Part-timers or independent contractors

I have a small business doing commercial and residential painting.  I have some people whom I regularly hire to help me with big jobs.  I pay them as independent contractors.  My wife has set up a group health plan for the two of us.  Can I pay for my helpers’ health insurance on our group plan?

Painting the Town Red

Dear Painting the Town Red,

You have a few issues wrapped up into one question!

The first issue is to make sure that your contractors are truly independent. Look at the IRS guidance on who is an independent contractor.  You may have part-time employees, and not realize it.

If they are part-time employees, then you can add them to your group health plan.  You also would have a whole host of other issues to deal with, including payroll taxes, overtime, etc.

If they are independent contractors, you cannot add them to your group health plan.  You could pay them an amount that includes enough to buy their own health insurance.  If they have set themselves up as a business, then they may be able to set up their own small group health plans.

In 2014, if health reform goes ahead as planned, your co-workers will be able to go to a health insurance exchange and buy their own health plans.  Stay tuned on that one.


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Linda Riddell

About Linda Riddell

A published author and health policy analyst with 25 years’ experience, Linda Riddell's goal is to alleviate the widespread ailment of not knowing what your health plan can do for you.