CMS changing program, but Arkansas already closing SHOP

The federal Centers for Medicare & Medicaid Services (CMS) says small businesses participating in the Small Business Health Options Program, or SHOP, will enroll directly with health insurers rather than online through HealthCare.gov.

But the change will not affect Arkansas because the state ran its own program until it lost its only insurer and will close it next year.

CMS said May 15 that it’s looking for greater efficiency, ease of use and participation. By Jan. 1, 2018, instead of enrolling through HealthCare.gov, employers with 2-50 employees will determine eligibility through the website and then enroll directly with insurers or with the help of brokers.

CMS announced the change May 15, saying participation by employers and insurance companies and brokers has been lower than expected and unlikely to reach expectations. The agency said that, in January, about 27,000 employers and nearly 230,000 individuals were participating – far short of the 4 million the Congressional Budget Office expected. Only .1 percent of the nation’s 30 million small businesses participate.

In Arkansas, the state-based SHOP program, run by the Arkansas Health Insurance Marketplace (AHIM), as of April 30 involved 79 groups covering 434 people.

But the only insurer, Arkansas Blue Cross and Blue Shield, decided it would not return to the market in 2018 and no other insurer stepped forward before the May 5 filing deadline.

Alicia McCoy, AHIM’s director of marketing and communications, said officials will meet with Blue Cross to discuss a transitional plan, but she expects consumers will move to small group plans not sold on the SHOP on their anniversary dates.

“No one’s going to lose coverage,” she said.

Max Greenwood, Blue Cross spokesman, said the program is “administratively prohibitive,” that small employers had to jump through hoops to qualify, and that the number of enrollees was small. The insurer sells the same products off SHOP. Blue Cross serves about 3,700 small groups of 50 or less, and only 79 were through the SHOP.

The SHOP was originally federally administered in Arkansas. The state took over the operation Jan. 1, 2016, by creating AHIM, a nonprofit public benefit corporation that administers the program and also approves plans for individual consumers.

The state-run SHOP was created through a three-year, $7.2 million contract with Virginia-based information technology provider hCentive.

The state SHOP was branded as My Arkansas Insurance. Businesses could purchase insurance through www.myARinsurance.com with the help of trained brokers and agents.

AHIM answered to a legislative oversight committee that was abolished by the Legislature this year. AHIM now will answer to the Legislative Council, a group of legislators that meets when the full Legislature is not in session.