Group health insurance.

For most employers this is the largest line in the benefits budget and the one employees judge you on. Here is how it works, who has to offer it, and what actually drives the cost.

What group health insurance is

A single policy covering multiple eligible people — typically a company’s employees and their dependants. Eligibility comes through employment, which is what separates it from an individual policy someone buys for themselves.

Because the risk is spread across a group rather than assessed person by person, group coverage is generally both cheaper and easier to qualify for than individual cover.

Are you required to offer it?

It depends on size. Under the Affordable Care Act, an Applicable Large Employer — broadly, 50 or more full-time or full-time-equivalent employees — must offer coverage that is both “affordable” and provides “minimum value” to full-time employees and their dependants, or face a penalty. This is the Employer Mandate, sometimes called play or pay.

Full-time for this purpose means averaging at least 30 hours a week, or 130 hours a month. Part-time hours still count toward the 50 through the full-time-equivalent calculation, which is where employers most often miscount themselves.

Below 50 employees there is no mandate. Plenty of smaller employers offer coverage anyway, because it is what makes them competitive for the people they want to hire.

Who pays

Cost is normally shared between employer and employee. Carriers typically require the employer to fund at least half of the employee-only premium, and many employers go well beyond that, including covering a share of spouse and family tiers.

For smaller employers, the Small Business Health Care Tax Credit can offset part of the cost where the group is under a certain size, average wages are below a threshold, and the employer covers a meaningful share of the premium. Both the size and the wage thresholds change, so this is worth checking each year rather than assuming last year’s answer still holds.

What actually drives your renewal

How CTR handles a renewal

We take the group to market across our appointed carriers rather than presenting a single renewal letter, we quote alternative funding where the group can support it, and we handle the enrollment and compliance work so it does not land on your HR staff. Sixty days out is workable. Ninety is better.