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Massachusetts and Health Care Reform: Small Group Transitional Period Extended

Learn about the extension granted to Massachusetts in regards to PPACA and the change to rating factors in calculating insurance premiums - via CBG Benefits.On April 24th, 2014, the U.S. Health and Human Services department announced that that Massachusetts has been given an additional year to phase in insurance rating changes that are part of the Affordable Care Act.

When it comes to calculating group health insurance premiums, current Massachusetts law allows for a larger variety of factors to be considered, including industry, participation rate, group size, intermediary discount and group purchasing cooperatives. However, the Affordable Care Act limits this to four rating factors,  for companies with 50 or fewer employees.

Due to the latest extension regarding the transitional period for Massachusetts, the schedule for adjusting to the rating factor change is now:

  • For policy years beginning on or after January 1, 2014, but before January 1, 2015, small group market issuers may use 2/3 of the disallowed factors
  • For policy years beginning on or after January 1, 2015, but before January 1, 2016, small group market issuers may use 2/3 of the disallowed factors
  • For policy years beginning on or after January 1, 2016, but before January 1, 2017, small group market issuers may use 1/3 of the disallowed factors
  • For policy years beginning on or after January 1, 2017, small group market issuers must be in full compliance with the rating rules

How This Impacts Your Business

While this extension may provide temporary relief for some Massachusetts businesses, it is essential that companies review their employee benefits strategy today.

In addition to changes that may need to be made to meet compliance requirements, businesses must analyze what options are available to deal with rising healthcare costs.

To learn how CBG Benefits can help you to do that successfully, please contact our team at 877-332-6387 or leave a message via our contact form.

 

Photo Credit: https://www.flickr.com/photos/68751915@N05/6355318323/

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Posted in: Benefits and Insurance, Human Resources, Legislation

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