On the eve of Thanksgiving, the Department of Health and Human Services announced another delay in the Affordable Care Act. This time the delay impacts small businesses with fewer than 50 full-time equivalent employees, and their ability to apply online for coverage using the SHOP exchange marketplace. SHOP stands for “Small Business Health Options.”
Small businesses with fewer than 50 employees are not required to secure insurance for their employees. Larger businesses do have a mandate, although that previously has been delayed one year. But the whole goal of Obamacare was to make better insurance coverage more affordable for everyone. Small businesses that want to take advantage of tax credits were supposed to be able to opt to use the SHOP exchanges to enroll in affordable coverage for their employees.
What this delay means is that small businesses won’t be able to use the Federal website to apply for/enroll in coverage through the SHOP exchange for their employees, if they do choose to offer coverage to their employees — and many do. They will instead have to apply in writing, in person or through an insurance broker or agent. The SHOP delay is until November of 2014.
Jason Millman, writing on Politico notes:
“The White House is trying to get the troubled enrollment website on track for individuals and families seeking coverage, which is a higher priority. It set this Saturday, Nov. 30, as a target date for getting HealthCare.gov working for the ‘vast majority’ of users.
The delay of the small business exchanges comes as little surprise, as the administration had said earlier this week it would offer alternative ways for small businesses to enroll. Still, it undercuts the White House message that it’s beginning to turn around the disastrous rollout of the health care law.”
Thomas Howell Jr. writing on the Washington Times adds:
“Its decision to delay Web enrollment through the Small Business Health Options Program, or SHOP, until November 2014 is yet another tweak to the Affordable Care Act’s tumultuous timeline.
‘The president bit off more than he can chew with this health care law, and small businesses are now forced to bear the consequences,’ House Speaker John A. Boehner, Ohio Republican, said.
The delay is rooted in the rampant Web glitches facing the federal portal, HealthCare.gov, which spoiled the October debut of the health exchanges and forced the administration to launch a 24-7 repair campaign.
On Wednesday the Department of Health and Human Services said the agency immediately is opening up direct enrollment in the SHOP program through agents, brokers and insurers in states that let the federal government run their exchange.
Businesses with fewer than 50 employees, which are not required to offer coverage under the Affordable Care Act, also can compare plans online starting Dec. 1, even if they have to rely on non-Internet applications to qualify for tax credits and gain coverage for employees, officials said.”
The announcement was made in a confusingly-titled blog post on the Department of Health and Human Services blog, called “A Direct New Path to SHOP Marketplace Coverage.” It states:
“For small businesses in states with a SHOP Marketplace that’s run by the federal government, we are making changes to make sure that you can take advantage of SHOP coverage and the tax credit as soon as possible. Specifically, for 2014, small employers will enroll their employees in coverage through an agent, broker, or insurer that offers a certified SHOP plan and has agreed to conduct enrollment according to HHS standards.”
While making it sound like it has become easier for small businesses to shop for health insurance coverage, in fact, your options are more limited. Why? Because you won’t be able to use the website to the extent anticipated. Still, you can use brokers and file written applications.
Two well established groups representing small businesses, responded quickly. The National Federation of Independent Business (NFIB) had this reaction, through its manager of legislative affairs, Kevin Kuhlman:
“This new delay announcement is a disappointment but not a surprise. Small businesses continue to be low on the priority list during the Obamacare implementation process. It probably matters little to people in Washington that the failure to get the small business exchanges online adds yet another onerous paperwork requirement for job creators. The continued delays add to uncertainty and contribute to the decision of many owners to take early renewals of their small-group plans.”
And the National Association for the Self-Employed (NASE) said this via Katie Vlietstra, Director of Government Affairs:
“Today’s announcement by the Obama Administration to further delay online enrollment of the federal small business exchange is just another blow to the new health care program. The Obama Administration continues to make it incredibly difficult for small businesses to adequately plan and prepare when they continue to move the goal post. We have provided the Administration with guidance and clear examples of how this type of decision will negatively impact us and yet, they continue to ignore the businesses that create the vast majority of jobs in the United States. We are disappointed to say the least; small business owners now have less than 45 days to scramble and find adequate health care coverage for them and their employees.”
So what should you do? If you might want to qualify for the Small Business Health Care Tax Credit, talk to a qualified insurance broker. Don’t expect to go online and enroll your employees — at least not until a year from now, in November 2014.
If you don’t care about the tax credit or are happy with your current group plan, then the SHOP exchanges and website are irrelevant anyway.
Meanwhile, as of late Wednesday, hours after the announcement, the Healthcare.gov website still says you can apply online for the small business SHOP exchange (screenshot above). Get more information at the HHS blog post.