Small Business Health (SHOP) Options Ends

CMS announced on May 15th that they would end the Small Business Health Options (SHOP) program, effectively on November 15th 2017.

The SHOP program allowed small business to purchase group health insurance through the Federal Facilitated Exchange. The goal, was to allow small business to offer multiple plan design and received a tax credit for a portion of the employer contribution.

The program never met its goals in Indiana or the rest of the country.  The architects of the SHOP did not understand the small group market.

1st.  Small groups providers did not have the technology for integrating multiple carriers, nor were there multiple carriers to offer.

2nd.  The enrollment process through the marketplace, was extremely frustrating to both employer and employee.

3rd. The exchange plans being offered, had less network access than group plans off the exchange.

4th. Employer tax credits, were based on the average income of the company. This devalued the tax company tax credit.

5th. For companies that have low wage employees, they were better off not offering a group health plan. Then those employees could get on Medicaid or were highly subsidized on the marketplace.

For Indiana, we had less than 100 companies elect coverage through SHOP. Nationwide there was less than 30K.

We were one of the first agencies to be certified to offer the SHOP plans in Indiana. Having quoted multiple small companies on the SHOP, there was little to no value with that option. It was a good idea.

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