SHOP Exchanges: The Basics Timothy Stoltzfus Jost Washington and Lee University College of Law

SHOP Exchanges Exchanges to make coverage more accessible and affordable to small businesses Should increase the market power of small businesses and choice for small businesses and their employees Proposed regulations take a practical approach to implementation and offer flexibility to employers

SHOP Exchanges Must exist in each state (either as state or federal exchanges) May be separate or combined with individual exchange Individual and small group risk pools may be combined or kept separate

Which Employers May Participate? Serves small employers (1-100, or, at state option, 1-50 until 2016) States may expand to larger employers beginning in 2017 Proposed regulations would not cover businesses without employees

SHOP Exchanges: Proposed Regulation Options Required: employer choice of actuarial value tier, employee choice of qualified health plan (QHP) States can offer employers options: (1) employees can choose any QHP offered in the SHOP in any tier; (2) employers select specific tiers from which an employee may choose a QHP; (3) employers select specific QHPs from different tiers of coverage from which an employee may choose a QHP; or (4) employers to select a single QHP to offer employees.

SHOP Exchanges: Proposed Regulations Rolling enrollment for employers, but upon enrollment locked into one year periods (and premiums locked in) Must offer exchange coverage to all employees Exchange must provide aggregate bill Employers must notify exchange about employee change of status Employers with multiple worksites can offer access to single exchange or to exchanges where employees located