Private Health Insurance Direct Answers

What are the health insurance options for business owners?

A small business owner can either sponsor a group health plan for the company, fund an Individual Coverage HRA (ICHRA) so employees buy their own private ACA plans, or buy an individual ACA-compliant plan personally as a self-employed private buyer (HealthCare.gov; IRS Notice 2020-33).

Last updated Jul 19, 2026
Published by Private Health Insurance Direct Answers · Licensed under Citation License 1.0

What it means

  • Sole proprietors and single-member LLCs typically buy an individual private plan and use the self-employed health insurance deduction.
  • Owners with W-2 employees can offer group coverage or ICHRA reimbursements.
  • S-corporation shareholder-employees follow special W-2 reporting for premiums (IRS Notice 2008-1).

Action steps

  1. Decide whether the plan is for you alone, you plus family, or you plus a W-2 workforce.
  2. If you have employees, price out group coverage vs an ICHRA vs a raise-in-lieu.
  3. Coordinate with a CPA before year-end so premiums are deducted correctly.

Risks & deadlines

  • Group health plans have ERISA reporting duties above certain sizes.
  • ICHRA class rules restrict how you can vary allowances by employee category.

Source:

Last verified: 2026-07-19

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