If you are a small business owner in California, health insurance is an important consideration for your employees. Covered California for Small Business can be a great option to provide your employees with the necessary healthcare coverage. However, choosing the right plan can be daunting, as it involves balancing the cost and the level of coverage. After enrolling for coverage, you may have questions about the premium payments for Covered California for Small Business. It’s important to note that health coverage and premium rates are guaranteed for 12 months from your initial coverage effective date. 

What Factors Determine the Cost of My Premium Payment

Let’s look at several factors that will determine the cost of your premium payment.

  • Your business address determines the cost of premiums that you pay for your health plan. Your address will fall in one of the 19 rating areas in California that determine the number of financial adjustments made to your health insurance premiums. 
  • Secondly, the type of health plan you choose can also influence your premiums. The Health maintenance organization (HMO) or the Preferred Provider Organization (PPO). Each Plan option offers a different balance of flexibility and cost, so you must choose wisely. Under the HMO and PPO plans, There are different tiers, which include Bronze, Silver, Gold, and Platinum – they offer different levels of coverage and out-of-pocket costs. Depending on your budget and employees ‘ needs, you can decide which tier(s) to offer.
  • Age and gender are also significant factors that insurers take into account. These details can predict healthcare usage and determine the amount you pay for premiums. Seniors are the most likely to need Healthcare, which might prompt higher plans.

What percentage of Premium payments am I required to pay?

To enroll in a Covered California for Small Business plan, you must meet certain minimum participation and contribution requirements. This includes enrolling at least 70% of your eligible employees in the plan and contributing at least 50% towards the employee-only premium. Additionally, you will need to choose a contribution strategy that determines the percentage of the premium you will pay each employee. You have the option to pay a fixed percentage for all employees.

When will my premium payment be effective?

When you sign up for health plans through Covered California for Small Business, you will receive a single invoice that covers all the plans. As an employee, you can choose from multiple health plans. However, it’s important to note that you must make the initial Premium payment for the total amount billed by the invoice’s due date. Your coverage will begin once the payment is received. If the payment is not received on time, your effective date may be delayed, or you may have to resubmit your enrollment materials.

Understanding Your Billing Cycle and Premium Payments 

To ensure smooth processing of your employee’s insurance coverage, it is essential to understand the billing cycle and premium payment process. The billing cycle starts on the 1st of each month, and Covered California for Small Business will send you an invoice on or about the 15th of each month for your employees’ premiums for the upcoming month of coverage. To avoid delinquency or cancellation, it is crucial to make ongoing monthly premium payments for the total balance due by the due date on the invoice.

What happens if I don’t pay the full Premium payment?

You must pay the full balance due on your invoice. Failure to do so may result in delinquency or cancellation of your coverage. If you cannot pay the full amount by the due date provided on the invoice, Covered California for Small Business will send you a Notice of Start of Grace Period on the day after payment is due. This notice will explain the terms of a 30-day grace period and include instructions for making the required payment to maintain coverage. Additionally, the notice will inform you of your rights to request a review of the cancellation by an applicable regulator.


Understanding the premium payment process for Covered California for Small Business is important. It can be difficult, but providing your employees with the necessary healthcare coverage is essential. Paying the premium payments on time ensures smooth processing of your employee’s insurance coverage and avoids delinquency or cancellation. Remember, choosing the right plan is just as crucial as paying on time. So, make a wise decision that fits your budget and your employee’s needs. Reach out to our experts at Skyline Benefit for guidance and assistance.

Need Help with Group Health Insurance

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.

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