Group Health Insurance
that helps you attract
and keep great people.
Medical, dental, vision, life, and disability benefit options for California businesses. HMO, PPO, HDHP, and multi-plan strategies. Independent broker support and a free benefits review.
Why Offer Group Health Insurance
Health benefits aren't just a perk — they're a competitive necessity
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.
Attract Better Candidates
Health insurance is consistently one of the most valued employee benefits when candidates compare job offers. Without it, employers may be competing at a disadvantage.
Retain Your Best People
Employer-sponsored health coverage can support retention and reduce the pressure of replacing key employees. Turnover can be expensive, especially for skilled or client-facing roles.
Significant Tax Advantages
Employer contributions are fully tax-deductible and not subject to payroll taxes — saving both you and your employees real money every year.
Plan Types
HMO, PPO, HDHP — which is right for your team?
California employers can offer one plan type or let employees choose from multiple options. Here's what each plan type means in practice.
Health Maintenance Organization
Requires employees to select a primary care physician (PCP) who coordinates care. Referrals needed for specialists. Lowest premiums and out-of-pocket costs.
Preferred Provider Organization
Employees can see any provider in-network without a referral. Out-of-network coverage available at higher cost. Most flexible — employees choose their own doctors.
High Deductible Health Plan
Lower premiums with higher deductibles. Paired with a Health Savings Account (HSA) allowing pre-tax savings for medical expenses. Growing in popularity.
Exclusive Provider Organization
Similar to PPO without out-of-network coverage except emergencies. Lower premiums than PPO with more flexibility than HMO. Growing option in California.
Employee Choice / Multi-Plan
Offer employees multiple plan options — they choose what fits their life. Through Covered California for Small Business (CCSB), employees can select from different carriers.
How much should you
contribute?
Carrier rules and market expectations create practical contribution floors — competitive employers often do more. Here's how contribution strategy works.
Common Floor — 50% of Employee Premium
Small-group carrier and participation rules commonly require employers to contribute at least 50% of the employee-only monthly premium. Treat this as a practical floor — not necessarily the competitive standard.
Competitive Standard — 75–100% Employee, 25–50% Dependent
Most competitive California employers contribute 75-100% of the employee premium. Dependent contribution varies widely — even 25% dependent coverage is a meaningful benefit.
Tax Savings on Contributions
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
Major group health carriers — what you need to know
The right carrier depends on your location, employee demographics, and priorities. Here's a quick guide to the major options in California.
What California employers
need to know about compliance
The ACA and California state law impose different obligations depending on your size. Here's the landscape.
Employer Mandate
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.
Small Employer Choice
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 Business Health Care Tax Credit
Small employers with fewer than 25 FTEs, average wages within IRS eligibility thresholds, and who contribute at least 50% of employee premiums may qualify for a federal tax credit of up to 50% of eligible premium costs when requirements are met.
CA Minimum Essential Coverage
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.
Covered California for Small Business
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.
Pre-Tax Premium Savings
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
Health insurance costs less
than you think — after tax savings
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
works harder than you think
100% Employer Deduction
Every dollar you contribute to employee health premiums is fully deductible as a business expense — reducing your taxable income dollar-for-dollar.
No Payroll Tax on Contributions
Employer health contributions are exempt from FICA (Social Security + Medicare) — saving you 7.65% on every premium dollar contributed.
Section 125 Pre-Tax Employee Premiums
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.
HSA Triple Tax Advantage
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
Group health insurance for every California employer
We serve employers in every California county — from 1-employee startups to established businesses with hundreds of team members.
Frequently Asked Questions
Group health insurance explained clearly
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.
Many California small-group carriers and plan structures require employers to contribute at least 50% of the employee-only monthly premium. This is a common market floor. 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. 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 be triggered by qualifying life events such as marriage, birth of a child, or loss of other coverage.
Ready to Offer Great Benefits?
Free group health review.
All California employers.
We compare Blue Shield, Kaiser, Anthem, and 50+ carriers to review health benefit options for your team and budget — free, practical, no obligation.