The Affordable Care Act's coverage mandate, which states that companies with 50 or more employees working 30-plus hours per week must provide them with health insurance options, goes into effect at the start of next year. However, it seems that options for doing so might be extremely limited on public exchanges put into place by the healthcare law.
Part of the ACA was designed to set up health insurance exchanges for small businesses in particular, not dissimilar to those put into place for individuals who would have to buy their own coverage. The idea behind this was that giving a large amount of companies access to the same plans would help to keep their costs for coverage down, and thus make it more affordable, even as the government provided subsidies for businesses falling into certain categories.
However, another part of the reason it was believed that these exchanges would help to keep prices down for companies' plans is that there would likely be a large number of insurance companies participating in these marketplaces, given that they might be eager to take advantage of the large amount of companies involved. However, that simply hasn't happened yet, and indeed, might not even as the deadline for enrollment approaches, according to a report from Politico. Insurer interest in publicly-run exchanges, whether they're handled by the federal government, those of the states, or jointly, has been relatively low, with some states having a larger amount of difficulty getting a large number of companies to participate.
This is especially true of the proposed Small Business Health Option Program, or SHOP, exchanges, the report said. As a consequence, the states that are poised to run these marketplaces may see many small businesses run into significantly difficulties insuring their workers through these public exchanges next year. However, many actually believe that interest will increase among insurers in the year following, as many may simply be waiting to see how the marketplaces function in general, and were simply not enticed by the tax incentives put into place by the federal government this time around, which Politico calls, "limited."
"I think the SHOP exchanges are basically a 2015 issue, but we will see how they work out in the states that are doing them, and they might turn out to be a bigger factor going forward," Tim Jost, a Washington and Lee University law professor and supporter of the health law, told the site.
Another potential hurdle exists
In addition to a large number of companies simply not getting involved in SHOP exchanges, the U.S. Department of Health and Human Services also recently announced that it would delay implementation of its proposed "employee choice" program through those marketplaces until 2015 instead of the originally-planned 2014, the report said. Some states will move forward with the initiatives anyway, but will do so without the federal government's full support.
For these reasons, as well as others, it might be wise for owners to look into the various small business insurance options available to them. Higher health insurance bills as a result of lower-than-expected participation among insurers might lead them to make difficult financial decisions, but this issue might be alleviated by looking for more affordable options elsewhere. For instance, trying to find less expensive – but still comprehensive – workers' compensation and general liability insurance coverage for companies can help to reduce costs and make it easier to afford health insurance issues ahead of the coverage mandate going into effect at the start of next year.