The monthly premium on a group health quote is only the starting number. What the company pays, and what each enrolled employee pays through payroll, depends on how you split that premium across the people who actually enroll, and across the tiers they choose. This calculator does that arithmetic from the figures you enter. It does not supply default premiums, default contribution percentages, or average costs. Official survey figures on what employers and employees have paid in published studies are on the cost of small-business health insurance page. Those figures are not a quote, and they are not used here.
Enter the number of employees enrolled in each tier — employee only, employee plus spouse, employee plus child or children, and family — the monthly premium for each tier, and the employer contribution for each tier, either as a percentage of that premium or as a flat dollar amount. The calculator returns, for each tier and in total, the employer's monthly and annual cost, each employee's monthly payroll deduction in that tier, and the total annual employee share. It is an estimate of the split you entered, not a carrier invoice and not tax advice.
Carriers, and in some markets state or SHOP rules, set their own minimum employer-contribution and participation requirements. There is no single nationwide official percentage that every fully insured small-group quote must use. HealthCare.gov states that SHOP coverage itself has no contribution requirement, though an employer that wants the Small Business Health Care Tax Credit must contribute at least 50% of the cost of premiums for all full-time employees who enroll in SHOP coverage. HealthCare.gov and 45 CFR 155.706 also describe SHOP minimum participation rules, including a federally facilitated default and the fact that some states set a different rate. Off the SHOP Marketplace, a state regulator may document that an insurance company can require a minimum employer share or a minimum participation percentage; the Texas Department of Insurance, for example, states that Texas law does not require the employer to pay the premium, but that an insurance company might require the employer to pay at least 50%, and that most insurance companies require at least 75% of full-time employees to participate. Those Texas figures are not a national rule. For any specific case, the minimum contribution and participation that apply are confirmed on the quote.
A Section 125 cafeteria plan is how many employers let employees pay their share of eligible group health premiums with pre-tax wages. IRS Publication 15-B describes a cafeteria plan as a written plan that gives participants an opportunity to receive qualified benefits, including accident and health benefits, on a pre-tax basis. IRS cafeteria-plan FAQs state that salary-reduction amounts used for qualified benefits are not considered wages for federal income tax purposes and generally are not subject to FICA and FUTA. This calculator does not build a tax-savings estimate, because that would require tax rates this page will not invent. If you have a written cafeteria plan and the rules are met, the employee payroll deduction shown here is the premium share that can be taken pre-tax; a tax advisor and your payroll provider should confirm the treatment. You can offer a group plan without a cafeteria plan.
Use the result to compare contribution designs while you work through how to compare group health plans. Request a proposal or call (813) 540-1299 with a roster, work locations, and the contribution you want to test. We will apply the split to the rates that can actually be issued for your group.Estimate the employer and employee contribution split
Frequently asked questions
Does this calculator use average premiums or a standard employer share?
No. There are no default numbers. You enter the monthly premium and the employer contribution for each tier. Published survey averages, where we have official figures, stay on the cost page and are not loaded into the tool.
Can employee premium shares be taken pre-tax?
Yes, when a written Section 125 cafeteria plan is in place and the Internal Revenue Code rules are met. IRS Publication 15-B and IRS cafeteria-plan FAQs describe that treatment. This page does not estimate a tax-dollar savings, and the result is not tax advice.
Is there a required employer contribution percentage?
Not as a single nationwide official rule for every small-group quote. HealthCare.gov states that SHOP coverage has no contribution requirement, though the Small Business Health Care Tax Credit generally requires a uniform contribution of at least 50% for enrolled full-time employees. Carriers, and some state or SHOP rules, set their own minimums. Those minimums are confirmed on the quote.
Can we contribute a different percentage for employee-only coverage than for family coverage?
Yes, in the calculator: each tier has its own percentage or flat-dollar contribution. Whether a carrier or a tax-credit qualifying arrangement will accept that design is a separate question, confirmed on the quote and, if you are claiming the credit, with a tax advisor.
Does this replace a proposal or a payroll setup?
No. It is an estimate of the split you entered. Request a proposal if you want those rates and that contribution applied to a census that can actually be issued.
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