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November 27, 2013 12:00 AM

Obama administration delays online insurance enrollment for small business

Jessica Zigmond
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    (Story updated at 5:15 p.m. ET.)

    The Obama administration announced a one-year delay of online enrollment for small businesses looking to purchase healthcare coverage for their workers in the 36 states served by the federal insurance exchange through the HealthCare.gov website. But they will be able to sign their workers up for coverage immediately through an insurer, agent, or broker, HHS said Wednesday.

    The administration said this means that by November 2014, online enrollment in the Small Business Health Options Program, or SHOP, marketplace will be available to employers in all states that have 50 or fewer full-time workers. That will allow them to shop for and purchase health coverage for their workers.

    The administration had said earlier this fall that it would delay online enrollment in SHOP though the federal exchange until November 2013. It previously had announced that for 2014, employers had to pick a single plan, and could not allow their employees to choose from a variety of plans on the federally run SHOP exchange.

    But many states running their own exchanges, including New York, are going ahead with online SHOP enrollment for 2014, and are allowing employees working for the same small business to choose from a variety of plans.

    The HHS' announcement that there is immediate availability of SHOP enrollment through an insurer, agent, or broker is intended to allow small employers to sign up for coverage while the CMS continues to work on improving the online experience in the SHOP marketplace on HealthCare.gov. Employers can buy coverage on the SHOP marketplace at any time during the year, with no open enrollment deadline.

    Qualifying small businesses with less than 25 employees and average wages under $50,000 can qualify for up for tax credits of up to 50% if they pay at least half the premiums for their employees through the SHOP exchanges.

    HHS announced Wednesday that small businesses no longer have to apply to be certified for the tax credits before enrolling. Because the application was intended for tax credit purposes, HHS will allow businesses to file the application any time before the business files its taxes.

    And small businesses will have until Dec. 23, instead of Dec. 15, to sign their employees up for SHOP coverage effective Jan. 1, 2014. In addition, HHS said that starting Dec. 1, 2013, HealthCare.gov will offer an enhanced comparison shopping feature for small businesses that will allow them to compare plans before choosing one and buying it directly through an insurer, agent, or broker.

    House Republican leaders criticized the Obama administration for making the announced changes in the SHOP exchange just ahead of a holiday, just as officials did this summer when they announced a one-year delay in the 2010 health reform law's mandate that employers provide insurance for their workers or face a penalty. In a written statement, House Speaker John Boehner (R-Ohio) said President Barack Obama should delay the law before it “wreaks any more havoc on American families and small businesses, as well as our economy.”

    “It is hard not to be disappointed that employers and employees will not be able to access care through the website,” said Neil Trautwein, vice president and employee benefits policy counsel at the National Retail Federation, which has opposed the reform law, in a written statement.

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