How can I get health insurance if I don’t have any employees?

We get calls from many accountants and CPAs as well as small business owners who are looking to get health insurance for a business that doesn’t have any employees besides the owner or the owner’s spouse.  They have been closed out of the small group marketplace because the Affordable Care Act has determined them to not qualify for small business health insurance since they do not employ a ‘common law’ employee. That means someone other than the owner and/or the owner’s spouse.

Fortunately, there are some carriers that will allow a business in this situation to have another non-spouse shareholder added to their corporation who will be active in the business 20 hours or more per week but will not have to enroll or draw salary if they have other valid health coverage.

So, in essence if you have a child 18 years or older, a parent on Medicare, or a sibling who has spousal coverage elsewhere and you add them as a 2% or more shareholder, you will be eligible for small group health insurance with a couple of carriers in NY.

The new shareholder does not have to be on payroll and if total shareholders are 2 or less then you do not have to carry WC or Disability insurance either.  They will have to attest to working 20 hours per week or more but you can assign office work, bookkeeping or sales duties to meet this need. There is no payroll required so as long as they attest to working 20 hours or more, they can legally waive coverage if they have other valid coverage (parental, spousal, Medicare, Medicaid) and then the business owner only can enroll on a small business plan.

The benefit of being able to obtain small group coverage in NY vs the individual marketplace is huge. Individual marketplace provider networks are typically much smaller, do not include the top hospitals and doctors, and do not cover doctors and hospitals outside of the local area if not an emergency.

Plus, small group plans are a deductible expense for a small business (please consult with your accountant).

If you have been looking for ways to get group health insurance when you have previously been declined or ran into dead ends, set up a virtual cup of coffee with us today! You can also call us directly to discuss at 631-207-1800.