Expert Addresses State Exchange Concerns Of Small Businesses

Many small business owners are concerned about upcoming changes resulting from the Patient Protection and Affordable Care Act (ACA), and the resulting implications regarding their health care coverage responsibilities to their employees. To compound the problem, news coverage on Small Business Health Options Programs (SHOP) Exchanges has been thin. To explain what the changes are, and how they will impact small business in the next few years, Wolters Kluwer interviewed Pat Haraden, Principal at Longfellow Benefits, Boston. Haraden is a corporate employee benefits consultant for large and small employer groups, municipal entities, and non-profits.

In response to a question about a common misconception that the SHOP exchanges have been completely postponed to 2015, Haraden said that “Most employers don’t understand the difference between the SHOP program and the Marketplaces in general. For example participation in the SHOP program is an employer choice to participate, whereas participating in the Marketplaces is an employee choice (although the eligibility for premium credits or cost sharing reductions is somewhat dependent on both the employer and employee). Additionally, most employers think that all Marketplaces have been delayed and some even believe the entire ACA has been delayed. The federal government and the states have not promoted their programs directly to employers as much as they have directly to employees.”

Haraden further explained, “In 2014, those states in which the federal government is either operating the Marketplace or is partnering with the state to operate the Marketplace, employers will need to choose a carrier for their employees—the individual employees would not be able to ‘shop’ for coverage among different carriers, just among different plan options. Those states that are operating their own Marketplace (e.g., Massachusetts, Connecticut) will be able to offer employees a choice of carriers and plans, depending on which carriers are selected to participate in the Marketplace.”

“Employers should first understand how their Marketplace is managed—is it federal run, state run, or a partnership. In this way they will know if their options would be limited. They should then review the carriers, rates and plan designs available in the Marketplace to those available under their traditional employer sponsored plan.”

Haraden also advised, “Employers should do their due diligence on their states’ Marketplace and the choices offered compared to their plans as described above, but the most important thing they should do is begin to educate their employees on what programs are available and what they are planning on doing. Employees who are unfamiliar with the Marketplaces and plans may feel that the employer is ‘dumping’ them on the ‘state plans’ and there may be some negative employee relations if the decision and options are not explained properly.”

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