While employers can start offering coverage through the SHOP marketplace at any time during the year, for coverage to begin on January 1, 2014, the current deadline for signups is December 15. However, the HHS intends to extend the enrollment deadline for the federal SHOP to December 23.
The Patient Protection and Affordable Care Act (or ACA) does not require small employers with fewer than 50 full-time or full-time-equivalent employees to offer health coverage to their workers. But the ACA does provide small employers with access to a SHOP marketplace in every state, offering coverage through qualified health plans that may take effect as early as January 1, 2014.
The SHOP marketplace is intended to help small businesses compare different health plans, finding one that fits their budget while meeting the needs of employees. It will also provide many small businesses with access to an expanded Small Business Health Care Tax Credit. In tax years beginning in 2014, this credit will be worth up to 50% of employer-paid premium costs.
Since it first became available in 2010, the Small Business Health Care Tax Credit has been worth up to 35% of employer-paid premium costs, and has provided more than $1 billion in tax credits. For tax years beginning in 2014, the credit will be available only for coverage purchased through the SHOP marketplace.
For small businesses in states with a SHOP marketplace run by the federal government, the HHS is making changes to ensure small businesses can take advantage of SHOP coverage and the tax credit as soon as possible. For 2014, small businesses will enroll their employees in coverage through an agent, broker or insurer that offers a certified SHOP plan and has agreed to conduct enrollment according to HHS standards.
According to the HHS, this process of direct enrollment is similar to the way most small employers get insurance today. Small businesses will not need to apply for SHOP eligibility before enrolling, or to use the HealthCare.gov website.
When using direct enrollment, small business owners can still go on HealthCare.gov to get information about plans available in their area. They can also download a paper application for SHOP eligibility from that site. Employers can also contact the toll-free SHOP Employer Call Center at 800-706-7893.