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Letter to the Administrator of Centers for Medicare and Medicaid Services Marilyn Tavenner - Small Business Health Options Program


Location: Washington, DC

House Small Business Committee Chairman Sam Graves (R-MO) today wrote to the Department of Health and Human Services' Centers for Medicare and Medicaid Services about its proposed rule to delay the implementation of the employee choice options under the Small Business Health Options Program (SHOPs). Under the proposed rule, small employers wouldn't be able to select a benefit level on federal exchanges, but would be limited to offering a single plan for their employees, severely limiting the breadth of choice that was originally envisioned, which could lead to increased premium costs.

On March 1st, the Department of Health and Human Services released the proposed rule, which would postpone employee choice in the SHOPs until 2015. The rule suggests a "transitional policy" that "is intended to provide additional time to prepare for an employee choice model and to increase the stability of the small group market while providing small groups with the benefits of SHOP in 2014…" Comments on the proposed rule are due by April 1, 2013.

"Proponents of the health care law have said exchanges would increase the availability and affordability of health insurance. During the debate on the law, and still today, the exchanges -- and the SHOPs -- have been touted as a key element of its implementation," wrote Chairman Graves.

Small business owners continue to cite the cost of health insurance as one of their most pressing problems related to running their companies. One of the reasons small business owners were promised that costs could drop was the competition envisioned by the health care law's SHOPs.

The Chairman continued, "If one of the key goals of supporters of the health care law was to provide small business owners with a competitive process by which they could select from a number of affordable health insurance plans for their employees, then that goal is not in sight. In the meantime, it is likely that entrepreneurs will continue to experience the premium increases they have come to expect."

Chairman Graves has opposed the law since its consideration and final passage three years ago, and has voted multiple times to repeal it. The Committee requested that the Centers for Medicare and Medicaid Services provide answers to several questions about the operation of the transitional policy by April 22, 2013.

Read the full text of the letter in PDF format below:

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