By Linda Laarman and Karen Nordahl
Part 4: If you missed parts 1 – 3, read them at ppulse.com.
Our series on the Affordable Care Act (ACA) has focused on the healthcare exchanges (aka “marketplaces) that will offer coverage starting in 2014. Previous articles presented information on the exchange for individuals and families. This installment addresses fundamental points on an exchange specifically designed for small businesses, called the “SHOP” exchange, i.e. the “Small Business Health Options Program” exchange.
In Wisconsin and the other states that chose to use federally designed exchanges, the key website on which to learn about and apply for exchange coverage – both individual and SHOP – is healthcare.gov. Technology challenges may exist for those seeking to apply for coverage in the early weeks following the website’s Oct. 1 go-live date. However, significant educational information that people will want in order to make informed choices when applying already is readily accessible on this website, glitch-free. [We also strongly encourage small-business owners to seek help with health insurance and related ramifications from licensed insurance professionals, financial advisers and tax advisers.] ACA “navigators” and “application counselors” also can help, although they cannot legally make specific insurance-purchasing recommendations.
The big picture for the small employer
Because it can be a decisive factor in an individual’s choice of where to work, employer-provided health insurance is an important tool for attracting and retaining employees. But, just as many have been unable to obtain affordable coverage in the individual/family health insurance policy market, many small-business owners have had difficulty securing affordable coverage for their work forces. Even one employee with a medical problem can cost huge sums, making neither self-insurance nor the cost of a group policy from an insurance company feasible.
The ACA’s approach to small-business coverage is not a cure-all but, ultimately, may yield improvements. What the law is primarily intended to do, through its SHOP features, is provide more competitive, affordable health care options to small employers through creation of a new type of marketplace specifically geared to those employers. A complementary objective is enabling small-business owners to make better apples-to-apples comparisons of health plans.
No employer – regardless of the size of its work force, revenues or other factors – is required by the ACA or Wisconsin law to provide employees with health insurance. But some larger businesses, if they don’t offer insurance that meets specified employee-affordability thresholds, will have to make ACA-required “shared responsibility” (sometimes called “play-or-pay”) payments, starting in 2015. Small employers will be exempt from such a payment, however. In addition, small-business owners wishing to obtain insurance are not being forced into SHOP coverage; the individual exchange remains available to them (and employees), as do any group insurance plans offered outside the SHOP marketplace.
Besides creating the SHOP exchange, the main new ACA feature for small businesses is a new tax incentive for providing employee health insurance. While the cost of health insurance coverage for employees has always qualified as a business deduction, the ACA added a credit that may be of benefit to some small employers. The ability to claim the credit began in 2010; starting in 2014, the credit will be available only if employers obtain coverage through the SHOP exchange and meet certain other standards.
As is true for the new healthcare options extended to individuals, it probably will take a few years for kinks in the new small-business options and rules to be worked out, and for a sound evaluation of the new small-business marketplace and its effects to be made.
Like most employment-related laws, the ACA involves line-drawing to determine what “small” and “large” businesses are for various purposes, and complex definitions and counting rules. Employers should consult reliable websites and professional advisers to ensure they’re up to speed, but here are some basics:
Computing “full-time equivalent” employees: To determine whether they (1) can buy insurance using the SHOP exchange, (2) may qualify for a tax credit, and (3) may have to make a shared responsibility payment, employers will need to determine the number of their “full-time equivalent” employees (FTEs).
In general, individuals working an average of 30 or more hours per week are considered FTEs. In addition, part-time employees’ hours may be handled in a manner such that, for example, two or more part-time employees may add up to one FTE. Employees defined as “seasonal” are generally disregarded when calculating the number of FTEs.
FAQs issued by the Wisconsin Office of the Commissioner of Insurance indicate that, while a sole proprietor with no non-owner employees is ineligible for the SHOP marketplace, a business comprised of an owner plus at least one non-owner employee is.
