The Affordable Care Act included a requirement that groups with 50-100 employees would need to leave the large group status and become subject to small group rules, making small groups from 1-100 employees. This change was planned to take place January 1, 2016.
Because this promised to have a substantial impact on these medium sized groups, the Assembly and the Senate proposed and passed a bill called Protecting Affordable Coverage for Employers (PACE) Act on September 30th that leaves the definition of small group at firms from 1 to 50. The Act was passed by voice vote in the House and then unanimously in the Senate. With the repeal of this Affordable Care Act small group expansion, states that included firms of over 50 in the small group plans will need to revise their regulations to keep these firms out of small group plans. California was one of the states to expand small group plans to 100, so hopefully they will make the change to comply with the federal rules.
Senator, and bill sponsor, Jeanne Shaheen (D-NH) commented: “This is a win for businesses across the country, a win for bipartisanship and I am pleased that it’s headed to the President’s desk.”
It is a win at the federal level and we will be active with other brokers to help encourage California legislators to comply with the new federal rules and make it a win for California employers. We will update you on California’s decision on this important legislation.
Malcolm and Stacey Cutler
Malcolm Cutler, Jr. CLU
CUTLER INSURANCE SERVICES
15901 Hawthorne Blvd., Suite 200
Lawndale, CA 90260