Between 10 and 25 people, the small-group rules stop being the obstacle and start being the strategy. Participation is easier to hit, level funding becomes realistic for healthy teams, and a federal tax credit may still be on the table. Here is what changes and what does not.
You are still a small group in every state, which means guaranteed issue and rates that vary only by age, location, family tier, and (where allowed) tobacco use, never by anyone's health history. The federal employer mandate does not apply to you; it starts at 50 full-time equivalents. Offering coverage at this size is a hiring and retention decision, not a compliance one.
What changes is the range of options. With 10 or more enrolled, most level-funded carriers will quote you, so a healthy team can be priced on its own claims instead of the community pool. You can usually offer two plans side by side, and your contribution strategy becomes a real lever on both cost and participation. Under 25 full-time equivalents, the Small Business Health Care Tax Credit may still apply if average wages are below the federal limit and the plan is bought through the SHOP program.
Ages, ZIP codes, family tiers, and who is likely to waive. At this size the census carries real weight: a team averaging 32 and a team averaging 51 with the same headcount land in very different places. We build it before any carrier sees it, so the quotes reflect your actual roster.
Fully insured gives you a fixed premium and the full guaranteed-issue market behind you at every renewal. Level funded prices your group on its expected claims, caps your exposure with stop-loss, and can return part of a healthy year. We price both and tell you plainly which one the roster supports, including what a bad claims year would do to the level-funded renewal.
How much you pay toward the employee-only premium drives who enrolls, which drives participation, which drives which plans stay available. We model contribution levels alongside plan design (one plan or two, HMO and PPO, HSA-eligible options) so the package fits both the budget and the team.
Most level-funded carriers set minimum enrolled counts that a 10 to 25 person group can meet. That is not a recommendation; a healthy young census can save real money, while an older or higher-claims team is usually better protected in the fully insured market. We run the numbers rather than the brochure.
The Small Business Health Care Tax Credit is for employers with fewer than 25 full-time equivalents, average annual wages under an inflation-adjusted limit ($68,200 for 2026), and at least half of the employee-only premium paid by the employer through a SHOP-eligible plan. It phases down above 10 FTEs and as wages rise, and it is available for two consecutive years. Confirm it with your tax professional; we will help you gather the numbers.
Nothing changes at 20 or 25 employees under federal law. The ACA employer mandate applies only to Applicable Large Employers, which means 50 or more full-time equivalents averaged over the prior year. Growing toward 50 is the point to plan for, not 25.
Under 10? The smallest groups have their own rules, and our guide for 2 to 10 employees walks through them. For level-funded mechanics, read the level-funded guide. For a fixed-budget alternative with no participation rules, see the ICHRA guide. State carriers and market rules live on the state pages.
Often yes. Many level-funded carriers will quote a group of that size, and a healthy census can price well below the fully insured equivalent with refund potential on top. The trade-off is underwriting and a renewal that moves with your claims. We price it against fully insured on the same census and show both.
No. The federal employer mandate applies only at 50 or more full-time equivalents. At 20 or 25 employees, offering coverage is a choice you make to hire and keep people, and the plan is guaranteed issue when you do.
Usually yes at this size. Many carriers let a small group put two plans side by side and let each employee choose, subject to the carrier's participation rules for each plan. It is a common way to give a mixed-age team real choice without blowing up the budget.
Possibly. It requires fewer than 25 full-time equivalents, average annual wages below the federal limit for the year, an employer contribution of at least half of the employee-only premium, and a plan purchased through the SHOP program. The credit shrinks above 10 FTEs and as wages rise, and it is limited to two consecutive years. A tax professional confirms eligibility; we supply the plan details.
We work with businesses of 2 to 25 employees, and that is a hard line rather than a preference. Once you are past 25 we are not the right broker for you, and we will say so plainly and point you toward a brokerage that handles larger groups. Up to 25, everything on this page applies.
Send us ages, ZIP codes, and your current contribution. We price fully insured against level funded on your real census, model the contribution levels, and flag the tax credit if you are in range. Zero cost to you.
Quotes are non-binding and based on the information you provide.