SHOPping for Health Insurance Just Got Easier

For small-business owners and their employees, health care is a major issue. Oftentimes, health care falls by the wayside because employees of small businesses pay for health insurance entirely out of pocket or aren’t eligible to receive benefits because they only work part-time. At the same time, some small businesses don’t even offer health insurance because premiums are way out of their budget. The Affordable Care Act aims to change all that.

By providing opportunities and benefits to small businesses, more affordable options for health coverage will be possible beginning as early as October 2013.
According to the Small Business Association (SBA), small businesses pay 18 percent higher premiums than that of bigger businesses and corporations. As of October 1, 2013, however, small-business owners will be able to shop for health benefits on par with larger businesses when Small Business Health Insurance Options Program (SHOP) Marketplaces open their virtual doors for business in every state, allowing for what the SBA calls “unprecedented transparency to the market.” This means small businesses will have the same clout as their larger counterparts when shopping for health insurance.

SHOP Marketplace allows business owners with 50 or fewer full-time employees to make the determination on how much they are willing to pay toward employees’ health coverage premiums and allows employers to compare plans through a web portal. This will streamline the process and let business owners see and purchase the plan that will best suit their needs and the needs of their employees.

Those who are self-employed will be eligible for affordable health care, too. While those working solo can’t go through the SHOP Marketplace, they can use the Health Insurance Marketplace found at www.HealthCare.gov. Also taking effect October 1, 2013, individuals who are self-employed and interested in obtaining health coverage will be able to shop for the coverage best suited to their health and financial needs.

Small businesses will also be eligible to receive a higher tax credit starting in 2014 when they purchase health coverage through the SHOP Marketplace. The intent of the credit is to help make insurance more affordable for business owners, as well as offset the cost of coverage. Currently, the savings is up to 35 percent, but in 2014, that number will increase to as much as 50 percent.

Also in 2014, the price of staying well will get ever closer to paying off. Wellness incentives and programs are already offered by a number of health care providers, but they are most often offered to employees of big businesses. Those who are self-employed and employed at small businesses are too often skipped over in terms of receiving rebates for being enrolled in a wellness program. Through the Affordable Care Act, rewards for small businesses taking steps to create healthier work environments will range anywhere from 30 percent to 50 percent.

Under the individual shared responsibility provision, listed under the broader Affordable Care Act banner, everyone will be eligible for minimum essential coverage, will qualify for an exemption or will make an individual shared responsibility payment on their federal income tax return. Pertaining to those who are self-employed and to employees of small businesses, minimum essential coverage includes individual coverage obtained through the Health Insurance Marketplace and COBRA coverage, respectively.

One exemption that will benefit employees getting new jobs is that coverage for part of the month will count as coverage for the entire month. For instance, if someone gets a job on May 26 and enrolls in coverage through their new employment, they will be treated as having coverage the entire month of May. Conversely, if a person is eligible for an exemption from coverage for any one day of the month, they are treated as being exempt for that entire month.
Individuals who qualify for minimum essential coverage do not have to do anything but continue with their current health coverage plan. For individuals who want to see if there are minimum essential coverage options that would prove more affordable, visit the Health Insurance Marketplace (www.HealthCare.gov) beginning October 1, 2013.

Helpful Resources:

Weekly webinar to help small business owners understand the process: http://www.sba.gov/community/blogs/community-blogs/health-care-business-pulse/new-dates-affordable-care-act-101-webinars

SHOP Marketplace and Health Insurance Marketplace: www.HealthCare.gov

Department of Health and Human Services Call Center: 1.800.706.7893

Story by Megan McClure

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