woman-687560_1920As a small business owner, you probably know that benefits like health insurance are a valuable part of your employees’ compensation package. You also know that there are a lot of factors to consider before deciding to add health insurance to your benefits offerings.

To help you weight the pros and cons of throwing health insurance into your benefit mix, it’s probably a good idea to thoroughly examine exactly WHY it’s so important to your employees, both current and potential.

  1. It aids in recruiting and retention. Not only are health benefits a valuable tool for recruiting top talent, they’re also a great way to keep your key employees happy. Some factors to consider might be whether the industry competition in your area offers similar perks. If not, adding health insurance might help you stand out. If so, it might be necessary for you to remain competitive.
  2. There are significant tax advantages. Buying employer-sponsored health coverage allows your employees to do so tax-free. What’s more, you get an income deduction for your contribution. So, by offering a tax-advantaged health plan, your employees gain far more in benefits than you lose in expenses.
  3. It improves employee health. Offering health benefits gives your employees access to preventative care and affordable healthcare options. When they have the coverage they need, they can stay healthier, happier, and more productive. That means less sick leave and less time worrying about getting sick or paying medical bills.


Given those reasons in the pro column, it seems like the decision to offer health insurance would be a no-brainer. But they also represent a significant investment which might not be viable for a business that’s growing, struggling, or just starting up. So, it’s important to find the tipping point where offering health benefits truly starts to make sense.

Here’s how you do that.

Step 1: Determine if the cost of health benefits fits in the company’s budget. Adding health insurance to your benefits package only makes sense if you’re consistently making a profit and covering all your expenses.

Step 2: Decide if offering health benefits aligns with your personnel goals. If you choose the right plan, offering health benefits can essentially lower your overall HR costs, especially if there’s a high demand for labor in your industry. So consider whether NOT offering health benefits could be costing you more than offering them.

Step 3: Consider your options. Once you decide health benefits are a good fit for your company, it’s time to start shopping. Learn about all the different types of group health plans out there and choose based on what best meets the needs of your workforce.

The decision to offer health benefits is a good one for most small businesses, but it’s not one to arrive at without some careful consideration. Start by asking yourself the questions above, and let us know if we can help.