It's that time again.
Colorado employers and their insurance brokers are gearing up for health plan open-enrollment season. It's time to review new rates, consider new plan options and organize their communications for employees. It's a challenge for many small employers, but next year might be much easier.
Most small employers would rather not be in the business of making health plan choices for their workforce. Unfortunately, the current group health insurance system places them in that role. Fortunately, the Colorado Health Benefit Exchange is building a health insurance delivery model that will assist small employers with purchasing health coverage.
The Small Business Health Options Program (SHOP) is the division of the Exchange that tailors programs for small employers. As part of the SHOP process, participating employees will have the opportunity to personalize their coverage.
The Exchange will bring together competing insurance carriers to offer an array of insurance plans under one roof. Employers and their employee benefit brokers can register with the Exchange to shop for available plans. The Exchange can simplify employers' lives by taking them out of the coverage decision process and empowering employees to choose among health plans for the one that best fits their needs.
An article in the Commonwealth Fund's newsletter called it "Choice Without Hassle." To assist employees in this effort, the Exchange will provide sophisticated, online "decision support" tools to help employees and their insurance advisors sort through and weigh plan options.
To increase competition, a new consumer-owned and operated insurance plan, called the Colorado Health Insurance Cooperative, will serve consumers throughout the state. Colorado consumers, especially in rural communities, should benefit from the expanded choice envisioned by co-op programs. In July, the co-op received a $69.4 million loan from the federal government to operate a statewide nonprofit that would sell individual and small-business plans. With the introduction of the Exchange, I would expect more health insurance co-ops to emerge over time.
Although the exchange concept sound's new, it's actually been in play with businesses for some time. The Connecticut Business and Industry Association has offered a private health exchange to its members for more than 15 years. Its main selling point with employers is embodied in their tagline: "The Power of Choice." It now writes about 20 percent of small group plans in the state of Connecticut.
Large employers also have used exchange-like delivery systems to deliver retiree health plans successfully. In her article, "The Grand Experiments," Carol Patton of Human Resource Executive Online, recounts how private Medicare exchanges are paving the way for the coming wave of state-based public exchange programs.
The Colorado Health Benefit Exchange will open its doors in October 2013 with its first policies to become effective in January 2014. The Exchange will initially serve businesses and nonprofit organizations with up to 50 full-time-equivalent employees.
For Colorado small businesses, next year just might bring a season of expanded choices and fewer hassles.