Employers are not required to provide health care benefits, but many do.
With health care costs rising in the United States, it is more important than ever to have adequate health insurance. Many large employers offer health insurance to their employees as part of the overall compensation package. There is no federal or state employment law, however, that requires an employer to give their staff health care benefits.
Compensation Enticement
Many large employers offer group health insurance premiums as part of the entire compensation package. The goal is to attract the best pool of applicants and to retain qualified staff. Every company sets up their health care plan differently. Some employers pay the entire premium on behalf of their employees. Some have a cost-sharing formula where part of the premium is withheld from the employee's paycheck. In some cases, the employer simply offers access to the plan but the employee is responsible for paying the entire premium. This is still often a benefit to the employee as group health insurance rates are less expensive than the equivalent individual rates.
Fair Offering
While there are no rules that say an employer has to offer health insurance benefits to its employees, there are rules that come into play once they choose to do so. An employer does not have to offer benefits to every employee, but they do have to offer it fairly to each class of employees. For example, a company may pay health care premiums for all of its full-time employees only or for management-level employees only. They are not allowed to exclude individuals in a class.
Pre-Existing Medical Conditions
The Health Insurance Portability and Accountability Act (HIPAA) sets out other rules for how an employer offers health insurance benefits to its workers. One of its main rules is that an employer cannot exclude an employee from the plan because of a pre-existing health condition. Employers may want to do so in order to reduce the cost of the premiums, but HIPAA requires that they do not discriminate based on health status.
COBRA
COBRA is a federal law that requires that employers offer continued health care coverage to former employees for up to 18 months. The former employees are required to pay all of the premiums but still have access to a similar plan while they seek new employment. If the employee has been fired for gross negligence, however, the employer does not have to offer COBRA coverage.
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