Small Group Definition Expands to 100 Employees

Beginning January 1, 2016 the federal law requires that small group health plans, subject to community rating, are defined as 2-100 employees as stated in the Affordable Care Act.  This expansion of the small group market is significant for fully insured groups with 50-100 employees who up until now (in KY, OH, and IN) have been treated under insurance carriers’ large group underwriting rules.

We believe that the vast majority of employers with 50-100 employees will be adversely impacted by changing to community rates, and carrier and industry estimates confirm this expectation.

Barring changes in the law, it appears that employers of this size may be well served to consider renewing or re-establishing their health plan for an October 1, 2015 effective date to maximize their opportunity for the transitional relief available from the impact of community rates.  Rest assured that your Business Benefits team members are working on your behalf to analyze your best strategy.