NY State of Health Insurance Exchange Updates
As you will be hearing via Radio, TV, and Newspapers in the coming months, NY
has set up 2 exchanges: the Small Business Health Options Plan (SHOP Exchange)
and the Individual Exchange. The SHOP Exchange is to be used exclusively for
small businesses, whereas the Individual Exchange is for the use of individuals
and sole proprietors.
The NY State of Health Insurance Exchanges are set up to provide individuals and companies with increased access to health care and introduce new protections for people who already have
health insurance. Starting in 2014, all individuals are required to purchase
health insurance that represents ‘minimum creditable coverage’ or face a
penalty. While the exchanges will begin allowing enrollments on the exchange
as of 10/1/2013, the coverage will not begin until 1/1/2014.
As a Certified Producer on BOTH the Individual and SHOP exchanges, we will be
available to assist all of our current clients, as well as many new individuals
and businesses in obtaining coverage thru the new exchanges if it is in their
As a business owner, you are NOT required to offer health benefits, and you are
NOT required to pay for health benefits for your employees. If you do offer
coverage, you must make the coverage available to your employees, but you do
NOT have to pay towards it.
You are NOT required to purchase your insurance thru the exchange…you
can continue to obtain your insurance directly from your current insurance
company as before, or thru private exchanges such as Health Pass. In fact, we
are suggesting to most businesses to wait until your normal renewal time to
look into the feasibility of the exchange, as with any new endeavor there is
likely to be some bumps in the road since the exchange is still new and the
website is still only being developed.
Rates in the exchange will be based on 4 ‘metal’ tiers: Bronze, Silver, Gold,
and Platinum. There will be a ‘catastrophic’ plan offered ONLY on the
individual exchange for members under 30 years old. While benefits are still
not knows for these plans, they are based on Actuarial Value. Bronze plans are
expected to pay 60% of health costs (40% paid by member), Silver plans are
expected to pay 70% of health costs (30% by member), Gold plans are expected to
pay 80% of health costs (20% by member), and Platinum plans are expected to
pay 90% of health costs (10% by member). Plans in the Gold and Platinum tiers
have premiums at or above current typical group plan rates. Only Silver and
Platinum plans will offer Out of Network benefits.
To participate in the NYHBE SHOP Plan, employers will have to have 2-50 Full
Time employees, be a valid business, offer QHP (qualified health plan) options
to employees, and have a business address in NY. All other individuals would be eligible to join the Individual exchange.
While so much is still being determined regarding the NYHBE, we are committed
to continuing to assist you in advising and servicing your health insurance needs. We
are proud to be Certified Producers on both the individual as well as SHOP
exchanges in NYS. As we continue to update you as we get information from the State and NYHBE, please know that your current insurance plan should remain in place until your next normal renewal date. We will be contacting groups directly in situations where we feel a change prior to renewal might benefit them.
The NYHBE does not expect a large influx of group business, with studies
showing between 10-20% of groups moving to the NYHBE. We expect to see larger
numbers moving to the individual exchange where currently those members are
paying exorbitant rates in the individual market. While we wait to see
what might transpire, we just wanted to keep you updated and let you know that
no matter what direction your insurance might take you, we will be able to
service and advise you in both instances.