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California's Small Business Health Insurance Exchange Off To Slow Start


Zachary Davis, co-founder of the Penny Ice Creamery and The Picnic Basket café in Santa Cruz, considered signing up for the small business exchange but said the premiums were higher than his existing Blue Shield plan. There were also a lot of unanswered questions, such as what plans would be involved and what they would cover.

“For a business, that makes it really difficult,” he said. “It made sense for us to continue what we were doing” and stick with the old plan.

Virginia Donohue, who owns Pet Camp in San Francisco, a pet-sitting and training service for dogs and cats, also chose not to sign up for Covered California. She supports the exchange and wants to be able to provide more choice to her employees, but Donohue said she worried about the paperwork processing delays.

“The whole system is overwhelmed right now,” she said. “California is so backed up that we decided it was wise to wait.”

The tax credit is a relief for some small businesses, but getting it “requires red tape, time and expense,” said Kabateck of the National Federation of Independent Businesses. “We are encouraging our members to look both in and out of the market.”

Janico Building Services in Sacramento, which provides janitorial services to hotels in the Sacramento region and the Bay Area, has offered insurance to full-time employees for the past 20 years. “We often go against the big boys in our industry,” said owner Lorenzo Harris. “We have to stay in lock step with them in terms of attracting labor.”

Harris said he enrolled himself in the individual exchange and four full-time employees in SHOP. There were some glitches during the application process but Harris said he was thankful to be saving money on his premiums.

“It’s new, so there are a lot of bugs in the system,” he said. As for the coverage itself, Harris said, “The jury is still out.”

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

Mon, May 05 2014

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