On Aug. 13, 2015, the Massachusetts Division of Insurance published Bulletin 2015-06, which relates to transitional renewal of insured health plans for employers with 51-100 employees. The bulletin is directed toward insurers, and states that insurers in the large group market are permitted to renew existing 2015 health plans for employers with 51-100 employees so long as certain conditions are met. As background, on Jan. 1, 2016, under PPCA, the definition of ‘small group’ changes from 1-50 employees to 1-100 employees, meaning small group plans in the 51-100 group will become subject to many of PPACA’s requirements. However, on March 5, 2014, the CCIIO published a bulletin announcing transition relief for non-PPACA compliant plans with years beginning on or before Oct. 1, 2016. The CCIIO transitional policy allows small employers with between 51-100 employees to renew their existing policies and remain in the large group market without violating PPACA.
According to the bulletin, so long as the 51-100 group policy is renewed on or before Oct. 1, 2016, carriers may continue to rate these transitional policies as large group plans under Massachusetts state law and under PPACA for one year. Importantly, the bulletin states that carriers are not required to allow transitional renewals—employers should consult with carriers to see if it is an option. The bulletin also states that transitional renewal is allowed only if certain conditions are met. While some conditions apply to the carrier, some relate to the employer. Specifically, an employer is eligible for the 2016 transitional renewal if on Oct. 1, 2015, the employer has between 51 and 100 employees and is covered by an insured health plan in Massachusetts. In addition, the employer must have more than 50 employees on the policy’s renewal date.
Although the bulletin is directed toward insurers, Massachusetts employers in the 51-100 group should take notice of the bulletin and work with their carriers to determine if transitional renewal is an appropriate course of action.
Bulletin 2015-06 »