Small Businesses Debate Options in Insurance Exchange
By Rebecca Jones
Colorado director for the National Federation of Independent Business, and member, Small Employer Work Group
Photography by Howard Sokol
Jim Sugden has a vision of what a health insurance exchange could offer to small employers in Colorado, and it looks something like this:
- It's a place where business owners could send their employees to shop for the health plan that fits them best. The employer stays out of it other than providing a set amount per employee for premiums.
- It would provide incentives for businesses to offer employee wellness programs and would reward those employees who make the effort to become healthier.
- It would offer transparency, so people could comparison shop when looking for providers or services and know exactly what they would be charged for a certain procedure.
Tony Gagliardi's vision differs a little in the specifics, but it's pretty close to Sugden's.
"We want choice," says Gagliardi. "We want flexibility in the way we pay for coverage – for ourselves and for our employees."
Gagliardi is the Colorado director for the National Federation of Independent Business. Sugden is the state exchange coordinator for the Colorado State Association of Health Underwriters. Both men serve on the Small Employer Work Group, one of three stakeholder subgroups that will advise and assist the state officials charged with developing the Colorado exchange.
The Colorado Health Benefit Exchange is the entity created last year by Senate Bill 200 to provide a marketplace for individuals and businesses to shop for health insurance coverage, in keeping with the requirements of the federal Affordable Care Act (ACA). The ACA requires the exchange to enroll individuals beginning Oct. 1, 2013, and to open for small businesses by Jan. 1, 2014.
The work group, which includes members from business organizations, insurers and consumer groups, has been meeting since April to work out suggestions for how the exchange can best serve the needs of small businesses.
"It's about getting the best ideas on the table," says Shawn Raintree, the Colorado exchange's operations manager and facilitator for the Small Employer Work Group.
While the ACA dictates that there will be a Small Business Health Options Program – SHOP in common parlance – what that looks like is open to debate. Should "small" remain at Colorado's current definition of less than 50 employees or go higher? Should self-employed individuals who are now covered through Colorado's "group of one" health plans be allowed into the small employer market?
"Instead of just saying that it ought to be the way it is now, [we thought] maybe we should have a discussion with interested, informed individuals who come together to talk about this so we hear all the different perspectives," Raintree says.
The Small Employer Work Group is still deep in its discussions and not yet ready to present recommendations. But he says some themes have emerged.
"One is that it's important to recognize how the existing marketplace works," Raintree says. "Clearly we need insurance companies, but not everybody knows that a broker fulfills an important role. The exchange needs to allow for the role of the broker." [Brokers offer policies from multiple insurance companies with which they contract.]
Other key components that the Small Employer Work Group sees as critical are:
- A shop-and-compare function that lets small businesses compare different plans.
- Good customer service, with a Web portal and customer support oriented to the small business customer, and easy access to services provided by brokers and insurance carriers.
- Information, education and assistance for employees as they choose plans.
"If we didn't have these discussions, didn't remain aware of all the different stakeholders in Colorado and weren't sensitive to them when we prepare to run the exchange, we would misfire," Raintree says. "It would be insensitive at least and a ticket to business failure at worst. We need to plan with the marketplace in mind."