How Does Health Insurance For My Nanny Work? A Detailed Review

Most people want to stay healthy and safe. So, having health insurance is important, especially if you have a job.

If you hire a nanny for your family, figuring out how to help pay for their health insurance might feel confusing.

Suddenly, you’re dealing with things that a whole department at your job usually handles!

At Smart Sitting, we often hear questions from parents about health insurance.

In this post, we’ll explain the basics to help you understand this important benefit better.

How to get health insurance as a nanny
Image source (Care.com)

How much should I contribute to my nanny’s health insurance premium?

When determining your contribution to your nanny’s health insurance premium, it’s essential to assess their employment status and the nature of their work for you.

Is this their primary source of income, and are they working full-time, or is it a regular part-time arrangement?

For part-time sitters and nannies, we typically suggest a monthly contribution ranging from $50 to $100. This allowance enables them to select a plan from the marketplace that aligns with their needs.

In the case of full-time nannies, we recommend contributing at least 50% and ideally covering the entire cost of their health insurance premium.

Similar to part-time caregivers, they can utilize this contribution to secure a plan from the marketplace.

If they haven’t selected a plan upon commencing employment, the specifics can be finalized either during contract negotiations or in collaboration with us as we assist you in the setup process.

On average, health insurance premiums for comprehensive coverage hover around $600 per month for individuals with full-time incomes purchasing plans from the marketplace, especially in metropolitan areas.

However, rates may vary in smaller communities with lower living costs, potentially resulting in lower premiums for similar coverage.

The national average for Affordable Care Act plans is approximately $488 per month.

Additionally, since marketplace plans are subsidized based on income, part-time caregivers may enjoy reduced monthly premiums, underscoring the significance of a contribution ranging from $50 to $100.

How does the health insurance contribution factor into taxes?

When you contribute to your nanny’s health insurance, it’s tax-free. Neither you nor your nanny pays taxes on it.

Your contribution can’t exceed what your nanny pays for the premium. Your nanny must show proof of their policy to you.

Keep it for IRS audits. Learn more about tax-free compensation for household employees in an article from HomePay, our partner. They handle nanny payrolls and taxes.

If you use HomePay for payroll, they’ll manage your health care contributions too.

Read more: Is Adroit health group legit?

Why offer health insurance as a benefit?

If you’ve talked to someone from our team about hiring a nanny for your family, you’ve probably heard us discuss making a good benefits and pay plan for the job.

Giving money for health insurance shows that you’re serious about the job, and it attracts nannies who are serious about their work.

We’ve seen that when nannies get good pay and benefits, they tend to stay in the job longer.

Think about your own job hunt – would you stick with a job long-term if it didn’t offer health insurance? We want to improve the childcare industry and make sure caregivers are valued. Making sure more nannies have health insurance is one way we’re doing that.

If you find your nanny through Smart Sitting, we’ll help you include health care in your job agreement and make sure it’s all written down before you finalize the contract.

Our team can also help your future nanny find a health insurance plan and figure out the costs if they don’t have one already.

We want both caregivers and families to be happy and satisfied when they start working together. That way, from day one of the job, the focus can be on making your kids happy and your life easier!

As one of our newest parents recently said, “A healthy nanny is a happy nanny.” And we think that means a happy family too.

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