The Contractor Guide to Health Insurance

October 2018
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As a contractor, should you carry a health insurance policy? Whether you are your only employee or you have 50+ people on staff, health coverage is an essential policy to help protect your bottom line and keep your employees healthy and productive.

Health Insurance for the Solo Contractor

When you’re an independent contractor operating a one-man business, you don’t get the luxury of employer-provided health care.

While the individual mandate portion of the Affordable Care Act is expected to be nullified by 2019, removing the threat of penalties for individuals not carrying health insurance, getting adequate coverage for you and your family is still important.

Why would you need health insurance? The answer is simple: health care issues are often unexpected and expensive.

Should a serious medical condition or accident occur that affects the health of you or your family, the mounting costs for treatment could be enough to drain your bank account.

On average, a trip to the emergency room for insured individuals comes in between $50 to $150, while the costs for an uninsured visit averages from $150 to $3,000. Add in critical care or emergency surgery and that number goes up to an average of $20,000.

Health insurance can help cover costs for you and your family that include:

  • Emergency services
  • Hospitalization
  • Pregnancy, maternity, and newborn care
  • Birth control and breastfeeding
  • Mental health and substance use disorders
  • Prescription drug costs
  • Rehabilitative services and devices
  • Preventative and wellness services
  • Pediatric services, including dental and vision care

You can also opt for coverages that include dental and vision care for yourself and your family, creating a plan that is comprehensive and covers you from head to toe.

But what if you do have employees? Do you need to carry coverage for them as well? That depends…

Health Insurance for the Small Contractor Business

You’ve been building your business for a few years now and have a small team working for you. Between your office assistance, your project manager, and your team of nine tradesmen – whose individual skill sets are essential to your business completing quality projects – you have a pretty decent crew working under you.

Are you making sure to take care of them as well as they take care of your business?

Law doesn’t require that you provide health coverage to employees in your small business when you have less than 50 employees. But you may want to provide healthcare for your hard-working crew, anyways. Helping to keep employees healthy with covered health screenings and preventive care isn’t just an altruistic enterprise.

While having a health plan in place is important for the well-being of your employees, it also benefits your business in a number of ways.

Your construction business will reap the rewards of offering health benefits to employees by:

  • Making your business more attractive to prospective employees.
  • Keeping your existing employees happy in the workplace so they don’t look for greener pastures.
  • Positioning your business as a serious place of business that cares about the well-being of its employees.
  • Helping to assure that your employees are as healthy and productive as possible.

Businesses benefit greatly from having a healthy, productive team that shows up to work every day.

A study on employers’ benefits from workers’ health insurance found that health insurance may contribute to workers’ and firms’ productivity, as healthy workers are usually more productive than unhealthy workers.

Since workers with health insurance may be more likely to seek regular preventive care and get needed treatment for illnesses and injuries, those with health insurance may be less likely to miss work and to miss fewer days of work when they do fall ill.

The study also found that unhealthy workers also may quit or retire early, creating a costly source of turnover. The benefits to employers of having healthier workers may also lower other labor costs, especially the cost of short-term and long-term disability insurance and workers’ compensation.

Combining the safety and care you take in the workplace with health coverages that help keep employees in top performing condition benefits everyone who is working to move business forward, including you.

Taking care of your employees’ health can have far-reaching benefits for your business, but if you have more than fifty employees it can help keep your business out of hot water.

Health Insurance for the Large Contractor Business

You have two office assistants, a general manager, four project managers, eight supervisions, and fifty-three skilled tradesmen working under you on a constant and ever-shifting myriad of projects. Business is good. Very good.

But if you aren’t providing your employees with health benefits, not only are you doing your employees and business a disservice, you could end up getting hit with tax penalties.

Under the Affordable Care Act, all businesses with 50+ people working for them are required to either provide health benefits to employees or face tax penalties.

This means your large construction business will either spend that money paying a fee or providing your 50+ employees with health benefits. Which option do you think is better for business?

All the benefits, to both employees and businesses, listed above for solo and small business contractors also apply for a large contractor, but with the added bonus of avoiding penalties.

Whether you’re just starting out or have been in the business for decades, carrying health insurance coverage for your construction business should always be part of your plan. Investing in the health and wellbeing of your own family and those who work hard for you will not only give you peace of mind, it will help your business thrive.

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