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When it comes to health insurance coverage, a small business is generally considered an employer with one to 50 employees, excluding the owner, their spouse, and any family members. However, some states and private companies include businesses with one to 100 employees in their definition of a small business. You can use the Small Business Health Insurance Options Program (SHOP) to find ACA-compliant group plans, which you can offer to employees by purchasing coverage with help from an agent or broker. A SHOP plan is the only way to qualify for the Small Business Health Care Tax Credit if you meet the eligibility requirements. If you can’t find a plan on the SHOP marketplace, you can find one directly through insurance company websites.
If you offer SHOP coverage, you must offer it to all full-time employees and have an office or worksite in the state where you’re applying for coverage. Not all providers offer SHOP plans, and they may not be available everywhere. Whether you decide to enroll in a SHOP plan or another group health insurance plan, you’ll want to choose a reputable company that prioritizes your employees and their healthcare needs. We evaluated companies based on the benefits they provide and their third-party ratings, so you can choose the right health insurance partner for your small business.
Best Health Insurance Companies for Small Businesses
- Best Overall: Blue Cross Blue Shield
- Best for Telemedicine: Oscar
- Best for Customer Satisfaction: Kaiser Permanente
- Best for Extra Benefits: UnitedHealthcare
- Best Self-Insured Plans: Aetna
Best Overall : Blue Cross Blue Shield
Wide provider network
Offers a variety of workplace wellness programs
Blue365 provides employees with discounts on health products and services
J.D. Power rating varies by region
With coverage in every U.S. ZIP code and a variety of national networks to choose from, Blue Cross Blue Shield can meet the needs of almost any business. The company was also our top pick for the best health insurance provider overall. But since BCBS is a group of companies, benefits vary by region, as do customer satisfaction ratings. It’s important to evaluate your BCBS company for issues like customer complaints.
BCBS workplace wellness programs vary by state, but as an example, BCBS Mississippi trains company leaders to teach fitness classes, and offers a significant reduction in health insurance premiums for employees who commit to working out at least twice per week. Other benefit offerings vary by region as well, but Anthem offers 24/7 virtual care, a convenient mobile app, a variety of plan types, and the option to bundle health coverage with dental, vision, life, and/or disability insurance. And the Blue365 discount program provides your employees with robust discounts on wellness-related products and services.
Best for Telemedicine : Oscar
$0 virtual urgent care available 24/7
Access to Cigna’s network with no referrals needed
A convenient mobile app with rewards for walking
Limited geographical availability
Oscar makes it easy for your employees to request virtual care from a convenient mobile app, and with most plans, there’s no cost to talk to a doctor online. Employees can also use the app to refill their prescriptions, message their care team, track their deductibles, and even get rewarded for meeting their step goals. What’s more, Oscar has partnered with Cigna to give members access to the company’s national and local provider networks. You can give your employees two network options, both of which don’t require specialist referrals and which include the Cigna Behavioral Health Network.
However, availability is limited to a few different states, cities, and metro areas: Georgia, Tennessee, Connecticut, select Arizona counties, select California counties, the Philadelphia metro area, Kansas City, Chicago, and St. Louis.
Best for Customer Satisfaction : Kaiser Permanente
Ranked highly by J.D. Power for customer satisfaction
4.3-star NCQA rating
Administers health payment accounts (HRA, HSA, or FSA) for deductible plans
Offers complementary care, vision, and dental plans
Limited geographical availability
Kaiser Permanente received the best third-party member experience ratings of any insurer we reviewed. Its average NCQA rating is 4.3 stars (higher than all other providers). And it came in first for customer satisfaction in five of 22 regions—this is significant because it’s only available in eight states and Washington D.C. What’s more, Kaiser offers a range of health plan options, from PPO plans to deductible HMOs that can be paired with a health savings account or health reimbursement arrangement. And it’s affordable to add extra benefits for your employees, which include not only dental and vision, but also complementary care, such as acupuncture and chiropractic.
However, Kaiser Permanente plans are only available in California, Colorado, Georgia, Hawaii, Maryland, Virginia, Oregon, Washington, and the District of Columbia. And while the company provides resources and support for establishing a workplace wellness program, Kaiser is less hands-on than some Blue Cross Blue Shield companies when it comes to specific workplace programs. The company does, however, offer a variety of fitness discounts, and members can speak with a wellness coach at no cost.
Best for Extra Benefits : UnitedHealthcare
Offers a variety of extra benefits beyond just vision and dental
Offers options for part-time and seasonal workers
A+ (Superior) financial strength rating with AM Best
Customer satisfaction varies by region
UnitedHealthcare allows you to offer employees a variety of choices for plan types. It even provides bundled savings when you choose to offer additional coverage, such as vision, dental, hearing, and disability and absence benefits, plus supplemental, pet, and life insurance benefits. UnitedHealthcare also offers a unique program designed for part-time and seasonal workers, which is the only such program available nationwide. Level-funded and fully insured options are available for traditional major medical coverage, and a lower-cost, level-funded, limited minimum essential coverage option is also available. In addition, UHC offers a variety of workplace wellness programs, including a no-cost virtual weight loss program and rewards for physical activity. Group health plans include a discount program as well.
