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NY1 Reports: Understanding The Affordable Care Act, Part 3

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The third installment of NY1's series on the Affordable Care Act focuses on small businesses, and how New York State's small business health exchange can help small companies insure their workers. NY1's Health reporter Erin Billups filed the following report.

All has not gone according to plan when it comes to Affordable Care Act's employer mandate. The provision requiring businesses with 50 or more employees provide insurance or face a penalty was postponed a year, earlier this month.

Still, in New York, the marketplace roll-out for businesses with less than 50 employees is on track.

One of those companies that could benefit from New York's marketplace is Brooklyn's IceStone, a recycled glass and cement counter manufacturer. In 2012, IceStone restructured its business. Employees became part owners, but 15 of its 35 employees at the business remained uninsured.

"It was 320 total, and the company was paying half of it, but some employees couldn't afford it and elected not to take it," says Dal LaMagna the CEO of IceStone.

So the staff got together to try and cut down on insurance costs. First, those making more offered to contribute more, then they all decided to give back their cellphones.

"That saved the company $18,000, which we then put into the employee side of the health care cost," LaMagna says.

Now most of IceStone's employees have health insurance except for a couple that opted out, for rates as low as $40 a month.

Still, LaMagna says providing health care remains a daunting task.

"You'll go to a health care provider that gives you good rates and as soon as they've got you, they'll raise the next year," LaMagna says.

He's hoping to take advantage of the state's Small Business Health Options Program (SHOP) for businesses with less than 50 employees.

"It's the administrative simplicity, the ability to go online so you can do it at your own convenience," says Kelly Smith, the state Health Exchange SHOP director.

Because New York is running its own exchange, businesses will have access to several different plan options from 10 different insurers. States with federally run exchanges will not.

New York employers could see premiums 32 percent lower than originally estimated for silver plans.

They can either decide to offer employees plans within that silver tier -- bronze, gold or platinum.

"Or they may say you know I'm only going to pick one carrier, but I'm going to open up all medal tiers for that carrier. So there is going to be a lot of flexibility," Smith says.

Employers simply pay SHOP, and SHOP then pays each insurer accordingly. Businesses with 25 or fewer employees, with an average salary of less than $50,000, are also eligible for federal tax credits.

While IceStone isn't eligible for credits, LaMagna still hopes with the help of the exchange they will eventually be able to cover 100 percent of insurance costs.

"Empowered, health-secure and job-secure employees are better workers and are more productive," LaMagna says.

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