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|  Small Businesses | |
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| Working Individuals and Sole Proprietors | |
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| Will I have to qualify before I can purchase health insurance for my small business? You'll have to prove you are a small business by showing that you have 2-50 employees, but neither you nor your employees will have to pass any medical exam. | |
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| Can all of my employees get health insurance? Yes. You may determine, however, if a subgroup of your employees or if all of them are eligible for health insurance coverage through your business. For example, some employers decide that employees working more than 20 hours per week are eligible for health insurance coverage. Most plans allow you to set the eligibility criteria. You'll need to ask about that when you are looking at specific plans. | |
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| Do all of my employees have to buy health insurance if I offer it? Not always. If you pay the entire premium, all of your eligible employees must participate. If the employer contributes to the cost of the coverage, at least 50% of eligible employees must participate. Most plans do require a certain percentage of employees to enroll for a business to qualify (normally 70 or 75%). For example, if a plan requires 70% participation and you have 10 employees, at least 7 of them have to enroll in health insurance. HMOs may not establish any minimum participation requirements within a small group and must accept any person within a small group who elects HMO coverage. | |
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| Do I have to wait before coverage begins? No, you don't have to wait, but you could decide to set some period of time before newly-hired employees are eligible for enrollment. A waiting period is normally between one month and six months. | |
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| What about husbands, wives and children? Do they get covered and who pays for them? You may decide to offer family coverage, and an employee may choose to enroll a spouse and/or children. Who pays the coverage is up to you. Most employers pay for at least part of the cost of family coverage, but that is entirely up to you. Through payroll deduction, the employee pays whatever part of family coverage you don't pay. | |
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| What about coverage for domestic partners? You may decide to offer coverage for domestic partners, and an employee may choose to enroll his or her domestic partner. Not all insurers, however, offer domestic partner coverage for businesses with 2-50 employees. Click here for a listing of companies that offer domestic partner coverage for small businesses in New York City. | |
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| Can any employee or dependent be denied coverage? No, but they'll have to enroll in coverage when it is first offered or wait until the next open enrollment period. Open enrollment usually is a one month period every year during which rates may be adjusted and employees may begin or end coverage. | |
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| Can my employees be covered if they are already sick? Health insurance contracts may contain up to a twelve (12) month waiting period before pre-existing conditions are covered. A pre-existing condition is a condition for which medical advice was given or treatment was recommended or received from a physician within six months before the effective date of coverage (i.e. when your new health insurance coverage begins). However, under New York State law, the waiting period may be either reduced or waived entirely, depending upon an employee's individual circumstances. Insurance carriers are required to reduce the waiting period by the number of days the employee was covered under some form of "creditable" coverage as long as there were no breaks in coverage of more than 63 calendar days. | |
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| Can my coverage be cancelled because of too many claims? No. As long as you qualify for coverage as a small business and pay your monthly bill, you cannot be cancelled. | |
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 What is a Health Savings Account? Health Savings Accounts (in PDF) (HSAs) are a new way for consumers to pay for medical expenses. As of January 1, 2004, almost anyone with a qualified high-deductible health plan can also have a Health Savings Account. HSAs may be used to save money for medical care now and provide a good way to save for future medical expenses. You may use HSA funds to pay for expenses before the deductible is met as well as to help pay for services not covered by the health plan, such as Medicare expenses, COBRA coverage during periods of unemployment, medical expenses after retirement, and long-term care expenses.
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What is a Health Reimbursement Arrangement Account? A Health
Reimbursement Arrangement (HRA) is an employer-sponsored savings plan for employee medical expenses. Only employers can contribute to an HRA; self-employed individuals may not establish HRAs.
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Will I have to qualify before I can purchase health insurance coverage? In New York, your ability to buy individual health coverage does not depend on your health status. |
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What about coverage if I am already sick or for a pre-existing condition? Health insurance contracts may contain up to a twelve (12) month waiting period before pre-existing conditions are covered. A pre-existing condition is a condition for which medical advice was given or treatment was recommended or received from a physician within six months before the effective date of coverage. However, under New York State law, the waiting period may be either reduced or waived entirely, depending upon the individual circumstances. Insurance carriers are required to reduce the waiting period by the number of days the individual was covered under some form of "creditable" coverage (see right for details) as long as there were no breaks in coverage of more than 63 calendar days. |
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What about husbands, wives and children? Can they be covered? In New York, insurers that sell individual health insurance must offer family coverage to persons who are interested in purchasing it. Some HMOs may also offer husband-wife plans, domestic partner plans and parent-children plans. |
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Can my individual health insurance policy be cancelled because I submit a lot of claims? No. Your coverage cannot be canceled because you get sick. This is called "guaranteed renewability". You have this protection provided that you pay the premiums. |
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What can I be charged for individual health coverage? Premiums for individual health plans in New York cannot vary due to your age, gender, health status, or occupation. The price of the coverage is based on a "community rate," which is the average cost offered to all individuals seeking the same coverage from the same HMO in a geographic region. |
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What if I've been recently laid off from a job? You may be eligible for another option called COBRA (Consolidated Omnibus Budget Reconciliation Act of 1985). This legislation allows you to continue the same coverage you held with your employer. You must pay the full price for COBRA coverage (plus an administrative fee), and coverage may last as long as 18 months. While expensive, many experts advise those who can exercise this option to do so because it's likely to be the most comprehensive individual coverage you'll get for the price. New York State law also provides a continuation right for health plans that are not subject to COBRA. Insurance Law Sections 3221(m) and 4305(e), which set forth the right to continuation, apply to groups of twenty or fewer employees and to cases where an employee is not eligible for COBRA. The rights afforded by these statutes apply only to group policies providing hospital, surgical or medical expense insurance and arise when all or any portion of the insurance on an employee ceases because of termination of employment or membership in the class or classes eligible for coverage under the policy. If such an event occurs, the employee is entitled to a right of continuation provided that they are not eligible for identical coverage with another plan. The employee must also request continuation coverage and pay the applicable premium within the timeframes set forth in the statutes. |
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What is a Health Savings Account? Health Savings Accounts (in PDF) (HSAs) are a new way for consumers to pay for medical expenses. As of January 1, 2004, almost anyone with a qualified high-deductible health plan can also have a Health Savings Account. HSAs may be used to save money for current medical care now and provide a good way to save for future medical expenses. You may use HSA funds to pay for expenses before you meet your deductible and to help pay for services not covered by your health plan, such as Medicare expenses, COBRA coverage during periods of unemployment, medical expenses after retirement and long-term care expenses. An employee can obtain a high-deductible health plan through his or her employer or can purchase it as an individual. An HSA account obtained through an employer is owned by the employee. The employee decides how much to contribute, how much of the account to use for medical expenses, and which medical expenses to pay from the account. An employee can also choose whether to pay for medical expenses from the account or save it for future use. Features of an HSA
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What is a Health Reimbursement Arrangement Account? A Health Reimbursement Arrangement (HRA) is an employer-sponsored savings plan for employee medical expenses that works in conjunction with a high-deductible health plan (HDHP). Only the employer can contribute to an HRA; self-employed individiuals are not eligible for an HRA.
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PRINTER FRIENDLY FORMAT |
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