Small Business Health Options Program (SHOP)

1. Small Business Health Options Program (SHOP)

2. This Training • Four sections to this training: • Overview of Tribes and Tribal Entities as Employers • Small Business Health Options Program (SHOP) • Small Business Tax Credit (Tax Credit) • Employer Shared Responsibility

3. Small Business Health Options Program Topics • What is SHOP? • SHOP Functions • Comparison with Individual Marketplace • Eligibility, Definitions & Application • SHOP Plans • Enrollment, Contributions, & Premium Aggregation

4. What is SHOP?

5. What is SHOP? • SHOP = Small Business Health Options Program • Designed to help small businesses purchase health insurance for employees. • Each State will have a Marketplace (a/k/a Exchange) where individuals and small businesses can shop for health insurance. • State, Federally-facilitated (FF), Partnership & Hybrid model in pending regulations (e.g., only SHOP run by State) • Tribes and Tribal entities are eligible to participate. • The SHOP will allow an employer to compare plans based on price, coverage and quality.

6. Status of 2014 Marketplace (Exchange) Implementation Source: Ctr. on Budget & Policy Priorities, Status of State Health Insurance Exchange Implementation (Aug 6, 2013, http://www.cbpp.org/files/CBPP-Analysis-on-the-Status-of-State-Exchange-Implementation.pdf.

7. SHOP Marketplace in Your State • Healthcare.gov https://www.healthcare.gov/what-is-the-marketplace-in-my-state/ • The Commonwealth Fund Interactive Map http://www.commonwealthfund.org/Maps-and-Data/State-Exchange-Map.aspx

8. SHOP Functions

9. SHOP Functions • Among other functions, the SHOP: • Determines requirements for enrollment and eligibility. • Provides qualified health plan (QHP) options for employers. • Administers premium payments. • Certifies QHPs. • Determines participation rules. • Establishes methods for contributions.

10. Comparison with Individual Marketplace

11. Individual Marketplace vs. SHOPGenerally

12. Individual Marketplace v. SHOPSpecific to AI/AN

13. Eligibility, Definitions & Application

14. Employer Eligibility Generally, an employer is eligible to participate in SHOP if the employer: • Is a small employer on business days during the prior calendar year and who employs at least one employee on first day of the plan year; • Elects to offer all full-time employees coverage in a plan through a SHOP; and • Has its principal place of business address in the Exchange and offers coverage to all full-time employees through that SHOP; OR offers coverage to each eligible employee through the SHOP serving that employee’s primary worksite (in this case, the employer participates in multiple SHOPs).

15. Employer Eligibility (continued) • Participation Rate Requirement • In Federally-facilitated SHOP, at least 70% of full-time employees must enroll in order for the employer to qualify (or a different rate as determined by State law). • If employer does not meet participation threshold, employer may enroll during a special enrollment period: 11/15/13 to 12/15/13. • For State-based SHOP, check SHOP application to determine participation rate requirement.

16. Employee Eligibility An employee (or employee’s family member) is a qualified individual eligible to enroll in coverage through the SHOP only if the employee (or the employee’s family member) receives an offer of coverage from a qualified employer.

17. Small Employer Definition State-based SHOP • In 2014 and 2015, a State may elect to define as an employer with <50 employees (or < 100 employees as determined by State) • In 2016, will be defined as an employer with <100 FTEs Federally-facilitated SHOP • In 2014 and 2015, an employer with < 50 FTEs • In 2016, will be defined as an employer with <100 FTEs

18. Full-Time Employee Definition State-based SHOP • In 2014 and 2015, a State may use the definition of full-time employee from the State’s small group market or the Federal definition. Look at State SHOP application for applicable definition. • In 2016, the Federal definition of full-time employee will apply to State-based SHOPs. Federally-facilitated SHOP • Beginning on October 1, 2013, the FF-SHOP will use the federal definition of full-time employee which is an employee who is employed an average of 30 hours of service per week (or 130 hours of service per month)

19. Counting Employees: State-based SHOP • Counting method will vary by State. • State-based SHOP application will explain counting method or check State-specific SHOP website. • In 2016, a State-based SHOP must use the same method as the Federally-facilitated SHOPs (i.e., large employer counting method under Shared Employer Responsibility rules).

