State health insurance exchanges mandated by the Patient Protection and Affordable Care Act may allow small businesses to extend coverage to 10 million employees, in addition to the 15.3 million who would be able to afford personal insurance.
Fredric Blavin and other experts at the Urban Institute estimated the exchanges' potential in a recent article in Health Affairs, noting that another two million people might be covered if the small business and individual exchanges are merged. This could decrease premiums by an average of $600 per year while simultaneously reducing federal subsidies.
Beyond that, they wrote, most design choices the states make should not have a major impact on the number of individuals who receive coverage. Decisions concerning the Small Business Health Care Options Program (SHOP), which includes the exchanges targeted at small employers, may be left up to each state's discretion without reducing the effectiveness.
The implementation of exchanges and expansion of employer-based healthcare programs could significantly increase the employee benefits services administration burden on companies unprepared for the change due to inexperience. Employee benefit consultants may be able to provide needed skills and management services to these employers, helping them cope with the transition and aiding employees in getting the most out of their coverage.
