Starting your own business can be scary. Leaving behind the security of your employer’s group benefits can appear to be a daunting task. As part of our course “Become A Nurse Consultant on a Shoestring Budget“, Going Brothers Financial is our resource to make this process easy for you. They are a niche firm that specializes in working with small business owners in setting up and reviewing their employee benefits packages – all the way from health insurance, retirement accounts, life, disability and long-term care insurance.
For many of these businesses, these benefits programs are done on an individual basis, especially for sole-proprietors who are the owner and the only employee. The health insurance industry is complex and the idea of navigating through the myriad of options can be a scary task. Depending on whether your needs are for yourself and family or for a group of employees, there are solutions that can be cost effective. Because individual and group insurance have different rules on what is covered and who is eligible, the rules can get confusing. We’re here to help. With a little bit of information about what you’re looking for, we can pare down the options to a handful of plans that fit your needs. More importantly, we can give you a rundown of the benefits in plain-English so you understand the pros and cons of each plan.
One of the misconceptions is that people with pre-existing medical conditions will not be able to get coverage. This is not true. Group plans have to cover all pre-existing conditions as long as you have had continuous coverage through a group or qualified individual plan for the past year. So for some small business owners who have pre-existing medical conditions, a group plan might be an advantageous way to go. You only need 2 employees to set up a group health plan. So if it’s just you, we can assist you in finding an individual or family plan to cover yourself or your family members. If any of you have pre-existing conditions, it doesn’t mean that they will be excluded or that you will be declined. However, there are programs through the Federal government – designed for individuals who have no group coverage and cannot qualify for individual coverage due to pre-existing conditions.
Another misconception is that only group plans are tax-deductible to business owners. This is not true. While it’s true that an employer may not pay the premiums for an individual, even if that individual is the owner of the business. However, self-employed individuals may deduct the premiums for themselves and their family on their tax returns, thus giving them the same deductibility as a group plan. Since individual plans can sometimes be cheaper than group plans, this can be an added savings to you as the business owner.
The final topic on health insurance that we should address is that of health savings accounts, or HSAs. These accounts are available to persons who have what is called a high deductible health plan, or HDHP, and can be set up individually or for a group. If you have one of these plans, then you can put pre-tax dollars into your HSA and then withdraw funds from these accounts tax-free if used for medical expenses for you or your family members. Best of all, the balances in these plans roll over each year, so you don’t forfeit the funds. This is yet another way to get you tax savings on your individual or group benefits.
Written by John Going of GOING BROTHERS FINANCIAL