UPDATED: California & New York SHOP enrollments jump dramatically.
I don't analyze or write about the ACA's SHOP (Small business Health Options Program) exchange enrollment very much these days. The main reason for this is that SHOP enrollment is extremely difficult to come by. The federal exchange (HealthCare.Gov) has mostly pretended the program doesn't even exist, at least when it comes to enrollment...in fact, to my knowledge, they've only issued a single hard number for HC.gov SHOP enrollment...in 2015:
On November 15th, 2014 we launched the HealthCare.gov portal for 33 states to enroll in SHOP Marketplaces. As of May 2015, approximately 85,000 Americans have 2015 coverage through SHOP Marketplaces with about 10,700 small employers participating in SHOP Marketplaces. These totals do not include employers that began coverage in 2014 and have not yet renewed their coverage through HealthCare.gov for 2015.
As for the state-based exchanges (down to 12 these days), their SHOP data has been pretty scattershot, with some posting occasional updates and others never mentioning the program at all. To the best of my knowledge, SHOP enrollment has never exceeded more than perhaps 200,000 enrollees total nationally, with the largest enrollment numbers coming from California and New York (no surprise given their large populations), as well as Vermont and the District of Columbia.
VT and DC may be surprising given their tiny populations, but there's a special reason for both: In both VT and DC, all small group enrollment has to be done via the SHOP exchange...and DC has the additional ACA clause requiring all members of Congress and their staff to use the DC SHOP exchange for their healthcare policies as well.
In any event, while SHOP has kind of trudged along in the background, there seems to be some perking up in enrollment of late, at least in CA and NY.
Covered California for Small Business Announces Rates and Plans for 2019 With an Average Premium Increase of 4.6 Percent
- The weighted average rate change is the lowest in the five years since Covered California for Small Business (CCSB) launched in 2014.
- CCSB has more than 47,000 members to date, an increase of more than 30 percent over a year ago.
- The small business program continues with five carriers offering coverage for employees around the state.
- Covered California produced a new video, capturing the experience of one of its CCSB members
SACRAMENTO, Calif. — Covered California for Small Business (CCSB) unveiled the health plan choices and rates for small-business employers and their employees for the upcoming 2019 plan year. The statewide weighted average rate change will be 4.6 percent for employers and their employees, which represents the lowest annual increase in the program’s five-year history.
“Our small-business exchange continues to grow as we offer a wide range of plan options to business owners and their employees across the state,” said Covered California Executive Director Peter V. Lee. “The modest rate change and increase in signups reflect the strides we have made as we seek to offer employers coverage options more tailored to each employee’s needs.”
This year’s rate change of 4.6 percent is lower than the most recent year-over-year trend of 6 percent that larger employers are experiencing (see Table 1) and reduces the program’s five year average increase to 5.9 percent.
“The success of Covered California for Small Business is yet another example of how this new era of health care is working for Californians,” Lee said. “The stability and competitive rates of our small business product helps put competitive market pressure on the entire small employee sector.”
Press Release: NY State of Health Announces Rapid Growth in New York’s Small Business Marketplace
Feb 27, 2019
- Nearly 500 Percent Increase in Employer Participation
- Robust Plan Choice, Easier Access to Small Business Tax Credits Fuel Growth
ALBANY, NY. (February 27, 2019) -– NY State of Health, the state’s official health plan Marketplace, today announced overwhelming success with New York’s Small Business Marketplace (SBM) following implementation of a simplified enrollment process and the addition of thousands of new plan options in April 2018. Since then, the number of small employers participating in the SBM has grown to 12,219, an increase of 465 percent. Greater plan choice and easier access to the federal Small Business Health Care Tax Credit have contributed to the rapid growth.
“Small business tax credits are alive and well under the Affordable Care Act,” said NY State of Health Executive Director Donna Frescatore. “It’s now easier than ever for qualified employers in New York State to offer their employees affordable health coverage while saving money. We continue to reach out to the broker community and directly to insurers to make the tax credit even more accessible in 2019.”
Enrollment in New York’s SBM is open year-round. Eligible employers who offer coverage therefore still have the opportunity in 2019 to qualify for the federal Small Business Health Care Tax Credit. Employers can access tax credits by completing a short application here and enrolling in Marketplace-certified plans directly through an insurer or broker of their choice. Previously, small businesses could access tax credits if they enrolled through the NY State of Health website and selected from a limited number of plans. Today there are nine insurers offering more than 2,000 plans through New York’s SBM.
