October 15, 2018
FOCUS: Employee Benefits/Insurance

Insurance exchange aims to raise profile, attraction of small business health insurance option

Photo | HBJ File
Photo | HBJ File
Hartford business owner Kevin Galvin said the state’s insurance exchange, Access Health CT, has struggled to connect with smaller employers, which often have difficulties finding affordable health coverage for their workers.
Jason Gutcheon, Insurance Broker
Gary D’Orsi, SHOP Director, Access Health CT
James Michel, CEO, Access Health CT
Andrea Ravitz, Marketing and Sales Director, Access Health CT

West Hartford insurance broker Jason Gutcheon said he doesn't recommend his small-business customers enroll in employer health plans sold through Access Health CT.

He said he doesn't see benefits to buying Small Business Health Options Program (SHOP) coverage through the state's official insurance exchange, created in 2013 as a result of the Affordable Care Act, compared to purchasing directly from insurance companies, which allows for greater plan customization.

Exchange plan affordability has also been an issue, he said.

Meantime, Hartford small business owner Kevin Galvin, who owns Connecticut Commercial Maintenance Inc. and sits on the state's SHOP advisory committee, said he doesn't offer his two employees exchange coverage either.

The program and coverage, he said, hasn't been user friendly for its customer base: employers with 50 or fewer full-time employees.

"In my view, since 2013, there has not been adequate, if any … outreach to small businesses to educate them around what their options are, and how to be involved," said Galvin, who thinks selecting plans from SHOP is often too complicated for non-experts. "Buying insurance in Connecticut is not for mere mortals."

That a broker and small business owner would hold these opinions of SHOP comes as no surprise to Gary D'Orsi. He's the SHOP director at Access Health CT.

"In all honesty, for the first couple years on the exchange, the concentration and focus was really on the individual market more than the small-group market," D'Orsi said.

But that's changing this year.

In recent months, Access Health has been partnering with business groups like chambers of commerce and professional associations to promote SHOP, and explain how companies can benefit from buying health plans through the exchange, as opposed to directly from insurers.

It has work to do.

With about 250 employers currently enrolled in SHOP plans through Access Health CT, Connecticut's small group insurance exchange is dwarfed by Massachusetts', which has 1,249 group enrollees. But, D'Orsi said, considering that 94 of those Connecticut employers signed up since the beginning of 2017, the number shows growing interest and an opportunity to strengthen SHOP, as Access Health continues outreach efforts to the business community.

"My goal is to double the number of groups and lives that we have for fiscal year '19," D'Orsi said.

Complaints about SHOP vary, depending on who you ask. Gutcheon points out that while plans on the exchange are rich in benefits, they're also expensive and come as-is. When he deals directly with insurance companies, Gutcheon said he can add and remove certain coverage to customize a plan for his clients.

However, the recent addition of ConnectiCare Inc. to the exchange, which previously hosted only Anthem Health Plans Inc., changes that calculus a bit.

ConnectiCare eschewed SHOP when the exchange began in 2013, citing federal regulations that then-President Michael Wise called "vague, complex and in some cases contradictory." The SHOP exchange started with three carriers — Anthem, United Healthcare and HealthyCT — but United and HealthyCT both left, leaving only Anthem, until ConnectiCare joined last year.

That move brought the total number of plans available on SHOP to 14, up from nine previously.

"We try to put our plans on all the possible shelves, meaning our small group plans," said Roberta Wachtelhausen, a senior vice president at the Farmington-based insurer. "That's why we're on SHOP."

Employers buying SHOP plans can now select plan options from both Anthem and ConnectiCare, not just one or the other. Access Health CT is using that as a new competitive advantage because the ability to mix and match coverages stands in contrast to buying group health insurance directly from a single insurer.

"That's extraordinary flexibility that your employees would have, where they could pick between two different carriers," said Access Health CEO James Michel. "If you go to one carrier directly, you could only use that carrier's plan."

Another advantage to buying a SHOP plan is the availability of a small-business tax credit, which covers up to 50 percent of a business' contribution to employee premium costs (or up to 35 percent for qualified nonprofits). However, brokers and others have said the tax credit's eligibility rules — to qualify an employer must provide health insurance to all employees, pay for at least half the employee-only premium cost (or 35 percent for nonprofits), have fewer than 25 full-time equivalent employees and pay an average annual wage below $53,000 — make it difficult for many small employers to qualify for it.

The push to promote SHOP is largely separate from the marketing Access Health does for its individual market exchange, which currently has about 114,000 enrollees to SHOP's approximately 1,400 members, said Andrea Ravitz, the exchange's marketing and sales director. Part of that is because of differences in how exchange plans are sold.

Customers buying individual plans have to do so during the annual open enrollment period, which runs from Nov. 1 to Dec. 22, for people buying insurance for 2019. But small-business employers are able to buy from SHOP year-round.

So while the marketing strategy for individual plans is focused on tailoring ads to targeted groups and media — i.e. running a different ad on social media platforms than the ones airing at movie theaters — efforts to get the word out for SHOP is more about networking and courting brokers.

"From a purely advertising perspective this is not where you'd go and put an ad on TV," Ravitz said. "I think our focus continues to be on brokers that sell to small businesses."

For so-called micro-businesses like Galvin's, outreach from Access Health is just what the doctor ordered. These very small businesses typically lack a human-resources department or staffers knowledgeable of the ins and outs of health insurance, he said.

"This is extremely complex information to take in by anyone, let alone people who are working every day," Galvin said.

Access Health plans to expand its business-community engagement, as it works toward gaining SHOP a better reputation among brokers and businesses.

"A lot of what you're going to see … is (Access Health) building those relationships, and letting them know about the advantages of coming through the exchange," Ravitz said.

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