How Shop Exchanges For Small Businesses Can Help in Health Plans? | Mercer US

How Shop Exchanges For Small Businesses Can Help in Health Plans?

Our Thinking / Healthcare /

Can SHOP Exchanges Deliver Savings One Study Says They Can
Calendar26 September 2014

Remember SHOP-- the new online insurance marketplaces for small businesses? In addition to the greater convenience of a start-to-finish online shopping experience, the exchanges were supposed to help employers save through price competition and tax breaks. But only a handful of states offered a fully functioning online small business exchange last year, and most small businesses could only apply for coverage through the SHOP program via paper application utilizing an agent or broker, or directly through issuers. (The New York Times blogger Robb Mandelbaum characterized the program’s first year as “plagued by technical problems and delays, insurer antipathy and small-business indifference.”) Official SHOP enrollment figures have yet to be released but they are certain to be low. However, that could improve this year as a number of additional states launch online portals. Further, an analysis conducted for CMS by the National Opinion Research Center this summer found that health plans offered on SHOP exchanges are on average about 7% cheaper than plans not offered on the exchange. Some brokers object that the study is not based on apples-to-apples comparisons, and that the availability of richer plans off-exchange accounts for the difference. That said, there are enough signs of progress that it makes sense for small employers to at least investigate their SHOP options this year before renewing.

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