October has arrived, and along with it comes open enrollment in Obamacare’s health insurance exchanges, but there's a catch for small business owners.
While the individual insurance markletplace launched on October 1 (with its fair share of glitches), small business owners in most states will have to wait a bit longer to hop online and enroll employees into the Small Business Health Options Program (SHOP). SHOP, a health insurance marketplace for employers with fewer than 50 employees, was supposed to accommodate online enrollment in all states starting October 1, but the Department of Health and Human Services recently announced a delay until sometime in November. This digital setback applies to small business owners in the 34 states that are letting the federal government run part or all of their insurance marketplaces.
Those 34 states are: Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Michigan, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, Wisconsin and Wyoming.
Note that small businesses in these states are able to enroll through agents and brokers, over the telephone or via fax as of October 1. And, this newest delay is not supposed to affect the proposed date that coverage under these policies will begin: January 1, 2014.
California, Connecticut, Hawaii, Idaho, Kentucky, Massachusetts, New Mexico, New York and Rhode Island (some of the states that are administering their own insurance marketplaces) are the few states that were ready for small business owners to enroll online on October 1. Other states that are operating their own exchanges are delayed, though. Maryland, for example, will not open its SHOP until January 2014.
The online-enrollment delay comes on top of another big postponement in the SHOP exchanges: Small business owners were supposed to have flexibility in the coverage options they offer so that employees can pick the best fit for their needs. In 2014, however, businesses will be able to select only one health insurance plan for all of their employees. The selection of multiple options has been delayed until 2015.
By October 1, employers must distribute to their employees a "notice of coverage options" document to all of their employees. The Department of Labor has issued model notice of coverage forms that employers can use. NFIB recommends that employers have all of their employees affirm that they have received this document in some way, such as signing a document. The DOL has indicated that there will be no penalties associated with complying with this provision.
On January 1, the individual mandate will begin, meaning that all individuals (with some small exceptions, such as inmates), must purchase "minimum essential coverage." Also on January 1, all of the insurance market reforms will go into effect, so any new insurance policies issued after that date will have to comply with the new insurance regulations. For more information about all of these reforms, and what "minimum essential health benefits" means, visit NFIB.com/Healthcare.