HELENA — State-subsidized health insurance for Montana’s smallest businesses is under way, as the state’s largest health insurer Thursday signed a contract to provide new policies for uninsured businesses and their workers.

“This is a first significant step in helping small businesses afford health insurance for employees,’’ said state Auditor John Morrison. “Coverage will now be a reality for hundreds of previously uninsured Montanans.’’

Morrison estimated that the program can help finance employee health insurance for as many as 350 businesses this year, each with two-to-five workers.

More businesses may be added starting in July, as more funds become available at the start of the state fiscal year, officials said.

The state also is offering tax credits for another 435 small businesses this year, to help offset the cost of employee health insurance they’re already purchasing.

“This is good for Montana businesses; this is good for Montana families,’’ added Gov. Brian Schweitzer, who joined Morrison and others for a contract-signing ceremony at the Capitol.

The state signed a contract with Blue Cross and Blue Shield of Montana, which is offering employee health-insurance policies to small businesses that qualify for a new purchasing pool launched by the state.

The health-insurance program, dubbed Insure Montana, has two parts:

- Direct state subsidies for small business owners and their employees, to help pay the cost of health insurance for those who previously had no insurance.

Blue Cross is offering medical and dental policies to these businesses through a new health-insurance pool. The businesses don’t have to buy from the pool, but most are expected to do so, state officials said.

The amount of state premium subsidies for businesses and their workers will depend on the coverage selected and the workers’ income level.

For example, low-income, single workers could receive up to $1,200 a year from the state to help pay their share of the premium for the ’’standard’’ or less expensive policy.

- A state income-tax credit for small businesses that already provide health insurance for their workers. It’s offered on a first-come, first-served basis, and Morrison estimates the money will finance 435 businesses this year.

The tax credit, which is paid regardless of a business’s total tax bill, will range from $2,400 to $14,700 per year, depending on the number of employees and type of coverage they have.

Those interested in the program can visit the auditor’s Web site at www.sao.mt.gov or call toll-free at 1-800-332-6148 or, in Helena, 444-2040.

The office already has a waiting list of applications, which will be processed as program slots open up.

Tanya Ask, Blue Cross vice president of government affairs, said Thursday a dozen businesses employing 40 people already have signed up to buy policies as part of the new insurance pool.

Blue Cross Chief Executive Officer Sherry Cladouhos signed the contract Thursday, saying the company is pleased to be part of a “public-private partnership’’ to reduce the number of Montanans without health insurance.

Some critics have said state-subsidized insurance doesn’t attack the core problem of rising health-care costs.

Morrison acknowledged Thursday that the Insure Montana program doesn’t directly address rising health-care costs, but said it’s one of many approaches that can start tackling the problem.

The policies offered by Blue Cross do include coverage of preventive measures and also will help reduce “cost-shifting’’ by reducing the number of uninsured people, he said.

Uninsured patients sometimes can’t pay their medical bills, and the costs must be shifted to those who do pay their bills, in the form of higher prices or higher insurance premiums.