November 5, 2010. SHARE has released a new issue brief from our grantees at The Hilltop Institute that offers key lessons for encouraging small employer coverage under the Affordable Care Act (ACA).
The new brief presents findings about participation in New Mexico’s State Coverage Insurance (SCI) program. SCI is a public-private initiative that provides access to subsidized health insurance for low-income uninsured adults. Eligible adults can enroll directly, but the program targets the state’s small employers, who can sponsor group enrollment for low-income employees for a $75 monthly premium per enrollee.
The authors of the brief find that SCI’s premium subsidies are warranted and led to increased enrollment for both individuals and employers. They also note that allowing bigger firms to enroll would shift a large number of non-group enrollees over to group enrollment (thereby increasing funding from employer premiums).
SCI, with its premium subsidies and public/private collaboration, may indicate what to expect under the ACA, which aims to encourage small businesses to provide health coverage by offering tax credits and the option of exchange participation. Accordingly, findings about the importance of financial subsidies, along with the possibility of expanding the definition of “small employer,” should be kept in mind as ACA implementation moves forward.
This brief is a companion to the authors' January 2010 brief that detailed findings from two surveys of New Mexico employers and from interviews with program stakeholders. Click here to view the first brief, "Small Business Participation in the New Mexico State Coverage Insurance Program: Evaluation Results."