While it was recently announced that the 33 states for which the federal government would be running their Affordable Care Act-mandated health insurance exchanges would not be proceeding with the small business marketplaces as originally planned, those states that are running their own appear as though they will do so.
At least some of the 17 states running their own health insurance systems will still allow companies within their borders to participate in their own marketplaces known as Small Business Health Option Program – or SHOP – exchanges, according to a report from the Capitol Hill news site Politico. This is true despite the fact that, due to the federal government’s own inability to set up exchanges on its higher level, it also pushed back requirements that these be offered by states operating outside that system until 2015.
Minnesota and Oregon, which were vehement about the importance of having their own exchanges overall, are certainly moving forward with plans to implement their SHOP exchanges, the report said. This is true partly because the idea of a marketplace that would help small businesses to find the most affordable health insurance for their employees (and themselves) is good for companies within the state, but also because such a move is politically expedient. It’s important to remember that much of the resistance to the ACA itself came because of the potential damage it could do to businesses nationwide, and the SHOP exchanges were included as a sort of salve that helped to assuage some opponents that there were significant business benefits to be had.
This is true on the state level as well, the report said. Rocky King, the executive director of Oregon’s healthcare marketplace, noted that giving employers and employees this option was critical for garnering bipartisan support for the state to run its own exchange, as it both gives workers the option of choosing the most affordable plans that are right for them, and also helps to cut employer costs. Prior to the Obama administration’s announcement that SHOP exchanges were being delayed and not required until 2015, Oregon had worked hard to create the infrastructure that allowed employers to make contributions directly to the insurance providers chosen by workers. Therefore, the state decided to just continue its plans regardless of federal mandates, or lack thereof.
“[Small business owners] really want this and wanted to make sure we were really doing it,” April Todd-Malmlov, executive director of the Minnesota exchange, told the site. “Having employee choice and doing defined contribution has been something that Minnesota employers have wanted to do for a long time.”
What does this mean for small businesses?
Of course, companies operating in the states in which the federal government will be running their exchanges will be out of luck until slightly less than two years from now when it comes to having more choices for employees’ healthcare coverage, but those in the states running their own SHOP marketplaces likely need to assess their options. Doing so may allow them to have a better understanding of all the options that are likely available to them, and aid in helping them find the most affordable care possible for each of their workers.
That, in turn, will likely significantly reduce a company’s costs as it relates to small business insurance policies that could otherwise increase operating costs significantly. in general, it’s usually a good idea for small businesses to shop around for the most affordable premiums for all the various types of coverage they need, including general liability insurance, errors and omissions insurance and workers’ compensation insurance.