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The Small Business Health Options Program (SHOP) provides small employers with new ways to offer employee health coverage, information, administration, and access to tax credits. The SHOP will allow employers to choose the level of coverage they will offer and offer the employees choices of all qualified health plans within that level of coverage. This allows employees a choice among plans.
State insurance exchanges began operating a SHOP in 2014. Through this program, employers can offer coverage from multiple insurers, just like larger companies and government employee plans, but get a single bill and write a single check. SHOP exchanges can also allow employers to select a single plan to offer its employees, like is typically done today. Minimum participation rules may be met through coverage in any SHOP plan, not a single particular plan.
Exchanges will decide how a SHOP is structured. Specifically, exchanges are able to decide:
Starting in 2014, small employers purchasing coverage through a SHOP may be eligible for a tax credit of up to 50 percent of their premium payments if they have 25 or fewer employees, pay employees an average annual wage of less than $50,000, offer all full-time employees coverage, and pay at least 50 percent of the premium.