How Much Health Insurance Do Churches Provide to Church Employees: Health Insurance Options, HRA, HSA, and Sharing Programs
It is important to understand the health insurance provided by churches and how it differs from secular employers.
According to a survey conducted by The Employee Benefit Research Institute, workers at religious institutions were less likely than those in other sectors of employment to have access to preventative care or wellness programs that are offered through their employer.
The same was true for long-term care coverage—which includes nursing homes and assisted living facilities.
Learn more about group benefits and what churches should do for their employees.
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How many Healthcare Coverage Benefits do Churches Provide to Employees?
How many health insurance Benefits do Churches Provide to Their Employees?
Churches typically offer health insurance to their employees as a benefit. This is because health insurance can be very expensive, and by offering it as a benefit, the church is able to help its employees with the costs.
There are a variety of health insurance options available, with pros and cons depending on the specifics of each plan. To be eligible for coverage, employees must be enrolled in the plan and meet certain enrollment requirements.
Typical group health benefits can include:
- Medical, Dental, and Vision Coverage
- Life and Accidental Death & Dismemberment Insurance (AD&D)
- Short-Term and Long-Term Disability Insurance
- Health Care Flexible Spending Account (FSA) or Health Savings Account (HSA) – with the ability to pay for qualifying medical expenses pre-tax.
Depending on the size of the church will factor in how many group benefits they are able to offer their employees.
What are the most common health insurance benefits offered by churches?
Churches can offer their employees health insurance just like many companies do. Group health coverage usually has lower premiums than individual insurance policies, making it more affordable for pastors.
The most common health insurance benefits offered by churches are medical, dental, and vision coverage. These are the most important benefits to employees, as they help cover the costs of necessary care.
Other common benefits include life and AD&D insurance, short-term and long-term disability insurance, and health care flexible spending accounts (FSAs) or health savings accounts (HSAs).
These benefits are important to employees because they help protect them financially in case of an accident or illness.
What are the Recommended Eligibility Requirements for Church Health Insurance Plans?
In order to be eligible for church health insurance, employees must usually be enrolled in the plan and meet certain enrollment requirements.
These requirements vary depending on the specific plan, but they may include things like being a full-time employee, working a certain number of hours per week, or being a member of the church.
How much do churches pay for health insurance for their employees?
The amount that churches pay for health insurance varies depending on the specific plan. Churches typically pay a portion of the premium, with employees paying the rest.
The percentage of the premium that churches pay can vary, but it is usually between 50% to 100% of the monthly costs. This means that if the premium is $100 per month, the church would pay $50 and the employee would pay $50.
Some churches also offer health insurance stipends to their employees. This is an amount of money that is given to help cover the costs of health insurance.
The stipend is typically a set amount each month, and it is in addition to the salary that employees receive.
What are the tax implications of church health insurance plans?
If a church has fewer than 50 employees, it is not required to offer health insurance. However, if the church does offer health insurance, the employee must pay for the coverage or be reimbursed.
Employees have a variety of options for obtaining their own health insurance, depending on their situation and employer.
One option is an HRA (health reimbursement arrangement), which is a tax-advantaged plan that allows employees to receive reimbursement for medical expenses from their employer. However, an HRA may reduce or eliminate the tax credit/subsidy the employee might otherwise receive.
Under current law, the church would functionally be paying the tax credit instead of the IRS and incurring minimal administration costs.
Are there any other benefits offered by churches in addition to health insurance?
Churches offer many different types of benefits to their employees, including health insurance. This is a great way to help keep your pastors and clergy healthy, without breaking the bank.
Churches may also offer other benefits to their employees, such as retirement plans, paid time off, and tuition assistance.
Retirement plans are a great benefit for employees, as they help them save for the future. Churches often match a certain percentage of employee contributions, making the plan even more beneficial.
Paid time off is another important benefit that churches can offer their employees. This allows employees to take time off from work for vacation, personal days, or sick days.
Tuition assistance is another common benefit offered by churches. This helps employees pay for educational expenses, such as tuition and books.
No matter how you structure your group coverage for your eligible employees as a church we need to be able to continue to afford them for the long term.
What are some of the most popular health insurance plans offered by churches?
The most popular health insurance plans offered by churches are Kaiser Permanente and Anthem Blue Cross Blue Shield. These companies offer group health insurance plans that are often more affordable than other options.
Churches can also offer health insurance to their staff through group health plans, HRAs, HSAs, or taxable stipends. Choosing the right type of health insurance for your church staff is important because it will help them cover costs associated with medical expenses.
What are the most common complaints about church health insurance plans?
