Many owners assume a group plan is only for big companies, and others assume they can start one with no employees at all. The real answer sits in the middle. Whether you qualify comes down to who is on your payroll, and there are good alternatives if you do not.
Small group plans are written for businesses with at least one common-law employee in addition to the owner. Most carriers want that employee to be someone other than the owner or the owner's spouse, usually a W-2 employee who works a minimum number of hours a week. A business with only an owner, or only an owner and spouse, generally does not qualify, and the owner would use an individual plan instead. Rules differ by carrier and state, so it is worth confirming before you apply.
Carriers typically ask for proof that the employee is on your payroll, such as recent payroll records and quarterly wage reports, along with your business license or other registration. Having these ready speeds up approval considerably.
Small group plans also come with participation and contribution rules, meaning the employer pays a share of the premium and most eligible employees must enroll or show proof of other coverage. With a one-employee group, that employee usually needs to enroll for the group to be approved. See our guide to small group participation and contribution rules for the specifics.
You still have options. An individual ACA plan works for owners with no employees, and the premiums may be deductible, as covered in our self-employed tax deduction guide. If you have a few employees but a traditional group plan does not fit, an ICHRA or QSEHRA lets you reimburse tax-free for individual plans, and we compare them in our ICHRA vs QSEHRA vs group plan guide.
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In many cases yes, if that person is a W-2 employee other than you or your spouse and the carrier's participation and contribution rules are met. Requirements vary, so a broker can confirm quickly.
Generally no. Most carriers need at least one non-owner employee. Owner-only businesses usually buy an individual ACA plan.
Most carriers do not count an owner's spouse as the qualifying employee, though rules vary, so check with the carrier.
Carriers often allow an employee to waive with proof of other coverage, but a group with only one eligible employee may still need that person to enroll. A broker can tell you how each carrier handles it.
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