Affordable Care Act Update, December 2013 – SHOP Delay for Small Businesses

The United States Health and Human Services (HHS) Department under direction from the Obama Administration recently announced the delay for the health care law, which will postpone the online enrollment for small businesses on the Small Business Health Options Program (SHOP) Exchange.

This delay will apply to those in the states where the federal government is running the marketplace.  HHS is advising that businesses in those states interested in signing up employees through the SHOP coverage can do so through a process called “direct enrollment” administered by an agent, broker, or insurer that offers a certified SHOP plan.

The agent, broker, or insurer will then enroll employees, and the SHOP Marketplace reviews all applications and determines whether the business and employees are eligible for SHOP coverage.  If the SHOP later determines that you’re not eligible to enroll, employees may remain enrolled in their preferred plan in the small group market. Businesses that are interested in researching the SHOP Qualified Health Plans in their area are encouraged by HHS to use the website, HealthCare.gov, to research option plans.

How the process will work: The agent, broker, or insurer can help businesses fill out a paper application and send it in to the SHOP Marketplace, or the application can be mailed in by the business. The SHOP Marketplace will notify you about eligibility by phone or e-mail and by regular mail if you request it.

The key motivation for folks to get the SHOP eligibility determination in 2014, is to allow groups to claim the expanded the Small Business Health Care Tax Credit at the end of your tax year—as long as you also meet all the other requirements for the tax credit.  If you don’t think you qualify for the tax credit, you don’t need to apply for SHOP eligibility. You also have the alternative to wait until you’ve received an official notice of eligibility from the SHOP Marketplace before enrolling your employees in a SHOP Plan.

Last but not least, when you use “direct enrollment”, you can still go on HealthCare.gov to get information about plans available in your area and help you find the best fit for your company and employees. You can also download a paper application for SHOP eligibility there.   

For more information you can call: toll-free SHOP Employer Call Center at 1-800-706-7893 (TTY: 1-800-706-7915).

NOTE: This change to “direct enrollment” in states with a Federally-facilitated SHOP Marketplace won’t affect the process for getting SHOP coverage in states running their own SHOP Marketplace.

More Valuable Info:

For employees’ coverage to begin on January 1st, 2014, in the Federally-Facilitated Market for both the individual and SHOP, it is extended to December 23, 2013.

Businesses can offer coverage through the SHOP Marketplace at any time during the year. If employee enrollments are submitted between the 1st and 15th day of the month, the group coverage begins the first day of the next month. For example, if employee enrollments are submitted on February 10, 2014, the group coverage begins March 1, 2014. For enrollments submitted after the 15th of the month, coverage begins the second following month. If employee enrollments are submitted on February 18, your group coverage will begin on April 1.

As always, you can count on your MBPA Government Relations team to guide you through federal healthcare reform.  We are here to help you make your business better!  Please feel free to contact us with any questions or comments by phone: (586) 393-8800 or email: bbochniak@michbusiness.org