We understand the complexities of navigating the ins and outs of California small business health insurance. Employers and employees need transparent information to make the right choice when deciding on which plan works for them.

That’s why we’ve put together an overview on employer-sponsored medical insurance plans that meet Affordable Care Act standards.

Read on to learn about health insurance for small businesses in California:

  • What to know about California’s small business health insurance
  • Employee and employer contribution requirements
  • Benefits of health insurance for small businesses in California

What to Know about California’s Small Business Health Insurance

Obtaining small business health insurance can seem daunting if you don’t know what it entails. But don’t worry — we’re here to close any knowledge gaps that you may have.

Small group health insurance in California includes:

  • Standardized benefits: Health insurance companies must offer the same plans to businesses with one to 100 workers. Keep in mind that if you have fewer employees, it doesn’t mean that you will have access to limited or worse health plans (you can pick any plan a company provides).
  • Regulations: Every California medical insurance firm must adhere to guidelines set by the federal government and the state of California.
  • Standardized rates: The monthly cost or rate, known as a premium, is based on a business’s location and the age of each employee and dependent.
  • Recent changes: The Biden administration (PDF) implemented a new change so that family members of employees who are covered under an employer-sponsored plan may be eligible for a subsidy if they enroll in an individual plan, not the group plan.
  • Twelve-month rate guarantee: The rate an employer pays for a plan cannot be changed within a 12-month period. Note: If you add or remove workers from a plan, the amount you pay will change.
  • Guaranteed renewal: Insurance companies have to offer and renew health coverage to every small business in California, despite any pre-existing medical conditions their employees may have.
  • No medical underwriting: Regardless of the health status of your staff member and their dependent(s) (e.g., spouse or child), they cannot be charged more for their plan.

Learn more about how California’s small group health insurance works.

Employee and Employer Contribution Requirements

Many medical insurance companies in California require that at least 60% to 70% of eligible workers enroll in a healthcare plan (PDF) offered by their employer. Additionally, a small business employer must contribute at least 50% of a worker’s monthly premium cost.

For instance, if a worker pays $300 monthly (not including dependents), then their employer must pay at least $150 of that price. Keep in mind that an insurance company may grant a lower contribution rate using a “defined contribution” arrangement. Learn more about employee and employer contribution requirements (PDF).

Get a quote on how much your business may have to pay for a California small business health insurance plan.

Small Businesses Must Offer Employees at Least 10 Healthcare Benefits

Small businesses that offer health insurance coverage are required to provide plans to employees that include at least 10 benefits.
Those 10 requirements include:

  1. Preventative services like counseling, screenings, and vaccinations
  2. Pediatric services like dental and vision care for kids under 19 years old
  3. Speech-language pathology, psychiatric rehabilitation, and occupational therapy to help recover from a chronic condition, injury, and disability
  4. Outpatient care in a doctor’s office, not in a hospital
  5. Laboratory tests
  6. Inpatient care after you’ve been admitted to a hospital
  7. Evaluation and treatment in an emergency room
  8. Receiving care before and after the birth of a child
  9. Treatment for psychotherapy, mental health counseling, and substance use
  10. Prescription medicine

Benefits Cafe Can Help You Obtain Affordable Health Insurance

Benefits Cafe is an insurance agency founded in 1970 by Robert D. Jugan that helps businesses and workers find affordable health insurance plans. Our licensed insurance agents work to find customers the best benefits at cost-effective prices, no questions asked!

Learn more about our group health insurance quotes, navigating insurance terms, and more! You can also contact Benefits Cafe for more information.