Benefits

CMS Offers New Health Coverage Enrollment Option for Small Businesses

The Centers for Medicare & Medicaid Services (CMS) has announced a plan to change the way that small businesses enroll in insurance coverage through the federal exchanges.

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The Federally-Facilitated Small Business Health Options Program (FF-SHOP) program was mandated under the Affordable Care Act (ACA), but it has “failed to sign-up significant numbers of small employers,” according to CMS. Out of the nearly 30 million small businesses in the country, less than 8,000—fewer than .1% of small businesses—currently participate in the FF-SHOPs in 33 states, says CMS, which cover fewer than 40,000 individuals nationwide.

“Our goal is to reduce ACA burdens on consumers and small businesses and make it easier for them to purchase coverage,” said CMS Administrator Seema Verma, quoted in a press release. “The ACA has failed to provide affordable insurance to small business and to the American people. This new direction will help employers find affordable healthcare coverage for their employees and make the SHOP exchanges function more effectively.”

As part of the changes CMS intends to propose, employers would still obtain a determination of SHOP eligibility through HealthCare.gov. Online enrollment would be removed from HealthCare.gov, and small employers would access coverage through an agent or broker, or an issuer of their choice, for plan years beginning on or after January 1, 2018.

The FF-SHOPs exist in states where the SHOP program is operated by the federal government. Small businesses with SHOP coverage that took effect in 2017 would be able to continue using HealthCare.gov for enrollment and premium payment until their current plan year ends. Some employers that purchase SHOP coverage are also able to access the Small Business Health Care Tax Credit. This option will still be available to small employers who purchase coverage under the new enrollment approach, says CMS.

CMS says that, under the intended approach, state-based SHOPs not using HealthCare.gov could continue to operate as they have been previously.

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