SHOP vs. Gravie: What’s the Difference?
The Small Business Health Options Program Marketplace (or SHOP, as it’s commonly known) is a program developed under the ACA with the intention to allow small employers to offer affordable coverage to their employees. Some of its elements make it seem a lot like Gravie, but there are some significant differences to be aware of, too.
Both the SHOP Marketplace and Gravie give individuals a variety of plan options to choose from, and offer dental plans, too. Both give employers the choice of how much they’ll contribute to their employees and both feature an online dashboard that makes it easy to manage the plans they choose.
Whether an insurance plan is sold through the SHOP Marketplace or through a broker like Gravie, it will always be the same price – by law you’ll never find the same plan for a lower price somewhere else.
Are SHOP plans group plan?
Yes, SHOP is a small group plan, which makes it subject to the same requirements as other small group plans. The difference between a traditional group plan and SHOP is that with SHOP employers choose the plan options they’d like to provide to employees from the plans available on the state or federal exchange. The plans selected do not need to be from the same health insurance company as each other.
Is Gravie a group plan?
No. Gravie works in the individual market and includes all of the plan options available through the state or federal exchange plus any plans that you can get directly from an insurance company (in the private market).
Where will my employees have more choice?
Gravie. With SHOP, you (as the employer) can choose the plans that your employees can then choose from, but with Gravie, your employees get to choose from any of the options available on the state or federal exchange or from additional plans that are available directly through an insurance company.
What about eligibility?
In order to use the SHOP Marketplace, an employer must meet certain eligibility requirements:
- The employer must have 50 or fewer full-time equivalent employees (FTEs),
- The employer must offer coverage to all full-time employees (generally workers averaging 30 hours a week or more)
- You must have an office or worksite within the state whose SHOP Marketplace you want to use, and
- In most states, at least 70% of the employees who are offered insurance must enroll in the plan or have coverage from another source.
- In some states, your contribution must be at least a certain percentage of the total premium for all employees. (For example, in Minnesota you must cover at least 50% of the premium.)
With Gravie there are no eligibility requirements. You don’t have to give employees a certain amount each month, there are no participation minimums, and whether an employer has 2 employees or 500, it can easily implement Gravie for its employees.
What about tax credits?
Some employers who use the SHOP Marketplace may be eligible for government tax credits if they meet certain eligibility requirements, but employees are not eligible for tax credits under a SHOP plan. In order for the employer to be eligible, the employer must:
- Have fewer than 25 FTEs,
- Pay an average wage of less than $50,000 a year, and
- Pay at least half of health insurance premiums for employees enrolled in a qualified plan offered through the SHOP Marketplace.
The credit is available to eligible employers for 2 consecutive taxable years.
While Gravie can’t facilitate tax credits for employers, we can help employees find out if they’re eligible for their own tax credits – and help them apply if they are. In some cases, tax credits can reduce your employees’ health insurance costs significantly.
Is there any support?
The SHOP Marketplace has a call center available to employers, individuals, agents, and brokers.
Gravie has account managers who work with employers to kick things off with their employees. Gravie also has a team of advisors who are available for employees year-round. The advisors help as employees shop for plans that fit their healthcare habits and budgets and then after a plan is selected, advisors are there to answer questions, help resolve issues, find doctors, pinpoint procedure costs – just about anything related to health insurance. We’re a little biased, but we think Gravie advisors go above and beyond what typical call centers do or are willing to do.
In a nutshell, while some elements of the SHOP Marketplace and Gravie are similar, Gravie offers features the SHOP Marketplace doesn’t – the biggest of which are unlimited choice for employees, reduced administration and headaches for employers because you don’t have to deal with group plan requirements and a high level of service.