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ACA Health Insurance Exchanges

At a glance

Beginning October 1, 2013, health insurance Exchanges will open in each state, giving small businesses and individuals the ability to easily compare, purchase, and enroll in health plans. There will be four main levels of coverage — bronze, silver, gold, and platinum — also known as “metal tiers.” Each tier has a different actuarial value — the percentage that the health plan will pay for covered essential health benefits based on the claims of a standard population:1

Platinum — 90 percent actuarial value

Gold — 80 percent actuarial value

Silver — 70 percent actuarial value

Bronze — 60 percent actuarial value

For example, a silver plan will pay for 70 percent of covered essential health benefits expenses. The average member will pay for the remaining 30 percent through some combination of deductibles, copayments, and coinsurance. Because the plans within each metal tier will offer similar coverage of health care expenses, it will be easier for employees to shop for and compare plans. It is important to note that not all tiers will be offered in every state or in every Exchange (individual or SHOP). In Oregon, all metal tiers will be offered in the SHOP for small business; however, in Washington, only gold, silver, and bronze plans will be offered.

What you need to know

The Exchange for small businesses is called the Small Business Health Options Program (SHOP) The initial open enrollment will last from October 1, 2013, to March 31, 2014.

Some of the benefits of the SHOP include:

  •  One-stop shopping experience — Employees can research, compare, purchase, and enroll in primary and ancillary coverage, such as dental and vision, all through the SHOP website.
  • Easy comparisons — Since all insurers within each tier are required to offer the same approximate actuarial level of coverage, it will be easy to compare pricing, benefits, and features to make a more informed decision.
  • Less administration — TheSHOP will handle enrollment, plan administration, and billing, which will help employers save time and resources.2
  • One monthly payment — Employers make only one monthly payment directly to the SHOP.
  • Tax credit —The small business tax credit is only available through participation in the SHOP.

What defines a small business?

For 2014, the SHOP in Oregon and Washington will only be open to groups with up to 50 employees. In 2016, all states will make the SHOP available to groups with up to 100 employees.

In 2017, states can open their SHOP to even larger employers.

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