The Centers for Medicare and Medicaid Services released a set of frequently asked questions relating to small businesses and the SHOP Health Exchange marketplace.
The Small Business Health Options Program (SHOP) is a new program for purchasing health insurance by small businesses to offer to their employees. Coverage is purchased through the Marketplace, or "Exchange."
Some questions and answers follow.
Q- How are premiums calculated in SHOP?
A.- The total premium charged to the group is the sum of the premiums of each of the participants and beneficiaries covered under the plan.
Q.- If an employer has multiple worksites in different states, which address is used to adjust premiums?
A.- The employer establishes one account per state. The rating area for the entire group is determined by the employer's principle business address.
Q.- If the employer moves, does the rating area change?
A.- The rating stays constant for the plan year.
Q.- Are composite premiums used in SHOP?
A.- Yes, composite premiums will be available upon request.
Q.- How will employers contribute premiums through SHOP?
A.-
- The employer will select a metal level of coverage;
- The employer will select a qualified health plan within that level of coverage to serve as a reference plan for contributions;
- The employer will define a percentage contribution toward premiums for employee only coverage under the reference plan;
- If dependent coverage is offered, the employer will define a percentage contribution toward premiums for dependent coverage under the reference plan;
- The resulting contribution amounts for each employee's coverage may then be applied toward the health plan selected by the employee.
Small employers seeking alternative health insurance options may decide to explore the offerings through the SHOP.
