Small business · 1 to 50 employees
Small group health insurance rules in Michigan
What qualifies as a small group, what you can set yourself, the tax credit some employers miss, and what insurers asked for in 2027.
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- 1 to 50 employees
- Enroll any time of year
- 9.6% requested for 2027
Review my small group options
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Who counts
- Spouses and family members don’t count toward eligibility. You need 1 to 50 full-time-equivalent employees who aren’t owners, partners or family members.[1]
- An owner can enroll in the plan as long as at least one non-owner, non-family employee also enrolls.[1]
What you decide
- One plan or a choice of plans; health, dental or both; how much you pay toward premiums; and whether to cover dependents.[1]
- A waiting period for new hires, which can’t exceed 90 days.[1]
- Employees can join after the initial enrollment only with a qualifying life event, such as a birth, adoption or marriage.[1]
The Small Business Health Care Tax Credit
- For employers with fewer than 25 full-time-equivalent employees with average wages under an inflation-adjusted limit (HealthCare.gov puts it at about $65,000 or less).[2,1]
- You must offer a qualified plan through SHOP (with a limited exception) and pay at least 50% of employee-only premiums.[2]
- Worth up to 50% of premiums paid (35% for tax-exempt employers), for two consecutive tax years, claimed on Form 8941.[2]
Requested 2027 small-group rate changes in Michigan
| Insurer (small group) | Requested 2027 average change |
|---|---|
| Blue Cross Blue Shield of Michigan | 7.0% |
| Blue Care Network of Michigan | 10.7% |
| Priority Health Insurance Company | 10.7% |
| Alliance Health and Life | 11.6% |
| Health Alliance Plan (HAP) | 11.6% |
| Priority Health | 11.6% |
| UnitedHealthcare Community Plan | 14.5% |
| UnitedHealthcare Insurance Company | 14.8% |
| All small-group insurers | 9.6% |
As filed with DIFS, subject to approval. Changes vary by plan, area and tobacco status, and what employees pay also depends on the employer’s contribution.[3]
Options beyond a traditional group plan: ICHRA, QSEHRA and level-funded plans. Renewing soon? Audit your 2027 renewal.
Sources
- HealthCare.gov, Overview of SHOP: Health insurance for small businesses. https://www.healthcare.gov/small-businesses/choose-and-enroll/shop-marketplace-overview/
- IRS, Small Business Health Care Tax Credit and the SHOP Marketplace. https://www.irs.gov/affordable-care-act/employers/small-business-health-care-tax-credit-and-the-shop-marketplace
- Michigan DIFS, 2027 Michigan Health Insurance Rate Change Requests, Individual Market (as filed, subject to DIFS approval), updated July 14, 2026. https://www.michigan.gov/difs/-/media/Project/Websites/difs/OIRF/EHB/PDFs/2027_Proposed_Rate_Changes.pdf
Checked October 16, 2026. 2027 Marketplace plans and final 2027 rates aren’t published yet; we’ll update this page when they are.
Frequently asked questions
How many employees do I need for small group health insurance?
For SHOP coverage, generally 1 to 50 full-time-equivalent employees who aren't owners, partners or family members.
Do I have to offer health insurance with under 50 employees?
No. With 1 to 50 full-time-equivalent employees you aren't required to offer insurance, and there's no penalty if you don't.
What is the longest waiting period for new employees?
Waiting periods can't exceed 90 days.
How much did Michigan small group rates go up for 2027?
Insurers requested an average 9.6% increase for 2027 small-group plans, from 7.0% to 14.8% by insurer, subject to DIFS approval.
Will you sell my information?
No. Your information goes to Nexus Benefit Solutions only and is never sold.