CMS to Change Small Business Health Options Program

Potential changes would increase access to affordable health insurance for small businesses.

The Centers for Medicare and Medicaid Services (CMS) recently announced a plan to change how small businesses enroll in health insurance through Affordable Care Act (ACA) exchanges, according to a press release. This change would help employers ensure they are able to find cost-effective health plans.

The ACA created the Federally-Facilitated Small Business Health Options Program (FF-SHOP) to help small employers provide insurance for their employees. However, a significant number of small employers did not sign up for the program.

The CMS reported that only 8000 out of nearly 30 million small businesses enrolled in the program (0.1%). This small percentage covers less than 40,000 employees of small businesses.

The lack of participation has made the program obsolete, as it does not provide substantial coverage for small businesses, according to the release.

Under the proposed changes, employers would still obtain SHOP eligibility through Healthcare.gov. However, it would reduce federal government involvement in coverage decisions by allowing issuers to use their own enrollment system for SHOP health plans.

The CMS proposes that the capabilities for online enrollment in health plans for SHOP would be removed. Small employers would now have to sign up for coverage through an agent, broker, or an issuer for plans beginning on January 1, 2018, according to the release.

The FF-SHOPs currently exist in states where the program is operated by the federal government. Businesses that purchased coverage through the program in 2017 would still be able to pay premiums on Healthcare.gov until 2018, so coverage would not be interrupted if the proposal receives approval.

Certain employers purchasing SHOP coverage that are entitled to the Small Business Health Care Tax Credit would still be able to receive the funding under the new approach, according to the release.

The CMS stated that the changes for 2018 would reduce the burden on insurance companies, consumers, and taxpayers.

While this plan has yet to be officially proposed, the agency feels that it would make health plans more readily available to small businesses that need affordable health insurance options, the CMS wrote.

“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. “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.”