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What health reform means for the people of Illinois

A blog by IllinoisHealthMatters.org

Thursday, January 22, 2015

Illinois Small Businesses Should SHOP for 2015 Health Coverage

Small business owners: are you considering all available options to find a health insurance plan that works best for your business and employees?

One resource for Illinois small business owners is the Small Business Health Insurance Options Program, or SHOP, where employers can compare group health insurance options. The SHOP is open year-round for small employers to browse, compare plans, and fill out applications online.

The Benefits of SHOPping Around

Buying health insurance through the SHOP can help small businesses save money. According to the Robert Wood Johnson Foundation, total spending on healthcare by small businesses will decrease by 8.7% because of provisions in the healthcare law. Small employers that offer coverage through the marketplace may be eligible for a tax credit that can cover up to 50% of their employees’ premiums. The Small Business Majority’s tax credit calculator shows if small businesses are eligible for the credit and how much money they could receive.

There are even more benefits to buying a SHOP plan, because small businesses will no longer be charged more for female workers, who had been paying up to 50% more for their premiums before the healthcare reform law. In addition, employers will no longer pay more for workers with pre-existing conditions and will benefit from new limits regulating health insurance costs for older workers.

Health & Disability Advocates, a non-profit with 16 full-time employees, is an example of a small organization that used the SHOP and found a better deal. Both HDA and its employees gained – the non-profit is now spending approximately $20,000 less on healthcare, while its workers have lower premiums and have access to a wider network.

The Downside of Sticking With Your Current Plan

As many as 80% of companies with up to 50 employees opted to renew their non-compliant plans for 2014, and a similar percentage will likely try to do so this year. Small business owners who decide to renew their old plan may not save money and may instead see a price increase for 2015. This is why investigating all health insurance options, including those offered through the SHOP, could benefit small businesses. Many could save money by purchasing a plan through the health insurance marketplace, or through selecting a plan with better coverage for about the same cost.

How to Start

In order to begin the enrollment process and explore options, Illinois small businesses can visit the SHOP online, or contact a certified health insurance broker to assist with the enrollment process. The more small business owners know, the easier it will be for them to get their employees more-affordable insurance coverage. Once owners have found a reasonable option for their small business, they can stop worrying about health insurance and do what they do best – run the companies that make up the backbone of our state and our nation.

Jesse Greenberg
Director, West and Midwest
Small Business Majority

Friday, January 9, 2015

Don't Chip Away CHIP

Leaders, from Illinois and across the country, are calling on Congress to continue funding the Children’s Health Insurance Program by highlighting its success in reducing the number of uninsured children and warning that these children may lose coverage or receive less age-appropriate care.  The Children’s Health Insurance Program, or CHIP for short, offers developmentally appropriate healthcare for low-and-moderate-income children from families earning wages above the Medicaid threshold.  In Illinois, the program covers 219,000 children and pregnant women as of June 30, 2014.

The healthcare reform law funded CHIP until October 2015, but states need quick federal action as they plan their budgets for the coming year. Unfortunately, Congress may forgo CHIP funding, because children could potentially obtain health insurance through the health insurance marketplace. However, the health benefits in a marketplace plan may not equal those offered through CHIP, and families may not be able to afford the premiums and co-payments.

CHIP’s Benefits are Better

The essential health benefits in the marketplace’s qualified health plans can differ from CHIP’s; marketplace plans can either enact more stringent benefit limits or not cover important pediatric services. For example, a Government Accountability Office study of CHIP programs in five states including Illinois found that marketplace plans were more likely to limit pediatric services and that CHIP offered more generous ceilings for certain services.

Of special significance for children, marketplace plans are not required to cover pediatric dental services if a stand-alone dental plan is available. This means families might be forced to purchase a dental plan in addition to a general health plan for their children—increasing monthly premiums. Since the individual mandate would not apply to dental coverage, families may forgo pediatric dental coverage altogether.

Children in the Illinois CHIP program, All Kids, benefit from Early and Periodic Screening, Diagnosis, and Treatment services. EPSDT can identify medical conditions at an earlier and more treatable point in time and link children with necessary care. The benchmark plan for the state does not offer a comparable set of services. 

Higher Costs and Family Glitches

CHIP health plans, including Illinois’ All Kids, have better cost sharing arrangements than marketplace plans. Monthly premiums in All Kids range from $0-40, while the marketplace’s lowest cost bronze plan in Chicago had a heftier premium of $76 per month.

A report by the nonpartisan Medicaid and CHIP Access Payment Commission found similar patterns across the nation. According to the report, the actuarial value, or the costs covered by a health insurance plan, is generally lower in marketplace plans.

Parents and children forced out of CHIP plans would also encounter higher healthcare prices due to the ACA’s family glitch. The healthcare law bases affordable workplace insurance—and a family’s eligibility for marketplace financial assistance—on the cost of insuring individuals, not families. Parents are placed in the bind of being unable to afford their employer’s family plan, because that option involves much higher costs, but cannot qualify for tax credits or subsidies.

Stick with CHIP

Advocacy groups and leaders from both political parties have called CHIP a success. Since its creation in 1997, the program has increased the number of children with health insurance: 8 million children were enrolled in 2012 alone. The program has contributed to the marked decrease in the percentage of uninsured children, which has fallen from 13.9% to 7.1% over the past 17 years. Because of CHIP’s proven track record and uncertainty surrounding healthcare options in a post-CHIP era, Congress needs to continue funding this important program.

Bryce Marable, MSW
Policy Analyst
Health & Disability Advocates