The implementation of the ACA – The Affordable Care Act will impact employers of all sizes. The small group health insurance market, currently serving firms 2 to 50 employees, will change significantly.
California is home to 610,000 small businesses that employ over 5.3 million people, and another 2.8 million small businesses with no employees, according to the UC Berkeley Center for Labor Research and Education. Because they do not have the bargaining power to negotiate low prices on health insurance, many small business owners have trouble attaining affordable insurance for their workers and themselves.
Under existing California law that dates back to the early 1990s, insurers are required to sell coverage or “guarantee issue” of coverage to small businesses with 2-50 employees. Rates may vary by plus/minus 10% depending on the health status of the employees as well by age, geographic region and family size.
Federal health reform modifies these rules in several key ways:
•Eliminating pricing of premiums based on health status
•Limiting the range of premiums based on age to no more than 3:1: that is, tho
60-64 can only be charged three times as much as those aged 20-29.
•Adding the self-employed to those eligible for guaranteed issue of coverage
•Expanding the rules to employers with
up to online casinos 100 employees
Federal law also permits non-smoker discounts and “wellness incentives”.
Passage of California AB 1083 modifies (for California) federal health reform. by changing the rules for small “group” or small business coverage by:
Eliminating pricing of premiums based on health
Limiting the range of premiums based on age to no more than 3:1:
that is, those ages 60-64 can only be charged three times as much as those aged 20-29.
Adding the self-employed to those eligible for guaranteed issue of coverage
Expanding the rules to employers with up to 100 employees
Consistent with existing California law, AB 1083 does not permit different charges based on health status, including smoking, wellness, etc.
These changes aim to make health insurance more available to million of businesses. The proof, wil be in the forthcoming release of rates and plans by insurers, and public/private exchanges.