In addition, SHOP was set up to provide incentives for certain businesses to participate. In specific, businesses with 25 or fewer employees, that pay average annual wages below $50,000, and that agree to pay at least 50 percent of the premium cost for health coverage for their employees (and to provide this coverage for their employees through a state or federal SHOP exchange), are eligible for two years worth of tax credits of up to 50 percent of the employer-paid premiums. 

Despite the purported good intentions of SHOP, though, it has been plagued by problems from the start. On September 14, 2014, the Subcommittee on Health and Technology of the U.S. House Committee on Small Business held a hearing on SHOP to determine the effectiveness of the program. During the hearing, Subcommittee Chairman Rep. Chris Collins (R-NY) noted, "Despite spending vast amounts of time and taxpayer dollars establishing the SHOPs, the program continues to be beset by operational delays and other problems that have undermined their utility as a tool for small business. These problems include the inability to utilize web-based portals, limited choice of plans, and a lack of insurance carrier participation in the SHOPs."

Roger Stark, health care policy analyst at the Washington Policy Center in Seattle, a witness in the hearings, noted, "Although the employer mandate is a critical part of the ACA, the SHOP marketplace for small businesses seems to be almost an afterthought in the law. There is no clear evidence of interest on the part of small companies to provide health insurance through a marketplace with tax credits."

Here are some of the specific challenges SHOP has faced and continues to face.

1 - Technical Glitches. Small business owners have had the SHOP option available since October 2013. However, federal SHOP website technical problems forced these business owners to rely on paper applications if they operated businesses in states without state SHOP exchanges. (The federal site actually crashed and was out of commission during the first two months of open enrollment.)

As a way to try to prevent future glitches, testing of the federally-run SHOP exchanges began on October 27, 2014, in five states: Delaware, Illinois, Missouri, New Jersey and Ohio. Between October 27 and November 15, when open enrollment begins, small businesses in these states are able to pre-enroll in SHOP. However, they won't actually be able to see or select plans until open enrollment begins November 15. (Open enrollment closes February 15, 2015.) Brokers and health insurance agents in these states are also able to pre-enroll, and have been asked to help the government test new on-line features, such as establishing an account, assigning an agent or broker to the account, completing the employer eligibility application, obtaining an eligibility determination, and uploading an employee roster.

2 - Employee Concerns. Since the tax credits discussed earlier are only available to businesses with a high percentage of low-income workers who would also likely be eligible for Medicaid coverage, or for significant subsidies if they purchased their own insurance on the individual exchanges, there is concern that small businesses may be doing a disservice to their employees by offering SHOP, since doing so would preclude the employees from purchasing insurance on the individual exchanges, which might end up being less expensive than the premiums they would pay by participating in a SHOP.

3 - Limited Plan Availability. Availability of coverage options in SHOPs is limited. Only a handful of states allow companies to offer employees a selection of health insurance plans via the SHOP exchanges. The majority of states offer only one plan for all employees. In addition, many of the SHOP plans provide access to smaller networks of health care providers (doctors and hospitals) than do health plans purchased on the private market.

4 - Lack of Professional Guidance. In almost every state, businesses with 50 or fewer employees can purchase private plans directly through insurance brokers or provider, or they can purchase the plans through a state or federal SHOP. For most small businesses, some suggest, lack of involvement by insurance professionals in SHOP could cause problems. For example, an October 20, 2014, press release from the Missouri Association of Health Underwriters, a chapter of the National Association of Health Underwriters, noted that, "The drafters of PPACA did not take into consideration that small businesses purchasing health insurance coverage normally require the assistance of a professional familiar with a myriad of laws and economic risks which impact the purchase. In order for SHOP to succeed, it must reach a critical mass of participation if it is to remain financially viable, and the only way to achieve that critical mass is to engage agents and brokers in the process."

5 - Lack of Publicity. Finally, what may be the most significant challenge for SHOP is that very few small business owners are even aware of it, and many of those who have heard of it really don't understand it. For example, a survey commissioned recently by an organization called Covering New Hampshire, a group focused on spreading the word about the health insurance marketplace around that state, found that 59 percent of small business respondents were "not at all familiar" with SHOP. Furthermore, once they had the program explained to them, approximately half of them said they had no interest in it at all.