COVID-19 is making health care critical now more than ever. If you are a small business, do you know all the small business health insurance options available to you in California?
Bernardini & Donovan is here to help you with all your insurance needs, including any options you have to receive small business health insurance options in California via the Covered California SHOP (Small Business Health Options Program) Exchange. Appropriately educating you on the best health small business insurance options means we take into consideration all of your small business needs, from your employees to your affordability.
As a health insurance company, Bernardini & Donovan recognizes that insurance plans change just as much as client needs change. That’s why our team thoughtfully advises our clients to switch plans and sometimes companies in order to better have their needs met. We prioritize your needs…no matter where life takes you. Because every ebb and flow of life can redirect one’s insurance requirements and necessities, and we see this especially now with the unanticipated effects of COVID-19.
For this reason, the Bernardini & Donovan team will be revisiting this topic when it comes to small business health insurance options in California: the Covered California SHOP Exchange program. We will explain what benefits small businesses and employers alike can experience if they utilize the SHOP Exchange program, how the SHOP Exchange program works, and what to do if you run a small business located in California and have questions about small business health insurance options.
What is the Covered California SHOP Exchange and what are the benefits for small businesses. Created through the Affordable Care Act, the SHOP Exchange initially started off as a healthcare insurance option in every state. The Covered California SHOP Exchange provides two major benefits to small employers—access and administrative relief by relieving small businesses of the burden of finding and administering health plans for their employees.
In California, small businesses that are struggling to provide health care coverage for their employees now have hope. This has been a concern for small businesses for years, but with the pandemic hitting the economy at new levels, small businesses have even more concern now when it comes to handling certain obligations that require finances, such as providing health insurance to their employees. The Covered California SHOP Exchange is beneficial because it provides a greater selection of group health insurance coverage—selections that were previously only offered to businesses with larger numbers of employees. Small business owners who are interested in joining the Covered California SHOP Exchange can do so just as long as they have less than 50 employees.
The SHOP program handles enrollment, eligibility, adds, changes, and terminations and provides small businesses with the necessary reports to integrate employee premium deductions into their payroll system. The employer writes just one check and the Covered California platform sends the premiums to each health insurance carrier.
California’s hundreds of thousands of small businesses that earn an average annual wage of less than $50,000 qualify for an additional benefit of being eligible for a 50 percent federal small-business tax credit when they purchase coverage through SHOP!
How the Covered California SHOP Exchange Works: Then and Now
Each participant enrolled in the Covered California SHOP Exchange completes a profile and receives a group ID. The employee of the business enters the SHOP program and they are then issued an ID of their own. In order for the business to access their plan, they are also issued a password. Once enrolled in the plan, the employee enrolls in the specific health plan that they need for themselves. Once the employee has made their selections, the employer then verifies that they work there. All information is taken care of by the SHOP program and then from there it is given over to the insurance carriers.
Some states that operate their own exchanges no longer offer SHOP coverage due to lack of insurer participation which was due, in part, to lackluster enrollment early on, as well as some changes made in 2016. Still, eleven states, including California, still use the Covered California SHOP Exchange platforms for small businesses, although some states have switched to a direct-to-carrier enrollment model, instead of maintaining an enrollment portal that small businesses can use.
Businesses that purchase SHOP coverage are eligible for a small-business health care tax credit. However, the tax credit is only available for up to two years.
The availability of the tax credit is limited if a business is in an area where there are no longer any SHOP plans available. Businesses that had a SHOP-certified plan during the first year of their two-year tax-credit eligibility window can continue to receive the tax credit for a non-SHOP plan if SHOP plans are no longer available during the second year. But businesses in areas without SHOP plans cannot newly enroll in a non-SHOP plan and claim the tax credit.
The Best Health Insurance Company to Help With Your Covered California Needs
Now, more than ever before, the issue of healthcare has been thrust into our everyday lives.
This pandemic has caused many small businesses to change their entire process; for small businesses that are still operating, having health insurance plans available to employees is critical now more than ever! But it is equally just as important to make sure that the options you are offering benefit you as a small business, as well. The SHOP program is a small business’s one-stop solution to their health insurance needs.
For a lot of people, the more you hear about the issue of healthcare, the more complicated it appears to be. With more than thirty years of experience in the health insurance field, our licensed health insurance agents are proud to have established long lasting and trusted relationships with all of the major carriers throughout California and beyond. Whether you need coverage for employees, families, individuals, temporary or short term coverage, or coverage for travel or abroad, Bernardini & Donovan Insurance Services has the answers to any questions you may have.
Here at Bernardini & Donovan, we offer additional information regarding the Covered California SHOP Exchange. If you would like assistance in determining if you are eligible or how to be a part of the SHOP program, contact us today.
