What Small Businesses Need to Know

A small business is defined as a company that has up to 100 full-time employees.

Current HMSA groups

We’ve got great news for you. Because of decisions made by President Barack Obama and the state insurance commissioner, HMSA is offering you and your employees the same health plan you currently have year until the first plan renewal after October 1, 2016.

What does this mean for you? Several things:

  • If you’re adversely affected by age rating, you can now choose to stay with HMSA and avoid age rating of your employees and their dependents for another year.
  • If you renewed your policy with HMSA in 2014, you can keep your current plan until the first renewal after October 1, 2016. For example, groups that renew on July 1, 2015, can extend their plan through June 30, 2016.
  • Please keep in mind that if you extend your current plan, your rate will be adjusted only to cover government fees and taxes and the expected rise in medical costs.

HMSA Plans for Small Businesses

A healthy employee means a healthy business. We can help you get there and stay there.

Premiums have changed

Health plan premiums for Affordable Care Act (ACA) plans are based on your employees’ age. Health plans for older employees may cost more than plans for younger employees.

Also, the federal government pays for health care reform changes with new fees and taxes imposed on health insurers nationwide, including HMSA. This adds costs to health plan premiums.

Benefits have changed

ACA plans include:

  1. Prescription drugs
  2. Ambulance service
  3. Emergency care
  4. Hospitalization
  5. Laboratory services
  1. Maternity and newborn care
  2. Mental health and substance use services
  3. Pediatric oral and vision services
  4. Rehabilitation and habilitative services
  5. Services for preventive care, wellness, and chronic disease management

Your part-time employees need coverage

You’re not required to offer health care coverage to your part-time employees who work less than 20 hours a week. However, if they don’t get coverage, they’ll have to pay a fine to the Internal Revenue Service (IRS). Those employees can buy an HMSA individual health plan directly from us or at healthcare.gov. Depending on their income, they could be eligible for financial help to pay for health insurance if they buy it healthcare.gov.

To-do checklist for employers

Health care reform requires you to:

  • Report the value of your employees’ benefits on their annual W-2 form. Some employers are exempt from this requirement for now, including employers who file less than 250 W-2s, multiemployer plans, health retirement account plans, and self-insured plans not subject to COBRA rules.
  • Starting in 2015, report your employees’ minimum essential coverage annually to the IRS. Large employers with at least 50 full-time equivalent employees must file additional information about fulfilling their responsibilities.

Dependent coverage

Do you offer your employees a B status plan under Hawaii’s Prepaid Health Care Act? If you do, state law requires you to provide coverage to your employees’ dependents and pay at least half of that coverage. If you don't offer a B status plan, you’re not required to offer dependent coverage.

Dependents can still get coverage by contacting us. We’ll help them choose a plan. They can also buy an HMSA individual plan in the on healthcare.gov. Depending on their income, they could be eligible for financial help to pay for health insurance if they buy it on healthcare.gov.

If you offer your employees family coverage, dependents up to age 26 must be offered coverage as well.

Remind your employees that health care reform requires almost everyone to get coverage or pay a fine to the IRS. And no one will be turned down for coverage, even if they have a serious health condition.

This information is based on HMSA’s review of the Affordable Care Act (ACA). This overview is intended for educational purposes only and should not be used as tax, legal, or compliance advice.

Frequently Asked Questions

What is the federal health insurance marketplace?

The federal health insurance marketplace is an online marketplace, healthcare.gov, where people can buy health insurance.

Do I have to use healthcare.gov for employee health plans?

No. You’re not required to use healthcare.gov for employee health plans. You can continue to work directly with HMSA.

Are HMSA health plans on healthcare.gov?

Yes. HMSA offers individual health plans on healthcare.gov. However, if you wish to purchase a small group plan with HMSA, you can work directly with us. Individual health plans are also available directly from HMSA.

Who can use healthcare.gov?

People who buy individual health plans on their own can use healthcare.gov. For plans effective January 1, 2016, small groups with up to 100 full time employees will be able to use healthcare.gov. HMSA is currently not offering small group plans on healthcare.gov, so contact us directly to obtain coverage.

Does health care reform affect Hawaii’s Prepaid Health Care Act?

Hawaii businesses must still comply with the state’s Prepaid Health Care Act. This 1974 law requires employers to provide health insurance for employees who work 20 hours or more a week for four weeks in a row (with some exceptions). Employers must contribute at least half of the employee’s premiums for single coverage. The employee contributes the rest, but no more than 1.5 percent of their wages.

What’s the benefit of buying a health plan through HMSA?

We can provide a smooth transition to plans that comply with health care reform and avoid disruption to your employees’ benefits and services. HMSA will help you choose health plans based on your employees’ health and financial needs. And HMSA representatives are always available to answer your questions.

What’s the benefit of buying a health plan in the marketplace?

Small businesses that use the marketplace may qualify for a tax credit of up to 50 percent for two years starting in 2014. To qualify, you must have an equivalent of fewer than 25 full-time employees with average wages of less than $50,000 and cover at least 50 percent of the cost of each employee’s health care coverage. You’ll need to fill out a lot of paper work, so check with your tax adviser. Also, the marketplace will send employers one consolidated bill for employee health plans, just as HMSA will.

Will health plan premiums go up?

HMSA and other health plans are required to pay new health care reform fees and taxes to the federal government. This will add to the cost of your health plan. We’re doing all we can to lessen costs with tools like HMSA’s Online Care and our Cozeva patient-doctor communications system.