What is Company-Provided Health Insurance?

In 2022, almost half of U.S. residents were covered by health insurance provided through their employer. Whether you call it job-based, employer-sponsored, or group health insurance, company-provided health insurance is the coverage you get as a workplace benefit — and it plays a major role in how Americans access health care and is something about which all business owners should be aware.

One thing to keep in mind: most employees share the cost. On average, workers paid 17% of the premium for single coverage and 28% for family coverage in 2022. The numbers can vary depending on where you work. Employees at smaller companies often shoulder more of the family coverage cost — 36% compared to 26% at larger firms. Private for-profit organizations also tend to require higher contributions compared to public employers, where workers generally pay a lower percentage for both single and family plans.

Interestingly, only about 30% of small to mid-sized organizations fully cover the cost of single coverage. At larger companies with 200+ employees, that number drops to just 6%. Clearly, company size can make a big difference in your health care costs.

Other Health Coverage Options

According to KFF, over 20% of U.S. residents rely on Medicaid for their health coverage—a program jointly funded by federal and state governments to support lower-income individuals. In California, this is known as Medi-Cal.

Meanwhile, Medicare provides health care to more than 18% of Americans, focusing on seniors and those under 65 with long-term disabilities. For those opting for private plans, about 6.3% of the population have non-group insurance, either through ACA marketplaces like Covered California or through personal plans purchased outside these exchanges. Additionally, just over 1% are covered by Tricare, the military’s health insurance program.

It’s worth noting that some individuals are covered by more than one plan, showcasing the diverse ways Americans access health care today.

Health Coverage For Your Small Business

If you’re thinking about offering health insurance to your employees you have options. You can go it alone and purchase coverage directly, or team up with an insurance company, administrator, exchange, or broker to make the process smoother.

• Get coverage directly from an insurance company: Some insurance companies in California provide group health plans directly, while others require you to work with an insurance broker or agent. Either way, it’s a straightforward way to secure coverage for your team.
• Explore options through a public exchange: California’s ACA exchange, Covered California for Small Business, makes securing health insurance simple. Choose plans from trusted providers like Blue Shield of California, Kaiser Permanente, and Sharp Health Plan. Plus, you can add Group Dental coverage from top names like Delta Dental and California Dental Network.
• Discover flexibility with a private exchange like CaliforniaChoice: Serving small businesses since 1996, CaliforniaChoice offers a range of options from major providers like Anthem Blue Cross, Health Net, Kaiser Permanente, UnitedHealthcare, and several regional health plan. It’s a one-stop shop for finding the perfect fit for your team.
• Work with a broker or agent for tailored solutions: Not sure where to start? A health insurance broker or agent can help you find coverage that fits your company’s unique needs. Don’t have one yet? CaliforniaChoice makes it easy to find a trusted expert near you.

Whether you are required to offer health insurance to employees is determined by whether your business is an Applicable Large Employer (ALE). Your status is evaluated annually in January based on the size of your workforce during the prior year.

If you had 50 or more employees (including full-time equivalent employees), you are subject to the ACA’s employer mandate and shared responsibility provisions. That means you are an ALE and are required to offer health insurance and reporting requirements. You can learn more about ALEs on the IRS website.

Read our blog post, 5 Essential Facts About Health Insurance for Small Business Owners, for information about the recruiting, tax, and other advantages of offering benefits to your employees. Another post, 5 Things About Health Insurance That Employers – and Employees – Should Be Thankful For in 2024, discusses more benefits of group health.

When comparing health plans, your employee benefits broker can help you evaluate your options. Reach out today to your broker or search for one online at MyCalChoice.com.