The SBM is open to businesses operating in New York with 100 or fewer full-time equivalent employees. The Small Business Health Care Tax Credit is available to businesses with fewer than 25 full-time equivalent employees with an average annual employee salary of $53,000 or less (excluding the owners’ salaries); whose contribution towards the lowest cost employee coverage is at least 50 percent; and who make coverage available to all full-time employees. Small employers can receive up to 50 percent (35 percent for non-profit employers) of their contribution toward employee coverage.
The NYSoH release doesn't list how many covered lives there are across those 12,219 employers. I do have a 2014 press release which suggested that each of the 4,000 businesses enrolled in SHOP at the time averaged 4-5 employees, which would suggest perhaps 18,000 employees total...except the same PR also said that there were 10,000 employees "and their dependents" enrolled, which would likely be more like 25,000, if you assume 2.5 people per household.
Using those ratios, it sounds like the 12,219 employers enrolled in NY's SHOP should have something like 3x as many covered lives today, or 54,000 - 75,000 people total, or 15% - 60% more than Covered CA, which would be particularly impressive given that California's total population is nearly twice that of New York's. I'll update this if I'm able to pin down the actual number of people covered.
UPDATE: Thanks to Jason Sparks for reminding me that the DC exchange has by far the highest number of SHOP enrollees today: Over 78,000 covered lives as of this month. I'm not sure how many of those are members of Congress or their staff. This link makes it sound like the grand total is something like 14,000 or so (including the House/Senate members themselves), plus some of their family members (I'm assuming most staffers are younger and therefore unmarried/no kids). Perhaps 30,000 or so of the 78,000 total?
UPDATE x2: Thanks to Michael Capaldo for reminding me of the major change which the SHOP program went through awhile back (and which I had actually written an entire blog post about and then promptly forgot about in May 2017):
Today, the Centers for Medicare & Medicaid Services (CMS) announced a plan to change the way that small businesses enroll in insurance coverage through the Federal exchanges, offering employers the help they need to find affordable insurance for their employees.
...As part of the changes CMS intends to propose, employers would still obtain a determination of SHOP eligibility through HealthCare.gov. The move would reduce the federal government’s role in healthcare coverage decisions and make it easier for issuers to use their own enrollment systems for SHOP plans. Online enrollment would be removed from HealthCare.gov and small employers would access coverage through an agent or broker, or an issuer of their choice, for plan years beginning on or after January 1, 2018.
The FF-SHOPs exist in states where the SHOP program is operated by the federal government. Small businesses with SHOP coverage that took effect in 2017 would be able to continue using HealthCare.gov for enrollment and premium payment until their current plan year ends. Some employers that purchase SHOP coverage are also able to access the Small Business Health Care Tax Credit. This option will still be available to small employers who purchase coverage under the new enrollment approach.
Under the intended approach, state-based SHOPs not using HealthCare.gov could continue to operate as they have previously.
In other words, employers would still have to go through the initial application process via HC.gov (to ensure they qualify for the program and tax credits), but they'd then actually enroll in the policies through a broker or the insurance carrier itself, along with making payments directly to the carrier. This...is actually fairly reasonable. Only a handful of the state exchanges ever handled payments for the individual market, and one of those (Washington State) abandoned that last year, moving to a direct premium payment model like nearly every other state (I think MA and RI are the only ones still handling payments today).
Capaldo sent me a link to a follow-up CMS memo from October 2017 which gave more details on the change, including, as far as I can tell, opening up the "enroll directly" part to state-based SHOP exchanges as well...including NYSoH:
To mitigate these operational complexities for issuers, agents and brokers, and employers, while HHS considers comments to the proposed rule, HHS will permit FF-SHOPs and SBE-FPs for SHOP, QHP issuers, SHOP-registered agents and brokers, and employers to begin operating in accordance with the approach for SHOP enrollment proposed in the rule, starting on the first date on which employers can complete a group enrollment for a plan year that would take effect in 2018 (e.g. for plans with effective dates on or after January 1, 2018). SBEs operating their own SHOP will have this same flexibility, and their relevant stakeholders (e.g., issuers and agents and brokers) upon direction from these SBEs.
It sounds to me like NYSoH held off on making this move until April 2018:
...following implementation of a simplified enrollment process and the addition of thousands of new plan options in April 2018. Since then, the number of small employers participating in the SBM has grown to 12,219, an increase of 465 percent.
Capaldo also states that:
Re enrollment, it was approx. 2100 groups / 9,500 enrollees in January of 2018.
— Michael Capaldo (@consultbenefits) March 1, 2019
...which suggests that the 12,219 groups enrolled today could have up to 55,000 enrollees total, although Capaldo clarifies that the 12.2K figure is just the number which have been found eligible to participate; there's no data on just how many have actually enrolled their employees yet.