Employee Benefits · Group Health
Group health insurance for Michigan employers
Group health insurance pays for medical care and prescriptions for your employees and their families, and it is often the benefit that decides whether a candidate accepts your offer. We help you choose plans, funding and contributions that fit your workforce and budget.
Schedule a Benefits ReviewWhat does group health insurance cover?
Group health insurance covers medical care for enrolled employees and, when the plan allows, their spouses and dependent children. Typical plans pay for doctor visits, hospital stays, emergency care, preventive services, mental health care, lab work and prescription drugs. Employees share costs through premiums, deductibles, copays and coinsurance, up to an annual out-of-pocket maximum. Exact benefits depend on the plan design and the insurer’s network.
| Plan feature | What it does | Where it stops |
|---|---|---|
| Preventive care | Routine checkups, screenings and immunizations, often with no cost share | Diagnostic follow-up care may apply to the deductible |
| Deductible | The amount an employee pays before the plan shares costs for many services | Copay services may bypass it, depending on the plan |
| Copays and coinsurance | The employee’s share of each visit, prescription or service | Stop once the out-of-pocket maximum is reached |
| Out-of-pocket maximum | Caps what an employee pays for covered in-network care in a plan year | Premiums and out-of-network or non-covered services generally do not count |
| Provider network | Negotiated rates with doctors and hospitals | Out-of-network care may cost more or not be covered at all |
Which type of group health plan is right for a small business?
It depends on what your employees value and what you can spend. HMO plans usually cost less but require in-network care and referrals. PPO plans cost more but allow broader provider choice. High-deductible health plans paired with a health savings account lower premiums and give employees a tax-advantaged way to save for care. Many employers offer two plans so employees can choose between lower premiums and lower deductibles.
- HMO. A defined network and a primary care physician who coordinates care. Lower premiums, less flexibility.
- PPO. In-network and out-of-network benefits without referrals. Higher premiums, more choice.
- HDHP with HSA. A qualifying high-deductible plan that lets employees and employers contribute to a health savings account the employee owns.
- Health reimbursement arrangement. An employer-funded account that reimburses some costs under the plan’s rules, often used to soften a higher deductible.
We look at where your employees live, which doctors and hospitals they use, and how they use the plan today before recommending a design.
How much should an employer contribute toward employee health insurance?
There is no single right amount. Employers commonly pay a percentage of the employee-only premium, a fixed dollar amount, or a richer share for employee-only coverage than for family coverage. Insurers often set minimum contribution and participation requirements for small groups, and applicable large employers must meet ACA affordability rules. Benchmarking against similar Michigan employers shows where your contribution stands for recruiting and retention.
A Section 125 premium-only plan lets employees pay their share of premiums with pre-tax dollars, which lowers their taxable pay and can reduce the employer’s payroll taxes as well.
What does the ACA employer mandate require?
The ACA employer mandate applies to applicable large employers, generally those with 50 or more full-time employees, including full-time equivalents. They must offer affordable coverage that provides minimum value to substantially all full-time employees and their dependent children, or face a possible IRS penalty. They also must report offers of coverage to the IRS and employees each year. Employers below the threshold are not subject to the mandate.
| Rule | Who it applies to | What it requires |
|---|---|---|
| Employer mandate | Applicable large employers (50+ full-time equivalents) | Offer affordable, minimum-value coverage to full-time employees, or risk a penalty |
| Annual reporting | Applicable large employers | Report coverage offers to the IRS and furnish statements to employees |
| Summary of Benefits and Coverage | Group health plans | Give employees a standard plan summary at enrollment and renewal |
| Federal COBRA | Employers with 20 or more employees | Offer continuation coverage after qualifying events, at the individual’s expense |
Counting employees, measuring variable-hour workers and testing affordability can be technical. We help you understand which rules apply and coordinate with your payroll provider and tax advisor.
What happens to employee health coverage when someone leaves the company?
Group coverage usually ends when employment ends, on a date set by the plan. Employers with 20 or more employees are generally subject to federal COBRA, which lets departing employees and covered dependents continue the group plan for a limited time at their own expense. Smaller employers should confirm whether any state continuation rules or insurer provisions apply. Departing employees may also qualify for individual coverage through the marketplace.
- Individual Health Insurance — Coverage options for individuals and families outside an employer plan
Related: Employee Benefits · Dental & Vision · Short-Term Disability · Long-Term Disability · Individual Health Insurance
This page is educational and is not legal or tax advice; benefits are determined by the actual plan documents and policies issued by the insurer, and compliance obligations depend on the laws that apply to your business.