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University of Minnesota professor and health economist Roger Feldman said that while current low enrollment on the MNsure SHOP exchange is tied to technical hitches, he doesn’t see much of a future for it.
While firms with 50-plus workers will face penalties under the health law in 2015 if they don’t offer insurance, small businesses are free of mandates. And businesses may be reluctant to rely on premium tax credits, fearing that they’ll go away down the road, he said.
“The history of these efforts to offer subsidies to employers are never successful,” Feldman said. “I don’t think the small group exchanges are ever going to take off. Period.”
About a third of Minnesota’s small businesses with fewer than 50 employees offer insurance to workers, according to federal figures. Despite the slow start attracting small businesses, MNsure supporters underscore that the long-term goal is to get more people insured.
At a recent board of directors meeting, MNsure officials heralded the latest enrollment figures, which showed that nearly 85 percent of the companies using MNsure to buy coverage have 10 employees or less — the size of an organization that likely couldn’t afford insurance before the Affordable Care Act, they noted.
Right now, about 10 percent of businesses that have created accounts on MNsure have followed through and purchased a plan. But because employers can buy coverage all year long, MNsure SHOP director Rolland said he isn’t overly concerned with the lack of follow-through in the first year.
Doyle said Forest Mushrooms, which sells mushrooms to grocery stores and restaurants, faced a 14 percent increase if it stayed with its current plan. But buying through the exchange allowed the family owned business to tap into more than $7,000 in premium tax credits.
The struggle was worth it in the end, Doyle said, because she found an equivalent plan on MNsure that will cost quite a bit less.
“The process was a nightmare,” she said. “But I’m pretty pleased with the choices that were there.”
Jackie Crosby • 612-673-7335