If you pay attention to current events (I don’t) you may know that last week President Trump released an executive order regarding health insurance. An executive order is when a president bypasses the checks and balances system and calls an audible which allows him to mandate new policies at his sole discretion. I want to break down what this executive order means for your business.
1. Cost sharing subsidies will be eliminated. How will we cover our premium costs? This is the main question I’m being asked right now. So here’s the deal, cost sharing subsidies are very different than tax credits. Since the Obamacare mandate was released the federal government has been paying a portion of the premiums for many families who meet the income guidelines. That’s called a tax credit. The premium was $1500 and the government is going to chip in 50% of the cost. Now the premium will only cost $750. Cost sharing is when the federal government assists an individual in paying their deductible and their co-pays. So, after I pay my $750/mo. premium I can use the insurance but only after I’ve paid $5,000 on my deductible. Once I’ve paid $5,000 on my deductible my insurance company will help using a tool called “co-pay”. Co-pay means that for every $1 I must spend; my insurance company will pay $0.80 and I will pay $0.20. The government was helping some families cover the $5,000 and then $0.20.
2. Group health premiums will go up. If you have traditional group health insurance, expect your premiums to rise. Why? Because the fed is not cost sharing any longer. This means the insurance company cannot use government money to subsidize co-pays and deductibles. Those bills still must be paid and those without money cannot pay them. So, the logical answer is to increase everyone’s premiums across the board to cover the difference. Your premiums will go up and it will happen fast.
3. Individual health premiums will not change much. Why? Because the government is still subsidizing premiums for individual enrollees. Small businesses do not get the same kind of tax subsidy as an individual enrollee does and that is why individual premiums will not see much of a change if any.
If you own a small business or if you work for a company with less than 49 employees I can save you up to 50% annually on your group health insurance premiums. I do this with a plan called “defined contribution” where each employee leverages their own tax credits, thus reducing the overall premium for the business and reflecting in lower premiums for each employee. We then take these savings and invest them in further benefits to reward productivity on the team and incentivize a long, profitable employer-employee relationship. If you’d like to spend 50% less on your group health insurance plan click here.
If you would like to continue giving 50% more of your money than you must, please disregard this article.
Own Your Potential!
Jerry Fetta
Jerry Fetta is a husband, son of Yahweh, Entrepreneur and owner of 5 privately held businesses. Jerry lives in Alaska with his wife and 2 dogs. His no-nonsense approach to business, finances, and life speaks truth and provides clarity to his clients and followers. His personal mission in life is to empower millions of leaders to own their God-given, ultimate potential.
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