Providing health insurance for employees is a critical decision for small business owners in California. A well-structured health plan can help attract and retain top talent while offering business tax benefits.
At Skyline Benefit, we specialize in helping small businesses find affordable group health insurance options that meet their needs. This guide explores the best small business health insurance plans in California for 2025 and provides insights on choosing the right plan.
Do Small Businesses in California Have to Offer Health Insurance?
Small businesses with fewer than 50 full-time employees are not required to offer health insurance under the Affordable Care Act (ACA). However, offering health benefits can provide several advantages:
- Attract and retain employees – Competitive benefits help businesses stand out in hiring.
- Tax benefits – Employer contributions may be tax-deductible.
- Increased productivity – Employees with access to healthcare take fewer sick days.
- Coverage for business owners – Employers can also enroll in the same plan.
Group Health insurance is mandatory for businesses with 50 or more full-time employees to comply with ACA regulations.
Who Qualifies for Small Business Health Insurance in California?
To qualify for small business health insurance, a business must meet the following requirements:
- At least one employee: The business must have at least one non-owner W-2 employee working 30 or more hours per week.
- Employer contribution: Employers must pay at least 50% of the employee’s premium.
- Minimum participation: At least 70% of eligible employees must enroll in the plan.
If these conditions are met, the business can access affordable group health insurance plans with tax advantages.
Best Small Business Health Insurance Plans in California (2025)
Skyline Benefit works with top insurance carriers to offer a range of small business health insurance plans. Below are some of the most popular options for 2025:
1. PPO (Preferred Provider Organization) Plans
- Flexibility to visit any doctor or specialist without a referral
- Coverage for both in-network and out-of-network providers
- Ideal for businesses seeking greater provider choice
2. HMO (Health Maintenance Organization) Plans
- Lower premiums and predictable costs
- Requires selecting a Primary Care Physician (PCP)
- Coverage is limited to in-network providers, except for emergencies
3. EPO (Exclusive Provider Organization) Plans
- No referrals needed for specialists
- Requires using in-network providers
- A balance between affordability and provider flexibility
How to Choose the Right Small Business Health Insurance Plan
Selecting the right small business health insurance plan in California depends on several factors:
- Budget: Compare premiums, deductibles, and employer contribution requirements.
- Employee preferences: Choose between cost-effective HMO plans or flexible PPO plans.
- Network access: Ensure employees’ preferred doctors and hospitals are included.
- Tax advantages: Some plans offer pre-tax employer contributions for cost savings.
For businesses uncertain about their options, Skyline Benefit provides expert guidance to compare plans and select the best fit.
When Can Small Businesses Enroll in Health Insurance?
Small business health insurance in California is available for enrollment year-round. Businesses that meet eligibility requirements can apply at any time.
However, many businesses review and renew their policies during the annual open enrollment period, allowing them to adjust coverage and costs for the upcoming year.
Need help with Small Business Health Insurance in California?
Skyline Benefit is an independent health insurance broker in Fullerton, CA, that offers affordable and flexible group health insurance options. Selecting the best group health insurance plans can be overwhelming; our mission is to simplify the process and help our clients every step of the way.
Schedule a consultation today. Call us at: (714) 888-5112