With demand for remote work that is higher than ever, employers are struggling to find ways to offer their remote workers health insurance across states, and sometimes countries. Offering health benefits for a remote workforce is becoming not only important but vital in keeping top talent, but it can be expensive and confusing to find a plan that could work for everyone.
Mira offers the perfect solution for small businesses and decentralized employers. For as little as $25 per month, your employees receive discounted office and urgent care visits, up to 80 percent discounts on over 1,000 prescriptions, and same-day lab testing. Find out if Mira is right for your business today.
How to Offer Health Insurance to Remote Employees in 5 Steps
The recent influx of remote work paired with insurance plans dependent upon state guidelines may make offering an affordable and equitable health coverage option in every location seem impossible. According to the Kaiser Family Foundation, about one out of every four small business owners are uninsured, yet having a form of health coverage is one of the most important benefits an employer can offer to attract and keep important employees.
Not only does providing health coverage to employees make the business more competitive, but workplace health programs can increase employee productivity. When employees have health coverage, they may actually be less likely to call out sick, so a greater percentage of employees are at work each day. In other words, despite the high costs of employer-sponsored health coverage, the benefits outweigh the costs and make up for financial losses from illness and absenteeism.
The steps to offer health coverage to remote employees are:
Step 1: Do Your Research on Offering Remote Health Insurance
If you already offer health insurance to your employees, your insurance provider may also have an international plan or a plan that can cross state borders. Typically, large insurance companies have international programs, but the problem lies in the localization and specificity of coverage. Without having a local context, employees may have inequitable benefits. Start by researching the extent of the coverage under your current provider.
Aside from exploring the option that may be sitting right in front of you, ask yourself about the outlook of your company. Do you currently provide employment for employees in one state, or are you looking to expand to other states or countries? If your current provider can’t help you, or you don’t have one, then you’ll need to start researching potential solutions.
Step 2: Talk with Your Team
When determining your health coverage options, talking with your team is imperative. Finding out your employee's needs will help point you in the right direction for finding the best coverage options. You may want to conduct an anonymous employee survey to find out demographic information such as age, gender, health status, and the number of dependents.
Stay transparent in your efforts in finding them a robust coverage option. Both employer and employee benefit from offering a health coverage option, and the one most suitable for the needs of the employee may make your company more competitive.
Step 3: Speak With a Professional
Speaking with a representative from a sole insurance company may falsely lead you back into their arms when there could be better options. Insurance consulting companies exist to assist companies in navigating the health insurance market to find the most suitable coverage for the needs and budget of your company.
Speaking with a professional will also include working with your current partners that manage your payroll, compliance, or administrative responsibilities. Oftentimes these partners also offer health insurance. This may mean partnering with a few local agencies to provide comprehensive health coverage for each employee. If you do have employees located between several countries, speaking with local providers may also help you better understand what constitutes comprehensive coverage in different global markets.
Regardless of what types of health coverage specialist you speak with, having the demographic information prepared from your employee survey will help gauge your organization's needs to find the best health coverage option. Understanding the nuances of insurance from having conducted research will enable you to ask the right questions and sufficiently address your company’s needs.
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Step 4: Know Your Alternatives
While it may seem as though employer-sponsored health insurance or individual insurance is the only health coverage option for employees, there are actually budget-friendly alternatives. Most Americans receive their health coverage through their employer because of the high costs associated with paying for individual insurance plans, but employers can also offer health reimbursement accounts or medical stipends to offset health costs. Care membership plans are also a great way to provide health coverage, without all the nuances of varying state guidelines.
Average Costs of Traditional Health Insurance Alternatives
|Plan Type||Monthly Cost||Comprehensive Care?||Subject to Payroll Tax?||Flexibility in Choosing Care?|
|International Health Insurance||$183-$581/ month||Yes||No||Yes|
|Health Reimbursement Arrangement (HRA)||~$400/month||Up to employee||No||Yes|
|Medical Insurance Stipend||Determined by empoyer||Up to employee||Yes||Yes|
|Remote Health Insurance||$80-$130/month||Yes||No||Yes|
International Health Insurance
If your company can afford to pay traditional health insurance for your employees, your provider may also offer international health insurance, or you may want to explore plans that offer this benefit. International health insurance is also different from travel insurance in that it not only covers emergency medical treatment, but also pre-existing conditions, routine coverage, choice of medical providers, and more. While international insurance may seem like a comprehensive option, it is often pricey, as employers often pay upwards of $15,000 per year for one employee's family.
Health Reimbursement Arrangement (HRA)
A health reimbursement account may also be a suitable option, as it can be offered to some or all employees based on job location, role, weekly hours worked, or participation in the company’s current group health insurance policy. HRA’s allow employers flexibility by providing different benefit allowances dependent on employee classifications to promote equal levels of insurance.
