Federal insurance marketplace offers new options for small businesses
This story was done in collaboration with Kaiser Health News, an editorially independent program of the Kaiser Family Foundation.
Thousands of small business owners in Georgia will soon have access to new health coverage options for their workers through HealthCare.gov, though it’s unclear how many will actually use the site.
Starting Nov. 15, three private insurers will offer for the first time health plans for small businesses through the Affordable Care Act’s year-old insurance marketplace. But industry experts say the Small Business Health Options Program, or SHOP, may be more of a hassle than a help for some companies. The Obama administration essentially sidelined the SHOP during the marketplace’s first year of operation as it scrambled to fix a host of technical troubles that plagued HealthCare.gov’s launch last fall.
“This year is the first year we’re going to see SHOP operating the way the law intended,” said Bill Custer, a health insurance expert at Georgia State University. It will give “the employee the opportunity to make an individual choice.”
Small businesses have traditionally only been able to offer one or two insurance packages for all employees – young and old, healthy and sick – despite their disparate needs. The SHOP will allow employees to choose from a greater array of plans to find the best price and network of doctors and hospitals that fit their individual needs.
A pillar of the health care law, the federal online marketplace allows consumers to choose from among dozens of health plans offered by private insurers. It’s second open enrollment runs from Nov. 15 through Feb. 15.
Nationwide, an estimated 4 million workers nationwide are expected to have insurance coverage through the marketplace’s SHOP by 2017, according to Congressional Budget Office estimates.
Roughly 108,000 businesses in Georgia are considered “small” with fewer than 50 employees. About 47,000 of them offer health insurance. But the actual number of companies that use the SHOP will likely be significantly less, Custer said.
“I’m not really sure that there was always a big clamoring among small businesses for employee choice, which is the (SHOP’s) major feature,” said Gary Claxton, a health policy expert at the nonprofit Kaiser Family Foundation.
Atlanta businessman TJ Callaway sees the SHOP as a useful tool to compare insurance pricing and benefits for plans but not much else.
“There’s no way I would use just this website in order to put together a health insurance plan for my company,” said Callaway, co-founder and CEO of Atlanta-based Onward Reserve, which has lifestyle gift and apparel boutiques in Buckhead, Athens, Charlotte, N.C., and Chattanooga, Tenn.
“I just don’t see it making it that much easier. I feel like I would still need to bring a broker into the situation for me to feel comfortable.”
Callaway, who has about 25 employees and doesn’t provide insurance, compares using the SHOP Marketplace to using a site such as Zillow.com to look at options but not to buy a home. He said he is concerned that there’s not enough opportunities for “employee choice” if all insurers do not participate.
So far, only three insurance companies — Blue Cross and Blue Shield of Georgia, Kaiser Foundation Health Plan of Georgia and Alliant Health Plans — plan to offer coverage options for small businesses through the marketplace, according to the state Department of Insurance. But that number could grow over time. The number of insurers offering marketplace plans for individuals increased to nine for 2015, up from five in its inaugural year.
The SHOP’s success will depend on how competitive the marketplace is going to be, in terms of the number of private insurers and the differences in their plans, such as which providers and hospitals are in network, said Russ Childers, a health insurance broker in Americus who works with small businesses.
“Now the question is: How much of an advantage is that to small employers?” said Custer with Georgia State. “How many employees would value that choice, being able to have a different health plan than their employer is traditionally offering? How many employers would go through the extra hassle to do that? Is it worth it?”
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