Small Businesses: Major Changes Proposed for 2018 FF-SHOP Enrollment
Note to readers: Efforts in Washington to repeal and replace the Affordable Care Act appear to have collapsed for the time being, but it’s possible efforts could be revived. Please bear this in mind as you read the article below, and consult your benefits advisor for the latest developments.
The Small Business Health Options Program (SHOP) was created under the Affordable Care Act to establish a centralized marketplace where small employers and their employees could choose coverage, complete enrollment and pay premiums. A subset called the “federally facilitated SHOP” (FF-SHOP) was also established to perform such functions in states that don’t have a state-based SHOP. Employers aren’t required to buy SHOP coverage unless they wish to receive the small business health care tax credit.
Recently, the Centers for Medicare and Medicaid Services (CMS) announced its intention to issue proposed regulations that would change the enrollment process for small employers buying plans via the FF-SHOP.
According to the CMS announcement, for plan years beginning on or after January 1, 2018, the proposed regulations would eliminate the FF-SHOP’s enrollment function. Instead, small employers would enroll directly with an insurer offering SHOP plans or with the assistance of an agent or broker registered with the FF-SHOP.
Although the announcement doesn’t directly address the FF-SHOP’s future role in collecting premiums from employers and forwarding them to insurers, it implies that the FF-SHOP will also discontinue this function. The CMS has stated that employers currently enrolled in FF-SHOP coverage for a plan year beginning in 2017 would be able to continue enrolling employees and pay premiums through the FF-SHOP for the remaining portion of that plan year in 2018.
The announcement also states that employers would still use the HealthCare.gov website to obtain a determination of eligibility. Additionally, the CMS anticipates that state-based SHOPs would be able to provide online enrollment, or opt to direct small employers to insurers and SHOP-registered agents and brokers in order to directly enroll in SHOP plans.
Under the transitional relief issued in April 2016, state-based SHOPs already have the option to use direct enrollment through 2018. Although the CMS proposal would revise the way the FF-SHOP operates, the full extent of the change will have to be developed through the rule-making process.
It appears that the SHOPs will have a role to play so long as they are linked to the small business health care tax credit. In addition, there may be resistance to the potential loss of the FF-SHOP’s premium calculation, collection and payment functions.
If you have questions on obtaining SHOP coverage to receive the small business health care tax credit, please contact Ron Present, Partner and Health Care Industry Group Leader, at firstname.lastname@example.org or 314.983.1358.