Small business owners across the United States are facing a daunting challenge: the ever-increasing cost of health insurance. As premiums continue to climb, many are being forced to explore alternative solutions to provide coverage for their employees, with telehealth emerging as a potentially viable option. The financial strain is particularly acute for businesses with limited resources, impacting their ability to attract and retain talent, and potentially hindering growth.
The escalating costs aren’t happening in a vacuum. According to the Kaiser Family Foundation (KFF), annual premiums for employer-sponsored family health coverage reached $26,993 in 2025, a 6% increase from the previous year [1]. Workers are similarly shouldering a larger portion of these costs, contributing an average of $6,850 toward family coverage. This financial burden is prompting small businesses to re-evaluate their health insurance strategies, and telehealth is increasingly seen as a cost-effective alternative.
The Tax Credit and Eligibility
The federal government offers a tax credit to help small employers offset the cost of providing health insurance. To qualify, businesses must have fewer than 25 full-time equivalent employees (FTEs) and pay average wages of less than an inflation-adjusted amount. For 2023, that amount is $62,000 [1]. The credit can cover up to 50% of the premiums paid for small business employers, and 35% for small tax-exempt employers. Eligible employers can claim the credit using Form 8941 [4].
Calculating eligibility involves determining the average annual wage. For example, a business paying total annual wages of $200,000 to 10 FTEs would have an average annual wage of $20,000 [1]. However, the amount of the credit received scales down as the number of employees increases or average wages rise above the adjusted threshold.
Telehealth as a Solution
Telehealth, which encompasses remote consultations, virtual check-ups, and remote monitoring, offers several advantages for small businesses. It can reduce healthcare costs by eliminating the need for expensive office visits, particularly for routine care. It also improves access to care, especially for employees in rural areas or those with limited mobility. Telehealth can lead to increased employee productivity by reducing time spent traveling to and from appointments.
Whereas total premiums have been rising for firms of all sizes, they were somewhat lower for small firms nationwide in 2023 [3]. However, workers in small firms still tend to pay more for health insurance on average and face higher deductibles than those in larger companies. This disparity underscores the need for innovative solutions like telehealth to level the playing field.
Employer Contributions and Coverage
Generally, small business owners are expected to contribute at least 50% of the premium for their employees’ health insurance [3]. Some companies even opt to cover 100% of the premiums, particularly smaller firms with fewer employees. On average, companies pay around 83% of employee premiums [3], though this can vary significantly.
The KFF 2025 Employer Health Benefits Survey reveals that annual premiums for single coverage average $8,435, roughly $703 monthly, while family coverage averages $23,968 annually, or about $1,997 per month [2]. The average deductible for single coverage in a plan with a general annual deductible is $1,886 [2].
Looking Ahead
The trend toward telehealth is likely to accelerate as health insurance costs continue to rise. Small businesses will need to carefully evaluate their options and consider how telehealth can be integrated into their health benefits packages to provide affordable and accessible care for their employees. The ongoing evolution of telehealth technology and the increasing acceptance of virtual care by both patients and providers suggest that it will play an increasingly important role in the future of employee health benefits.
What are your thoughts on the role of telehealth in addressing rising healthcare costs? Share your experiences and opinions in the comments below.
Disclaimer: This article provides informational content and should not be considered medical or financial advice. Consult with a qualified healthcare professional or financial advisor for personalized guidance.