There are a few common complaints about church health insurance plans.
Some people find that the premiums and deductibles are too high and that the plans don’t cover all types of medical expenses. Others find it difficult to find and purchase a plan that fits their needs.
This is largely due to churches not being able to afford medical insurance coverage so they offer the lowest premium plans available.
Are there any other options for health insurance for church employees?
Medical sharing groups are an alternative option for churches as these health-sharing organizations are typically faith-based. They are not perfect but may offer an alternative option for healthier and younger church organizations.
How do churches decide which health insurance plan to offer?
Churches can set up health insurance for their employees in a few different ways. The most common way is to partner with a health insurance broker that specifically works with religious organizations.
Your church insurance agent will want to know the following in developing a health plan for your church:
- How many eligible employees qualify for group benefits
- Total number of full-time and part-time employees
- Monthly health insurance budget
- Does the group prefer HMOs or PPOs
- Which health insurance company are you currently with
- Expiring group health premium and renewal premium
- Current health plans offered to employees
- Desired health benefits
Most churches operate on a limited budget so it is vital as your church insurance agent understand the full picture when shopping for health insurance quotes.
What are some of the challenges of offering health insurance to employees?
There are a few challenges that come with offering group health insurance to employees.
The primary challenge is finding affordable health coverage not only for the church organization but also for the employees. If your employees are not able to afford the plan offered they may not be able to afford to sign up.
Group health plans require a high percentage of eligible employees to enroll. Unattractive health plans or high costs plans may stop employees from enrolling.
It is critical to understand the needs of your employees as a group so we can try to lower costs and provide group health coverage that meets your organization’s needs.
What are some of the benefits of offering health insurance to employees?
Offering health insurance to employees can be a great way to reduce the costs associated with healthcare for your group of employees. By setting up a group plan with an independent health insurance broker, you can obtain quotes from all available insurance companies in your area.
There are many choices for cafeteria coverage, so you can find the best fit for your employees.
- Offering health insurance to employees can be a great fit for your group of employees, or made available as an option alongside your health insurance program at significant cost savings.
- You can set up a group plan with a health insurance agency that specializes in church insurance allowing you to obtain quotes from all available insurance companies
- There are many choices for cafeteria plans: Different carriers, good/better/best coverage, etc.
- Offering health insurance to employees is a way to reduce the costs associated with healthcare for your group of employees
- Improves employee retention rates
Are there any other considerations that churches should take into account when offering health insurance to employees?
Churches should take into account the following considerations when offering health insurance to employees:
- The number of employees that need to be covered. In order to offer health insurance, insurance companies may require churches to have a 70% enrollment requirement. This means that a majority of the church’s employees must be enrolled in the plan in order for it to be offered.
- The needs of the employees. When choosing an insurance provider, employers should take into account the employees’ needs. This includes things like what type of coverage is needed and whether or not there are any pre-existing conditions that need to be covered.
- The cost of the insurance. Health insurance can be a costly benefit to offer, so employers need to make sure that they are getting the best value for their money. They can do this by utilizing a church insurance broker who can shop around for different providers and compare rates.
What are the most popular health insurance companies for churches?
There are many health insurance companies that cater to churches and their employees. It is important to choose a plan that is affordable and suits the needs of your employees.
Some popular health insurance companies for churches include:
- Anthem Blue Cross Blue Shield
- United Healthcare
- Kaiser Permanente
- Health Net
How can churches find the best health insurance for their employees?
Churches have a few different options when it comes to finding health insurance for their employees.
Using a broker is one of the best ways for churches to find health insurance for their employees. An insurance broker can assess the risk of each employee and find the best plan for them.
The insurance agent is able to discuss with each employee the health concerns they are facing to find the best health plan for them, which is something an employer is unable to inquire about.
How can churches save money on health insurance?
Churches can save money on health insurance by checking the health insurance marketplace to keep their current insurance company competitive. This is where a health insurance agency provides the knowledge to help guide its clients.
What are the most common mistakes made when buying health insurance for a church?
The most common mistake churches make related to buying health insurance is not understanding the coverage they buy. It is critical to not only understand the monthly insurance premiums but also how the coverage works.
Churches should inquire about the following:
- Max out-of-pocket cost (in and out-of-network costs)
- Network access restrictions
- Copays, deductibles, and coinsurance costs
- Doctor access based on the plans network size
- Stability of insurance premiums from year to year
How does the size of the church affect health insurance offerings?
Group health benefits are broken down into two primary categories. Small Group and Large Group plans.
Small Group Plans:
To be considered a small group, a church must have 2-50 employees enrolled in the plan.
