Healthcare Reform - For Employers

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What is the SHOP (Small Business Health Options Program) and how does this program affect small business employers?

A "small business" or "small group" has 1-50 eligible employees.

The Federal Marketplace (also called the Exchange) is for individuals who purchase their coverage independently, and it also includes the SHOP, which is for small employers seeking to provide access to health insurance coverage for their employees.

For 2015, small business have two options:

  1. The employer can select a carrier and plan, and enroll their employees in that plan, or
  2. The employer can select a "metal level" (for example, Platinum, Gold, Silver, or Bronze), and their employees can enroll in the plan of their choice in the same metal level.

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Do all businesses have to start a new policy on January 1?

Most insurance policies are in effect for one year, so if you have coverage for your business that began sometime during 2013 and want to keep it until it ends, you can. If you don't want to keep it, you can review the plans on the Federal Marketplace for Florida and select a new plan that starts on January 1. If you choose to keep your current plan you will be eligible to choose a new plan when your coverage is due for renewal.

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What do small business employers need to know about their healthcare options?

Small business employers will be able to provide coverage options to their employees either "on" or "off" of the Federal Marketplace. Many health carriers who offer plans for small employers on the SHOP will also offer those same plans as well as other federally compliant health plans without using the SHOP (off the Marketplace). The requirements for pricing, eligibility, and coverage offered are the same on or off the Federal Marketplace for small businesses. It's important to note that tax credits may be available to small employers who choose provide coverage using the SHOP. These tax credits may make it possible for the employer to better manage their overall cost.

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How should a small business employer evaluate healthcare options and ultimately decide what is best?

Employers must weigh several options when looking at benefits. First of all, there are a limit to the number of plans available through the SHOP, but at the same time the employer may be eligible for tax credits based on how much they pay toward the coverage. Small employers who choose to make benefits available outside of the Marketplace SHOP will not be able to use the tax credits.

Some small employers may elect to no longer offer health coverage to their employees. In that case, employees could go to the Marketplace and possibly qualify for Advanced Premium Tax Subsidies, which could lower the amount they have to pay for coverage.

Most carriers announce their premiums and benefit changes each October-around the same time the Marketplace opens, so employers will be able to compare coverage and pricing options for plans that are available both on and off the Marketplace. Employees can visit the Marketplace to see if they may be eligible for the advanced premium tax credit (or premium subsidy).

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What do small business employees need to know with regard to tax credit? In what scenarios would a small business employee qualify for a tax credit?

Besides the tax credits available to businesses, one of the biggest parts of healthcare reform is financial assistance to help make insurance more affordable for individuals who earn up to 400% of the Federal Poverty Level (FPL).

  • That means if you don't have coverage through your employer and you're an individual earning between $11,670 and $46,680 a year, or a family of four earning from $23,850 to $95,400 a year, you can qualify for a tax credit to help pay for part of your premium, or maybe even pay for your whole premium.
  • And if you earn between $11,670 and $29,175 for an individual or $23,850 and $59,625 for a family of four, you also can get help to pay out-of-pocket costs, such as deductibles and copayments.

You may also qualify for tax credits if you have an employer-sponsored plan and the cost for employee-only coverage exceeds 9.5 percent of your income.

The discount that helps cover the cost of premiums is called the Advance Payments of the Premium Tax Credit (APTC), and the Cost Sharing Reduction (CSR) helps reduce out-of-pocket costs.

Remember: You must use the Marketplace to see if you qualify for financial assistance, and if you do qualify, you must buy your policy through the Marketplace.

People eligible for public health coverage or Medicaid are not eligible for APTCs.

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If a small business does offer group coverage, but an employee could get better coverage through the Marketplace, can the employee purchase the Marketplace plan instead? And if so, could he or she receive a tax credit to do so?

If a business offers health insurance, an employee could enroll in a different plan on the Marketplace and qualify for the tax credit ONLY if the cost for employee-only coverage under the employer-sponsored plan exceeds 9.5 percent of the employee's income.

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How can a small business employee take more action and get more involved when it comes to his/her healthcare purchasing decisions?

People should ask their employer what the company's plan is for providing coverage. Also, visit the Federal website to learn more about the Marketplace and the options that may be available.

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How can people take accountability for their own health, thus ultimately lowering healthcare costs across the board?

Healthcare costs certainly have gone up over the years, but most people really do have more control over their medical expenses than they think. For example, those super-sized fries or double cheese pizza may sound like a bargain now, but if they lead to expensive heart surgery later, or diabetes, are they really worth it?

Your doctor can take care of you when you're sick, but YOU are the best one to take care of yourself every day, and hopefully avoid getting sick. You don't have to be a body builder or marathon runner. Small, everyday changes can make a big difference. Even the little things we always hear about-cutting down on sodas, junk food, and the drive-thru; walking 30 minutes a day, even if it's 15 minutes after lunch and another 15 after dinner; eating more fresh fruits and vegetables; get an annual checkup; and of course quit using any tobacco-really do add up over time to help you lose weight and improve your health.

Also, insurance companies really do want their members to be healthier, and most have free wellness programs and disease management tools by phone and online, so be sure to take advantage of them. Just pick one thing to focus on, and get started!

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More information

Be sure to keep checking the websites that provide ongoing updates on Health Care Reform and the implementation process. We encourage you to visit and for an ever-increasing amount of information on programs that can help you provide coverage for yourself and for your family. Also look for more information on "Navigators" who will soon be helping individuals and employers understand healthcare coverage on the Marketplace or SHOP.

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