Small Business Leaders Applaud New Choices for Health Insurance and Welcome Efforts to Hold Down Costs
SACRAMENTO – Small business leaders today lauded the announcement of the health insurance plans and rates that will be available to small businesses through Covered California’s Small Business Health Options Program (SHOP), seeing them as an important first step in offering new choices for health insurance to small businesses and keeping future costs in check.
“For nearly a decade, increasing health care costs have been the top concern for California’s more than 3 million small business owners,” said Scott Hauge, president of Small Business California. “The plans and prices announced today should help control costs and put health insurance within reach for many.”
The SHOP is designed to level the playing field for small business owners who want to provide health care coverage by offering plans and prices similar to those available to big businesses. All plans participating in the exchange must offer 10 “essential benefits” required by the federal health reform law and must accept anyone who applies, regardless of pre-existing health conditions. Additionally, through SHOP, small businesses will, for the first time, be able to make apples-to-apples comparisons among the plans because their benefits will be standardized. Prices will vary based on a plan’s networks of doctors and hospitals, its strategies for dealing with prevention and chronic illness and their administrative costs and profit.
“The SHOP is an important new participant in the small group market in many ways,” said Micah Weinberg, senior policy advisor to the Bay Area Council and CEO of Healthy Systems Project. “It will more effectively link employees and family members to coverage if they are not part of the group plan, forwarding the goal of universal coverage of the Affordable Care Act. It will also be a disruptive participant in the marketplace, using its active purchasing power to push insurance plans and health care providers to improve quality and lower costs.”
Also important for small businesses is that the SHOP will handle administrative tasks that come with purchasing coverage, such as premium collection, enrollment and plan payments. The SHOP will provide small business owners with a single, consolidated bill to help minimize the time and paperwork employers often face when providing health coverage for their employees.
Small business owners may start enrolling in these newly announced SHOP plans when the health exchange is officially open for enrollment on October 1 and the coverage will take effect January 1, 2014.
The SHOP is part of an important effort to control health care costs. In fact, the U.S. Department of Health and Human Services recently evaluated proposed insurance premiums in 6 states, reporting that prices for small business plans in those states have come in an average of 18 percent lower than the premiums employers were paying prior to the Patient Protection and Affordable Care Act.
“The plans and rates offered by Covered California’s SHOP should help bring more competition to the marketplace and that’s good for business owners, workers and all of us in the long run,” Hauge said.
About Health Law Guide for Business
Established in partnership with the Bay Area Council, California Chamber of Commerce, California Hispanic Chambers of Commerce, California Restaurant Association, California Small Business Development Centers, Los Angeles Area Chamber of Commerce, Los Angeles County Business Federation, Pacific Business Group on Health, Silicon Valley Leadership Group, Small Business California, Small Business Majority and The California Endowment, Health Law Guide for Business is a resource designed to inform California’s employers about business-specific provisions of the health care law. To learn more visit www.healthlawguideforbusiness.org.
About The California Endowment
The California Endowment, a private, statewide health foundation, was established in 1996 to expand access to affordable, quality health care for underserved individuals and communities, and to promote fundamental improvements in the health status of all Californians. Headquartered in downtown Los Angeles, The Endowment has regional offices in Sacramento, Oakland, Fresno and San Diego, with program staff working throughout the state. The Endowment challenges the conventional wisdom that medical settings and individual choices are solely responsible for people’s health. Through its ‘Health Happens Here’ campaign and ten-year initiative for Building Healthy Communities, The Endowment is creating places where children are healthy, safe and ready to learn. At its core, The Endowment believes that health happens in neighborhoods, schools, and with prevention. For more information, visit The California Endowment’s homepage at www.calendow.org.