A small group client comes to you and says they want to cancel health benefits for their business. They say it’s not because they don’t want to offer it—but that it’s just too expensive. You know they’re “allowed” to do this, as small groups with under 50 employees aren’t mandated under the Affordable Care Act to provide health insurance coverage to employees. But, you don’t want to lose their business either.

What’s a health insurance broker to do?

Of course you don’t want to lose their business. That’s a given. But another reason you do what you do is because you’re committed to bringing affordable health insurance benefits options to clients and their employees. You can help steer them in another direction so they can continue to offer benefits.

Here are two ways:

1. “Pure” Defined Contribution Plan
   In this scenario, the company gives each employee a fixed dollar amount (called a “defined contribution”) and they can choose how to spend it on a qualified health insurance plan.
   
   With this type of situation, employees will purchase a health insurance plan. Then they submit documents to be reimbursed per the rules of the specific plan. You can be a valuable service in helping employees select and enroll in a plan, and determine whether they are eligible for federal premium tax subsidies.
   
   
2. Defined Contribution with a Private Exchange
   You can align yourself with a private exchange that you believe meets the needs of your groups—particularly your smaller groups who are at risk for dropping insurance offerings. With many, you can leverage your already-existing relationships with your health plan carriers and help provide affordable options for your small groups. Many private exchanges offer easy-to-use online enrollment options and other mechanisms for employers to connect employees with benefits offerings.

Some of your small groups may be throwing their hands in the air about the cost of providing health insurance to employees, but there are options. Make sure they are well informed before they go down that road.