On May 31, 2013, the Centers for Medicare & Medicaid Services (CMS) released the Small Business "SHOP" Marketplace final rule, and SHOP application forms for small businesses. This article provides an overview of the SHOP Marketplaces and sample SHOP application forms for small businesses and employees.
SHOP Marketplace Overview
As part of the Affordable Care Act (ACA), the Small Business Health Options Program ("SHOP") will be a new online marketplace in each state, where small businesses can shop for group health insurance plans.
The SHOP will offer a single point of entry for small businesses and their employees to apply for coverage.
If eligible, small businesses may qualify for a tax credit worth up to 50% of the employer’s premium contribution (i.e. the small business tax credit).
Small businesses who are eligible for the SHOP must: have 50 or fewer full-time equivalent (FTE) employees (100 or fewer in some states), have at least one common-law employee, have a primary business address within the state the business is buying coverage, and offer coverage through the SHOP to all full-time employees.
Originally, all state SHOP marketplaces were required to include an "employee choice" feature in 2014, where the small business could offer employees a choice of plans within the same level of coverage. For example, a small business could provide employees a menu of silver-rated plans to choose from. The federal government delayed this "employee choice" SHOP requirement until 2015. Some states running a state-based marketplace, however, will offer this feature in their SHOP marketplaces in 2014.
SHOP Marketplace Application Form for Small Businesses
CMS released sample SHOP applications small businesses will use to apply for coverage starting October 1, 2013. There are two print versions of the SHOP application: one for the small business employer, and one for employees. There will also be an online application that, according to CMS, will be dynamic and will streamline the application process further.
The printed application forms are for small businesses who cannot apply online, and who are not working with a broker. Small businesses working with a broker will need to apply online (so they can enter their broker ID and NPN number).
Here is a copy of the sample SHOP Marketplace application form for the employer released May 31, 2013 by CMS:
SHOP Marketplace Application Form for Employees
The second application is a form employees can use to see if they are eligible for SHOP health coverage from an employer.
According to CMS, the applications are simpler than existing small group market insurance applications. What do you think? Let us know in the comments below.