Effort to bypass exchange for small business continues

MONTPELIER — The Shumlin administration and lawmakers are moving forward with efforts to scrap plans for the small business function on the state’s online health insurance marketplace.

Under state law, small businesses are supposed to be enrolling employees through Vermont Health Connect, the state-based insurance exchange created under the federal Affordable Care Act. But the website, which launched in October 2013, has never included that online function, known as Small Business Health Options Program, or SHOP.


Lawrence Miller

As a result, small businesses have enrolled employees directly through the two insurance carriers offering health plans on the exchange — Blue Cross Blue Shield of Vermont and MVP Health Care. Rep. William Lippert, D-Hinesburg, the chairman of the House Health Care Committee, has introduced a bill to allow the state to seek a so-called 1332 waiver to allow small businesses to continue enrollment directly through the carriers.

Under Lippert’s bill, the commissioner of the Department of Vermont Health Access is authorized to seek the waiver from the Centers for Medicare and Medicaid Services and the U.S. Secretary of Health and Human Services.

Lawrence Miller, Gov. Peter Shumlin’s chief of health care reform, said the system put in place after the exchange launched without online small business enrollment is working well. Maintaining it is “the least expensive option of all.”

Even if the waiver is obtained the state will need to maintain the same policies and benefits, he said.

“It can’t degrade benefits and it can’t degrade choice. All of the core things that the ACA set out to do are tests for any waiver,” Miller said.

States around the country that have created their own state-based exchanges have had difficulty setting up the small business markets, according to Miller. He said completing work on the online function “doesn’t necessarily make a lot of sense.”

“Vermont has a very strong small business SHOP market, and I think it’s important to remember that the SHOP market, or the exchange market in general, is not a website. The exchange market is the risk pool and products and policies that are within that. So, we’ve taken some really good steps to have a really robust SHOP market, absent a website,” he said.

The small business function might cost “$4 or $5 million to develop the technology but then you’ve got to maintain it,” Miller said.

On top of that, operating costs might reach “a few million dollars” a year on an ongoing basis, he said.

Cory Gustafson, director of government and public affairs for BCBS, said the insurer fully supports the administration’s efforts to obtain a waiver and maintain small business enrollment directly through carriers.

Most lawmakers agree, too.

“I feel very confident that nearly all are on the same page,” Miller said. “Certainly, I’ll be interested to see it come out of House Health Care and come to the floor for a vote.”


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