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DC Health Benefit Exchange Board Votes to Maximize Choice for Small Business Owners Buying Coverage

Friday, April 5, 2013
A transparent, competitive market can lower costs.

Small businesses operating in the District will have new options for providing health insurance coverage to their employees under policies approved by the DC Health Benefit Exchange (HBX) Authority.

Beginning in 2014, small businesses, like large businesses today, will be able to offer their workers a choice of insurance companies and a choice of coverage.   Small businesses (those with 50 or fewer employees) will be able to offer health benefits to their workers through the DC Exchange, an on-line marketplace in which insurers will compete for business based on price and quality. Some small firms (those with 25 or fewer workers and average wages below $25,000 a year) may also qualify for federal tax credits to reduce their premium cost. Tax credits can offset as much as 50 percent of the employer’s share of costs.

“The District of Columbia is home to thousands of small businesses that struggle to provide meaningful health coverage for their employees. Bringing down the cost of coverage for small businesses is a critical element of the national health reforms being implemented across the country in 2014. These policies will provide new options to small business owners to offer quality health coverage to their employees,” said Mohammad Akhter, M.D., chair of the Exchange Board.

All insurance policies offered for sale in 2014 must cover, at a minimum, a set of essential health benefits that includes such things as hospital stays and doctor visits, lab tests and prescription drugs, and preventive care. To empower businesses and individual consumers with useful information to make decisions, the Affordable Care Act creates four groupings – platinum, gold, silver, and bronze health plans – to reflect how much of average health care costs would be covered by the premium.

Under the policies adopted by the HBX Board, small businesses will have options currently only available to large businesses. They are:

  • A small business can offer its employees the choice of all health insurance policies  from  all insurers in a metal level (i.e., silver).  With this option, employees can choose any insurer offering coverage through the Exchange Web portal;
  • A small business  can offer employees a choice of all health insurance plans offered by one insurer in two contiguous metal levels (i.e., bronze and silver); or
  • A small business can offer employees one plan offered by one insurer in one metal level.  This option reflects what most small businesses do today.

Finally, the HBX Authority will collect data to examine the effectiveness of this approach, including a survey of employers and employees, an analysis of premiums, and options to further expand choice.

“These decisions mean new options that small businesses do not have in today’s insurance market.” said Mila Kofman, J.D., the authority’s executive director. “The Board’s actions continue our strong commitment to the District’s business community and workers to improve choices and strengthen the private health insurance market.”

For more information about the approved policies, visit