Small businesses still not taking to health insurance exchanges

On Nov. 15, the federal government opened its small business health insurance exchange websites, over a year later than initially scheduled. However there have been relatively few visitors to the business side of Healthcare.gov.

According to a report from the Washington Post, in the first week of open enrollment the site attracted only about 200,000 unique visitors. This suggests that millions of small US businesses may not be enamored with this opportunity. This number of visitors is far smaller than the roughly 1.5 million individuals who checked the Healthcare.gov exchanges in the first week of individual open enrollment last year.

According to the same report, the Center for Medicare and Medicaid Services (CMS) which oversees the exchanges, has not released the number of small businesses already offering coverage to their workers through the exchanges, nor the number of individuals enrolled through those offerings within the first week. While numbers aren't available yet, general consensus is that there's little reason to expect a huge rush similar to that which occurred on the individual exchanges near the end  of open enrollment.

What's the issue?
The small business exchanges are currently only open to companies with fewer than 50 employees, about half of which already offer health insurance coverage to their workers. Roughly half the individuals working for such companies are uninsured, thus the pool of companies interested in purchasing employee coverage from the exchange is small.  Those who are happy with their current plan, will keep their current plan.  The pool of individuals covered through the small group exchange can be expected to remain small.

With this in mind, health insurance companies may wish to find other methods to boost small businesses enrollment.  The federal government mandate that small businesses extend coverage options to their workers should provide opportunities to insurers who can offer attractive, flexible plans to these companies.