Medical, dental, vision, and life benefits for California businesses. HMO, PPO, and HDHP options. Independent broker with access to Blue Shield, Kaiser, Anthem, and 50+ carriers. Free employer quote.
Why Offer Group Health Insurance
In California's tight labor market, health insurance is consistently the #1 benefit employees value. The cost to replace one employee often exceeds the annual cost of providing health coverage.
73% of job seekers say health insurance is the most important employer benefit when evaluating job offers. Without it, you're competing with one hand tied behind your back.
Employees with employer-sponsored health coverage are 60% less likely to leave than those without. Turnover costs 50-200% of an employee's annual salary.
Employer contributions are fully tax-deductible and not subject to payroll taxes — saving both you and your employees real money every year.
Plan Types
California employers can offer one plan type or let employees choose from multiple options. Here's what each plan type means in practice.
Requires employees to select a primary care physician (PCP) who coordinates care. Referrals needed to see specialists. Lowest premiums and out-of-pocket costs.
Employees can see any provider in-network without a referral. Out-of-network coverage available at higher cost. Most flexible option — employees choose their own doctors.
Lower premiums with higher deductibles. Paired with a Health Savings Account (HSA) allowing pre-tax savings for medical expenses. Growing in popularity.
Similar to PPO without out-of-network coverage except emergencies. Lower premiums than PPO with more flexibility than HMO. Growing option in California.
Offer employees multiple plan options — they choose what fits their life. Through Covered California for Small Business (CCSB), employees can select from different carriers.
California law sets a minimum — competitive employers do much more. Here's how contribution strategy works.
California law (SB 1137) requires employers offering group health to contribute at least 50% of the employee-only monthly premium. This is the legal floor — not the competitive standard.
Most competitive California employers contribute 75-100% of the employee premium. Dependent contribution varies widely — even 25% dependent coverage is a meaningful benefit.
Every dollar you contribute to employee health premiums is tax-deductible and not subject to payroll taxes (FICA). For a $500/month contribution, that's roughly $600-$900 in annual tax savings per employee.
California Carrier Guide
The right carrier depends on your location, employee demographics, and priorities. Here's a quick guide to the major options in California.
The ACA and California state law impose different obligations depending on your size. Here's the landscape.
Employers with 50+ full-time equivalent employees must offer affordable, minimum value health coverage to full-time employees — or pay the Employer Shared Responsibility Payment (ESRP) to the IRS.
Employers with fewer than 50 FTEs are not required by federal law to offer health insurance. However, California's individual mandate means your employees likely need coverage — making group insurance an attractive benefit.
Small employers with fewer than 25 FTEs, average wages under $56,000, and who contribute at least 50% of employee premiums may qualify for a federal tax credit of up to 50% of premium costs through CCSB.
California requires most residents to have minimum essential health coverage or pay a state tax penalty. This means your employees who lack coverage face financial consequences — strengthening the case for employer-sponsored benefits.
California's SHOP marketplace for employers with 1-100 employees. Allows multi-carrier, multi-plan offerings. Employees pick their own plan while employer sets a fixed contribution amount.
A Section 125 cafeteria or premium-only plan allows employees to pay their premium share with pre-tax dollars. For a $300/month employee contribution, this saves $600-$1,200/year in federal taxes.
Tax Advantages
The tax treatment of group health insurance makes it one of the most efficient ways to compensate employees. Here's how the math works.
Estimates based on average California wages and contribution levels. Actual savings vary.
How the Tax Savings Stack Up
Every dollar you contribute to employee health premiums is fully deductible as a business expense — reducing your taxable income dollar-for-dollar.
Employer health contributions are exempt from FICA (Social Security + Medicare) — saving you 7.65% on every premium dollar contributed.
With a premium-only plan (POP), employees pay their share pre-tax — reducing their taxable income and saving both employee and employer on payroll taxes.
For HDHP plans paired with HSAs: contributions are pre-tax, growth is tax-free, and qualified withdrawals are tax-free. No other savings vehicle offers this.
Serving All of California
We serve employers in every California county — from 1-employee startups to established businesses with hundreds of team members.
Frequently Asked Questions
Under the ACA, employers with 50+ full-time equivalent employees must offer affordable, minimum value coverage to full-time employees — or pay the Employer Shared Responsibility Payment. Employers with fewer than 50 FTEs are not federally required to offer health insurance but may choose to for competitive reasons. California has its own individual mandate requiring employees to have coverage.
California law (SB 1137) requires employers offering group health insurance to contribute at least 50% of the employee-only monthly premium. This is the legal minimum. Most competitive California employers contribute 75-100% of the employee premium to attract and retain quality employees.
California allows employer groups as small as 1 employee to access group health insurance in certain cases. Groups of 1-100 employees access the small group market regulated by California. Groups of 101+ employees access the large group market. Through Covered California for Small Business (CCSB), groups of 1-100 can access multiple carrier options.
HMO plans require a primary care physician and referrals — lowest premiums, limited network. PPO plans allow direct specialist access and some out-of-network coverage — most flexible, higher premiums. HDHP plans have lower premiums but higher deductibles — paired with an HSA for pre-tax medical savings. Each has a place depending on your workforce and budget.
CCSB is California's SHOP marketplace for employers with 1-100 employees. It allows employers to offer employees a choice of multiple health plans from different carriers, with the employer setting a fixed contribution amount. CCSB also provides access to the Small Business Health Care Tax Credit for eligible employers.
A Section 125 premium-only plan (POP) allows employees to pay their health insurance premium share with pre-tax dollars. This reduces employees' taxable income and saves both employer and employee on payroll taxes. It's a simple, low-cost document that nearly every employer with group health insurance should have. We help you set one up.
Yes. Dental and vision can be offered as standalone group benefits, bundled with medical, or added as voluntary (employee-paid) benefits. Major California dental carriers include Delta Dental, Guardian, MetLife, Cigna Dental, and Anthem Dental. Vision carriers include VSP and EyeMed. We help you structure the right combination.
New employees can enroll during their initial enrollment period (typically within 30 days of hire). Existing employees enroll during annual open enrollment (typically 30-60 days before the plan year start). Special enrollment may also be triggered by qualifying life events such as marriage, birth of a child, or loss of other coverage.
Ready to Offer Great Benefits?
We compare Blue Shield, Kaiser, Anthem, and 50+ carriers to find the right health benefits for your team and your budget — free, fast, no obligation.