Why MEC Plans are Ideal for Small Businesses

If You Own a Small Business, MEC Plans Should Work Well with your Budget

Since 2010, health insurance premiums for small scale businesses with 3 to 199 employees have increased up to 25%. Average family premium rose from $13, 250 to $16,625 in 2015. As a result, many small businesses struggle to afford and provide their hourly workforce fringe benefits that meet legal requirements.

Fortunately for small business, they can now provide health and medical benefits to their hourly workers through the Minimum Essential Coverage or MEC.

What is MEC?

A MEC Plan is a self-funded minimum essential coverage plan designed to give employers with low cost alternative to major medical coverage plans. MEC also provides preventive care benefits. As it is self-funded, employers will get a refund when group claims are lower than projected.

MEC Plans aim to help ensure that small scale employers can enroll their hourly workers in medical coverage that is affordable and is in compliance with the minimum value requirement of the ACA.

What Coverage Does a MEC Plan Provide?

MEC Plans include preventive care benefits. Preventive care services include screenings to prevent illnesses, diseases, and other health problems, and can vary between adults, women, children and pregnant women.

Other MEC plans may include additional benefits such us doctor visits, prescription drug coverage, and telemedicine services, although these can also vary. With the help of ARCHER JORDAN, employers can customize a MEC plan based on the needs and nature of the job of the workers.  

Who are allowed to Offer MEC Plans?

The following key identifiers indicate that you are allowed to offer MEC plans to cover the fringe benefits of your prevailing wage workers:

  • Company population has mixed income levels and has a low participation in major medical plans
  • Employers who meet the Employer Shared Responsibility mandate, requiring employers with a certain number of full-time employees to provide minimum essential coverage to full-time employees and their children up to the age of 26.

Employers that do not meet the employer mandate can be fined, as well as those who do not comply with the required coverage offering. The fine is rated per full time employee. As of 2016, if employers do not provide adequate medical coverage, they can be fined $2,160 per full time employee. If the MEC Plan provided by the employer does not meet the affordability requirements, they can also be fined $3,240 for each full-time employee.

Let a Fringe Benefit Expert like ARCHER JORDAN Manage Your Employee Benefits for You

We at ARCHER JORDAN are committed to giving the best coverage for your hourly workers, while helping your company save thousands of dollars in the process. Our decades of experience will help you create the perfect MEC Plan for your employees. Call us now at +1888-745-0754 to discuss!

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