With HRA’s, you have no minimum contribution requirements and employees may purchase an individual insurance plan of their choosing that meets their needs and lifestyle, but they must use the HRA for medical expenses. HRA’s are also tax-free as long as the employee has minimal essential coverage (MEC). Most companies use an HRA administration software for efficiency and reimbursement arrangement issued through a formally defined contribution plan are free to employees and tax-deductible to the company.
Medical Insurance Stipend
Similar to a health reimbursement account, employers can also decide to offer a medical insurance stipend that covers expenses in restrictive countries without the employer having to tackle administrative tasks to track down specific coverage options. With stipends, employees receive a fixed and taxable amount to purchase their own individual coverage. Since a stipend is not a health plan, the employer does not have to worry about ACA compliance.
The employers pay a payroll tax of 7.65% which includes social security and medicare, and employees are taxed based on income. Employees are not required to use the stipend for health insurance, as opposed to a health reimbursement account, which may seem as though the stipend is part of their standard wages. Should you change health coverage options, this may appear as a pay cut.
Care Membership Plans
Mira offers a care membership plan where employers can offer a new type of health coverage to their employees without breaking the bank. Most businesses cannot afford to pay thousands of dollars per employee for their health coverage every year.
With Mira, the employer pays only $45 per month per employee and receives access to doctor’s office and urgent care visits for just $99, up to 80% discounts on nearly 1,000 prescriptions, preventative screenings and lab tests, discounted gym memberships, and more. Mira provides an innovative solution to offering health coverage for remote workers, start-up businesses, and even as an added level of protection if you already have health insurance.
Remote Health Insurance
Remote health insurance plans have been surfacing, and are typically easy to buy and easy to manage. They even offer group or individual coverage as well as extra benefits, but with added costs. These types of plans are not only available for full-time employees, but also for part-time workers and freelancers. If you are looking for immediate coverage, there are certain additional offerings that require you to be enrolled for 12 months before getting the perks.
Digital nomad insurance is also a type of coverage made for those often traveling for work and can be utilized on a temporary basis for when traveling to other countries. Similar to traditional insurance pools, remote health insurance is cheaper with the more people enrolled in the plan, but ranges between $80-$130 per month per person.
Step 5: Choose a Plan & Communicate it to Your Team
Once you have come to a decision about what works best for your company and the employee's needs, develop a plan on how to ensure everyone understands how your health coverage works. If you decide to offer a health reimbursement account, make sure everyone understands how to use the HRA software and the reimbursement process. Perhaps work with your human resource department to set up a seminar discussing the plan specifics and any special offerings so you and your employees can get the most out of the coverage.
Health Insurance for Remote Employees Frequently Asked Questions (FAQs)
While you mull over your options of how to best cover your employees’ medical needs, you may be thinking about what you are required to do by law. Whatever decision you do decide, be sure to speak with your insurance professional to best protect you from minor nuances hidden among your options.
Do I have to offer health insurance for remote employees?
The simple answer, it’s complicated. Under the Affordable Care Act, companies are required to provide health insurance if they have 50 or more full-time employees or otherwise pay a penalty. Offering health insurance to contracted workers also runs the risk of reclassification and more fines. You may find the benefits outweigh the risks, as offering a health coverage option allows your company to stand out, have healthier employees, and more productive workdays. Investing in your employees is a great way to invest in your company.
How do I know which option is best?
Being communicative and transparent will point you in the best direction. Speaking with your employees about the benefits they value may help you narrow your options. If you are worried about the price tag or complexities of offering insurance to remote employees, consider a health reimbursement arrangement, medical stipend, or care membership plan such as Mira.
Do companies have to offer health coverage to an employee’s family?
There is no law mandating employers to provide health insurance for an employee’s family, but do require companies with more than 50 full-time employees to provide health insurance. Under the ACA, applicable large employers (ALEs) must offer coverage to their employees and their dependents, but does not require spousal coverage, nor require specific payouts for premiums of dependents.
Health insurance is an important factor in choosing an employer, and a great way for an employer to attract top talent, but offering health insurance to employees across states, around the globe, and with varying employment contracts may seem impossible without getting hit with heavy costs or potential fines. If you cannot afford to cover health insurance for an employee and their entire family, but still want to set your business apart, consider alternatives such as international plans, remote and nomad insurance, reimbursement plans, or care memberships.
Mira offers a great alternative for offering health coverage for remote employees. For as little as $45 a month, your employees have access to doctor’s office and urgent care visits, preventative screenings, same-day lab testing, and up to 80 percent discounts on over 1,000 medications. With Mira, you do not have to wait for an Enrollment Period to get started. Get started today.