No matter how many times it is repeated, there are many people who don’t realize that small businesses with fewer than 50 employees (or the “full-time equivalency” of 50 employees) are NOT required to purchase health insurance coverage for their employees. However, if you DO choose to provide insurance to employees, you can purchase it through a local insurance agent or there is a marketplace in which to purchase coverage. Such marketplaces can are run by either states or the federal government and are called the SHOP marketplace. (Individuals do not have access to SHOP marketplaces, only small group organizations.) Here are some frequently asked questions about SHOP marketplaces. Below the FAQ, you can find a glossary of terms found on the website Healthcare.Gov.
Do I have to provide my employees with health coverage if I have fewer than 50 employees? No!
You do not have 50 or more full-time equivalent (FTE) employees, you do not have to provide health insurance. However, you can choose to offer insurance through the SHOP Marketplace in your state or through any other source. But you don’t have to, and you don’t face a penalty if you don’t.
If you have 50 or more employees, you may have to offer health coverage meeting certain standards or make a payment. Learn about the Employer Shared Responsibility Payment.
What if I’m self-employed?
If you’re self-employed with no employees, here are your options:
You can enroll in coverage through the Health Insurance Marketplace for Individuals & Families.
You cannot enroll in a SHOP plan.
Learn more about how self-employment is defined. If you have at least one full-time employee other than yourself, a spouse, a family member, or another owner, you can enroll in a SHOP plan.
How do I make payments for my SHOP plan?
You make your premium payments to the SHOP Marketplace, not your insurance company.
Where can I get a list of agents and brokers in my area?
- After you create a SHOP Marketplace account, log in and you’ll see a list of agents and brokers searchable by ZIP code. All of them have signed privacy and security agreements with the SHOP Marketplace that allow them to sell SHOP plans.
- See how to create a SHOP Marketplace account and log in.
- You can work with any agent or broker who’s signed the SHOP agreement. Ask any agent or broker you want to work with if they’ve signed it.
Are you confused by any of the terms mentioned in the questions or answers above? Click on any of these terms and you can find out what they mean. (Note: These links leave SmallBusiness.com and will take you to the Healthcare.gov website.)