Employee benefit plan open enrollment is here, and a number of factors are affecting the outlook of the small group market.
Continued uncertainty around the Affordable Care Act is driving small employers toward group plans, and away from the idea of depending on the individual market, but changing federal regulations and rising costs are affecting the group market, too.
Here are three trends to keep an eye on in the small group market.
1. Oscar Health is making a play.
In July, health insurance startup Oscar Health announced a partnership with Humana to offer small group health insurance in the Nashville, Tennessee, area. This regional market entry is in the small group market, for employers with 50 or fewer employees.
But the company also launched a broader strategy, Oscar for Business, earlier this year. This segment is for organizations with up to 100 employees, and the company’s consumer-oriented model could work well for millennials, who are quickly rising up the ranks in small businesses nationwide.
Despite significant financial losses on the individual side of its business, Oscar Health has continued to operate in growth mode, and its concierge services and technology-heavy service model could shake up insurance dynamics in Nashville and, eventually, elsewhere.
2. SHOP is dying. if not already dead.
The end of the idea of the Small Business Health Options Program (SHOP) selling coverage through the Affordable Care Act public exchange system seems all but certain. BlueCross BlueShield of Illinois announced it August it would leave the network, the last in a slew of problems for the program.