Benefits for startups whose people are not all in one city

Ares Benefit Group works with tech and similar startups in this size range. We compare a group plan, an ICHRA, and a QSEHRA against where people actually live and how the company is incorporated.

How startups actually staff

• Remote and multi-state teams are common early. An ICHRA, where each employee buys individual coverage where they live, is often the structure we compare first with a group plan based at the company's office. See multi-state teams. SHOP also has official options for businesses in more than one state.
• Founders and owners. A self-employed founder or that person's spouse is not the intended ICHRA participant. If founders are employees of a C corporation, that fact matters and we will use it. Do not assume a founder can be covered the same way a hired engineer can.
• Contractors and early vendors. Many startups rely on 1099 specialists. Those people are not put on the employee plan if they are true independent contractors under IRS rules.
• Headcount can move quickly. A company can go from 8 to 30 people in a year and still be under 50. Build a structure you can enroll new hires into cleanly, and watch the applicable large employer line before you cross it by accident.
• The offer has to be easy to explain to a candidate. A set ICHRA contribution, or a clearly described group plan, is more useful in a job offer than a vague promise to "figure out benefits later."

Structures we compare for a team this size

For a distributed startup, an ICHRA is often the most straightforward comparison to a group plan. A QSEHRA can fit a very small team that will not also offer a group plan. We will not treat either as the only serious option.

• SHOP and other group coverage, when you want one employer-sponsored medical plan and you can meet eligibility and participation rules.
• A level-funded arrangement, when a carrier offers one for your census. We compare it with fully insured group coverage and do not treat either as automatically better.
• An ICHRA, when you want a set contribution and employees choose individual coverage. Permitted classes include full-time, part-time, hourly or salaried, work location, and a waiting period. It is for employees, not for a self-employed owner.
• A QSEHRA, when you are not an applicable large employer and you are not offering a group health plan. See ICHRA vs QSEHRA if both are on the table.
• Section 125 for pre-tax employee premium contributions on a group plan. A QSEHRA cannot be funded by salary reduction.
• Group life and disability and voluntary benefits.

A company under 50 full-time employees, including full-time equivalents, is generally not required by federal law to offer health coverage. If you have fewer than 25 full-time equivalents and you meet the wage, contribution, and SHOP rules, look at the Small Business Health Care Tax Credit.

What to send us

A roster with home states, entity type, who is a founder versus a hired employee, and who is a contractor. If you have a Tampa or Florida office and a remote team, say so.

Tell us about your startup

Our agents are licensed in all 50 states.