The Evolving Coverage Landscape for Small Businesses: Opportunities and Challenges

June 12, 2015

The Affordable Care Act (ACA) created new health insurance marketplaces for small businesses, known as Small Business Health Options Program (SHOP) marketplaces, and made substantial changes to the regulation of health insurance for small businesses. For purposes of health insurance regulation, small businesses have traditionally been defined by states as businesses with up to 50 employees. The ACA defined the small group market as employers with 1-100 employees, while allowing states to limit small group participation to employers with 50 or fewer workers from 2014 through 2016. Every state chose to do so, but, for plan years beginning in 2016, the definition of small business is set to expand to include those with 100 or fewer employees—with potentially significant consequences for the small group health insurance market and the SHOP marketplaces.

This briefing addressed small group market regulation before and after the Affordable Care Act, coverage challenges unique to small employers, recent changes in coverage availability and affordability for small business employees, the design of the SHOP marketplace and its intended purpose, and proposals to delay or reconsider the expansion of the size of businesses regulated as small employers.

If you were unable to attend the briefing, here are some key takeaways:
Sabrina Corlette, senior research fellowand project director, Georgetown University’s Center on Health Insurance Reforms
The challenges small businesses have faced in providing health coverage to their employees is longstanding, Sabrina Corlette of Georgetown’s Center on Health Insurance Reforms said. Authors of the Affordable Care Act aimed to alleviate some of the difficulties, including limited choice and high, volatile premiums.

Terry Gardiner, vice president, Small Business Majority
The purpose of the small group expansion was to facilitate greater competition that would drive down the cost of care, Small Business Majority’s Terry Gardiner stated. The evidence isn’t yet clear on that proposition one way or the other, so major changes in the law may be premature.

Katie Mahoney, executive director, health policy, U.S. Chamber of Commerce
Katie Mahoney, executive director of health policy at the US Chamber of Commerce, warned that an expansion of the small group market could make it harder for employers with 51-100 employees to provide coverage. She went on to say that the conversation should not just be about helping businesses provide access to care, but should also shed light on the need to reduce the cost of care in general.

Alissa Fox, senior vice president of the Office of Policy and Representation, Blue Cross Blue Shield Association
The newly defined small group market (up to 100 employees) would cover over 8 million employees and dependents, Alissa Fox of the Blue Cross Blue Shield Association stated. She recommended permanently allowing states to determine the size of their small group market in order to best meet the needs and cost constraints of their constituencies.

Marilyn Serafini of the Alliance moderated the panel discussion.

Contact Monica Laufer (202)789-2300

Follow the briefing on Twitter: #SmallGroupMarket

The event was sponsored by the nonpartisan Alliance for Health Reform and the Blue Cross Blue Shield Association.


Full Transcript (Adobe Acrobat PDF)

Speaker Presentations

Sabrina Corlette Presentation (Adobe Acrobat PDF)
Terry Gardiner Presentation (Adobe Acrobat PDF)
Alissa Fox Presentation (Adobe Acrobat PDF)
Katie Mahoney Presentation (Adobe Acrobat PDF)

Event Details

Agenda (Adobe Acrobat PDF)
Speaker Biographies (Adobe Acrobat PDF)

Event Resources