Not Much For Small Businesses To SHOP For in 2014?

Last month, the folks who oversee America’s new health care reform, the Department of Health and Human Services (HHS), issued a proposed rule that would effectively delay much of the Small Business Health Options (SHOP) exchange program in federally facilitated and partnership exchanges until January 1, 2015. Even though the department has yet to issue a final rule, HHS confirmed its plan to delay in a statement issued on Monday.

To be clear, the proposal would not completely postpone the start of the SHOP exchange program. For the first year, the plan will still offer small employers SHOP coverage through federally facilitated exchanges and partnership programs, but employers would not be able to offer their employees multiple plan choices from multiple carriers and pay one aggregated premium. Instead, small employers will be able to pick from one of many qualified health plan choices for their employees, mirroring what will already be available to employers in the traditional small group marketplace. Given that there is going to be an added user fee of 3.5 percent for federal exchange based coverage moving forward and that the SHOP coverage will not otherwise differ regular small group plans, the proposed rule makes it highly unlikely that small employers in federally facilitated and partnership states will see much value in SHOP coverage in 2014.

This delay for the federally facilitated and partnership state exchanges does not necessarily impact states that are going ahead with their own exchanges. These states have the option as to whether or not they will allow employee choice and premium aggregation in 2014, and so far no state building their own exchange has said that they will not continue as planned for 2014. Florida has, thus far, decided that it will be using the federal exchange and thus in light of the recent HHS announcement it would appear that the exchanges promised as of 01/2014 will not be helpful until at least 2015.

As always, our fine agents and advocates are here to answer your questions and help in any manner possible.

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