Small businesses won’t be able to use the federal government’s health insurance website until November 2014 in most U.S. states, the latest delay for the Obama administration’s health-care system overhaul.
Businesses can use brokers or enroll directly with insurers in the meantime, the U.S. Department of Health and Human Services said on a conference call yesterday. The change applies to 36 states where the federal government is running insurance exchanges.
President Barack Obama has been seeking to give consumers and insurers more time to adapt to the Patient Protection and Affordable Care Act as this year’s rollout was beset by missed deadlines, technology outages and public confusion. The National Federation of Independent Business, which represents small companies, said the latest delay isn’t building confidence.
“Small businesses continue to be low on the priority list during the Obamacare implementation process,” said Kevin Kuhlman, manager of legislative affairs for the Nashville, Tennessee-based trade group. “The failure to get the small business exchanges online adds yet another onerous paperwork requirement for job creators.”
The exchanges for small businesses, available for companies with 50 or fewer full-time workers, had already been delayed from a scheduled Oct. 1, 2013, start. Republicans seized on yesterday’s announcement as more evidence that the Obama administration had been unable to meet its own timetable for the president’s signature domestic policy initiative.
“Piecemeal delays and working outside of Congress to issue regulations does nothing to solve the fact that this law remains a tremendous failure that still, two months into open enrollment, is not even 80 percent operational,” said U.S. Representative Fred Upton, the Michigan Republican who is chairman of the House Energy and Commerce Committee, in a statement.
Businesses will still be able to shop for plans at the federal website healthcare.gov beginning in December, they just won’t be able to sign up their employees using the system. The change may have a minimal effect since many small businesses already rely on agents and brokers for insurance, Julie Bataille, a spokeswoman for the Centers for Medicare and Medicaid Services told reporters on a conference call.
“The particular mechanism we have outlined today in many cases is very familiar to the small business community and is something that will work for them,” she said.
The change in the small business provision was announced a day before the U.S. Thanksgiving holiday as the government seeks to complete a two-month rush to fix flaws in the healthcare.gov insurance exchange for individuals. The website was prone to error messages, slow loading and outages when it debuted Oct. 1.
While 106,185 people were able to select private plans through those government exchanges last month, almost 1 million more abandoned the application process before choosing a plan. Jeffrey Zients, the economic adviser that Obama asked to help fix the website, said the exchange will work smoothly by the end of November.
The online exchanges are the core of the Affordable Care Act’s promise of extending medical coverage to most of the nation’s 48 million uninsured. The federal website covers 36 states while the other 14 states and Washington, D.C., created their own exchanges.
Throughout the year, the administration has delayed pieces of the health care law as it has confronted challenges standing up the program. It already curtailed the small business plan in March, saying companies wouldn’t be able to give their workers a choice of health plans in exchanges set up just for them.
On July 3, the eve of the Independence Day holiday, the administration announced it would postpone enforcement of the so-called employer mandate until 2015. Under that provision, companies with 50 or more workers face a fine of as much as $3,000 per employee if they don’t offer affordable insurance.
Beginning next year small businesses with fewer than 25 workers can obtain a tax credit for as much as 50 percent of the cost of insurance for their workforce, up from 35 percent now. The Government Accountability Office has said the tax credit has been underutilized, and small business groups have complained it isn’t easy to apply for the assistance.
“While we’re disappointed that the ability to enroll online on the healthcare.gov website has been pushed back for small employers, starting in December healthcare.gov will offer small businesses a better comparison shopping experience,” said Joshua Welter, a spokesman for the Main Street Alliance, a small business advocacy group, in an e-mail.