a ranking of brokers or plans.
The Small Business Health Care Tax Credit, when it applies, generally requires SHOP coverage and other IRS tests. Do not assume you qualify. Check the HealthCare.gov pages in the sources below.
Participation and the employer share
Carriers and SHOP both care how many eligible people actually enroll. The HealthCare.gov SHOP glossary says a small business offering SHOP coverage must offer it to all full-time employees and generally enroll at least 70% of the employees offered insurance, with some exceptions. Carriers outside SHOP set their own participation and contribution rules.
If too few people enroll, the carrier can decline the group or ask you to change the offer. Valid waivers (for example, coverage under a spouse’s plan) often count differently from a simple “no.” Ask how waivers are counted before you announce a plan.
Employers usually pay a stated share of the employee-only premium and a smaller share, or none, for dependents. There is no single federal percentage that every small group must use, except where a tax credit or a specific program requires one.
What to do next
Write down eligible headcount, full-time hours, and the ZIP where the group is based. Build a census. Then talk to a licensed broker.
If you are an employer looking for coverage, Innov8 Healthcare can introduce you to a broker. This site does not collect a quote request, and it does not sell a plan from this page.