How to cover your team without breaking the business

Written for the owner who has been quoted a renewal increase and is trying to work out what the actual choices are.

You are not buying insurance, you are buying a trade-off

Most owners start by asking what a plan costs and get quoted a premium that answers half the question. What your team actually pays, whether they can get in to see a doctor, and what happens if someone lands in the hospital are three separate decisions hiding inside that one number.

This guide lays out every realistic path for a small Montana employer in the same format, so you can compare them honestly. Some cost less. Some cover more. None do both. Knowing which trade-off you are making is the whole job.

Cost predictability. Can you budget the number a year out, or does it move at renewal?
Everyday access. Will people actually go to the doctor, or wait until it is expensive?
Big-bill protection. What happens if someone has a surgery, a cancer, a bad accident?
Admin load. How many hours a month does it take from you or your office manager?

What actually applies to a business your size

The federal employer mandate applies to applicable large employers, meaning 50 or more full-time equivalent employees. Below that line there is no federal requirement to offer health benefits at all. Almost every Montana small business is here, which means your choice is genuinely a choice.

Full-time equivalent is a calculation, not a headcount: part-time hours are aggregated. A business with 60 people working half time can land above the line, and a business with 55 seasonal staff may not. If you are anywhere near 50, work it out properly rather than eyeballing it.

2026 QSEHRA limits and the ACA employer mandate threshold, both cited below. Full-time equivalent is a calculation that aggregates part-time hours, not a headcount.

Four rules worth knowing before you get a quote

If you offer a group plan, participation rules apply. Carriers usually require a minimum share of employees to enrol and a minimum employer contribution. Ask for both numbers before you fall in love with a quote.

Small-group premiums are not priced on your claims. In the ACA small-group market, rates are set by age, family size, geography and tobacco use, not by how healthy your crew is. A young team does not automatically get a bargain.

Reimbursing premiums has to be done properly. Handing employees cash for insurance can create tax problems. The compliant versions are formal arrangements, ICHRA and QSEHRA, both covered below.

Timing is a lever. Group coverage can start most months, but individual plans are tied to open enrollment and qualifying life events. Start comparing 60 to 90 days before renewal.

Six ways to cover a small team

Most businesses land on one of these, or a combination of two. Read them as building blocks, not a ranking.

1. Traditional small-group insurance. You buy a plan from a carrier for the whole team and split the premium. The familiar path, usually arranged through a broker. Fits teams that want one recognisable plan and broad network access. Watch renewal increases, participation minimums, and high deductibles that keep people from using it.

2. ICHRA. You set a monthly allowance, employees buy their own individual plan and get reimbursed tax free. No IRS cap on what you contribute. Fits owners who want a fixed, budgetable number and employees who want to keep their own doctor. Watch that employees must shop for a plan, and that accepting the allowance can affect their marketplace subsidy.

3. QSEHRA. The simpler reimbursement arrangement for employers under 50 full-time equivalents with no group plan. For 2026 the IRS caps it at $6,450 a year for self-only and $13,100 for family. Fits very small teams wanting a clean, uniform benefit with little administration. Watch that the cap may not go far, it cannot be offered alongside a group plan, and it covers W-2 employees only.

4. Level-funded or self-funded. You pay a fixed monthly amount that funds your own claims plus stop-loss insurance, and may get money back in a good year. Fits healthier groups of roughly 10 or more employees willing to take on some risk for upside. Watch underwriting, claims volatility, and a renewal that can move hard after a bad year.

5. Membership care and cost sharing. A monthly membership covers everyday care directly with local providers, primary care, labs, imaging and therapy, often paired with a cost-sharing community for large bills. This is where CoreMed sits, and by our own figures it usually runs 40 to 60% under a comparable group premium. Fits teams who use everyday care and want a predictable number. Watch that it is not insurance, that cost sharing is not guaranteed payment, and that you should check what is excluded before you switch.

6. No employer plan, done deliberately. Employees buy marketplace coverage, often with subsidies based on household income, and you pay wages instead of premiums. Fits very small or seasonal teams where subsidies beat anything you could buy for them. Watch recruiting and retention, and the fact that a raise is taxed while a benefit generally is not.

Combinations are common and often the best answer: a high-deductible group plan paired with a membership for everyday care, or an ICHRA alongside a direct primary care membership. Ask each provider what they pair well with.

The part that catches people out

Reimbursement arrangements like QSEHRA generally require the employee to hold care that meets the federal minimum standard for the reimbursement to be tax free. A health sharing membership does not meet that standard.

CoreMed says this plainly because it matters: our memberships are an alternative to insurance, not ACA-compliant care, and they do not qualify for pre-tax treatment. If your plan is to fund a sharing membership through a reimbursement arrangement, get that specific combination checked by a benefits adviser or CPA before you commit. This is the single most common place small employers get bad information.

Compare total cost, not the premium

The premium is one of four numbers. Add all four for each option before you compare anything.

1. What the business pays. Premium or allowance, per employee, per month.
2. What the employee pays. Their share of premium, plus the deductible and copays before anything kicks in.
3. The worst case. Maximum out of pocket, or the exposure if a large bill is not shared.
4. The cost of not using it. Deferred care, sick days, turnover. Real money, and it never appears on the quote.

Where owners like you usually start

2 to 9 employees. Compare a QSEHRA or ICHRA against a membership model. A full group plan is often more cost and administration than it is worth at this size.

10 to 25 employees. Get a group quote and a level-funded quote, then price a membership model against both. This is where the real comparison lives.

Seasonal or high turnover. Look hard at ICHRA and at benefits that start on day one without a waiting period, so people are covered while they are on your crew.

Run the decision in five steps

1. Build your census. Ages, ZIP codes, who has family coverage. Every quote needs it.
2. Set your number. Decide the per-employee, per-month spend you can sustain for two years, and hold it.
3. Get three quotes. From different models, not three versions of the same one.
4. Ask your team. Doctor access, prescriptions, dependants. Cheap benefits nobody wants are wasted money.
5. Decide early. Give yourself 60 to 90 days before renewal, and run the CPA check before you announce anything.

Ask every broker, carrier or provider these six questions

What is the total per-employee monthly cost, all in?
What does an employee pay before anything is covered?
What happens with a $100,000 hospital bill, who pays, and is it guaranteed?
Which local doctors and facilities can my team actually use?
What has this cost increased by, on average, over the last three years?
What is excluded, and what is the waiting period for new hires?

Where to get independent help

Montana Commissioner of Securities and Insurance. The state insurance help line for consumers and employers, at csimt.gov.

HealthCare.gov SHOP. Small-group plans and the small business tax credit, at healthcare.gov/small-businesses.

A local independent broker. Ask them to quote more than one model, and ask how they are paid.

Terms worth knowing are collected in the glossary: deductible, maximum out of pocket, full-time equivalent, stop-loss, cost-sharing community and direct primary care.