Key ways in which number of FTEs matters:
Relevant ACA Feature – FTEs Cutoff
• Ability to buy on SHOP exchange – Only if under 50 FTEs.
• Eligibility for tax credit (if, starting in 2014, buy from SHOP) – Only if under 25 FTEs.
• Possibility of “shared responsibility payment” – Not if under 50 FTEs.
Local Organizations Team up to Offer Assistance for Enrolling in New Health Care Marketplace
Local health care and community service organizations are banding together to help consumers navigate the process of enrolling in the new public health insurance Marketplace.
“The Affordable Care Act marks a big change in how some individuals and families will access health insurance,” says Matt Luders of Ministry Door County Medical Center. “We know that change can be hard, and we want to help people understand their options and make the best choices for their families.”
Certified application counselors (CACs) at a variety of organizations will, by appointment, meet with individuals to provide support to consumers enrolling in the Marketplace.
Joanne Ator, economic support manager at the Door County Department of Human Services, believes it’s important for the county’s providers to work together in helping individuals and families get the health insurance they need.
“We have a great history of working collaboratively in Door County. In order to help people enroll in BadgerCare or the federal Marketplace, we have put together a system where there is no wrong door.”
Consumers are encouraged to begin their research by visiting healthcare.gov, the official site of the federal Health Insurance Marketplace. The Door County Library system and the Door County Job Center offer access to computers for beginning the research process. For people desiring further guidance, the following organizations offer one-on-one counseling.
• Ministry Door County Medical Center: Any resident of Door or Kewaunee counties can call 920.743.3707 to schedule an appointment Mon.- Fri. 8 am-4:30 pm
• Community Clinic of Door County, Inc.: One-on-one assistance at the Sister Bay and Sturgeon Bay clinic sites. Call 920.746.8989 ext. 101 to schedule an appointment Mon.-Thurs. 10 am-5 pm
• Door County Dept. of Human Services-Economic Support Unit will answer BadgerCare questions and referral to community partners for assistance in enrolling in private Marketplace plans. Call 920.746.2300 Mon.-Fri. 8:30 am-4 pm
• Current BadgerCare clients can call the Change and Information Center at 888.794.5747
• In addition, the League of Women Voters of Door County will present a panel discussion titled “Affordable Care Act: Learn what affordable health care can do for you,” on Oct. 17, from 6-8 pm. The discussion, held at Bay View Lutheran Church, Sturgeon Bay, will include representatives from Aurora Health Care, Ministry Door County Medical Center, and the Community Clinic of Door County.
Key federal educational/application information for exchanges:
- • healthcare.gov
- • Individual exchanges: 800.318.2596, TTY 855.889.4325
- • SHOP exchanges: 800.706.7893, TTY 800.706.7915
- • Non-English language support: 800.318.2596
Other important federal ACA websites
- • Internal Revenue Service: irs.gov/uac/Affordable-Care-Act-Tax-Provisions-Home
- • Department of Labor: dol.gov/ebsa/healthreform/
Key exchanges navigator for Door/Kewaunee/surrounding counties:
- • Partners for Community Development: partners4cd.com, 800.584.8172
Upcoming local forum on ACA: Oct. 17, 6 to 8 pm, at Bayview Lutheran Church in Sturgeon Bay (340 W. Maple), sponsored by the nonpartisan League of Women Voters of Door County. For more information, contact Paula Olson at 920.487.0383 or [email protected]
Wisconsin OCI FAQs:
- • “Federal Health Care Law Frequently Asked Questions for Employers,” oci.wi.gov/healthcare_ref/healthcarereform_employerfaq.pdf
- • “Federal Health Care Law Frequently Asked Questions for Consumers,” oci.wi.gov/healthcare_ref/healthcarereform_consumerfaq.pdf
WI Department of Health Services Information
- • Information from the Wisconsin Department of Health Services (DHS) on BadgerCare Plus, including letters regarding effect of ACA exchanges on health plan coverage for 2014, dhs.wisconsin.gov/badgercareplus/, 608.266.1865, or TTY 888.701.1251