Offering health coverage is beneficial for both small businesses and their employees. Although employer-sponsored health coverage as a small business requires some spending, the benefits far outweigh the costs. Altogether, there are multiple reasons to offer health coverage to your employees.

1. Attract and Retain Top Talent

The number one reason to offer employer-sponsored health coverage as a small business is the ability to attract and retain the best talent in your area to fill your job positions. Attracting talent is one of the most consistent challenges for any business, but healthcare benefits are a key point of consideration for prospective employees in the job search.

Offering health coverage plans is one way to make your job openings more attractive to potential employees. When searching for jobs, many prospects consider the benefits offered for a position in their decision to apply. A high percentage of prospective candidates place some or heavy consideration to better health coverage benefits as a deciding factor when choosing between a high-paying job and a lower-paying job with a better benefits package.

By offering healthcare as a benefit, you will both set your position apart from others and attract better job candidates. To many candidates, a health plan option demonstrates a positive company culture and that a business cares about its employees’ well-being.

A strong benefits package also helps businesses retain employees. Higher retention rates are precious for small businesses, as frequent turnover costs time, money, and value. Replacing employees comes with multiple disadvantages, including:

• The costs of finding, hiring, and training new employees
• Loss of productivity with a smaller staff
• Reduced employee morale due to covering for a smaller staff
• The risk of mistakes on the job
• The risk of negative customer service interactions

In today’s landscape, where businesses struggle to find and retain employees, taking any initiative to support employee retention is highly valuable. By offering health coverage, small businesses decrease the amount of turnover and ensure smoother business functions.

2. Improve Employee Morale and Productivity

Health coverage can directly impact a business’s efficiency and employee output. Anyone who has experienced a health concern knows it can be a heavy distraction. It is even more distracting when you are concerned about how to pay for the costs associated with managing this concern.

Health coverage is important for both employees and their families, but many employees struggle to pay health plan premiums on their own. Uncertainty regarding health coverage and how to pay for it can be stressful for employees. Employer-sponsored health plans can help take this stress off employees’ plates.

Ultimately, when their health needs are taken care of, employees are happier and more productive. By reducing a key area of stress for their staff, small businesses can reap the benefits of happier employees. Increased employee morale can lead to several benefits that demonstrate better business outcomes, like:

• Improved customer satisfaction
• Higher employee retention rates
• Increased productivity
• An improved bottom line
• Advanced creativity and innovation.
• Ultimately, an employee benefit plan in place is a valuable strategy that can lead to positive ripple effects throughout a business.

3. Reduce Healthcare Costs

Although small business health coverage options may cost a little more upfront, they can actually save your business money in the long run. When your employees have access to preventative and primary care, they are better able to manage their health and avoid missing time at work. Preventative care options will help employees stay healthy and ready for their shifts.

Frequent employee absence can weigh heavily on a business. A short staff can lead to slower business output, potential mistakes, overworked employees, and negative staff culture.

4. Receive Tax Advantages

Businesses that offer healthcare plans to their employees may even be able to qualify for a tax credit that offers further business savings. It is always advised to speak to your CPA or Accountant when applying these advantages.

Offering health coverage can result in a business receiving a return of up to 50% of contributions to employee premiums. As a result, businesses can enjoy a return on premiums while still all the additional benefits of health coverage.