If you’ve been thinking about turning your hobby into a small business or even buying an existing business, you may be hesitant after you start looking into the health insurance aspects of hiring employees.
Thanks to Obamacare, more small businesses are now required to provide health insurance plans.
That’s all well and good for owners who have the resources necessary to fund such plans, but it bodes ominous for startups that are bootstrapping their business.
In fact, the sole requirement for a health plan can deter new businesses from starting up in the first place.
Starting a small business doesn’t have to be a health insurance headache.
There are ways around the Obamacare mandate, just as there are ways to comply with the law in ways that won’t negatively impact your business finances.
Here are some effective ways to get your small business up and running – and keep it running – while dealing with health insurance requirements:
How to Get Around the Requirement
If you have zero funds available for a health insurance plan, yet still need employees to operate the day-to-day tasks of your business, hire independent contractors. Independent contractors are in business for themselves.
As such, they are responsible for their own taxes and health insurance.
They work for you on what’s called a “work for hire” basis. You assign them tasks based on their expertise and specialties, and they invoice you for work that is satisfactorily completed.
Independent contractors don’t technically work for you, and are not your employees. Thus, you are not liable to provide health insurance for them.
The management of your independent contractors needs to be systemized so that in itself doesn’t become an organizational headache.
If this is an avenue you’re interested in pursuing, consider hiring a project manager and investing in some kind of online collaborative software to ensure projects get done on time and under budget.
Keep in mind that if you want or expect your business to grow, eventually you’ll need to move to a traditional employee model.
At that time, you will need to implement a health insurance plan for them, and you’ll need to save in order to manage that scenario.
How to Work With the Requirement
The fact is, there are so many complicated requirements within the Obamacare mandate that it can be compared to the complexity of the overall tax law in general.
As the following article shows, a small business owner, will be hard pressed to research and understand the basic key health insurance terms, let alone come up with a health plan by themselves that satisfies the vast legal requirements.
Your best course of action is to outsource your health insurance plan management to a professional company that specializes in working with small businesses like yours.
Otherwise, the vast amount of your time and the time of your admin team will be spent trying to navigate the minefield of employee health insurance.
Whatever you spend on the health plan management company is tax deductible and the return on investment will prove substantial, even in the short term.
As a small business owner, how are you dealing with the new health insurance requirements?
Photo credit: Image courtesy of Ambro at FreeDigitalPhotos.net
About the Author: Kate Supino writes extensively about best business practices.