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Commonly Asked Questions About Small Group Policies

Who Is Eligible for Coverage?

The general rule is that if an employer offers group health coverage to any full-time employees, the employer must offer coverage to all full-time employees.

The employer has the option to offer coverage to part-time employees (defined as those working fewer than 30 hours per week). If the employer offers coverage to any part-time employees, all of them must be offered coverage.

These rules apply regardless of the medical condition of the employees. In other words, any eligible employee can’t be denied coverage based on previous medical problems, known as preexisting conditions.

In addition, any dependents of eligible employees are generally eligible for coverage under a group plan. Dependents include spouses, children, and in some cases, unmarried domestic partners. Dependents cannot enroll for coverage unless the employee has enrolled. Under the Affordable Care Act, group insurance plans are required to extend coverage to adult dependents through age 26.

What Do Employers Have to Pay?

Some employers who decide to offer coverage choose to pay the full premium, while others require employees to pay a portion. When considering what portion of the premium to pay, employers should be aware that the Affordable Care Act offers small businesses tax credits to help offset the cost of insurance. The small business healthcare tax credits have been available since the 2010 tax year, with significant changes implemented in 2014. To qualify for a tax credit of up to 50% of premium expenses for any two years, small business owners must pay at least half of employees’ healthcare premiums and have fewer than 25 full-time-equivalent employees who earn an average of $50,000 or less per year.

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