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3 secrets about the ACA small-group exchange program

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Just a few years ago, federal paperwork analysts were estimating that the Affordable Care Act exchange system’s Small Business Health Options Program (SHOP) division could attract 200,000 small groups per year.

Related: PPACA: CMS Talks SHOP

The builders of, the exchange enrollment and administration system for states unwilling or unable to set up their own exchange programs, struggled to reassure agents and brokers that they knew producers were important to small employers, and that wanted to have a good relationship with producers.

Related: CCIIO: Producers critical to small-group exchanges

Then, the individual exchange system opened. Technical glitches and management problems ate up so much exchange builder energy that and many of the state-based exchanges let SHOP implementation deadlines slip. Nevada, for example, had a state-based exchange with strong individual health sales, but so many technical glitches it switched to using for individual plan enrollment. In mid-April, an executive told the Nevada exchange board that, as of February, the state’s SHOP division was providing coverage for just six people.

The U.S. Department of Health and Human Services has infuriated Republicans in Congress by refusing to give even rough estimates of SHOP plan enrollment. A U.S. Government Accountability Office official, James McTigue Jr., gave a possible clue about the size of SHOP use in March, when he testified at a hearing that, in 2014, 181,004 employers used an ACA tax credit tied to SHOP plan use.

Emily Curran, a health policy analyst at a Georgetown University health think tank, and two colleagues have tried to fill the ACA SHOP information void by publishing a report on SHOP implementation.

Curran and her colleagues ran into a major obstacle: HHS would not give them any information about the performance of the SHOP division.

But managers of most of the locally based SHOP exchange divisions in 17 states and the District of Columbia were more helpful. The researchers found that those exchanges are serving employers with about 144,000 covered lives.

For a look at some of what Curran and her colleagues found, read on.

Covered California screen shot

In March, Covered California was serving SHOP plans with 27,467 enrollees. (Image: Covered California)

1. Three SHOP exchanges have broken the 10,000-covered-life barrier without help from a mandate.

The District of Columbia and Vermont inflated their SHOP transaction figures by requiring all employers seeking fully insured group plans, including those using brokers, to sign up for the coverage through the SHOP exchange system.

The District of Columbia has another factor helping to increase its SHOP numbers: The ACA requires members of Congress and some of their aides to use ACA exchange plan coverage themselves. The U.S. Office of Personnel Management has arranged for those lawmakers and aides to get their health coverage through the D.C. SHOP division.

The District of Columbia reported having 924 SHOP plan sponsors and 19,768 SHOP covered lives in May.

Vermont had 4,007 SHOP plan sponsors and 44,787 SHOP lives.

The other three states with more than 10,000 covered lives are California, with 27,467 covered lives; Utah, with 14,748 covered lives; and New York, with 14,628 covered lives.

Managers of Mississippi’s SHOP program did not give the researchers any numbers.

Idaho, which started its exchange late, had 27 SHOP sponsors and 264 covered lives.

All of the other SHOP divisions had at least 98 sponsors and at least 717 covered lives. 

Related: Limelight strategist: The exchange force is real


Maryland does not offer online enrollment, but it brings in plans through SHOP-authorized brokers, and the brokers themselves use online enrollment systems. (Image: Thinkstock)

2. Thirteen of the SHOP programs now offer online enrollment.

Mississippi did not tell the researchers about its enrollment strategy.

Twelve of the exchanges have their own online enrollment system.

Maryland does not have its own online enrollment system, but it requires SHOP sponsors to come in through SHOP-authorized brokers, and some of those brokers have online enrollment systems, the researchers say.

Related: eHealth To Market Small Group HSAs

Menu chalkboard

The vast majority of SHOP plan sponsors in at least six states choose the employee choice option. (Image: Thinkstock)

3. Employee choice menu options are popular with employers.

Word & Brown, an Orange, California, company, helped get insurers, brokers and policymakers interested in the small-group exchange concept in the first place by running a stable small-group exchange in California.

One of the most popular options at that exchange is a program that lets employers offer workers a choice of several different plans.

SHOP system designers tried to copy that California small-group exchange by requiring each state-based SHOP division to offer employers the option of letting workers choose from a list of all plans available within a certain coverage level category.

A SHOP employer is supposed to be able to offer workers access to all of the mid-level “silver plans” in its community, or all of the high-end platinum plans.

Currant and her colleagues did not have complete data on that, but they found that “choice options” seem to be very popular.

The researchers found that “most” of the SHOP sponsors in California, Idaho, New Mexico and Utah offer the choice option, and more than 85 percent of the SHOP sponsors in New York state and Rhode Island offer the choice option.


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