GAO Survey: Challenges for Health Insurance Advisors Contributed to Low SHOP Enrollment

Small Business Health Options Programs (SHOPs), the online health insurance exchanges for small employers required under the Affordable Care Act, saw enrollment figures for 2014 that fell well below officials’ expectations, according to a new Government Accountability Office (GAO) report.
The 18 state-based SHOPs enrolled approximately 76,000 people, as of June 1 of this year. More than 40 percent of these enrollments occurred in Vermont, and only three other states (Utah, New York and California) had enrolled more than 5,000 individuals. At the low end of the tally, the Mississippi SHOP had enrolled one employee (in part because the program was delayed and did not open until May 1). Enrollment numbers for the federally facilitated SHOP are not yet available, but officials for the Centers for Medicare & Medicaid Services (CMS) have indicated that federal enrollment trends are likely to be similar to those for state-based programs.
The Congressional Budget Office had estimated that the state and federal SHOPs would provide coverage for 2 million people in 2014, rising to 3 million in 2015 and 3 million in 2017.
One reason the GAO cites for the low enrollment figures is that “technical challenges and administrative burdens” discouraged some agents and brokers from recommending SHOPs. This proved significant because small employers that provide health insurance benefits have traditionally relied heavily on agents and brokers to provide advice and services. One significant obstacle was the fact that the federal SHOP and several state SHOPs merely provided plan information online in 2014, but no online enrollment. The GAO report says agents and brokers were also discouraged by:
“…poor or inaccessible customer service for brokers; poor training for brokers on SHOP requirements; the extra time required to explain SHOP requirements to clients; challenges receiving compensation; and the lack of a dedicated broker 'portal' on some SHOP websites that would allow brokers to set up and help manage accounts for their clients. Agent and broker representatives from one state noted that challenges such as these have led some agents and brokers to avoid recommending that their small employer clients use the SHOP.”
Several states and CMS officials said that they were aware of the concerns and were taking steps to improve their coordination with agents and brokers. For example, the GAO report cites a new tool under development by the Kentucky SHOP that would make it easier for brokers and agents to obtain and compare multiple price quotes of different plans for clients. CMS and officials in Illinois have developed dedicated online SHOP portals for registered agents and brokers.
  • Posted November 21, 2014 IN

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