Small Business Plans for Covered California Announced

SHOP is the Small Business Health Options Program operating under Covered California that will begin in 2015 for businesses with 50 or fewer employees. Small businesses will have the option to offer insurance plans through SHOP rather than through carriers not on the Covered California plan. According to Covered California Executive Director Peter Lee, this gives employers more flexibility in the types of plans and quality of coverage they are offering to employees.

How will the SHOP work?
Under SHOP, employers will be able to offer employees coverage from two pre-selected metal tiers similar to the individual tiered plan under Covered California. Unlike the individual market where consumers can select among one of four options, employers who choose to participate in SHOP must offer plans that are adjoining such as Bronze and Silver, Silver and Gold, or Gold and Platinum. An employer cannot select a Bronze plan and a Platinum plan to offer employees. While this is meant to make employee benefits more competitive and valued, in reality this limits the flexibility of the employer to appease individual employee needs.

5 Things You Need To Know About SHOP:

  • Employers have the option to offer additional benefits like dental plans for adults in 2015 (Dental benefits will be employee paid only)
  • There are 6 health plans and 10 dental plans
  • Businesses with 50 or fewer employees are not required to get benefits through SHOP and there is no penalty for choosing not to enroll in coverage with SHOP
  • Businesses with 25 or fewer employees who choose to enroll in SHOP will be eligible for a tax credit
  • Open enrollment for SHOP is available year round (1,714 businesses are currently enrolled)
For a list of the health plan carriers and dental providers covered through SHOP in 2015, click here.
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