3 Health Benefit Options For Small Businesses With One Employee
1.) Health reimbursement arrangement (HRA): An HRA is a tax-advantaged account that allows employers to reimburse employees for their health care expenses. The employer sets up the HRA and contributes money to it, and the employee can then use the money to pay for things like doctor visits, prescription drugs, and copays. HRAs are a good option for small businesses because they can be customized to fit the needs of the employee.
2.) Health savings account (HSA): An HSA is a tax-advantaged account that allows employees to save money for future medical expenses. The employee contributes money to the HSA, and the money grows tax-free. The money can then be used to pay for qualified medical expenses, such as doctor visits, prescription drugs, and copays. HSAs are a good option for small businesses because they can help employees save money on their health care costs.
3.) Health stipend: A health stipend is a fixed amount of money that an employer gives to an employee to help them pay for their health care expenses. The employee can use the stipend to purchase health insurance, pay for copays, or cover other health care costs. Health stipends are a good option for small businesses because they give employees more flexibility in how they use their health care money.
When choosing a health benefit option for your small business, it is important to consider the needs of your employee and your budget. You should also compare the different options available to find the one that is right for you.