UnitedHealthcare also boasts relatively strong third-party ratings, with an average NCQA rating of 3.5 stars and an A+ (Superior) financial strength rating from AM Best, the highest grade of any of the featured providers on this list. However, the company’s customer satisfaction rating in the J.D. Power 2022 U.S. Commercial Member Health Plan Study varies by region. For example, the company was ranked lowest (out of seven providers) in Florida, but ranked second in the Heartland.
Best Self-Insured Plans : Aetna
Offers self-insured funding options
Offers a suite of more than 70 wellness programs
Dedicated support for new business onboarding
$0 MinuteClinic copays for self-insured members
MinuteClinic benefits not available to fully-insured groups in some states
If you’re looking for more plan flexibility and the possibility of greater savings, Aetna is our top pick for self-insured funding options. Self-funding with Aetna can save you as much as 25% on monthly costs, plus the insurer returns 50% of the surplus to your business. At the same time, stop-loss insurance protects you from unaffordable costs. HSA accounts are also available to employees, as are $0 copays for many MinuteClinic services. Just keep in mind that some fully-insured groups don’t get the same benefits.
Aetna also offers a suite of tools to members of self-insured plans, including a convenient mobile app that can provide rewards for reaching personalized goals, virtual care through Teladoc, and virtual fitness classes. The company also has an A (Excellent) financial strength rating with AM Best, and an average 3.3 NCQA star rating for its commercial plans, which indicates above-average member satisfaction. You can get group dental coverage through the provider as well. But Aetna’s group plans aren’t available everywhere.
Bear in mind that if you opt for self-insurance, you’ll be subject to IRS reporting requirements, regardless of your business size.
Blue Cross Blue Shield was our top pick all-around, and will be an especially good choice in regions where BCBS has high customer satisfaction ratings, robust workplace wellness programs, and other benefits. But if a convenient app with easy access to virtual care is most important to your employees, you may want to go with Oscar. And if you want the best customer experience for your employees, Kaiser is an excellent choice.
We recommend Aetna for small businesses pursuing self-insurance, and UnitedHealthcare is the best option for businesses that want the most extensive benefits package, especially those who want options for their variable-hour employees. Your budget and location may also limit your choices, but our top picks are all reputable providers that offer good coverage.
Frequently Asked Questions
How Do I Get Health Insurance for a Small Business?
If you’re self-employed, check the best health insurance companies for self-employed workers. Otherwise, you have a couple of options: The first is to work directly with a private insurer to get a fully-insured or self-funded plan. The second is to compare plans offered through the Small Business Health Insurance Options Program (SHOP), and to purchase coverage directly or with help from a broker.
While this program offers robust options in some states, others have limited or no plans available. Generally, getting SHOP coverage is the only way to claim the Small Business Health Care Tax Credit, which could save you up to 50% on your premium contributions. You must meet other eligibility requirements as well.
Do Small Businesses Have to Provide Health Insurance?
No employer is required to offer health coverage for its employees, but companies with at least 50 employees that do not offer health coverage are subject to the Employer Shared Responsibility Payment. If you choose to offer health insurance coverage to your full-time employees, you must offer it to all full-time employees once they become eligible, and there is a 90-day maximum waiting period.
How Much Does Small Business Health Insurance Cost?
Your total cost will depend on several factors, including the location of your business and the type of network you choose. In 2021, businesses with fewer than 200 employees spent an average of $6,569 per employee on annual health insurance premiums for single coverage and $14,094 for family coverage. Experts generally recommend keeping group health insurance costs between 10% and 20% of your annual revenue.
What Is a Self-Insured Health Plan?
A self-insured health plan is a type of group health insurance in which the employer collects premiums and is responsible for paying claims when employees need care. These plans can be self-administered, or the business may work with an insurance provider to get stop-loss coverage and administrative support.
There are several benefits to self-funded plans. Employers can keep surplus premiums (or receive a portion returned by the stop-loss carrier), plans can be customized to a greater degree, and certain ACA provisions that lead to high costs can be avoided. Increasingly, small businesses are opting for self-funded coverage. But self-insured plans aren’t right for every business.
We compared the largest health insurers nationwide and considered criteria in the following categories to determine the best health insurance companies for small businesses.
- Customer satisfaction: We used NCQA ratings and performance in the J.D. Power U.S. Commercial Member Health Plan Study to measure this criteria.
- State availability: This measure indicates how widely available plans are across the U.S.
- Plan features: For each company, we researched the types of plans available, plan features and benefits, the provider network, available wellness programs, and discounts.
- Types of employees covered: We considered whether coverage is available for full-time, part-time, and seasonal workers.
- Accessibility: We considered how easy it is for members to navigate plan services.