By Julie Gallion, Senior HR Consultant

The merger of the individual and small group health insurance market into the DC Health Insurance Exchange-DC Health Link is causing some concerns among nonprofit organizations. On Friday, July 19th, Nonprofit HR brought employees from the DC Exchange and Nonprofit leaders together to explain the concept of the Exchange and to answer questions about how it will work.

(To view the entire town hall, click here.)

One concern, is how will organizations that purchase insurance through the DC Health Link manage the number of plans that will be available to their employees through the Exchange.

It is important to understand that an employer can not make all of the plans available on the exchange available to their employees. Instead, employers will have three options:

  1. Offer no employee choice, employers would chose one plan to offer to all employees.
  2. Offer all plans on the same level, Silver for example; the employee would be able choose any Silver level plans available on within the Small Business Health Options Program (SHOP) on the Exchange.
  3. Offer all plans from the same insurance company; the employee would be able to choose any level (Platinum, Silver, Gold, Bronze) offered by the chosen insurance company. For example if Carefirst is the chosen carrier, employees may chose any plan available from Carefirst in the SHOP.

For many, choosing option 2 or 3 may result in a greater administrative burden as employers will likely want to help educate their new employees on the different plans available. However, an employer could simply refer all employees to the DC Health Link for assistance with understanding and choosing the insurance product that is right for them. All employees will enroll directly through the DC Health Link website. DC Health Link will notify the carriers of the enrollment and will consolidate the bills from the various carriers and send one invoice to the employer with data on what to deduct from the employee’s paycheck.

Regardless of the choice the employer makes on plan options, the employer will also choose a Base Plan. The Base Plan will be the specific Plan, Carrier, Metal level etc on which to base their contributions. Employees may select a plan that is not the base plan and the rates paid by the employees and employer would be adjusted accordingly. Many employees may simply chose to enroll in the base plan because it may seem easier. This will be much more clear and easier to understand once the plan design information is available and real examples can be illustrated.

Administration of benefit plans within DC Health Link will be quite different than it is now, however, until we begin to see the system in action, it is difficult to determine the new administrative processes.

Another concern is related to the enrollment period. It is important for employers to understand that although DC Health Link opens in October for plan years starting January 1, 2014 this only applies to employers purchasing new plans. Employers who currently offer insurance can renew their current plans in 2014 as long as those plans continue to be available. However, all renewals must go through DC Health Link in 2015.