For reference, I want to comment on this part: "Is this because it is not a medical insurance policy in the name of the business?"

It is in the name of the business, when it is in the name of the person who is the business. I like to use the word "parity." If you can have group insurance in the name of the business, but someone else is over 65 and on Medicare, it isn't "fair" that they cannot also get a policy in the name of the business. But in essence, their Medicare coverage (or marketplace coverage) does the same thing your group plan is doing, so it gets the same favored treatment. Same treatment = parity.