You just got a job offer, congratulations!
When starting a position at a new workplace, you may want to evaluate the benefits package - health insurance options paid vacation time, paid parental leave and other plans your employer is willing to offer you. Many times, health insurance within a company or organization is less expensive than buying a plan individually.
Employers often cover part of the cost of an employer-based health plan. Federal laws require large employers to pay at least half of the health plan premiums.
Does my employer have to provide health insurance?
Dr. Kate Tulenko, a health workforce expert at Corvus Health, explains why employers are not required to provide health insurance for their employees;
The Affordable Care Act (ACA) does require large employers (50 or more full-time employees) to provide health insurance to 95% of their workers or pay a fine.
The health insurance provided must meet certain affordability requirements and must cover a minimum set of essential services. Whether individuals have to pay a penalty if they do not have health insurance depends on their state of residence and is in flux due to lawsuits challenging the ACA.
What happens if I am not offered health insurance, do I have to pay a tax penalty?
Effective 2019 tax year, the federal penalty for not having health insurance (individual mandate) is no longer in effect.
States like NY, MA, CA, and the District of Columbia had reinstated this at the state level, the level ranges from $95 to $695 for an individual. The individual mandate is not an actual penalty because you don't have to pay this out of pocket but it is deducted from your tax return every year.
In the wording of the law, a taxpayer who fails to pay the penalty "shall not be subject to any criminal prosecution or penalty".
What is group insurance?
Group health insurance is an insurance plan that covers a group of people who are employees of a company or part of an organization.
The employee purchases the plan and employees are often given a small discount. Although it is not required to be on your employer's plan, many people choose to be covered by group insurance for several reasons.
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Many group insurance plans can cover immediate family members, or dependents, such as a spouse and children. Additionally, the premium rates for all employees are determined by the insurer, and part of the employees‚ premiums are paid for by the employer.
Generally, there are three types of health plans your employer may offer: HMO, EPO, POS, and PPO.
How much should I expect to pay?
Depending on the level of cost-sharing, most employers pay anywhere from 50%-70% of your health plan.
The average costs of a health plan are $500 per individual and $1000 per family. This means you can expect to pay $150 - $300 a month out of your salary.
In some cases, your employers can opt to pay for 100% of your health plan, but if there is a deductible (the amount you are responsible for before the insurance starts kicking in), you still have to pay a decent amount out-of-pocket.
Should I accept the health insurance plan my employer is offering?
While it may be convenient to accept the health insurance plan your employer is offering, it's important to evaluate if it's actually worth accepting.
Dr. Tulenko explains how to determine if the plan is right for you:
Compare the health insurance plan that your employer is offering with ones that you can purchase in your state health insurance market or the national health insurance market. Factors to consider include:
- Who will be insured (just you or you and your family)?
- What the monthly expenses are; including premiums, copays, deductibles.
- What services are covered (for example some insurers cover fertility treatments and some do not)?
- Whether you will be able to keep your existing physicians or will need to find new physicians in the health insurance network?
- How far you may need to travel for care, or how quickly you can get an appointment within the network.
Consider speaking with someone who has the health insurance plan you are considering to find out what they like and don't like about the plan.
Dr. Tulenko also suggests you find out if your employer offers vision and dental coverage.
The Affordable Care Act does not require dental or vision coverage but many employers offer it. Consider other health-related benefits such as paid sick leave, Health Reimbursement Arrangements (HRA), and Health Savings Accounts (HSA).
My employer doesn't provide health insurance, what should I do?
There are several options in terms of getting health insurance even if your employer does not provide coverage.
- If you live in the United States, you are eligible to sign up for a membership with Mira. You can pay between $25 and $45 per month for access to doctor visits, laboratory tests, and prescriptions at a discounted rate.
- If you are under the age of 26, you are permitted to stay on your parent's health insurance. Additionally, if you live in New York, you may be qualified to stay on your parent's ‚ insurance through age 29. Some of the qualifications include that the individual is: unmarried, uninsured by the employer, and lives in New York. For more information on qualifications and cost, visit this link.
- You can buy an individual plan through a health insurance company. You can sign up for an individual plan during the open enrollment period, which typically runs from mid-November to early-December. Additionally, if you recently experienced a major life event, you may qualify for a special enrollment.
- If you are married and your partner‚s employer offers health insurance, you may be able to get coverage through his/her plan. Additionally, your income level may allow you to qualify for Medicaid.
- You may be able to get group health insurance by joining a professional organization. Here are a few organizations that offer group health insurance: Alliance for Affordable Services, National Associations for Female Executives, Freelancers Union, and Writers Guild of America.