If the church employs 51-100 people, they can still qualify for a Small Group rate if they meet certain conditions within the rating system set by their state.
If a business employs more than 100 people, they will not qualify for a Small Group rate and must instead purchase a Large Group health insurance plan.
Small group plans are set in stone and are unable to be changed.
Large Group Plan:
A large group plan is defined as a business with over 100 employees enrolled in the health insurance plan.
In order to qualify for this type of coverage, the church must have at least 51 full-time equivalent employees.
Part-time employees can be included in this number, but they must be counted as a percentage of a full-time employees.
For example, if a church has two part-time employees who each work 20 hours per week, they would count as one full-time equivalent employee.
If a church has 50 or fewer employees, it can still qualify for a Large Group rate if they meet certain conditions within the rating system set by its state.
Large group plans can be manipulated to increase or decrease coverage as the insurance company has more leverage to modify coverage. As the coverage is modified the pricing of the plan will also change.
What are the benefits of having health insurance through a church?
If a church does provide health insurance to its employees, it is responsible for paying a portion of the premiums.
When a church provides health insurance to its employees, they are required by law to pay a portion of the premiums. This can be a burden on small businesses with fewer than 50 workers as they are not obligated by law to provide healthcare coverage to their staff.
A qualified small employer such as a church is required to contribute a flat amount of no less than $100 per employee or no less than 50 percent towards the monthly health insurance premiums.
To help contain costs a church can set up a small employer health reimbursement arrangement (HRA) to help contain costs associated with employee health insurance. An HRA is a tax-advantaged program that reimburses employees for medical expenses up to a certain limit.
The church can contribute to the HRA on a pre-tax basis, and employees can use the funds to pay for qualifying medical expenses.
By utilizing this program, churches can pick a less costly health plan and contain costs.
Churches may also offer health insurance through an Obamacare exchange, a medical cost-sharing ministry, or a traditional group health insurance plan.
As an employer churches may be able to participate in the insurance exchange under the group exchange program. This could provide tax benefits for those that meet specific guidelines under the law.
Medical cost-sharing ministries are another option to scale back costs while providing an alternative option for covering medical costs. It is critical to talk with a licensed health insurance agent before going with this option.
The church may prefer to purchase its group policy outside of the exchange. As health insurance agents, we have found the exchange can create an additional burden and slow down certain processes.
No matter which option you believe is best for your nonprofit organization talk with one of our church insurance agents and see how we can help you navigate the enrollment process.
What is the average amount of health insurance that churches provide to employees?
Churches can offer health insurance to their employees through a private insurer or a church-run plan. Coverage must be offered to all employees, regardless of position or length of employment.
On average many churches provide health insurance benefits to cover their employee’s doctors and hospital visits. Some churches also include dental, vision, and hearing coverage as part of their group benefits program.
We also recommend providing short-term and long-term disability policies to your employees providing them with the peace of mind of knowing they will be taken care.
Churches can also provide life insurance coverage, long-term care, and critical illness policy such as a cancer policy.
What are the different types of health care sharing ministries?
There are three main types of healthcare-sharing ministries: Samaritan Ministries, Christian Healthcare Ministries, and Medi-Share. There are many other smaller sharing ministries but we do not recommend them at this time.
Each ministry has its own way of connecting members and providing coverage, but all of them aim to provide an affordable and Bible-based alternative to traditional health insurance.
Samaritan Ministries is a ministry that connects Christians from across the nation. It is direct, Biblically based, and affordable. The ministry coordinates and connects members to care for the whole need with prayer and financial support.
Christian Healthcare Ministries is a faith-based healthcare solution for Christians. It is a non-profit membership organization that helps its members share medical bills at a reduced cost. Members of Christian Healthcare Ministries also share in each other’s prayers for good health.
Medi-Share is a community of Christians who come together to share each other’s medical expenses. The program is based on Biblical principles of sharing one another’s burdens and loving thy neighbor as thyself.
Of these three options, medi-share has an employer plan option. Talk with one of our licensed health insurance agents to discuss if any of these options would work for your church.
What is the average family deductible for a church health insurance plan?
The average family deductible for a church health insurance plan is $500. This means that when an employee incurs a medical expense, the church will contribute its share of the deductible, up to $500.
This can be a good option for churches because it can reduce the cost of GHP premiums by integrating a deductible gap HRA.
Need a Church Health Insurance Agent
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If your church is trying to save money on your insurance let one of our agents help.
Our agency specializes in churches and religious organizations. We understand the unique needs of churches and are experts in finding the best coverage at the most competitive prices.
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