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Small Business Employee Benefits and HR Blog

15 States to Offer 'Employee Choice' in Small Business SHOP Marketplace

In April, the administration announced a delay in the Affordable Care Act (ACA) requirement for all SHOP marketplaces to include an 'employee choice' feature for small businesses. Under this 'employee choice' or 'plan choice' model, small businesses could offer employees a menu of plan options through the SHOP marketplaces, like many larger businesses do today.

The delay announced in April made this requirement optional until 2015, though now it appears that most of the states operating their own health insurance marketplace will go forward with an 'employee choice' option. The 33 federally-run health insurance marketplaces will not have this feature in the SHOP marketplaces until 2015.

SHOP Marketplaces Offering an 'Employee Choice' Option

The following states plan to offer an 'employee choice' option through their small business SHOP marketplace:

  1. California
  2. Colorado
  3. Connecticut
  4. District of Columbia
  5. Hawaii
  6. Kentucky
  7. Maryland
  8. Massachusetts
  9. Minnesota
  10. Nevada
  11. New York
  12. Oregon
  13. Rhode Island
  14. Vermont
  15. Washington

The two state-run health insurance marketplaces missing from this list are Idaho and New Mexico. Idaho is using the federally-run SHOP marketplace, and New Mexico is undecided if they will provide this option.

With the 'employee choice' feature, a business could set an amount toward coverage for each employee, then let each employee select from a variety of plans from the SHOP marketplace. The variety of plans and options will vary by state.

According to Kaiser Health News, Hawaii, Minnesota, Nevada, New York, Oregon, Rhode Island, and Vermont will offer employees the widest variety of choices, selecting from across multiple insurers and coverage levels. (Source: Kaiser Health News.)

To find out more about your state's health insurance marketplace, see State by State Guide to Health Insurance Marketplaces.