Small-business employees will have to wait a year before they can choose their own medical plans after the Obama administration delayed a part of the 2010 U.S. health care reform law intended to provide them with coverage options. This is not a surprise to our agency since the entire healthcare reform is a massive undertaking and the CA health insurance exchange looks to be playing catchup on the individual side of the equation.
Starting in 2014, workers at companies with fewer than 100 employees were supposed to have been able to choose from a variety of health plans through new small-business insurance marketplaces. They will instead wait until at least 2015, according to regulations released by the U.S. Department of Health and Human Services.
In the meantime, small-business employees will face a situation similar to what most companies offer, with their employers choosing the coverage. Health insurers will still offer the plans, though they will be competing for business from companies, not individuals.
The delay is “a major letdown for small-business owners and their employees looking forward to robust, competitive exchanges in 2014,” said John Arensmeyer, CEO of the Small Business Majority, an advocacy group that backed the health care law, in a statement.
Implementation of employee choice in the program won’t be possible next year because of “operational challenges,” the federal government said in the regulation posted March 11. Small Businesses may still consider giving employees some form of a stipend and have them purchase coverage either through the private market or through the california health exchange.
Policies through Covered California, the formal name of the health exchange or a private carrier such as Aetna or Anthem Blue Cross which will guarantee issuance during the initial enrollment period between October 1, 2013 to March 31, 2014. The exchange will be comprised of the same private carriers bidding to participate in a program that allow certain consumers within certain income limits.
Our office will provide both group and individual quotes for employers to consider since businesses may be better off with employees getting a stipend since subsidies for employees may allow individuals and families to obtain more coverage than would otherwise be available through the group plan sponsored by the employer.
Our expectation is that employers will see the benefit of allowing employees to purchase their own coverage for a variety of factors including better coverage for a similar price, flexibility and choice of plans and physicians and less administrative costs.
Any tax benefit that may be received for offering health coverage will be made up in the savings that many employees will get through tax subsidies which means companies will not have to pay as much which adds to the bottom line. Contact us for a comprehensive health insurance proposal showing how tax subsidies through the exchange may reduce your business costs.