20. Counting Employees: Federally-facilitated SHOP To determine FTEs: • Count the number of full-time employees for each calendar month in the prior year. • Determine the number of full-time equivalent employees by adding the total number of hours of service of part-time employees in a calendar month and dividing by 120. • Add the number of full-time employees and full-time equivalent employees for each month of the calendar year. • Add up the 12 monthly numbers and divide by 12. • Exclude seasonal workers (120 hours or less) for the calendar year.

21. Application Process • An employer may apply through the SHOP website, a Navigator, an insurance broker, or a call center • Single SHOP application (on line & paper) • Separate applications for employer & employee • The SHOP will: • Verify information in applications • Determine employer’s eligibility to participate • Notify employer as to denial or approval of application

22. SHOP Plans

23. Essential Health Benefits The plans in SHOP will include Essential Health Benefits (EHB): • Ambulatory patient service • Emergency services • Hospitalization • Maternity and newborn care • Mental health and substance use disorder services, including behavioral health treatment • Prescription drugs • Rehabilitative and habilitative services and devices • Laboratory services • Preventive and wellness services and chronic disease management • Pediatric services, including oral and vision care

24. SHOP Plans • Different actuarial values (AV) in plans are described using “metallic” descriptors. • All plans in the SHOP will have the same EHB. • Plans may have different: • Network of providers • Premiums & cost sharing

25. SHOP Plans (continued) Sources for Plans Offered in SHOP: • Qualified Health Plans (QHPs) • Multi-State Plans (MSPs)

26. Qualified Health Plans (QHPs) • An insurance plan certified by an Exchange (Marketplace) • Includes EHBs • Follows established limits on cost-sharing • deductibles, copayments, and out-of-pocket maximum amounts • Meets other requirements

27. Multi-State Plans (MSPs) • Administered by the Office of Personnel Management (OPM) • OPM contracts to offer at least 2 MSPs on SHOPs in each State. • 31 states in 2013, phased in to all states by 2018 • MSPs at Silver and Gold level required; Bronze or Platinum permitted. • Must include EHB. • For MSPs, OPM sets the Benchmark.

28. Employer & Employee Choices

29. Enrollment, Contributions & Premium Aggregation

30. Enrollment • Initial open enrollment period • October 1, 2013 • SHOP must provide special enrollment periods. • American Indians and Alaska Natives may enroll in a plan or change plans once per month. • Employer may purchase insurance at any time during the year (rolling enrollment). • SHOP provides notice to the employer as to the annual employer enrollment period.

31. Employer and Employee Contributions State-based SHOP • In 2014, a State-based SHOP may establish one or more standard methods that an employer may use to determine their contributions toward employee and dependent coverage. Federally-facilitated SHOP • In 2014, an employer sets the contribution amount for employees (and dependents, if applicable) • In 2015, a standardized method for employer contributions is required.

32. Premium Aggregation State-based SHOP • In 2014, a State-based SHOP may aggregate premiums. • In 2015, a State-based SHOP will aggregate premiums and provide a monthly invoice to employers that identifies the employer and employee contribution and total amount due to the plan issuers from the employer. Federally-facilitated SHOP • In 2014, FF-SHOP will not aggregate premiums; employer pays insurance company directly. • In 2015, FF-SHOP will aggregate premiums.

33. Preparation • Learn about the options for your business at:http://business.usa.gov/healthcare • Prepare a budget to determine how much you can spend on insurance. • Gather and organize information about your employees. • Talk to your HR Department, attorney and insurance broker about your options. • Consider participating in SHOP because the Small Business Tax Credit will only be available for plans purchased in the SHOP in 2014.

34. Section Review • What is SHOP? • Are Tribes and Tribal entities eligible? • Name one difference between SHOP and the Individual Marketplace? • What is limit on number of employees for SHOP? • In 2014, how many plans will an employer in an FF-SHOP offer to employees? In a State-based SHOP?

35. Questions