Brokers May Run 2018 HealthCare.gov Group Enrollment

The District of Columbia and Vermont have high SHOP enrollment numbers because they require small groups to get new, fully insured health coverage through their locally run ACA exchange program SHOP divisions, even if those groups also use agents, brokers or benefits consultants. Some other states with state-based exchanges, including California and Connecticut, have also achieved respectable SHOP enrollment numbers.

Other states have had trouble with their SHOP divisions. Managers of Nevada’s exchange reported in April 2015 that, earlier in the year, the state’s SHOP exchange division was providing coverage for just seven people.

The new CMS SHOP enrollment numbers imply that jurisdictions with their own locally based ACA exchange programs serve 19,400 SHOP plan sponsors and about 191,000 SHOP plan enrollees.

Members of the Trump administration and Republicans in Congress are trying to repeal and replace the ACA. Successful efforts to change the ACA could kill the ACA exchange system. For now, however, officials at Trump’s CMS are operating under the principle that the ACA is still the law of the land, and that they must do their best to make the exchange system work. CMS has been continuing to run the ACA individual and small-group risk-adjustment programs in about the same way it was running them under Obama. The agency recently completed work on a collection of individual exchange stabilization measures, including a move to tighten the documentation standards for consumers who are applying for permission to buy coverage outside the usual open enrollment period.

If the current ACA rules stay in effect in 2018, CMS needs to keep some version of the SHOP system alive to give small employers access to the ACA Small Business Health Care Tax Credit.

The ACA requires employers with the equivalent of at least 50 full-time employees to offer the full-time workers major medical coverage oor face the risk of having to pay a penalty. Small employers do not have to meet the ACA “employer shared responsibility” requirements.

The ACA also created the individual public exchange program and the individual exchange user premium tax credit subsidy program.

ACA drafters put the Small Business Health Care Tax Credit in to keep small employers from dropping their coverage and sending the workers to the individual exchange.

When ACA rules and programs came to life, small employers did not rush to drop their coverage, but enrollment did not stabilize either. Enrollment continued to drop at about the same rate. The new tax credit did little to increase small-group health insurance sales, partly partly because qualifying for the tax credit has turned out to be difficult.

To enlist brokers in efforts to turn the HealthCare.gov small-group division around, Trump’s CMS will have to wrestle with a problem it inherited from the Obama administration: a history of refusing to help agents and brokers get paid.

Early on, CMS officials said they wanted to work with agents and brokers. CMS then did nothing to help agents and brokers collect enrollment fees from 2011 through 2013, when it was in charge of a temporary ACA Pre-existing Condition Insurance Plan program for people with health problems.

When HealthCare.gov opened, CMS said issuers had to pay the same commissions for plans sold through HealthCare.gov and similar plans sold outside the exchange system, but CMS never set minimum commissions standards, and it never helped agents and brokers collect the commissions that exchange plan issuers had already promised to pay them.

Managers at some locally run exchanges have been far more active at speaking up for brokers. Covered California, for example, has set minimum exchange plan commission standards.

In the new notice, CMS makes no mention of any campaigns to persuade issuers to offer minimum commission levels, or to push issuers to pay the commissions agents and brokers have already earned.

— Read 3 Secrets About the ACA Small-Group Exchange Program on ThinkAdvisor.