Small Business plans and Covered CA (aka Obamacare)

CAHU States the Important Role of Agents at Press Launch of SHOP Today

California Association of Health Underwriters was well represented by President Sam Smith at the press conference held today at the Los Angeles Chamber of Commerce to announce the launch of Covered California’s small business health insurance enrollment exchange, also known as SHOP.

Among the priorities articulated by Smith, a featured speaker at the press event, is that 86% of small businesses prefer to work with their agent when selecting their health insurance according to a recent poll conducted on behalf of Covered California,  and that more than 7,700 agents are now certified to enroll individuals and businesses through the exchange.

Perhaps one of the biggest myths Smith sought to overcome during one-on-one interviews he had following the press event with both ABC and NBC local affiliates is to dispel public belief that by using an agent the cost of their health insurance premiums would increase. This fact is often misunderstood and was well received by reporters covering the event.

Smith was also quick to point out that agents can, and, do offer an array of ACA compliant policies including many good policies that are not offered through the exchange but are fully compliant with new federal guidelines. This point was supported by Peter Lee, Director of the Covered California Exchange.

The press release distributed by Covered California follows below.

COVERED CALIFORNIA LAUNCHES SELF-SERVICE WEBSITE FOR THE SMALL BUSINESS HEALTH OPTIONS PROGRAM

Small Businesses Can Enroll for Coverage That Begins As Soon AsJanuary 1st

December 2, 2013 LOS ANGELES, Calif. – Covered California™ today officially launched the full self-enrollment function of the Small Business Health Options (SHOP) online marketplace.  This significant new function on the Covered California website will enable small businesses to fully enroll for coverage that may begin as early as Jan. 1, 2014.

“Small businesses now have new options to provide more choice for their employees and new affordable options for their business,” said Covered California Executive Director Peter V Lee.  “Covered California has created the Small Business Health Options Program (SHOP) to help the small business owners to get the best value for themselves and their employees.  Since October more than 1,500 small business owners have begun the process of exploring whether the SHOP program is right for them.”

Small-business owners with one to 50 eligible employees may now enroll in Covered California’s Small Business Health Options Program (SHOP) plans for coverage effective Jan. 1, 2014.  Like the health insurance plans in Covered California’s individual market, Covered California’s SHOP plans were negotiated to bring a standardized set of benefits, a robust provider network, and a broad choice of health insurance plans with competitive pricing to employers and their employees.

Previously, small business employers have been able to register online, check their eligibility and work with a Certified Insurance Agent to obtain a quote.  The new system enhancements now allow online enrollment functionality for SHOP, including online quoting, the ability to submit an online application at www.coveredca.com in real-time, and the ability for employers to initiate electronic open enrollment for their employees.

Many Small-business owners qualify for a federal tax credit to help offset contributions toward employee premiums. Beginning in 2014, the only way for small-business owners to access the tax credits is to purchase insurance through Covered California’s SHOP. Small businesses are eligible for a federal health care tax credit if they have fewer than 25 full-time-equivalent employees for the tax year, pay employees an average of less than $50,000 per year and contribute at least 50 percent of their employees’ premium cost. Employers with 10 or fewer full-time-equivalent employees with wages averaging $25,000 or less per year are eligible for the maximum amount of tax credits.

“The tax credits available to small business through Covered California make quality coverage more affordable,” said Lee. “For example, a beauty shop with 10 full-time employees and total wages of $250,000 that purchases insurance through Covered California’s SHOP may be eligible for a $35,000 tax credit in 2014. We know that the tax credit is meaningful for a lot of small business that have been struggling to obtain quality, affordable coverage for their employees.”

In addition to purchasing coverage on the Covered California website, Covered California SHOP plans are sold through licensed agents who are trained and certified by Covered California.  Since registration opened in August, more than 22,000 licensed agents have signed up to become certified to sell Covered California products, with more than 7,000 agents currently certified and available to help individual consumers and small employers in the Covered California marketplace.

The increased website functionality also includes a number of new features available for the Certified Insurance Agent community, such as the ability to create an online profile for an individual consumer or small employer; the ability to start and submit an application on behalf of an individual or small employer; and, the ability to process and manage employer online enrollment applications for SHOP.

About the Small Business Health Options Program (SHOP)

The Affordable Care Act includes provisions to encourage small businesses to offer health coverage for their employees by making insurance more affordable and easier to purchase. Covered California has created the Small Business Health Options Program (SHOP) to facilitate the purchase of affordable health insurance for small-business owners.

SHOP is a second marketplace-separate from the one for individuals-and is designed to give employers and their employees more options for health coverage.  Using this marketplace, small-business owners can shop for health insurance in ways that offer convenience and choice, which is comparable to how large companies shop for employee health insurance today.

In 2014, health insurance companies participating in SHOP are: Blue Shield of California, Chinese Community Health Plan, Health Net, Kaiser Permanente, Sharp Health Plan and Western Health Advantage.  These plans will be sold through Certified Licensed Insurance Agents trained and certified by Covered California.

Small businesses are not required to buy insurance for their employees. SHOP is completely voluntary, and small businesses will not be penalized for non-participation. Small businesses can enroll in a SHOP plan year round.

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